The job market is beginning to resemble a field of round holes littered with square pegs. While 11 million Americans are looking for jobs, 4 million jobs are looking for workers. The reason those two numbers don’t meet each other at a cool 7 million has a lot to do with the skills gap, characterized as a lack of qualified candidates for skills-based jobs, the biggest example of which is in manufacturing. It’s a big talking point for employers across several industries, but what is this whole thing about?
What The Skills Gap is Costing Us
There’s currently a debate as to whether the skills gap actually exists, but its symptoms are damaging the workforce whether their source is perceived to be real or not. 92% of executives believe there’s a serious gap between the skills they need for jobs and the workers who have them, and half of them are struggling to fill those jobs. Employers are looking at the jobs they need to fill and the resumes they have… and coming up short. Candidates simply don’t have the right skills.
This comes at a time when the candidates looking to break into the workforce (mostly college-aged) can’t seem to get over the college hump. According to a study the U.S. Chamber of Commerce Foundation, only 36% of full-time students are enrolled at the four-year research universities that provide the skills they need to enter these markets. 4% of students at two-year graduate institutions graduate on time. Candidates aren’t getting trained in the skills they need to join the workforce, and the result is that 54% of candidates under 25 with a bachelor’s degree are underemployed or unemployed.
These unqualified candidates are costing employers big-time. The USCCF study reports that employers spent over $486 billion on training programs, 43% of them failed to achieve key financial targets, 40% reported a reduced ability to innovate, and 37% percent were unable to start a big project or initiative because they lacked the talent to do so. They’re also losing about $23,000 annually per job they don’t have filled. A job posting may not always be the most urgent task for many, but clearly a lack of talent is hurting our ability to thrive.
Where Employers and Candidates Should Meet
If we’re going to get candidates and employers to meet each other halfway, we’re going to need to clear up a few things. For one, there’s a big misconception of how prepared college grads are to enter the workforce. 96% of chief academic officers at colleges believe their students are ready to start working in skills-based jobs, but only 11% of business leaders agree. Colleges may not be preparing students as much as they think, and it’s a big problem for the university system.
Candidates and the colleges who train them could use some recalibrating of expectations, but so could employers. There’s a good chance that while candidates aren’t shaping up, they’re also better equipped for on-the-job training than ever.
“The problem may not be the skills workers ostensibly lack. It may be that employers’ expectations are out of whack… For much of the twentieth century, it was up to industry to pluck smart, capable college graduates and turn them into quality workers. In recent decades, on-the-job training has declined. Companies want new hires to be able to “hit the ground running.” — Matthew Philips (@matthewphilips)
An increase in on-the-job training would do some good to alleviate the issue, but there’s more to it than that. The USCCF has a few other recommendations for employers to follow as well. For one, they emphasize restructuring how employers see their talent sourcing. They need to “link their talent strategy to their business strategy,” making sure that multiple people in an organization are responsible for finding what tasks (not roles) need doing. This strategy also demands that employers be more flexible and responsive with their talent pipelines to make sure that an eager learner who may not have all the necessary skills doesn’t slip through the cracks.
Some employers are already taking those suggestions to heart. 49% of employers will train workers who don’t have the skills needed to do their work on site. It may sound expensive (and risky) to do this, but if that skills gap is going to get filled, it’s going to take employers valuing quick learners (something colleges are known for providing) over candidates who meet the exact criteria. This isn’t lowering your expectations — it’s being pragmatic.
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