Talent Managers Face Shifting Politics, Unsteady Economies

By Lisellotte Ortega Feb 9, 2016
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The dramatic political, economic and demographic shifts we are experiencing in Latin America challenge talent managers to step back and look at the big picture. From generational differences to increased government controls, navigating the changing world of work will require talent managers to redefine their practices and sharpen their skills for managing employees, organizational cultures and work environments.

The Interamerican Federation of People Management Associations (FIDAGH) asked leaders of each of its member national associations, representing 15 countries in Latin America, about the main concerns talent management professionals in this region have.

Before we review their answers, it is important to understand some differences and similarities between countries, the political realities in the region, and the significant changes Latin American labor markets are experiencing.

On the political front, Argentina is currently in the middle of a very complicated election process, overshadowed by a weakened economy and a government that struggles with its credibility.

In Colombia, the government is negotiating peace with the guerrilla group FARC, so far without success. Nicaragua and Ecuador have approved indefinite presidential re-elections.

Many Latin American countries are facing new economic uncertainty. Chile’s rate of economic growth is declining because of falling copper prices, and Venezuela’s economy is contracting rapidly after crude oil prices dropped 50 percent over the past year.

Guatemalan migrants, facing dwindling remittances from their struggling home country, are returning from abroad with few prospects. Corruption scandals in Brazil, Guatemala and Panama are contributing to economic deceleration.

Labor markets and workplaces are in flux. In Argentina, Chile and other countries, labor efforts are underway to secure collective bargaining rights and give unions more power to push for better wage agreements and salary increases. In the Dominican Republic, Guatemala and Panama, unions are pressing for minimum salary increases of 30 percent to 40 percent, which will greatly impact the private sector.

Big changes are coming to Ecuador, where the government has proposed a new draft Labor Justice Act that will, among other measures, allow nonworking wives to receive social security; place limits on profits and wages in the private sector; eliminate fixed-term contracts; and protect from unfair dismissal pregnant women, people with disabilities, union leaders, and lesbian, gay and transgender individuals.

Of all the Latin American countries, Venezuela is facing the most significant workforce changes. In 2012, the government approved a new labor law without any consideration in the National Assembly. The legislation established workers’ councils, taking what many deem a socialist approach to giving employees more control over the companies where they work. Implementation of the law has been delayed, generating anxiety in both employers and trade unionists who fear it may be another instrument for the state to exert control over both unions and private employers.

In addition, the Venezuelan government established groups of “militia workers” to monitor worker production while also serving as armed government protection. Nationalized state enterprises, seized and/or confiscated, are paralyzed or producing at very low capacity, generating economic losses for the state. Nevertheless, late last year, the government increased wages for public employees by 32.25 percent. Finally, as of May 2015, job outsourcing in Venezuela is prohibited. Companies have had three years to absorb outsourced workers into their payrolls; those who missed the May deadline face criminal penalties.

Against this complex and colorful backdrop, it may be surprising to learn that our survey of member national organizations revealed that most countries are experiencing the same top three concerns: recruiting and talent retention, labor reforms, and hiring technical talent.

Other challenges identified by the survey results are talent management, corporate social responsibility, labor relations, career planning and succession, ethics and values, diversity, and generational tensions.

Looking at issues of talent management specifically, the main priorities respondents identified were creating a supportive work environment, managing employee engagement and commitment, and developing leadership. Respondents noted that in the near future, managing the coexistence of multiple generations in the workforce will be a focal point as well.

To effectively pilot through such challenging waters, talent managers need to be very creative, using innovation to redefine practices in managing skills; gaining employee commitment; and recruiting, evaluating and developing employees.

Finally, talent managers must develop the capacity to measure and monitor the work climate, simplifying processes and using qualitative methods to help employees find their best fit within the organization so they can achieve their highest levels of productivity and engagement.

Lisellotte Ortega is Past President of the National Association of Human Resources Professionals of Panama and current FIDAGH Permanent Executive Secretary. Republished by permission from the World Federation of Personnel Management Administrators.​

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