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Rethink the Skills Gap, Part I: What is the skills gap?

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In the corporate world, “skills gap” has become one of the most popular buzzwords for hiring managers, no matter their industry. Despite its ubiquity, the skills gap as a concept is surprisingly hard to pin down. No definition exists in the dictionary, and the term lacks a Wikipedia page. Yet the term is everywhere, and HR professionals and executives are clamoring to fix the gap.

The Economic Modeling Specialists define the skills gap as “the perceived mismatch between the needs of employers for skilled talent and the skills possessed by the available workforce.” This definition captures the problem: companies need experienced and qualified candidates, and they aren’t finding talent to match their needs.

The skills gap is real: a CareerBuilder survey found over half of companies have open positions they aren’t able to fill. There are 5 million job openings in the U.S. today.

The missing skills causing this gap aren’t the same in every industry or every region, but nationwide two types of skills are growing increasingly hard to find: STEM skills and “middle-skills.”

The STEM Gap

The CareerBuilder survey reveals 71% of employers report having difficulty filling STEM (Science Technology Engineering Mathematics) positions, and a survey highlighted by the U.S. News & World Report shows 62% of CEOs have trouble filling jobs demanding advanced computer and IT skills.

STEM positions make up about 15 percent of the 5 million job openings today, and many of these positions are going unfilled. This talent shortage comes in part from the nature of the industry; technology changes faster than people are able to keep up. A candidate’s skills in 2010 may already be obsolete in 2015.

Many of these skills are also not taught or introduced in high school or during secondary education. The tides are changing, but in the past decade, few schools have taught students how to code, for example, so many people must be self-taught or have already learned on the job.

The Middle-Skills Gap

Middle-skills include skills required in industries such as transportation, nursing, manufacturing, and industries requiring technical or trade education. A seminal study from the Harvard Business School found that 69% of HR executives said “their inability to attract and retain middle-skills talent frequently affects their firm’s performance.”

By 2017, the Economic Modeling Specialists estimate 2.5 million middle-skill jobs will be added to the workforce. These middle-skills jobs are the fastest growing occupations in the U.S., but the pool of applicants isn’t growing at the same pace. Baby Boomers make up a large percentage of the middle-skills workforce, and they are set to retire in the next decade.

 

Each of these skills gaps present a unique problem for the future of the workforce and for U.S. companies. One solution won’t reverse the tides, but there are ways companies can creatively lessen the potential costs to their growth.

To find out how, download our white paper, Rethinking the Skills Gap.

 

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