Businesses in the U.S. are experiencing a skills crisis. More than 600,000 jobs went unfilled in 2012, simply because the workforce was not skilled enough to do them. The Skills Gap and the State of the Economy, the first part of this series, uncovered how and why this is possible. The second part, Why the Skills Gap Matters Today and Tomorrow, addressed current and future implications for U.S. business.
Now that we’ve covered what it is and what it means for business, we’ll address strategies that employers in the U.S. can adopt to close the skills the gap and position themselves for sustainable growth and lasting success in the years to come.
First, the root of the problem. Is the labor force itself the issue?
Only 23% of the senior executives we surveyed feel that the skills gap comes from a lack of interest from job seekers in pursuing careers affected by the skills gap.
In that case, it certainly can’t be the education system. A 2012 white paper by the World Economic Forum notes: “In 2011, 215 US-based science, technology, engineering and math (STEM) programmes are ranked globally, while only 29 Chinese programmes can claim the honour.”
And yet, 59% of senior executives we polled in 2013 do not feel that U.S. colleges and universities prepare graduates for today’s workforce.
So what gives?
The answer can be found in a statistic we covered in The Skills Gap and the State of the Economy:
“44% of executives reported that soft skills — intangibles like communication, creativity, collaboration and critical thinking — were lacking among hires and job candidates.”
These skills aren’t taught in classrooms. Four (or six, or even more) years of engineering, chemistry, math, and technology education can’t teach these skills. But apprenticeships and on-the-the-job training can.
Among those senior executives who believe there is a U.S. workforce skills gap, the vast majority (89%) thinks that corporate apprenticeships or training programs would help alleviate the skills gap in the U.S. workforce. Since this attitude is so pervasive, why aren’t we seeing more of these programs cropping up nationwide?
The primary reason seems to be cost. Despite the recognized need for corporate apprenticeships and on-the-job training, 42% of our respondents indicated that the single greatest barrier to implementing these initiatives is that they can be prohibitively expensive. An additional 30% cited a lack of interest at the executive level in pursuing alternative training options. Only 17% pointed to a lack of a employee interest as a barrier to creating in-house training programs.
These programs are certainly not cheap. They require personnel to conduct the training. They also require employees spending time away from productive tasks to undergo the training. But while the initial investment in alternative training programs may be high, they may pay substantial and lasting dividends, especially where global competition is concerned.
A 2012 article in Bloomberg Businessweek noted the following of Asian economies:
“Some 45 percent of employers surveyed there cited difficulties in finding the right people to hire. That’s the same number as in 2011, and it’s 17 percentage points above the total when the first survey was carried out in 2006.”
Emerging global players like India and South America are experiencing similar crises, as is Europe.
As such, this may be the perfect time for U.S. business to invest aggressively in closing the skills gap. Apprenticeships and on-the-job training will help domestic businesses capitalize on growth opportunities and improve the pace of innovation and product development. They can also help the U.S. economy gain substantial yardage in a global market that’s exceptionally competitive and desperate for skilled labor.