Mind the Gap … Between Grad Skills and Employer Expectations

Much has been written in both the business and higher education press about the gap between today’s jobs and the skills presented by those seeking work. The fact that U.S. Department of Labor statistics show 9.6 million people out of work with 4.8 million jobs still unfilled (August 2014) suggests a problem. However, little agreement exists as to the source of this disparity or what needs to be done about it.
Headlines were created earlier this year by a Lumina Foundation-sponsored Gallup Poll, which reported that only 11% of business leaders strongly agreed with the statement that college graduates had the necessary skills and competencies to succeed in the workplace. This contrasted with the finding that 96%of chief academic officers believed their institutions are effectively preparing students for employment. Since its release in February 2014, these findings have been widely cited as proof that higher education is not doing its job.

A different point of view is presented by Inc. Magazine’s Cait Murphy in April articles: “Why the skills gap ‘crisis’ is overblown” and “Is there really a skills gap.” Citing the Federal Reserve’s finding that “current skill mismatches are limited” and the Boston Consulting Group (BCG), Murphy finds no evidence of a widespread “gap” between employer needs and applicant skills. She does acknowledge BCG findings of skill shortages in five specific geographic regions, but finds little connection between such shortages and college preparation, noting that some of these are for welders, electricians and machinists.

Murphy underscores her arguments by pointing to 2013 BCG research findings that four times as many employers are now seeking to bring offshore jobs back to the U.S. as are seeking to send work abroad. The reason: the quality of the American workforce.

Paul Krugman has written that the skills gap is a “zombie idea that refuses to die,” and his employer, the New York Times wrote in September 2014 that this concern is “mostly a corporate fiction” trumpeted to pressure government into providing training formerly offered by employers.

The Times editorial board may have a point. National Bureau of Research findings show that employer-sponsored training has fallen from an average of 2.5 weeks per year, per employee in 1979 to 11 hours in 1995. Data for 2011 reveals that 21%of those surveyed had received no training in the past five years.

The NBER report’s author, Peter Cappelli, also notes: “There is very little evidence consistent with complaints about skills and a wide range of evidence suggesting that they are not true. Indeed, a reasonable conclusion is that over-education [emphasis added] remains the persistent and ever-growing situation of the U.S. labor force with respect to skills.”

James Bessen, writing in the Harvard Business Review (“Employers Aren’t Just Whining–the ‘Skills Gap’ is Real”) in August 2014 points out some of the reasons why this issue “refuses to die.” He notes that different observers mean different things when they use the term skills gap. Close examination of the surveys conducted by Gallup, Manpower, the Small Business Majority, Inc., and Adecco find that there is little consistency in the construction of the questions from which conclusions are drawn. Some refer to “skill and knowledge,” while others include such qualifiers as “background,” “experience” and, in the Gallup poll, “competency.” There is also little or no differentiation between skills that might be developed through “education” and those resulting from “training.”

Bessen believes that the skills gap does exist, but to differing degrees in different industries and, as Murphy pointed out, in different geographic areas. He does not see this gap as a problem of “schooling.” The problem, he concludes, is that of fast-moving technologies that require new or different skills on a more frequent basis than can be provided through traditional educational programs alone. While there is an expectation that college graduates will have communication and other “soft skills,” the “hard” technical skills must come from job-specific training. As one, Inc. article noted in February 2014, college is “not looking to open the doors to any job for any student.”

So, given the reports of the Federal Reserve, the Boston Consulting Group, the National Bureau of Economic Research and various publications, is higher education off the hook in regard to the employment readiness of its graduates? Not necessarily. Anyone in higher education and the hiring managers of most law firms (to name only one employment sector) knows that the academy continues to graduate way too many who can’t write. Imagine the employer who finds that 90%of their new hires, after 16 to 18 years of schooling, cannot develop clear declarative sentences, spell or use punctuation appropriately.

Other soft skills found lacking include knowledge of how to make effective presentations, problem solving, critical thinking and teamwork. These are areas that higher education can address.

For its part, the academy is attempting to respond to the criticisms directed toward it. In reaction to the call for experience, in addition to skills, more institutions have incorporated internships and work-study opportunities into their curricula. Additionally, there has been a groundswell of interest in “competency-based education” (CBE), partially driven by the employer expectations discussed here. These CBE programs are requiring demonstrations of the ability to apply knowledge in a skillful way, as well as to pass more traditional forms of assessment such as multiple-choice exams.

Business is also responding. A recent report by the U.S. Chamber of Commerce titled “Managing the Talent Pipeline,” acknowledges that “the nation’s current approach to skills development is no longer capable of meeting the needs of a rapidly changing business environment.” It goes on to say that “education and training providers are unable to respond quickly enough to changing workforce needs.”

In addition to calling for greater attention to workforce readiness by educators, the Chamber also asks the employer community to do a better job of making its skill and knowledge needs known, and to work collaboratively with education and training providers, much as they do in supply-chain processes with other suppliers.

To summarize, there is a skills gap, highly localized at present, but likely to grow quickly as technology continues its unrelenting expansion. Providing the skills needed to deal with this phenomenon is not the job of the academy alone. As the Chamber of Commerce study outlines, new relationships and new forms of collaboration are needed, both to enhance the CBE effort and to maintain the competitiveness of a high-tech workforce. Higher education’s unique contribution will be to ensure that its graduates know how to learn.

John F. Ebersole is the president of Excelsior College in Albany, N.Y.



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