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TD Magazine Article

Turning to Tech to Fill Skills Gaps

The ways organizations interact with their employees are changing, and talent development needs to keep up.

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Fri Jun 01 2018

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Rather than training the workforce, new research shows companies are seeking out artificial intelligence and other external resources.

More than six million unfilled jobs in the United States are leading to stalled business growth and innovation, says Dan Schawbel, research director at Future Workplace, one of the organizations behind the newly released study, “Closing the Skills Gap.” Why so many unfilled positions? Schawbel puts it this way, “Instead of investing more money in reskilling current employees to fill the gap, companies are betting on AI \[artificial intelligence\] and outsourcing.” What they should be doing instead, he says, is training the workforce.

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The Future Workplace—a research firm preparing leaders for disruptions in the workplace—along with the Learning House—a leader in workforce education and training—surveyed 600 U.S. human resources leaders, nearly half of whom reported that college graduates aren’t ready for the world of work, and 52 percent noting that they were currently experiencing a skills gap.

And while organizations may be pointing fingers at colleges, they themselves could be doing more: Three-quarters of respondents (74 percent) are investing $500 or less per employee on training and development for upskilling and reskilling. Schawbel notes that many of the companies surveyed were smaller businesses with fewer than 1,000 employees and have smaller budgets, but he underscores the need for organizations to train their talent. “Still, it’s more cost effective to retrain and upskill an employee than spend money on recruiting, advertising, or the hiring of a head hunter.”

What Skills, and What Proof of Them?

It is not surprising in this day of technology reliance that tech and IT skills are in great demand. The study found 43 percent of human resources leaders said roles requiring those skills are the hardest to fill.

These sought-after skills don’t need to a four-year degree to back them up, however. The findings indicate that nearly all employers—90 percent—are open to hiring individuals without a four-year college degree. Specifically, employers are open to hiring those with a recognized certification (66 percent), complete certificate (66 percent), and—to a lesser extent—a degree from a massive open online course, or MOOC, or a digital badge.

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More than computer skills (47 percent), the hard skills that are most attractive to employers are strategic thinking and analytic skills (59 percent); project management likewise came in at 47 percent. Meanwhile, teamwork, the ability to adapt to change, and leadership ability top the list of looked-for soft skills.

Although employers say that technology and IT skills are what they most want and are the hardest to fill, the skills they are trying to develop in their employees tell another story.

“Companies are looking for a combination of hard and soft skills,” says Schawbel. “As more jobs become automated, soft skills become more important, as well as new hard skills that help with innovation. At Google, they are starting to recruit more liberal arts majors and have dropped their GPA requirement. Their data has found that they need employees who have strong communication skills over just hiring STEM majors.”

Are You About to Be Obsolete?

“The world is changing so fast that it has become not only hard to keep up but somewhat unpredictable. Who would have thought that the cab industry could be disrupted by Uber years ago or the hotel industry by Airbnb?” offers Schawbel. “We thought they had a lock on their industries, yet now no one does in any industry.”

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In this somewhat unpredictable world, how much can you rely on your current skills? Nearly half of those surveyed for “Closing the Skills Gap” believe that the average length of time a skill is usable is more than six years, while almost one-quarter (23 percent) of respondents opined that skills have a shelf life of two to four years. However, the C-suite and executive level are much more likely to believe that skills won’t be relevant for long. Fifty-five percent of junior and middle management thinks that the average length of time a skill is usable is greater than six years; 40 percent of senior management, including the vice-president level, said so; yet, only 26 percent of C-level and executives feel that way.

Employees are right to be concerned. “I was particularly surprised that almost one-fourth of companies are looking to fill their skills gap by investing in artificial intelligence,” states Schawbel. “Instead of hiring people or training current employees, they are turning to machines, I assume, because of the lower cost. You don’t have to pay employee benefits to a machine and they can work 24/7.”

Jeremy Walsh, senior vice president of Enterprise Learning Solutions at the Learning House, voices his surprise in the findings that employers are investing a relatively low dollar figure, on average, per employee on skill enhancement and that employers spent as much time as they did recruiting at colleges where students didn’t have the right skills to fit employers’ needs.

Looking Toward a Brighter Horizon

Yet, it’s not all gray skies. On the upside, Walsh was pleasantly surprised that 62 percent of employers are currently reskilling employees for future roles. “I thought this was a promising indictor. In the past, companies have been quick to render layoffs only to turn around in six months and hire a whole slew of new employees. If this trend \[of employers reskilling employees for future roles\] is accurate and remains, I’m hopeful that companies will find effective ways to help employees navigate the ever-growing skills race.”

Figuring out what jobs will be needed and maintaining skill level in employees is critical to filling the skills gap. Learning House has been working closely with universities on research, identifying market-driven programs, and implementing best practices that support the student experience. It was through that work, says Walsh, that he realized the need to also work more closely with employers.

“I think all parties would agree that in an ideal world, colleges would produce more work-ready candidates who can tackle the in-demand jobs that employers desperately need to fill. I believe universities need to continue to evolve in ways that better support the lifelong learning needs of their students.”

Meanwhile, Walsh continues, “Employers that will effectively address their major skill gap challenges will engage in conversations with local universities by reaching out instead of waiting for someone to reach out.”

There’s obviously work to be done. Schawbel says he believes “that companies can do a better job of forecasting jobs and creating a workforce readiness strategy to create a pipeline for them.”

Addressing Skills Gaps

According to the report, the number one reason given for a skills gap was a lack of qualified candidates to hire. This was followed by the pace of change in technology (34 percent), lack of employee development initiatives and options (32 percent), and the skills of the current workforce not matching organizational needs (32 percent).

In addition to the lack of budget, many organizations surveyed reported that they couldn’t find training resources, either internally or externally, to upskill or reskill workers.

Rather than spending the money and hiring training practitioners, many organizations simply hire new employees; outsource; hire gig workers; or are relying on artificial intelligence. When companies do reskill or upskill their employees, preferred vehicles include coaching, instructor-led training on-site, training manuals or books, and peer mentoring.

Preparing for the future isn’t necessarily going to be easy, notes Schawbel. “Training needs to happen every day, whether it’s on-the-job, mobile learning, or instructor led. Just sending someone to one conference or to a single online course is simply not enough to keep up with the changes at work.”

The challenges, then, are myriad and will require interaction among stakeholders: academia, employers, talent development professionals, third parties, and others.

“Talent development practitioners need to meet with college deans to better communicate their skill requirements and notify them of their job openings so that colleges can start producing candidates that can fill those roles,” says Schawbel. And “this is good for colleges because they can increase their placement rates and become more marketable. This is good for students because they can get jobs and for companies who need this talent in order to grow and compete in their industry.”

“For educators, there is really one thing they can do … be innovative,” said Walsh. “The pace of change in technology and emerging business models can make it challenging for colleges to keep up with in a traditional four-year academic setting. Educators who will win in the future are those who lock arms with employers to be aware of necessary skills and collaboratively develop the key curriculum and learning experiences within programs that best prepare students to be work-ready.”

There is no magic bullet or secret sauce, emphasized Walsh. While it may not be easy, the “how” to get there is grounded in many of the same principles we so often talk relative to surviving and even thriving in today’s world of work: “It’s about engaging in conversations and turning ideas into outputs,” Walsh continued.

While companies may need to commit additional resources, it doesn’t necessarily need to be a ton more. What it takes is looking at organizational-specific skills gaps. “With a little creativity and the right kind of partnerships, you can go a long way toward improving the effectiveness without it becoming costly.”

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