Surviving the Drought: 10 Approaches for Talent Scarcity in Pharmaceuticals

By Mitch Robbins on February 16, 2024

Imagine a faucet that's slowly running dry. The life-saving pharmaceutical industry is now facing a surprise twist in its plot. It's not a sudden shortage but rather a drip-by-drip decline that's gradually turning into a full-blown drought. But what if this shortage wasn't just about numbers?

A report by Korn Ferry predicts a gap of 2.5 million skilled workers in the pharmaceutical industry by 2030. We're not just talking numbers, but this talent drought has the potential to hold back the pulse of innovation and slow the pace of new drug development. This is more than a human resources challenge; it's a pressing issue that threatens the very heart of the industry.

Let's treat this article as a key, opening the door to understand the ins and outs of this talent shortage. We'll dissect the roots of the issue, explore its possible effects, and finally, unveil some innovative strategies to turn the tide. It's not just a crisis, it's a puzzle that needs solving, and there's a world of opportunities for those who can crack the code.

Talent Drought: What, Why, How

What is a talent drought, you might ask? Picture a field without enough rain. It may survive for a while, but eventually, the lack of water begins to hinder growth. Similarly, a talent drought is a situation where there is a lack of skilled professionals necessary for an industry's growth and success. It's not about having enough people; it's about having enough of the right people, equipped with the correct skills and knowledge.

The talent drought in the pharmaceutical industry didn't crop up overnight. It's a situation that has been brewing over the past few years, stemming from a combination of factors. It is like a domino sequence, where one falling piece sets off a falling effect leading to a larger issue.

Thus, it's not a sudden storm but a slow-brewing cloud. Understanding the beginning and progression of this talent drought is crucial, not only to know its extent but also to formulate strategies and solutions that hit at the core of the issue.

Major Factors of Talent Shortage

In the quest to recognize the talent shortage in the pharma industry, it's like peering through a magnifying glass at a complex map. There are many roads leading to the issue, and here we zoom into some key paths:

Retirement Wave: A good number of the pharmaceutical industry's skilled workforce are nearing retirement. When these folks hang up their lab coats, it's not easy to find replacements with the same level of expertise and experience. The SHRM predicts that by 2026, nearly 25% of the U.S. workforce will be 55 or older, representing a significant wave of impending retirements that the pharmaceutical industry must prepare for.

Skills Gap: The pharmaceutical industry has a wide-ranging list of necessary skills. We need experts in everything from research and development to managing the regulations. Unfortunately, we're finding that the people with these skills aren't easy to come by. This imbalance between demand for and supply of specialists is worsening the lack of talent.

Intricacy of Drug Development: Creating a new drug is a complicated process. It needs a mix of specialized skills and know-how. With the rise of personalized medicine and biological drugs, the need for these specialist skill sets is growing.

Advancement in Technology: Technology continues to evolve, and the pharmaceutical industry is doing its best to keep pace. According to a PwC survey, 80% of pharmaceutical CEOs are worried about keeping up with these rapid changes.

Geographical Limitations: The supply of pharmaceutical professionals isn't evenly spread. Some locations, especially remote and rural areas, struggle to attract qualified workers. This mismatch worsens the talent shortage.

Changes in Workforce Demographics: The demographics of the workforce are constantly changing. For instance, Millennials and Gen Z, who are now entering the workforce in a high rate, have different career expectations and values than previous generations. Their emphasis on work-life balance and opportunity for growth means pharma companies need to adapt their strategies accordingly.

At its heart, understanding this talent shortage isn't just about recognizing what's missing. It's about appreciating the complexity of the issue, seeing it from different angles, and exploring possible solutions. As we turn each stone, we inch closer to meeting the challenge head-on.

Impact of Talent Shortage: Positive and Negative

A talent shortage in the pharmaceutical industry casts a long shadow, with the ripple effects touching multiple aspects of a company's operations. It's similar to throwing a stone in a pond—the ripples continue in waves, creating a broader impact than the initial splash. But not all these ripples carry unfavorable consequences. In fact, some can stir up favorable changes within an organization. Let's examine this from both sides:

Positive Impacts

  • Innovation in Hiring: Talent shortages can force companies to be more innovative in their hiring practices. Roche, the Swiss pharmaceutical giant, adopted an innovative strategy, the "Roche Continents" project. The aim is to attract young talents from across Europe to share their thoughts and work on real-life projects, raising innovation.
  • Investment in Training: Companies may invest more in training programs to bridge the skills gap, leading to a more skilled workforce in the long run. For instance, Merck has a program called MSD Fellows which is a two-year postdoctoral fellowship program, designed to provide training and exposure to drug discovery and development.
  • Strategic Partnerships: The talent shortage can push pharmaceutical companies to forge strategic academic partnerships to ensure a steady supply of skilled graduates. Take for example, Bayer has collaborated with several academic institutions worldwide through its Bayer Science & Education Foundation.
  • Adoption of Technology: Talent scarcity may encourage greater adoption of AI and automation, increasing efficiency and freeing up human talent for complex tasks. Great example is Novo Nordisk, a Danish multinational pharmaceutical company, which is leveraging automations and AI in their laboratories.
  • Global Recruitment: Faced with talent scarcity, companies might consider global recruitment strategies, leading to a more diverse and global team. For instance, Takeda Pharmaceutical, the largest pharmaceutical company in Japan, has operations in 80 countries and regions, seeking talent globally to form a varied team.
  • Emphasis on Talent Retention: An often overlooked aspect of talent management is retention. A talent shortage can put the spotlight firmly on this area, encouraging organizations to strengthen their strategies to keep skilled professionals. 
  • Promotion of Cross-disciplinary Skills: With a talent shortage, it's not just about having a single set of skills anymore. Pharma companies may start valuing professionals who can wear multiple hats and adapt to various roles, encouraging a more versatile and agile workforce. 

