Career

Explosive population growth creates a greater talent pool and, along with it, greater pressures on local municipalities, domestic companies and multinationals to accommodate the influx. How can organizations harness the benefits of rapid urbanization while ensuring workforce needs are being met? And, what is the best market entry strategy? Today, 5 in 10 people live in urban centers in Asia, representing 54% of the world's urban population1. Over the next two decades, one billion more people are expected to move to Asian urban centers; this equates to one million new arrivals each week. Soon, the continent will be home to 60% of the world's megacities. In India, this trend is even more accelerated, with more than 200 million people migrating in search of a better quality of life and greater financial prospects. Urban centers of India will grow exponentially in the next few years, and the bulk of the country's GDP is expected to come from cities. And given the pace at which Indian cities are growing, India will soon be home to new megacities and hundreds of new towns. On a trip to India, the country's expansive growth is palpable, its dynamism and vibrancy simultaneously exhilarating and overwhelming. The feast of colors, sounds, tastes and smells — from the open-air markets and street vendors to the hustle and bustle of hotel lobbies and meeting rooms — assaults the senses. At the heart of it all is people. Rapid growth, however, brings formidable challenges for cities, old and new alike, for highly connected — or "smart" — cities, as well as for startups, local firms and multinationals. To better understand the obstacles and opportunities, Mercer conducted an extensive study, People First: Driving Growth in Emerging Megacities, which provides an examination of living and working in emerging growth cities. The study gleaned perspectives of employers and workers across 15 cities globally, with four rapidly growing cities in India — Ahmedabad, Chennai, Hyderabad and Kolkata. The findings provide actionable insights for potential beneficiaries of India's urbanization. Below are our three key findings and imperatives. 1. Understand What People Value Most   The study explores people's expectations from cities and how well the cities are delivering on what they deem most important. Globally, there was a 30-point gap between workers' quality of life expectations and how a city is performing against those needs. Around the world, the top three factors that affect how people feel about the cities they live and work in are security, safety and lack of violence (first); affordable housing (second); and transport, traffic and mobility (third). The findings in India are strikingly similar; however, there are some regional differences. Residents of Kolkata feel challenged by the lack of sufficient career opportunities (gap of 25 points). People in Ahmedabad and Chennai, meanwhile, want their cities to perform better on managing air and water quality/pollution (gap of 14 and 19 points, respectively); and pay/bonuses emerged as the top challenge in Hyderabad (gap of 10 points).                                             Source: People First: Driving Growth in Emerging Megacities, Mercer To ensure cities can better meet residents' needs in the overpopulated and resource-constrained urban centers, governments and businesses must engage in a coordinated effort. The study found that workers do not expect any one group to be responsible for addressing the systemic issues of a city at scale.  Instead, they want effective collaboration between the city or local government (77%) along with the support of the national or federal government (62%) and large businesses (53%). No one entity can solve the infrastructure, talent or people needs of a rapidly growing city — this can and must be done through collaboration, shared interests and pooling of resources.  2. Prepare for the Future of Work   Cities are often the testing ground for automation and emerging technologies, and the workplace is typically one of the first areas to experience the benefit from their effects. In India, "connectedness" is a way of life — more so than in some other global economies — and digital platforms are widely used. According to estimates, more than 40% of purchases are set to be highly digitally influenced by 2030.2 India is one of the world leaders in creating a national artificial intelligence strategy; it is at the forefront of adopting blockchain technology and is pioneering the use of drones. Our research found that both employees (45%) and employers (52%) believe work will become more efficient with automation and AI. Globally, 62% of workers expect that AI could replace at least half of their tasks in the next 5-to-10 years. In India, automation is predicted to play a bigger role: 61% of employers and 8% of employees expect technology will take over more than 50% of their role. As a result, only one in five people are confident that they are not going to lose their jobs in the next five years — signifying a call to organizations to prepare for the future of work and the skills and workers that the future requires. There is a journey ahead. Our study reveals that, presently, only 30% of the Indian workforce in the cities of tomorrow has flexible working arrangements. As technology continues to augment human capabilities at an increasing pace, businesses will not only need to plan on where work gets done but also how it is done. They will need to explore alternative talent sources and new skills and place even greater importance on distinctly human qualities for a sustained competitive advantage — such as complex problem solving, creativity, superior client service, cross-cultural collaboration, judgment and empathy.  