Why the 'Skills Gap' is Employers' Own Fault

by Phil Stott | December 11, 2013

A recent report from the Society of Human Resources Management (SHRM) highlights one of the biggest problems that companies have today: the ability to find employees who are ready to tackle the challenges they're likely to meet on the job. In pointing this out, however, the report also makes an unconscious point: that the problem is almost completely companies' own fault.

 

Before we get into why that is, let's start with a couple of introductory takeaways from the report—the most recent version of the SHRM workplace forecast which "is based on a survey of human resource professionals on their views of key issues they feel will affect the workplace in the coming years."

 

When asked about the biggest challenges facing them as HR executives over the next 10 years, a couple of interesting, and likely related, themes emerge. First, as you can see from the table below, the perception of challenges has shifted markedly in the past two years. Concerns among HR execs polled in 2010 largely revolved around culture and finding the right employees with the necessary skills to meet business objectives. Fast forward to 2012, however, and the questions of retention and succession planning seem to be top of mind. Not coincidentally, the same survey also reports serious concerns over the effect of the boomer generation leaving the workforce in the course of the next 10 years.

 

SHRM_screencap 

And that's where the problems come in. In a section of the forecast titled "Overall decline in the workforce readiness of new entrants to the labor market", the report notes that "expectations for education and certifications were on the rise across industries and for all types of jobs. This finding means that not only will the next generations of workers need to meet the education levels of the exiting Boomers, but in many jobs they will actually have to surpass them." (Emphasis added).

 

To further back up this point, the report also cites the results of a 2012 Pew Research Center survey, which found that "the majority of young people (those between the ages of 18 and 34) do not feel they have the education and training to get ahead. Less than half (46%) of those who are employed say they have the education and training necessary to get ahead in their job or career, and only 27% of those not working say they are adequately prepared for the kind of job they want."

 

Taken together, those points could be used to predict an impending crisis for American business. Companies are losing all of their experienced talent, and finding nothing to replace it with—the fault presumably lying on the part of the millennials and the educational institutions that are failing to prepare them for the workforce they're seeking to enter.

 

And yet, it's impossible to look at educational data and come to that same conclusion. As we know, rates of educational attainment have rocketed in recent years: BLS data (which I could only find for as far back as 1992) shows that the number of people in the 25+ age range with less than a high school diploma has dropped from 13,756,000 in January 1992 to 10,932,000 just last month—even as the population has grown. Over the same period, the number of 25+-year-olds with any kind of degree—from Bachelor's on up—has almost doubled, up from 27,632,000 to 49,921,000 last month. Clearly, the problem does not lie on the education side.

 

Going back to the point about replacing the boomers, it seems fair to make a couple of assumptions: first, that the boomer generation—the employees that HR executives are now fretting about being able to replace—was not as well-credentialed as the millennial generation that will be picking up its mantle. And, second, that what the upcoming generation is lacking is not education per se, but experience. 

 

Perhaps instead of lamenting the skills gap, then, companies would be better positioned to meet future demand if they actually asked some of those outgoing employees how it was that they got so good at their jobs in the first place. It's a pretty fair bet that many of them, having first entered the workforce in the 1960s and 1970s will throw around some archaic terms like "workplace training," "apprenticeships" and "time on the job." A survey of the concerns of HR professionals at companies that instituted some of those concepts would likely yield very different results.

 

Read More:

SHRM Workplace Forecast (pdf) 

Why Good People Can't Find Jobs--What You're Up Against

Training: Coming Soon to a Workplace Near You!

Filed Under: Consulting | Job Search | Workplace Issues


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