We take a look at what the skills gap is, why it’s started to form, which skills and industries have high demand, and how you can make sure you keep up-to-date with current trends.

Fl416 Blog Header What Is The Skills Gap
We’re living through an interesting part of history. Advancements in technology are rapidly changing our lives and the way we work. We’re also more connected than ever before, allowing us to stay in touch and perform our duties from just about anywhere in the world. Yet this rate of change and development means that employers need new and evolving skill sets. As such, some fear a ‘skills gap’ is opening.

There is some debate on the severity and scope of this skills gap, yet it has the potential to cause some real issues. We explore what exactly it is, which industries are lacking certain skills, and how you can keep on top of your personal development for your career.

What is the skills gap?
Let’s start by exploring what we mean when we use the term skills gap. In reality short, it’s the difference between the skills needed to do a particular job and those that are available. However, as we’ll see, it can impact different levels of the job industry:

For individuals
The skills mismatch means that some people don’t have the right skills for the jobs available. For example, some figures show that in the UK, around 40% of UK workers don’t have the right qualifications for their current jobs. This means that some people are underqualified, and some are overqualified.

Estimates suggest that by 2030, nearly 20% of the workforce will be significantly under-skilled for their jobs. As a result, many could find themselves being less productive in their work, less satisfied with it, or even out of work completely. Right now, it can mean that finding an appropriate job in a relevant industry is more difficult.

For businesses
For businesses, the skill gap is also problematic. They’re finding that talent pools are limited in certain areas/professions, meaning that roles are taking longer to fill. This lack of qualified personnel also has several impacts on businesses. It can cause:

A loss of productivity
A higher rate of staff turnover
Lower levels of morale
Lower-quality work
An inability to expand the business
A loss of revenue
Clearly, these are all potentially damaging effects that arise from a mismatch of skills. It can ultimately mean that companies aren’t able to fulfil the demands of their customers, whether it’s in delivering products or services.

For industries
When these problems are extrapolated out across entire industries, the issues become even more evident. Talent shortages could be widespread, and as well as a lack of role-specific personnel, there may also be a lack of skilled managers to train those who are coming through. On the other hand, we may even end up in a situation where some industries have a high number of low-skilled people applying for a small number of low-skilled jobs.

Such instances could see the rate of progress in certain industries slow, as many positions remain unfilled. What’s more, such widespread gaps could have a significant impact on the economy.

Does it really exist?
Of course, not everyone agrees that there is such a thing as this skills gap. A quick internet search will highlight a number of high-profile articles with claims like ‘the skills gap was a lie’. Many of these refer specifically to the US jobs market in the wake of the 2009 financial crisis.

According to some data, as unemployment rose, employers were looking for candidates with more skills, education, and experience. As the rate of unemployment started to fall, so did the expectations of employers. However, there are many other angles to this issue.

As we’ll explore, in the UK at least, there are clear signs that there are industries where there is a shortage of qualified professionals. What’s more, some data suggests that although levels of education are higher, basic skills like numeracy and literacy may be lagging behind.

Why does the skills gap exist?
There are several theories on why a skills gap might exist. Often, these depend on the industry and type of role. However, there are some suggestions that apply across just about every area of work:

Technology
With the rise in disruptive new technologies such as artificial intelligence, machine learning, and automation, the world of work is changing. There is the potential for many roles to be made obsolete in the coming years, with new positions opening to support these new innovations. Additionally, things like the gig economy are meaning a fundamental shift in the way people find work.

With these advances, the types of job roles and skills that employers need are changing, and there aren’t always the people to fill them. A 2018 Deloitte study suggested that in the US manufacturing industry alone, the skills gap could see around 2.4 million roles unfilled between 2018 and 2028.

Education
One of the areas where there are problems emerging is in education. The overall level of education in the UK is high – a recent OECD report shows there are more graduates than non-graduates in the job market. However, employers are seeing gaps in areas such as basic literacy, numeracy, and IT skills.

Despite this lack of relevant knowledge, there isn’t a lot being done to promote further learning and upskilling. Some figures suggest that just 24% of UK workers have spent time reskilling over the last two years.

Training
Some schools of thought suggest that the skills gap isn’t just down to individuals and the education system. In previous generations, employers would hire graduates or untrained newcomers and train them to do the job. Nowadays, with the gig economy and pressure for instant results, many companies are seeking those who are job-ready. Experience is valued more than potential, and expectations and requirements often reflect this.

There are additional challenges here too. For example, fewer people are starting apprenticeships in the UK. This could be because funding for them (and adult learning in general) has fallen 45% since 2009-10.

Source: https://www.futurelearn.com/info/blog/what-is-the-skills-gap