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5 Stats About the Skills Gap that Demand Attention

July 12, 2018

Headaches from vacant positions. Training and development challenges. Increased turnover. The skills gap refers to the gap between the actual knowledge, skills, and abilities of candidates or employees, and the knowledge, skills, and abilities that employers want or need their employees to have. The gap is growing. Though there are over seven million people unemployed in the US, they may not possess the right KSAs to obtain these open jobs or to perform at a sufficient level. Below are five statistics that are causing major concern for organizations regarding the skills gap:

  • 80% of Americans agree there is a skills gap, and 35% say it affects them personally. 

  • 42.5% of recent graduates were underemployed as of March 2018, according to the Federal Reserve Bank of New York. This shows there is a disconnect that could be influencing the skills gap in different ways, for example, an outdated view of manufacturing jobs.

  • $160 billion. This is the amount that researchers from the Centre for Economic Research calculated to be the total cost of the skills gap to US companies per year.

  • 60% of U.S. employers have job openings that stay vacant for 12 weeks or longer. This came from a survey in 2017 by CareerBuilder. In the survey, HR managers say that the average cost from having extended job vacancies is $800,000 or more annually.

  • 81% of employers said prospective employees lack critical thinking and analytical reasoning skills. Also, 75% think graduates lack adequate innovation and diversity skills.

Going along with these stats, 67% of HR managers would hire a candidate with strong soft skills even if hard skills were weak. More and more, we are seeing employers targeting a job-person fit rather than seeking someone with the hard skills to get the job done. Companies are more aware of the important role that soft skills play in building a strong company culture. The demand for individuals with these soft skills is rising. So how can job seekers prepare and how can employers find them?

First, we must measure those soft skills for job fit. This can be done with many well-established psychological assessments. The majority of employers engage in various forms of job skills testing, including 89 of the Fortune 100 companies. Once we have a better understanding of strengths and weaknesses, we know where to focus.

Next, take steps to develop those skills. Again, there is a wide range of literature, development tools, and other resources available online and through educational institutions. Many organizations will offer development opportunities to their employees – after all, it only benefits them to close the skills gap. Am I Job Ready?” is one example of a platform that could be used to assess individuals, identify strengths and weaknesses, develop skills, and master those skills. 

There are many resources out there that can help close the skills gap. The important thing is that we act and work to get better. As we do so, we will help our economy, our organization, and ourselves.

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Trevor McGlochlin Trevor McGlochlin is a Research Consultant at PSI. He leads the Financial and Automotive verticals within R&D. He earned a Master of Science degree in Industrial and Organizational Psychology from Florida Institute of Technology. His areas of expertise include selection, employee turnover, organizational development, applied research, and statistical analyses. His analysis work is centered around validation, adverse impact, turnover analyses, assessment scoring, and other data analysis.