Is There Really a Skills Gap?

A prosperous future for the world’s economy rests on the foundations we lay through our education and skills system, so it comes as sorry news to hear complaints we’re facing a skills shortage, or ‘skills gap’. That’s the message coming from employers the world over: workers, or the education system, or both, simply aren’t up to scratch.

In the UK, the ‘skills gap’ is much publicized: The long-awaited Sainsbury Report on Technical Education was published in April 2016, shortly followed by the CBI skills survey, The Right Combination. Reports such as these imply that the skills problems businesses face—skills gaps, shortages and mismatches—are owed squarely to supply side factors. There are also problems with basic skills, with the survey showing almost a third of businesses had concerns about the literacy and numeracy levels of their new recruits.

But if we’re going to tackle the skills gap, we’re going to need to know where to start. Let’s start in the UK, where the ‘skills gap’ resurfaced at the top of employers’ and governments’ concerns following the decision to leave the EU.

Where is the skills gap?

It’s not uncommon these days for the media to complain of a ‘skills gap’, but like all buzzwords, it comes with some ambiguity. Stormline conducted a study to investigate the realities and the myths held by the UK public with regards to the skills gap, but found that a third of participants couldn’t correctly identify a single occupation the government listed as in-demand. A fifth responded thinking the country needed more police, lawyers and government officials, despite none of these featuring among the most in-demand professions.

In reality, the most in-demand occupations are in engineering, medicine, visual effects, and other professions that require science, technology, engineering and maths (STEM) skills. Despite this necessity, only 1 in 5 participants thought science skills were in demand.

The Association of Colleges recruit for lecturers and support staff in FE colleges up and down the UK. They write that ensuring the supply of high quality STEM professionals to teach and support future STEM talent is paramount if we are to collectively solve the skills challenge in the UK’s high tech industries. With the STEM sector expected to need an additional 160,000 engineers, scientists and technicians every year by 2020, it’s an area of critical need.

The digital industry is also among those facing the biggest skills shortage. It’s one field where the jobs market has shifted along with rapid advances in technology, which brings with it brand new skill sets and careers: UX (user experience) designers, social media analysts and online community managers – roles that barely existed 10 years ago. Digital skills sometimes come in the shape of periphery tactics, such as website monitoring, CRM management and search knowledge. The British Chamber of Commerce’s 2014 workforce survey found that when hiring, two-thirds of businesses believe this tech knowledge is key, and demand continues to grow.

We need to learn what Brexit means for the skills gap

According to the latest figures, there are 2.1 million European Union immigrants working in the UK. EU migrants provide the British economy with vital skills across such industries as construction, engineering and IT, as well as making a big contribution to the healthcare sector—11 percent of all NHS staff are not British. The games industry is one particular area where trade bodies are concerned over the effect of the UK leaving the EU.

If Britain’s withdrawal from the EU results in a reduction in the number of skilled workers from abroad, it’s likely to force the Government and businesses to invest more in training and development. It’s good news, then, that a new Skills for London taskforce, emerged in Brexit’s wake.

A report from the Organisation for Economic Cooperation and Development (OECD) calls for a policy focus aimed at re-engaging young unemployed people with education and the labour market, including through ‘second-chance’ training schemes. It also suggests employers can help by building on the quantity and quality of apprenticeships and improving the school-to-work transition.

And more general careers advice was also seen as important in a separate survey by the Baker Dearing Educational Trust, which found that young people entering the job market benefited from direct contact with employers, work experience placements and talks from professionals when it came to finding suitable pathways into industry. It’s vital employers show an awareness of common worries and anxieties that young people have in the crucial transition-into-work period, and offer workplace support by fostering confidence and a sense of self-worth.

However, don’t be too quick to decry a skills gap

A report published in OCUFA’s Journal of Academic Matters considers the skills gap is largely a myth. In one report on ‘The persistent myth of the “skills gap”’ in Canada, the author writes: “The skills gap takes the onus off employers to pay decent wages and train workers, blaming labour market failings on workers instead.”

Elsewhere, there are reports that the skills gap is less about skills shortages, rather, it’s about skills mismatch. A Survey of Adult Skills in 24 OECD countries also confirms that more of the adult workforce is over-skilled than under-skilled. Another comprehensive review of studies from the United States published in 2014 showed that many workers are in fact overqualified for their jobs. So what is going wrong?

Well, there’s a chance candidates are being overlooked. As noted in Alphr, junior applicants are far more likely to get hired if they have a degree in a specific field. “From what we’ve seen, and what the data shows us, having formal education is important to a lot of employers. It’s just a way for them to filter and differentiate.” Why? A report from Hired entitled ‘Mind the Gap’ showed that in many companies, the HR staff responsible for hiring talent aren’t trained in the technical skills for which they are recruiting. A formal degree qualification, therefore, acts as an easy signal.

SAP is a technology solutions provider, and both the company and the industry are one of the world’s largest employers. According to specialists recruiting for positions in SAP industries, finding success in job applications is down to effective communication. As Daniel Patel, SAP Delivery Director for Eursap reveals in a blog on writing an SAP CV: “If I am searching for an SAP SuccessFactors Learning Management System specialist for example, I would normally check the document for some specific keywords using the Ctrl-F search function. I would check for ‘SuccessFactors’ and ‘Learning Management System’ and see how many times each of these was mentioned.”

Keywords relating to specific industries, in this case SAP, are vital in order to lead a recruiter by the nose. Prospective employees must enable employers to determine the relevant skills they possess more easily.

It might not be about skills after all

Despite the increase in technical and skilled professions, employers have been shown to be more likely to rate “attitude to work” as more important than qualifications.

Rod Bristow, president of Pearson UK, told CBI: “Employers don’t just value what people know; they value what they can do. By far the most important ‘skills factor’ centers on attitudes.” In fact, the most important factor for employers when recruiting school and college leavers is their attitude to work (89 percent) followed by their aptitude for work (66 percent). These rank well ahead of formal qualifications, which recorded just 23 percent. Commitment to the industry, whether formally trained or not, might just be one solution to tackle the skills gap.

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