Negative Impacts

  • Delayed Drug Development: Talent shortages can significantly delay the development of new drugs. For instance, the absence of a clinical trials' manager can extend the timeline by several months, which directly impacts the company's revenue and patients awaiting new treatments.
  • Increased Costs: Any delay in the drug development process due to talent shortages results in higher costs. The Tufts Center for the Study of Drug Development estimates that developing a prescription drug that gains market approval can cost up to $2.6 billion, a figure that amplifies with delays.
  • Decreased Morale and Productivity: With fewer hands on deck, remaining staff may end up overworked and stressed, leading to decreased productivity and lower morale, which can initiate a vicious cycle of even higher turnover.
  • Quality Risks: Lack of skilled talent might lead to quality and compliance issues. Any errors can compromise the standards set in the pharma industry, damaging a company's reputation. These errors can, at worst, risk patient safety.
  • Loss of Business: Talent shortage could ultimately lead to potential business loss. For instance, a single day's delay in getting a pharmaceutical product to market can result in losses of up to $13 million, according to Grayson 
  • Prolonged Patient Waiting Times: Talent shortages and Associates can lead to longer waits for patients needing new drugs. Without a full staff to speed up the process, the timeline from drug development to market delivery is extended. This affects both the commercial success of the company and the well-being of patients who await these life-saving treatments.
  • Decreased Global Competitiveness: A talent drought can lower a company's global competitiveness. Pharmaceutical firms failing to attract and retain the expertise needed to innovate and develop new drugs may find themselves behind international competitors. This lack of competitive edge could result in a small market share over time.

It becomes perfectly clear that lack of talent is not just about filling seats. It's a critical issue that extends into every gap of a pharma company's operation, displaying in ways that might not seem obvious at first glance. But like any setback, it presents an opportunity — an opportunity to rethink, reassess, and reshape the industry’s approach to talent management.

10 Tips to Survive Talent Scarcity

Just as a gardener uses wise tactics to save water during a drought, pharma companies too, need to strategize to overcome talent shortage. They need to adapt, reassess their old methods, and find innovative ways to attract and retain the right talent. Here are 10 inventive ways:

1. Invest in Training Programs

Workforce development is a powerful tool. Companies can invest in robust training programs to bridge the skills gap. For instance, Pfizer has a Global Organizational Learning and Development department dedicated to fostering a culture of continuous learning.

2. Build Academic Partnerships

Collaborating with academic institutions can help companies ensure a steady supply of skilled graduates. For example, GlaxoSmithKline has a long-standing partnership with the University of Strathclyde, which includes a tailored graduate training program.

3. Embrace Digital Recruitment

Digitizing the recruitment process can widen the talent pool and make it easier to find the right candidate. Eli Lilly, for instance, engages with potential candidates through a dynamic careers website and active social media presence.

4. Offer Competitive Compensation and Benefits

Attractive compensation and benefits packages can help companies attract and retain top talent. According to a survey by Mercer, 55% of pharmaceutical employees cited competitive pay and health benefits as key factors influencing job satisfaction.

5. Implement Flexible Work Arrangements

Flexible work arrangements can enhance work-life balance and appeal to a broader talent pool. Novartis, for instance, has implemented flex work arrangements for its employees globally.

6. Build a Strong Employer Brand

A strong employer brand can give companies an edge in attracting top talent. Johnson & Johnson, for example, consistently ranks high on employer ratings due to its focus on employee development and company culture.

7. Leverage AI and Automation

Using artificial intelligence and automation can help companies manage routine tasks, freeing up human talent for more complex roles. AstraZeneca's Operations IT team, for instance, uses automation to enhance productivity.

8. Encourage Internal Mobility

By offering career progression opportunities within the company, organizations can keep top-tier talent. Abbott Laboratories encourages internal mobility through its job posting system, enabling employees to explore new roles and challenges.

9. Cultivate a Diverse and Inclusive Environment

A diverse workforce can bring a wider range of ideas and perspectives. Merck is known for its commitment to diversity and inclusion, earning it recognition on DiversityInc’s list of Top 50 Companies for Diversity.

10. Promote Employee Engagement

Engaged employees are more likely to stay, positively impacting retention rates. Bristol-Myers Squibb focuses on employee engagement through its People and Business Resource Groups, which foster a culture of inclusion and engagement.

As a result, with smart strategies and a bit of out-of-the-box thinking, pharmaceutical companies can not only survive the talent drought but prosper in it. It's about turning challenges into opportunities, from surviving to thriving.

It's clear that the talent shortage in the pharma industry presents a real challenge. But as we've seen, this challenge also brings opportunities for growth, innovation, and change. It's a matter of shifting perspective and using strategic tools at your disposal to transform this shortage into a surplus of possibilities.

Is your pharma company parched by the talent drought? Think of AMG as the refreshing rain you've been waiting for. With our innovative hiring strategies, we can deeply saturate your talent soil, bringing new life to your workforce and encouraging growth where it seemed impossible. So why wait for the clouds to gather? Reach out to AMG today, and let's create a downpour of talent that transforms your company! 

Posted by Mitch Robbins

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