In effect, companies will benefit by putting people at the center of technology — not the other way around. 3. Be Indian, Buy Indian, Partner with India   As international companies seek to scale their operations and expand globally, they would be remiss to ignore India. By 2025, the number of Indian households will triple in size with 80% of them comprising middle-class families. And, with a growing middle class comes demand for a better quality of life, from basic necessities to luxuries and all forms of services, from better housing, education and health care to more robust transportation and safety. As global blue-chip firms expand into India, they will need to devise well-informed and relevant strategies. For some, the best mode of entry may be partnering with local companies with deep knowledge and expertise in how to navigate cultural norms, the regulatory environment and business practices. Expansion also means a shift in mindset, from considering India as a path to cheap labor and a valuable source of talented, educated people growing in their purchasing power. For all, it will mean letting go of traditional ways of working and, instead, adopting local partnerships, practices and leadership. Being patient and relentless in the pursuit of sustainable growth will drive value in the long term. Lastly, it benefits everyone to keep in mind that, before many of us retire, India will overtake the U.S. economy and will likely become the world's second-largest market.3 Growth, like time, does not wait. Done right, there is profitable growth potential in India's rapid urban expansion. Critically, for all to benefit means putting people first. To access more insights and practical advice on how companies and municipalities can accelerate their people strategies and realize commercial gains, download People First: Driving Growth in Emerging Megacities. 1U.N. Economic and Social Council, "Urbanization and sustainable development in Asia and the Pacific: linkages and policy implications," March 7, 2017, https://www.unescap.org/commission/73/document/E73_16E.pdf. 2Ojha, Nikhil and Zara, Ingilizian, "How India Will Consume in 2030: 10 Mega Trends," World Economic Forum, January 7, 2019, https://www.weforum.org/agenda/2019/01/10-mega-trends-for-india-in-2030-the-future-of-consumption-in-one-of-the-fastest-growing-consumer-markets. 3Wang, Brian, "World GDP Forecasts for 2030," Next Big Future, January 14, 2019, https://www.nextbigfuture.com/2019/01/world-gdp-forecasts-for-2030.html.

Pearly Siffel | 30 May 2019
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Career

The Urbanization of the Global Population - Nearly half of the world’s GDP growth will come from about 400 cities across growth economies in the next ten years. Urbanization continues to profoundly shape the cultural and economic dynamics of modern societies, especially as today’s skilled and talented employees gravitate toward the professional, personal and cultural amenities provided by contemporary metropolitan areas. In fact, urbanization increased from 13% to 55% in the last century and is projected to grow to 70% by 2050. This growth, however, is providing overlooked urban areas with opportunities to leapfrog established megacities that were once the de facto homes to the world’s most successful employees and businesses. A lack of highly skilled workers means that cities and companies must compete with increasing ferocity for the talented workers who will lead their businesses into the future. These highly desired employees are setting new trends in urbanization as they prioritize a confluence of human and societal factors when deciding where to work, live and raise their families. A new landmark Mercer study, People First: Driving Growth in Emerging Megacities, explores why “satisfaction with life” ranks as the most important factor to workers in 15 emerging megacities—and analyzes how safety, security and other key professional and hyper-local considerations factor into landing top talent. The survey focuses on 7,200 workers and 577 employers across seven countries: Brazil, China, India, Kenya, Mexico, Morocco and Nigeria. The Mercer report investigates the prevailing needs of today’s workers, and the motivations and concerns that inform their decisions regarding where to work, and why. The report also analyzes the ability of employers and megacities to fulfill the needs of workers and their families. In an increasingly urbanized world where highly skilled talent is scarce, employers and cities are asking important existential questions: What makes professionals move to and stay in a particular city? How can employers and cities retain talented workers with the high-level skills demanded by rising start-ups, upcoming unicorns and global brands in emerging hot spots? What, exactly, do productive employees want from an employer and home city? The Desire to Live Well in the Cities of Tomorrow   Mercer’s report reveals the importance of acknowledging and internalizing the priorities of people. Companies too often operate under the assumption that creating career and job opportunities (ranked #1 by employers) is key to unlocking growth potential throughout their business and host city. Businesses are also under the impression that job satisfaction (ranked #3 by employers) is another key contributor that compels cities to flourish. These misleading conclusions can be profoundly costly to businesses and megacities and undermine their ability to compete in the modern global economy. As part of the research, Mercer conducted an employee-focused