Talent Pool Shrinking?
Employers, increasingly, struggle to hire qualified employees. Many industries, as diverse as construction, engineering, finance, healthcare, retail, social services, technology, and transportation, are dealing with positions that they are unable to fill.
Beyond barriers related to the pandemic, such as health & safety concerns or salaries having to compete with increased unemployment benefits, employers lay blame to a skills gap.
This skills gap, according to a survey of HR managers by CareerBuilder.com, is costing employers nearly $1 million, annually. Open positions result in productivity loss, higher employee turnover, lower morale, decreased quality of work, being unable to grow the business as well as actual revenue loss.
It is also an international concern according to the Boston Consulting Group (BCG). “It affected two out of five employees in OECD countries [there are 37 countries who are members of the Organization for Economic Co-operation and Development], prevented millions of people from fulfilling their potential, and created severe labor productivity losses. BCG analysis shows that the mismatch effectively imposed a 6% annual “tax” on the global economy and that now, as a result of the COVID-19 pandemic, the situation could cost 11% in terms of productivity or $18 trillion in unrealized GDP by 2025.”
30% of Jobs will Require New Skills
The skills gap will continue for the foreseeable future per BCG, “the pandemic has already triggered long-lasting structural changes—flexible and remote working arrangements, for example, and accelerated automation—that will affect up to 1.5 billion jobs within the next decade. And while automation will put at risk 12% of current jobs by 2030, some 30% of jobs will require completely new skills.”
There are many factors behind the talent shortage:
The rapid pace of technology and the need for digital skills is one of the biggest drivers. Knowledge has a shorter and shorter shelf life. Artificial intelligence and automation will transform existing jobs and create brand new jobs, requiring new skills.
Additionally, there is the decline in birth rates of many industrialized countries, the retirement of the Baby Boomer generation, anti-immigration policies (capping H-1B visas or forcing underemployment due to certification or licensing, i.e., where you have a doctor driving a taxi) as well as the sky-rocketing price of higher education.
Traditional employment and management practices also play a role. These include not hiring inexperienced workers for entry level positions (3 years of experience is a typical requirement); not considering job applicants who have been and/or are unemployed; and insisting on college graduates for all positions.
Not investing in talent through apprenticeships and training programs is probably the largest misstep.
Skills Gap Myths & Misnomers
There is an assumption that the jobs that are left on the table are undesirable—low skill and low paying and, therefore, the reason why these jobs are not being filled. Research into America’s skills gap, however, tells us otherwise. “A second claim from skills gap skeptics is that the 6.9 million unfilled jobs are not skilled jobs, but rather low-skill jobs. This line of argument casts the “true” gap as one of labor, not skills. So while the engine of America’s dynamic economy is humming along, millions of jobs in agriculture, hospitality, and custodial services are unfilled.
“BLS [Bureau of Labor Statistics] has relevant information on this point. Last fall, there were around 900,000 unfilled jobs in accommodation and food service, but also nearly 1.2 million unfilled openings in professional and business services, and another 1.3 million in education and health services. While some of these positions are certainly lower skill (e.g., medical assistants), a significant percentage of America’s unfilled jobs are skilled positions. According to Burning Glass, there are 1.7 openings for every qualified worker in high-skill healthcare jobs like nurse practitioners, physician’s assistants, physical therapists, and occupational therapists. The job site indeed.com alone lists nearly a million open positions with salaries at or above $75,000.”
When good jobs with good pay and good benefits are unable be filled, it tells us that there is a genuine skills gap.
How to Reduce Skills Gap Costs
All sorts of strategies are being proposed by researchers, think tanks, and analysts. Partner with another business for employee sharing programs. Establish policies to increase inclusivity for underrepresented groups such as women, minorities and the disabled. But, the simplest and most direct, would be to set aside hiring practices that are based on perfectionism. Rather than search for employee masterpieces, instead, look for a work-in-progress.
You should seek the candidates that are being overlooked by your competitors. Job applicants who offer some of the training, experience, skills, or attitudes desired, but not all. Yet, most importantly, they have a lifelong learning mindset. This means that they are future-ready, resilient, and capable of adapting to new technology as your organization evolves.
Hiring is a nuanced activity. Often, a final decision is based on instinct or a gut feeling.
You can’t afford a bad hire.
But, how can you accurately measure the potential of any applicant to succeed?
Assessment of job candidates is the first step, as advised by many Future of Work studies and white papers. Assessment, per Deloitte’s Building the Future Ready Workforce, assists in developing a culture of continuous learning focused on capabilities such as critical thinking, adaptive thinking, creativity, and curiosity. Assessment will fuel your hiring and recruitment efforts. It will also clarify who are the best consultants and gig workers to engage.
INSIGHT Business Professional, for example, assesses the core thinking and learning competencies necessary for effective problem-solving and decision-making. Reports allow you to prescreen job candidates for skills such as problem analysis, evaluating alternatives, and anticipating risks. Relevant mindset attributes, including focus, flexibility, tolerance, and commitment are also evaluated.
Interview only the strongest candidates, those ready to think and learn fast.
Additionally, when moving to the second step of preparing for the future of work, by looking internally, assessment will identify strengths and areas for improvement within your current employees. It provides essential information for succession planning, promotions, and fueling initiatives for improvement via training/learning & development.
Minimize the Skills Gap in One Easy Step
It is time to expand your hiring metrics. Screen not just for expertise and knowledge, but for strength in critical thinking skills and lifelong learning mindset. This is the evidence-based ‘complete package’ that predicts high performance and productivity. Now, and into the future.
Employment decisions that impact the viability of your company should be based on actual scales that have been proven with over 30 years of research to predict academic, career, and life success.
The qualified candidates that your company requires, to remain competitive, are out there.
Allow Insight Assessment to help you find them. Our critical thinking assessments have been customized for numerous industries—business, education, healthcare, and government service; at all levels of employment—support staff, professional and executive; in multiple languages with real-time results via online deployment.