The job market has been hit by more changes in the past few years than at any time since the Great Depression.
The advancement of technology and robotics changed the landscape for manufacturing workers. The Great Recession has skewered employment numbers for the past three or four years. And the aging of the baby boomer generation has brought the possibility of worker shortages to the forefront.
All of these factors have led to a gap between the skill set that employers look for in workers, and the skill set that those workers currently possess.
The American Society for Training and Development (ASTD) is the world’s largest professional association dedicated to the training and development field. The ASTD recently released a series of reports on the subject of skills gap and how it is impacting the employment landscape.
The recent economic challenges brought on by the recession have forced businesses to execute their strategies with more precision than ever before and do it with fewer resources. But fewer employees mean a skills gap within their existing employee base.
Some experts predict that skills shortages will intensify in the coming years as employers find the need to hire more knowledge workers for high-skilled jobs that will help their organizations grow as the economy rebounds.
ASTD defines a skills gap as a significant gap between businesses’ current capabilities and the skills it needs to achieve its goals. It is the point at which an organization can no longer grow or remain competitive because it cannot fill critical jobs with workers who have the right knowledge, skills, and abilities.
It is not just private businesses that are feeling the consequences of the skills gap. Communities, states, regions, and entire nations pay a heavy price when they can neither find nor equip workers with the right skills for critical jobs.
The first step to solving a problem is to properly identify its root cause. In the case of the skills gap, there are several contributing factors.
1) Significant job loss due to the recession
2) Jobs are changing
3) Education shortfalls
Beginning in late 2007, unemployment reached 10 percent of the U.S. workforce. By 2009, statistics from the U.S. Department of Labor showed that manufacturing jobs had decreased 47 percent, construction jobs 37 percent, and retail jobs 22 percent. That same report stated that job candidates outnumbered job openings six to one.
The other half of the numbers equation is the pending retirement of baby boomers. An overall loss of expertise and management skill is expected to result from the gradual departure from the workplace of the 77.2 million baby boomers, the oldest of whom turned 60 in 2006. According to the Social Security Administration almost 80 million Americans—more than 10,000 per day—will be eligible for social security benefits in the next 20 years.
The impact of the recession and retirement numbers was felt on the type of jobs available. Recessions always eliminate low-wage, low-skill jobs. In many instances those jobs do not come back. Instead, businesses will create jobs that require more education and skill.
But the growth of these “thinking” jobs is slow because they require higher salaries and costly technological infrastructure. Hiring managers will cautiously hire “knowledge workers” to fill skill gaps that they couldn’t address by hiring during the recession.
Knowledge workers have high degrees of expertise, education, or experience and the primary purpose of their jobs involves the creation, distribution, or application of knowledge. Knowledge workers such as accountants, financial analysts, software engineers, and research scientists, often depart from established procedures to solve problems and may adapt or update their knowledge in order to do their work.
Colleges and universities have been slow to change the type of education given to students. Part of that is due to the nature of change, especially at a place as large as a state university.
Community colleges and vocational schools have been quicker to change, due to the fact that they are generally more in tune with the local employment landscape.
But even smaller local schools can have trouble keeping up with the change in skill sets needed by businesses. The ones that have had the most success are schools that have reached out to the business world to determine what skills are needed.
Identifying the problem is only the first step. The next step is to determine exactly what skills businesses are looking for, and how to help workers learn those new skills so they can be a strategic part of business growth.
Next week’s JobsSunday feature will focus on what Indiana has done and is doing to help define what skills local businesses are looking for, and what workers can do to acquire them.