There is a vicious cycle at play in our current labour market. The “skills gap problem” has become a classic HR cliché, provoking eye-rolls and exasperated gestures – “we’ve heard it all before!”. The skills gap refers to the apparent divide between the skills employers expect employees to have and the skills employees and job seekers actually possess. In this article we will explain the job skills gap and cover the following topics:
- What is the job skills gap?
- The problem of the skills gap
- Causes of the skills gap
- The research behind bridging the job skills gap
- Differences between hard and soft skills
- Actionable insights for employers & jobseekers to bridge the skills gap
What is the job skills gap?
The jobs skills gap is the difference between the qualifications employers desire and the qualifications most job applicants possess. This gap can be attributed to both employers seeking applicants with too specialized skills (creating a skills shortage) and applicants lacking industry experience in the job they want to pursue (creating a lack of skilled workers).
The jobs skills gap restricts economic growth because it limits access to talent, makes it harder for businesses to find workers who possess the right skill sets and increases the risk of overcrowding in already available sectors.
This can be a particular problem in areas where new technologies are growing rapidly, like artificial intelligence (AI) and machine learning (ML), as these require highly specialized skillsets that most potential employees do not possess.
The problem of the skills gap
Yes, this is becoming a tiring discussion with every thought leader pointing at who is “really” at fault. Education and technology get the brunt of the blame – politicians and policy makers claim that technology is moving too fast, whilst our education system lags behind. Yet these explanations are lacking in corroborating evidence and proposed solutions are ineffective. So unfortunately, this deadlock prevails.
Cedefop’s European Skills and Jobs Survey 20181 revealed that four in ten EU employers had difficulty finding people with the right skills. Yet despite these concerns of an increasing skill shortage, the survey exposed that approximately 39% of adult EU employees are over-skilled and trapped in low quality jobs. Employers are struggling to find people with the specific skill sets they require. Job seekers are investing years in education only to end up with few satisfying prospects. Workers are finding that they are more often than not failing to meet requirements listed in job advertisements.
This is a macro-level issue affecting national economies, closing doors on talented workers, stifling company growth and having a detrimental effect on the entire labour market. Nobody has answers for the people at the core of the issue – the job seekers and hiring companies. They need pragmatic solutions and they need them fast.
What causes the skills gap?
New insights carried out in LiveCareer’s Skills Gap report2suggests that the cause of the skills gap problem lies in the behaviour of two key market players; CVs and job advertisements.
CVs (or resumes) and job advertisements are the tools through which the labour market communicates – they form the basis of interactions in HR and recruiting. There is a misalignment between how job seekers are communicating their skills in their CV and how employers are advertising the skills they require in their job specifications. This means that friction is created as soon as job seekers and employers engage – they start off already on separate tracks. And the tracks diverge further and further apart. In desperation, job seekers bulk send CVs to organisations and employers succumb to screening bias amidst the flood of incoming CVs. Neither party ends up happy, and no amount of policy reform, education initiatives or technology training will resolve this.
Let’s take a closer look at the research:
” We took a “big data” approach to analyzing
thousands of resumes and job ads across 12 different occupations.
In total, these occupations represent nearly one-quarter of the workforce
in the United States.”
LiveCareer (2018) Bridging the Skills Gap 2
The research behind bridging the skills gap
Thousands of CVs and job adverts across 12 different occupations were analysed using a Natural Language Processing tool to compare required skills listed in job ads vs skills offered in job seekers CVs.
One of the most remarkable insights is that job seekers are specifying far too few skills on their CVs. This significant mismatch in the number of skills listed is evidenced in the report which indicated that job ads contain on average of 21.8 skills, whereas CVs only list an average of 13 skills.
There is a clear gap between the most valued skills from each side’s perspective as evidenced by the study – job seekers’ CVs only match 59% of hard skills and 62% of soft skills in job ads.
The difference between hard and soft skills
What is the difference between hard skills and soft skills? Hard skills are specific job-related technical skills, knowledge, and training. Hard skills are often gained through studying and training.