segmentation analysis based on each respondent’s demographics, life stage, career progression, predisposition to life-long learning, aspirations and levels of financial security. The report contextualizes worker’s “satisfaction with life” through four key metrics: human, health, money and work. Identifying the specific needs and values of each unique employee segment provides employers and planners in high-growth cities with valuable insights needed to attract and retain highly skilled talent. Though career opportunities and job satisfaction are important to financial well-being, employees are placing more emphasis on the importance of family, security and environmental influences that impact emotional stress, lifestyle affordability and personal health. The chart below illustrates the remarkable discrepancies in how employers and workers perceive the various components of “satisfaction with life”:     Leapfrogging Established Power Hubs   From Shanghai to Seoul, the world is very familiar with the influence powerful megacities have on the global economy. However, the incredible success of these cities also contributes to the challenges that may limit their growth in the future. Skyrocketing rents and costs of living, unwieldy population and pollution rates, limited access to affordable family-care services and education, increasing commuting times and aging infrastructure all serve to undermine the very amenities modern employees seek when deciding where to live and raise their families. Emerging and next-generation cities, in contrast, are better situated to accommodate and grow with—not in reaction to—the needs of modern workers. A business or megacity is only as strong as its people. To compete against established power hubs and build a formidable presence in the global economy, emerging megacities must proactively accommodate the full scope of professional, personal and cultural demands from skilled employees. Although the study’s 15 current and future megacities share some commonalities, it did reveal key differences regarding performance when addressing the human, health, money and work categories. The report classified the cities into three groups based on their abilities to fulfill worker expectations—advanced, progressing and approaching.   Theses 15 emerging megacities have a collective population of more than 113 million people, strong projected GDP, more than $4 billion of foreign direct investment annually and a population growth trajectory expected to reach one billion new consumers over the next decade. These growth economies represent the forefront of the emerging global economy. If the business leaders, government policymakers and infrastructure planners in these 15 cities align their resources and incorporate the “voice of the employee” into their decisions and planning processes, they can successfully manifest the human and social factors that drive residency decisions. With a greater understanding of the specific human needs, wants and motivations of each segment of the employee population, businesses can tailor their offerings and programs to better attract and retain the best talent—and leapfrog over established hubs, one employee at a time. A New Era of Collaboration   Neither employers nor next-generation megacities can deliver “satisfaction with life” alone. Skilled employees demand resources that will require the combined efforts of businesses and city governments. Corporate thought leaders and policymakers must create and implement new policies and frameworks that accommodate digital transformation, globalization, modern healthcare and the educational environments valued by forward-thinking families. Empowering a new era of collaboration begins with elevating the voices and concerns of individual workers and the collective workforce. Employers and emerging megacities must appreciate how employees want to live their lives, work, earn, and learn. Of course, not every employer or megacity is the same. The needs of workers can vary based on their surrounding communities, seasonal changes, personal situations (such a health concerns), life aspirations, and even factors like the proximity of their home to their workplace or school. Thinking beyond traditional business dynamics and prioritizing the complex needs of employees demands a fresh mindset. Stretch assignments, retention bonuses and travel allowances have a limited impact. Businesses and megacities need to create a nurturing environment for workers, where they pursue lives that offer new ways to work, support their families and connect with their communities. Effective public-private partnerships can facilitate improvements and accelerate progress at scale. By creating environments in which workers and their families can thrive, companies and governments can create sustainable economic growth for everyone and address the future needs of the employees they are trying to attract. For example, a lack of affordable housing, regional transportation challenges, access to childcare and elderly care directly impact the life satisfaction of employees. To address the depth and scope of such elaborate challenges, employers and next-generation megacities should seek collaborations with other businesses, civil societies and support organizations to develop strategies that serve employees and their families. Those that don’t, may get left behind. To access more insights and practical advice on how companies and municipalities can accelerate their people strategies and realize commercial gains, download People First: Driving Growth in Emerging Megacities.

Pearly Siffel | 06 Dec 2018
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