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Workforce analysis is the process of aligning your workforce planning efforts with current and future business requirements and forecasting staffing needs based on assumptions of retirement and turnover. This phase involves gathering and analyzing specific information about staffing levels, skill sets and competencies needed in your workforce. The analysis process consists of three steps: supply, demand and gap analysis. It is the process of looking at your current talent supply, projecting demands for the future, and realizing potential gaps and surpluses in order to enable action planning to eliminate the gaps.

There is a variety of sources that can be used to collect needed and valuable information. It is recommended that workforce analytics be used as well as on-going dialogue with managers and supervisors. You may wish to consider structured interviews or focus groups to begin the process of gathering information, and understanding specific needs and challenges. The involvement of managers and supervisors is critical, as they are the eyes and ears of an organization and are a source of valuable information.

To begin the process, you may consider asking managers and supervisors the following questions as a means of introducing the workforce planning process and to begin to understand their needs.

• What are the talent issues or concerns that need attention in your area?
• Is it an immediate, critical issue or do you have time to plan?
• Are you having difficulty recruiting for a particular position or positions?
• Are you having difficulty retaining employees in a particular area?
• Are you anticipating retirements in a number of key positions?
• Do your employees have the knowledge, skills and abilities to do their job well?
• Are your employees engaged?
• Are there obstacles and barriers that get in the way of employees doing their jobs?
• Are there areas of work where process improvement would enhance productivity?

STEP 1: Supply Analysis

Supply analysis involves profiling your current workforce and projecting the future composition needed. This step involves analyzing specific attributes of the current workforce, reviewing trend data and projecting the future workforce supply.

You may want to consider focusing your attention on a limited number of positions within divisions or occupational groups until you gain more experience in this process. You may wish to consider the following positions in your initial profile:

• Key positions — positions designated by an agency that include responsibility for performing mission-critical work necessary for an organization to achieve its business goals. The work involves planning, designing, delivering or managing the flow of essential services. A vacancy in a key position of over one week would have a negative impact on the delivery of services because of the criticality of the work.
• Positions hardest hit by attrition — positions that have a high turnover rate or have a high number of employees who are eligible or soon to be eligible to retire.
• Positions most difficult to fill — positions that historically are difficult to recruit for and talent is not readily available.

Current Supply

Trend Data

STEP 2: Demand Analysis

Demand analysis helps you determine your agency's future workforce needs. The focus of this step should be on the work that the agency must perform and on the staff needed to perform that work. Some of this information can be obtained from your agency's strategic or business plan. Additional information can be obtained through environmental scanning that involves examining external trends in your operating environment. You can identify more information through organizational analysis that involves examining internal factors that are affecting or could affect the workforce.

Using data from your supply analysis, this step will guide you to forecasting your workforce demands. You may wish to consider the following items.

Environmental Factors

Identify internal and external environmental factors that will impact decisions such as legislative changes, agency initiatives, budget trends and patterns, etc.

Demographics

Identify significant demographic issues such as the aging population, high turnover, disengaged workers, etc., that are likely to influence the demand placed on the agency.

Technology

Economics

Consider economic factors that have particular relevance to the agency and its provision of programs and services.

Labor Market

 

STEP 3: Gap Analysis

Gap analysis is the process of comparing the workforce supply analysis to the workforce demand analysis to identify the differences or "gaps" and surpluses in staffing levels and skill sets or competencies needed for the future. The supply analysis identifies what resources currently are available within the agency. The demand analysis determines what resources will be required in the future. The process of reconciling the differences between your supply and demand establishes the roadmap for action plans that need to be considered for development and implementation.

• A gap (projected supply less than forecasted demand) indicates a future shortage of needed employees.
• A surplus (projected supply greater than forecasted demand) indicates future excess that may require action.

As you begin looking at your gaps, it may be helpful for you to address some key questions to identify your own unique situation and the challenges associated with the changing demographics of your workforce.

Which employees are likely to retire in the next five years?

How will your workforce be different in five years?

How will human resource issues be different in five years?

Adapted from the League of Minnesota Cities' City Employees and Workforce Planning - Getting Started 1