According to a survey conducted by the National Association of Colleges and Employers, the top 10 most in-demand hard skills for new graduates in the United States in 2021 are:
Examples of hard skills:
- Data analysis and interpretation (cited by 72% of surveyed employers)
- Strong written and verbal communication (cited by 71% of surveyed employers)
- Problem-solving and analytical skills (cited by 69% of surveyed employers)
- Strong IT skills (cited by 69% of surveyed employers)
- Leadership (cited by 67% of surveyed employers)
- Strong organizational skills (cited by 67% of surveyed employers)
- Strong attention to detail (cited by 66% of surveyed employers)
- Strong digital literacy (cited by 65% of surveyed employers)
- Strong project management skills (cited by 64% of surveyed employers)
- Strong interpersonal skills (cited by 64% of surveyed employers)
Whereas soft skills are seen as personality traits that you have developed over the years. Soft skills often can shape how you work, on your own and with others.
According to a survey conducted by the Society for Human Resource Management, the top five most important soft skills for employees are:
Examples of soft skills:
- Strong work ethic (cited by 86% of surveyed employers)
- Positive attitude (cited by 85% of surveyed employers)
- Strong verbal and written communication skills (cited by 81% of surveyed employers)
- Teamwork and collaboration (cited by 78% of surveyed employers)
- Flexibility and adaptability (cited by 72% of surveyed employers)
Employees need both hard and soft skills to perform successfully in their job.
Hard skills are mentioned more frequently in job advertisements across all industries – an average of 16.7 hard skills are found in job ads versus an average of 5.2 soft skills.
However, despite this, 3 out of the 4 skills most often mentioned in job advertisements are soft skills – Customer Service (13% of total top 20 skill occurrences), Communication Skills, (8,9%), and Written Communication (8.3%). These 3 soft skills account for 30% of the top 20 most frequently mentioned skills.
A key takeaway from this is for employers across all industries not to underestimate the significance of soft skills during their candidate selection process. This corroborates research carried out by Harvard University, the Carnegie Foundation and Stanford Research Center which found that 85% of job success correlates to well-developed soft skills, compared to 15% from hard-skills.3
Actionable insights for employers & jobseekers to bridge the skills gap
Firstly, job seekers must work on matching their skills to those listed in job advertisements (assuming they have these skills). For soft skills, job seekers must find better ways to articulate these in a way that resonates with employers and subsequently, in interviews.
In parallel, employers must be wary of relying on automated keyword-matching software to screen candidates, as according to the data, they will most likely not find enough ‘qualified candidates’ and the perfect candidate might slip through the defined algorithms. Instead, employers should implement efficient processes for screening CVs and utilize technology to enable more effective evaluation of CVs. For example the Allsorter.com platform enables recruiters to format CVs to highlight key skills and competencies. This ensures that CVs are all standardised allowing for efficient and optimum comparison, in addition to eliminating any selection bias.
Additionally, employers could develop programs offering formal training, group coaching or one-on-one mentoring that give employees an opportunity to up-skill in areas that employees and employers value. Creating a system through which internal talent can be identified for vacant roles in larger companies should be considered in order to give existing employees the opportunity to grow and develop within the same organisation. This would empower HR teams to demonstrate significant value to both the company and employee alike, cutting hiring and training costs whilst engendering greater loyalty and employee retention.
Did you enjoy this post? Here are some more recruitment topics you might be interested in:
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- How to address biases in recruitment
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- ATS resume template guide
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1Report: Cedefop (2018) Insights into Skills Shortages and Skills Mismatch https://www.cedefop.europa.eu/en/publications-and-resources/publications/3075
2 Report: LiveCareer (2018) Bridging the Skills Gap: An Analysis of Job Ads and Resumes and How They Contribute to Employer-Jobseeker Friction https://www.livecareer.com/skills-gap
3Report: National Soft Skills Association (2015) The Soft Skills Disconnect