COVID-19 exacerbated an already growing skills gap in the rapidly-changing jobs market. Which skills are needed by which job sectors? And what does it mean for your learning and career plans?
The skills gap was growing in the workforce even before COVID-19 brought big changes to the way industries work. Technological advancements are rapidly changing our working lives and there is a real need for the current and future generations to adapt to a digital world and acquire digital skills, or risk being unskilled for a wide range of jobs.
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. These fundamental shifts and the rate at which they have developed 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 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:
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. It’s also the reason why governments like the UK maintain entry visa routes for overseas skilled workers to enter the country and join the workforce.
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, 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. It can also have a dramatic impact on post-COVID economies as a whole.
When these problems are extrapolated 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. Whether we are talking high or low-skilled work, there is the potential for gaps. Last summer, for example, the UK was faced with a huge shortage of HGV truck drivers. And in the future we are looking at the likelihood of driverless trucks, and other driverless vehicles. What does that mean for people who are skilled drivers, and how will businesses make sure there are enough skilled engineers to build and maintain these new types of vehicles?
We may end up with a situation where some industries have a high number of low-skilled people applying for a small number of low-skilled jobs, while simultaneously high-skilled job opportunities arise without the necessary skilled staff to fill them.
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. As a result, industry leaders and governments worldwide must respond quickly with plans on how to bridge the skills gap.
Does it really exist?
Of course, not everyone agrees that there is such a thing as a 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 and high unemployment 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 with shortages 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.
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.
FutureLearn is keeping apace with the furious rate of technological change by designing AI courses (and even robot courses!) with our academic and professional partners, that you can complete and get qualified in, to ensure that you have the kinds of skills that will be sought both today and far into the future.
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 in recent years.
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.
FutureLearn has courses that will equip you with valuable knowledge about what to expect from the future of vocational education and training, which you can use to both shape your path into the future and build the skills to help develop others too.
Which industries have a skills gap?
Although people may lack skills in general areas such as literacy, numeracy, and IT, what about when it comes to professions? It’s safe to say that certain industries suffer more from a mismatch of skills than others.
Where to find the information
In the UK, there are several indications of where these shortages are. One place worth referencing is the government’s Shortage Occupation List. This list outlines where there are shortages of skilled jobs, giving overseas workers the chance to apply. However, it also highlights where there is a lack of skilled people to fill them from within the country.
Another useful resource is the Project Luminate report, which identifies the industries and occupations where there are skills shortages. It also explores why some of these vacancies are so hard to fill, and how the labour market looks on a regional level.
One final paper on the subject is the UK Skills Mismatch in 2030 report, which explores the skills themselves. It highlights a major problem with basic digital skills, as well as leadership and management. It also looks at knowledge areas where there is expected to be a high number of under-skilled workers.
Where are the skills gaps?
So, what can we tell from these sources? There are several consistencies across the reports, highlighting areas where the skills gap is more obvious. Some of the main areas include the STEM industry (science, technology, engineering and mathematics), healthcare, IT, the creative sector, and trade.
Some of the roles with the most skill shortages highlighted by the Project Luminate report include:
- Programmers and software developers
- HR and industrial relations officers
- IT user support technicians
- Business sales executives
- Design and development engineers
- Web designers
- Chartered accountants
As you can see, even this short selection represents a varied range of positions. What’s more, studies show that a similar set of professions are experiencing a shortage in the US.
What skills are in high demand?
The roles experiencing a shortage of skilled professionals often have a fairly unique knowledge base and set of qualifications. However, there are some skills that are consistently in demand across many of these industries. Employers of all kinds are seeking candidates with both hard and soft skills.
Some recent LinkedIn research explored over 20 million job postings across the network to determine ‘the skills that are in the highest demand relative to the supply of people who have those skills’. They divided the list into hard and soft skills:
Hard skills are the taught skills that are required to do a particular job. They’re the measurable abilities that employers can easily define and find:
- Blockchain. The blockchain technology behind cryptocurrencies like Bitcoin has many fascinating applications. Employers are looking for those who are experts in the emerging field.
- Cloud computing. The cloud is another relatively new technology with huge potential. Systems like Microsoft Azure have an array of uses, making those who can understand them invaluable.
- Analytical reasoning. Whether it’s in fields such as data analytics or strategic thinking, there is significant demand for those who can process and interpret large sets of data.
