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The Future of Work

Why There’s No Such Thing As A Skills Gap

skills gap

What is the “skills gap?” The prevailing hope is that teaching more skills will address income inequality and flat wages. Unfortunately, specific training programs may miss the mark on what are actually the most useful skills, argues Marina Gorbis, executive director of the Institute for the Future.

 

 

Paul Krugman has called our widespread belief in the existence of a severe “skills gap” a zombie idea — an idea that should have been killed by evidence but refuses to die. Hardly a day goes by when a candidate for a political office does not propose investments in training and re-training as a panacea for stagnating wages and growing income inequality. Billions of federal dollars flow into the workforce development industry (yes, it is a big industry of its own). And yet, the evidence for the existence of the skills gap is questionable at best.

Virtually all the data supporting the notion of a crisis comes from surveys of business executives, such as the Inc. magazine survey of 5000 CEOs in which “76 percent said that finding qualified people was a major problem.” There are absolutely no credible academic studies or data that support the skills gap claims. In fact, when four branches of the Federal Reserve looked into the skills “crisis” a few years ago, they came up “empty-handed,” according Inc. A study by the Boston Consulting Group (BCG) analyzed national wage and job data, supplemented with a survey of manufacturers. Like the Federal Reserve, BCG’s research failed to uncover significant skills shortages.

Iowa State University’s economic analysis of national and statewide employment, education and population data arrived at a similar conclusion. Researchers Dave Swenson and Liesl Eathington identified several factors contributing to hiring challenges, but a widespread lack of skilled workers was not one them. They found small regional variations in availability of skilled labor, but nothing significant beyond the regular ebbs and flows of the economy. Indeed, if you believe in a well-functioning market economy, skill gaps should result in significant wage increases and longer work hours for workers, neither of which is the case today. The Iowa researchers’ conclusion? “When employers say there’s a skills gap, what they’re often really saying is they can’t find workers willing to work for the pay they’re willing to pay,” Swenson said.

In addition to potentially wasting a lot of money on an idea that is based on very little rigorous evidence, the other problem with the myth of the skills gap is that it assumes the solution to people getting good paying jobs is to give them training in a specific area, usually coding, programming or another technical area. While it might be a good idea to learn some of these skills, an Institute for the Future forecast, Future Work Skills 2020, identified ten skills most difficult to train for and yet we feel will be most significant in contributing to one’s success. Such skills include:

  • Sense-making: ability to determine the deeper meaning or significance of what is being expressed;
  • Social Intelligence: ability to connect to others in a deep and direct way, to sense and stimulate reactions and desired interactions;
  • Novel and Adaptive Thinking: proficiency at coming up with solutions and responses beyond that which is rote or rule-based;
  • Cross-cultural Competency: ability to operate in different cultural settings;
  • Computational Thinking: ability to translate vast amounts of data into abstract concepts and to understand data-based reasoning, (this is very different from learning different coding programs);
  • Transdisciplinarity: literacy in and ability to understand concepts across multiple disciplines.

These and other skills we identified in our research are difficult to train for largely because these are developed over a lifetime. They grow out of life experiences — the conversations you are exposed to at home, with peers, schools and in our workplaces. They are not something that can be picked up in a few weeks or even months.

Jim Spohrer, a computer scientist who has led IBM’s Global University Programs, is a strong believer in the need to create T-shaped people — people with deep knowledge of one vertical area but who also have the breadth to be able to connect this vertical knowledge to multiple other domains. And that is the problem with looking at skill-specific training as a solution: skills training may address the vertical part of the T. The horizontal part — which includes the kinds of skills we identified relating to connecting ideas, sensing the deeper meaning, adaptive thinking and others — are not subject to quick fixes and yet, are equally, if not more important, to an individual’s success in the long run.

(Top image: A scientist with a pipette loads gels in a DNA laboratory. Courtesy Getty Images.)

 

RTEmagicC_picture-43Marina Gorbis is a futurist and social scientist who serves as executive director to the Institute for the Future, a Silicon Valley nonprofit research and consulting organization. Marina’s current research focuses on how social production is changing the face of major industries, a topic explored in her book, The Nature of the Future: Dispatches from the Socialstructed World.

 

All views expressed are those of the author.

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