Why is there a skills gap?

By January 22, 2016 Uncategorized No Comments

What is the skills gap?
“The difference between the skills that employers want and the skills that employees actually have” is how NPR describes it. While there has always been some degree of mismatch of skills and abilities on the labour market, the problem of the skills gap has recently become uniquely dominant.

The primary concern of employers has narrowed from whether an employee can perform specific tasks, to whether that employee can perform those tasks better than anyone else can. Previously, the biggest difficulty for companies was finding enough people who lived close enough to the workplace that they could work. Today, as INC.com’s Cait Murphy has said: “10 million [people are] unemployed. Yet employers’ No. 1 problem is finding the right talent”.

Skill-based requirements have increased dramatically
The issue is that requirements are increasing faster than education standards are; thus, graduates are entering the labour market under-educated and unprepared from the corporate perspective. As traditional education is both time-consuming and expensive, an increasing percentage of the population is either underemployed or outright unemployed.

The skills gap is a self-perpetuating cycle

Companies are steadily increasing skill requirements; skill requirements are increasingly more difficult to obtain; students and employees are unable to increase their skills quickly or efficiently enough through traditional means; the skills gap becomes wider as more under-educated people enter the workforce. It is crucial to factor in the population of employees with many years of practical experience who are competing with recent graduates entering the labour market as well as the current economic stagnation following many years of worldwide recessions and decreasing number of jobs being created.

Is it a big deal?
This is a very big deal – so large in fact, that Manpower Group’s “Talent Shortage Survey” showed that 35% of 38000 employers reported difficulty filling jobs due to lack of available talent.

A real world example
Dan Adams, owner of the high-end manufacturing company MTI, has had 12 open engineering positions that have gone unfilled for over a year. Mr Adams cannot find qualified workers to fill the empty positions; he said “I wish we could go to the school system and be able to hire machinists, tool and die makers, people who have machining experience. I wish I could go to college and higher designers that knew how to design machine tools. It’s not happening.”

Companies blame schools for inadequately prepared students
While the Wall Street Journal has been reporting that companies are blaming schools for inadequately preparing students, the American Society for Training & Development has shown that there is a large discrepancy between the required skill level for available positions and the skill level of applicants.

 

Reports such as these have been coming to light more and more frequently. Critics and nonbelievers of the skills gap are now few and far between; there is a well-documented discrepancy between the skills that graduates are leaving school with and skills that employers expect employees to have.

 

More than a jobs and skills mismatch

The idea that there are more than enough qualified people, but that these people are simply displaced from the workplace is false. That said, this was a perfectly reasonable argument in the past: people who are able and willing to work, but are geographically displaced from someone who is able and willing to hire them, will not be employed.

 

The problem with this argument is that it is outdated. Many industries are information-based and are accommodating to displaced workers. Today, the most valuable asset an employee has is their knowledge and experience, rather than their proximity to the workplace. Now that it is possible to either work, and to find work, from afar, the skills gap has become a dominant problem.


Closing the skills gap

While many firms are blaming schools’ education infrastructure, the staffing firm Aquent has taken a different approach. After realizing that the increasing demand for workers with HTML 5 experience was not being met, Aquent created its own MOOC – Aquent Gymnasium. Aquent’s vice president of learning and development Alison Farmer explained that “Even though unemployment was high, companies were telling us that most candidates weren’t qualified”.

According to workforce.com, 40,000 participants took part in Aquent’s free course on HTML5. 180 of these participants found employment as a direct result of the online learning MOOC. The company has gone on to create a hybrid LMS-corporate university format that offers free courses to designers, front-end developers, and marketing professionals. Alison Farmer commented on this initiative saying “people who complete the MOOC curricula receive a certificate of completion from Aquent, which serves as validation to employers”.

It is clear that targeted digital learning benefits both sides: it provides individuals with the skills and abilities they need while creating a specifically educated employee base that companies are currently struggling to find. Farmer underlined this achievement by stating that Aquent is using its MOOC to “manufacture the workforce our clients need”.

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