- Artificial intelligence. We’ve only just started to see the potential for artificial intelligence (AI). As fields such as machine learning continue to develop, demand for these professionals is high.
- UX Design. Digital devices and products are at the heart of our modern lives. Those who can design intuitive user experiences (UX) will always find work in today’s job market.
Soft skills are the productive personality traits that make for good employees. They’re harder to teach, but no less sought-after by employers. When it comes to a skills gap, some of the most in-demand soft skills include:
- Creativity. The ability to use imaginative ways to solve problems and connect the dots is a valuable asset in just about every industry.
- Persuasion. When it comes to things like negotiation or leadership, the ability to convince others to follow your ideas is always useful.
- Collaboration. Working effectively and efficiently with others to deliver results is at the core of many organisations. Collaboration takes many forms and is an essential skill.
- Adaptability. In a rapidly changing working environment, those who can think on their feet and handle new situations will always be valuable.
- Emotional intelligence. This soft skill is all about understanding and responding to emotions, both your own and those of the people you work with.
Challenges in addressing the skills gap
It’s clear that there is a mismatch between the demands of the modern labour market and the number and level of people to meet those demands. However, addressing these issues can be difficult for both employers and individuals.
From a workplace perspective, it can be hard for organisations to develop the infrastructure to recruit, hire, train, and upskill their workforce. Many companies focus on hiring people who can fill an immediate gap, rather than on finding people they can develop over the course of a career. Couple this with a rapidly changing workplace and further gaps soon appear.
For individuals, the challenge of training or retraining can be a daunting prospect. Not only does it mean dedicating time and effort to learn new skills, but also deciding what the right progression path is.
Although these challenges seem difficult to overcome, the situation is far from an impossible one. There are several ways that industries, businesses, and individuals can address the skills gap.
How are companies reacting?
Industry experts McKinsey found in a recent global survey that 87% of organisations said they’re either experiencing a skills gap now or expect to experience one in the next few years. But what can companies do to address the problem? Thankfully, there are several proven steps that companies can take:
A skills gap analysis
The first step of the process is to highlight where there are problem areas or the potential for them to emerge. Companies need to examine the essential skills they need or want and compare them to what their workforce currently has. This type of analysis can provide HR teams with valuable insight, allowing them to take further action.
With a full analysis in place, companies can start to hire people with the right kinds of skills. Rather than employing for roles with a narrow scope, they can focus on the areas they currently have weaknesses in, improving the overall skill pool.
Perhaps the most effective way of bridging the skills gap is for employers to offer reskilling and upskilling programmes. These help existing employees train in the skills where the organisation is lacking. This type of knowledge building helps both the company and the individual.
How can I close the skills gap?
Although the landscape may not seem the most encouraging, there are plenty of positives to take from all of this data. The fact that we’re able to identify potentially difficult areas means we can take steps to avoid them. What’s more, we can also focus on building skills and lifelong learning to benefit our careers. Here are some of the steps you can take:
The first thing that can help is to self-analyse your existing skills. You need to work out what your personal strengths and weaknesses are, and how these might impact your career. A good place to start is to compare your current skills to those outlined in job postings that you’re interested in. Here, you can see whether there are any gaps in your knowledge.
Address the shortages
By knowing where your weaknesses are, you can start to take steps to address them. Whether it’s undertaking training through your current employer or striking out on your own, it can help to boost your CV. There are plenty of learning opportunities available, such as a short online course or a longer learning experience. We’ve highlighted a range of courses throughout this article to help get you started.
One of the best ways to work on and demonstrate your skills is to find relevant experience. Although this may sometimes seem difficult (experience requires a job, jobs require experience), there are several methods you can try. Freelancing as a side gig can help you build your expertise, as can things like internships and apprenticeships. Even volunteering can help you work on a variety of skills.
Know how to sell yourself
When it comes to finding work, you need to know how to appeal to employers. Essentially, you need to demonstrate that you can help them fill their skills gap. Knowing how to write a strong CV can help, as can things like interview skills.
How can I close the skills gap?
As we’ve seen, the skills gap is a real issue and one that needs addressing from top to bottom. As technology continues to change the world of work, we need to make sure we can keep up. Thankfully, there are more learning opportunities than ever before, helping individuals and organisations address the skills gap.