Across a multitude of industries, employers have been struggling to find " and retain " quality talent. However, the root of this issue is highly contested. While some critics challenge the very existence of it, 92% of executives agree that there is a skills gap in the U.S. workforce, resulting in companies' inability to adequately fill their workforce.1 Where does this problem stem from? There are many factors working together that have led to the skills shortage, and we'll explore several of them in the article below.
Traditional Schools Aren't Focusing on the Skills Sought By Employers
According to Quartz, US students are judged by their performance in math, reading and science, but the US labor market is increasingly focused on strong social skills.2 Therefore, schools that focus narrowly on cognitive skills may be overlooking a key factor in their students' future workplace success: soft skills. Since 1890, the proportion of jobs requiring social skill-related tasks rose much faster than jobs calling for basic math and reading, highlighting a major trend in the needs of the labor market.3 Workplaces have become more collaborative and communications-focused, making social leadership valued almost as much as a college degree in some instances.4 If the US education system were able to adapt to the reality of needing to teach soft skills, the student of today would be even better suited to enter the workforce.5
In his NBER paper, Peter Cappelli reinforces this argument, saying that workers may be overeducated in basic math and reading, just not in the technical skills they need to keep up with new technologies " skills that neither schools teach nor labor markets supply.6 However, his argument does note that the skills gap is not exclusively a problem of traditional schooling.
Employers Have High Expectations, But Don't Offer Adequate Learning Opportunities
Employers recognize the challenge of the skills gap, but they also recognize where solutions could be implemented. In its first annual Workplace Learning Report, LinkedIn found that 90% of business leaders believe learning and design programs are key to closing skills gaps.7 Unfortunately, only 8% currently see the business impact of learning and development.8 When this is the case, executives become less likely to designate additional budget toward new programs. In 2015, Training Magazine found that training expenditures for large companies were actually on the decrease, while the expenditures for small companies and midsize companies remained essentially flat.9 Without the appropriate support and backing, employers will continue to find their expectations for workforce-ready employees unmet.
As companies seek proof that their learning and development investments are paying off with increased workforce performance, chief learning officers face increased pressure to deliver programs that engage their employees and positively impact the bottom line.10
Without Being Able to Demonstrate ROI, Employers Will Not Be Able to Expand L&D Options
No matter the industry, learning and development leaders across the board struggle to provide concrete numbers to prove the benefits of their programs. According to LinkedIn Learning's 2017 Report, only four percent of executives recognize the ROI their companies are gaining from learning programs.11 How can you prove how much more productive or knowledgeable employees are once they have completed training? How can you prove employees' increase in engagement while they are taking college courses sponsored by your business? There are also additional aspects to consider, such as transfers of learning from one employee to another and new skills learned on the job.
To get the attention of your c-suite, focus on the key figures they will want to hear about. For example, highlighting that "organizations with high employee engagement are 12 percent more profitable and 18 percent more productive" will likely generate some interest.12 The better L&D teams are able to adequately measure the ROI of their programs, the more C-suite executives will be willing to back them and invest in closing the skills gap.
Looking for additional resources on building the case for investing in learning and development? Check out our recent series below.
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Resources: (1) Adecco USA (2) Quartz Media (3) Harvard University (4) HR Dive (5) Quartz Media (6) The National Bureau of Economic Research (7, 10) HR Dive (8,11) LinkedIn Learning Report (9) Training Magazine (12) Kenan-Flagler Business School