Employers often say that there are not enough skilled workers in the available workforce to fill positions that they need filled. This has become known as the “skills gap.” This belief that there are not enough skilled workers to fill available positions is made worse by the fact that technology is constantly evolving as workers try to keep up and older workers are retiring in large numbers leaving technical positions unfilled. Is the skills gap real, or are there other factors that have resulted in employers not finding the workers they need to fill positions?
Wage stagnation
During the recession, approximately 8.7 million workers lost their jobs. Those that didn’t lose their jobs didn’t leave the jobs they had to look for better opportunities because the market was so unstable that they couldn’t guarantee that they would find other employment. Eleven years later, those jobs have been recovered and the economy is doing well considering unemployment is at an almost 20 year low. Now that the economy has recovered, employers are making record profits and not passing the profit to their employees.
The part of the problem employers have with the talent shortage is that they don’t want to pay employees a proper wage for their work. Wages have been stagnant and have not been adjusted for inflation. Workers know that as prices increase and their wages do not, that they will be able to afford less on the same pay year after year. Employers get potential hires and make them low offers and potential hires decline because they know they aren’t getting the pay they deserve. They may not even apply knowing that the pay is lower than they expected.
Will an increase in wages automatically close the gap? No because there are other factors involved. Some employers will hire fewer workers since they have to pay more in wages or they will cut hours to compensate for having to increase pay. When Seattle raised their minimum wage from $9.47 to $13 between 2015 and 2016, employers on low-wage jobs cut their employees hours resulting in an overall wage decrease. Wendy’s also chose to cut worker’s hours when the minimum wage was increased in 2017. They used the money they saved in worker’s pay to add automated kiosks to some locations. There is no mention of these CEOs lowering their pay or bonuses to offset the cost of paying higher wages though.
Recruiting problems
Recruiting issues contribute to the perceived skills gap. Years ago before the internet, it took more effort to apply for jobs than it does now. An applicant had to fill out an application, send a cover letter, and attach a copy of their resume. They would mail it or drop it off at the job location with human resources. Then, they would wait for a phone call and maybe if they had not heard back in a week, they would call back to check on the status of the position. Human resources representatives would review the resumes and choose candidates for interviews.
Now with LinkedIn and other job search sites, resumes are uploaded and links to job site profiles are sent to human resources for review. When applicants are not networking on LinkedIn, they are filling out applications online through applicant tracking systems (or ATS). About 98% of Fortune 500 companies use ATS for recruiting. They send resumes and cover letters to the employer through the ATS and wait to be contacted. Before anyone in human resources sees their application, the system will have already scanned it for keywords and screened out the ones without keywords fitting specific parameters set by human resources.
Assuming an applicant’s resume makes it past the review of the ATS, they will move on to the next stage of the interview and if they pass that section then they may do more interviews or tests before they are hired. What about all of the people who didn’t know that they were going to have to play the keyword game or restructure each resume to pass through a keyword scanner? Their information stays in the system for 30 days and they may or may not get an email or a call to let them know that the position was filled.
ATS are efficient from the standpoint of making it easier to sort through thousands of resumes at once, but applicants that are capable of performing well can be screened out of jobs that are a good fit for them due to the way their resume is formatted or for not using enough of the keywords that employers are looking for on their resume. Flaws in the way some ATS are set up are causing recruitment problems and contributing to employers feeling like they are not getting enough qualified candidates. Some aren’t but it’s not because there isn’t enough skilled talent out there. They are going about the search in the wrong way.
Hiring workers with criminal records
Employers, having a hard time filling positions, have been looking to hiring workers with criminal records to fill their employment gaps. These workers who were seen as a bad fit before for having a criminal record or being unskilled are now sought after by employers. After failing to raise wages in order to attract skilled talented workers, employers are reaching out to workers previously deemed unskilled to fill open positions.
Some employers are starting to hiring workers that have gaps in their employment and workers without degrees or high school diplomas. The lack of skills is overlooked to fill positions as employers struggle to find workers. Through on the job training, some employers are hiring inmates while they are still in prison and working with them to get them back into the routine of having a job and putting their lives back together after incarceration. Providing on the job training allows employers to hire workers that may lack required skills and give them the opportunity to learn the skills needed to succeed. It’s a win-win situation because employers get the workers they need and workers find jobs.
Having employers work with schools and set up apprenticeships to train students before they graduate will also help employers find the right talent. If high school students were not automatically groomed for an academic career and taught that getting a college degree is the only way to go, then students would know that they can still make good money in careers in manufacturing and jobs requiring mechanical skills. Vocational training in high school and on the job training after graduation is a good way to bridge the gap.
There isn’t so much of an actual skills gap as there is a problem with the way employers have been recruiting. There are qualified candidates looking for jobs that they can succeed at and employers are looking for workers that are willing to do the work. Between not raising wages enough to attract the best candidates to open positions to not using ATS in a way that is really helping the best candidates shine through, employers are just not doing enough to find the best candidates to fill needed positions. Hiring workers with criminal records, those without degrees, and training more workers on the job is a way to close the perceived gap and fill needed positions.
