A 2021 Salesforce report claims that 14 G20 countries would have lost out on $11.5 trillion in cumulative GDP growth due to the digital skill gap being faced by the corporate sector. The report further defines the skill gap as the divide between the skills a company needs and what the dominant workforce offers. Simply put, in a digital-first world, there aren’t enough people with appropriate digital skills to power the technological transformation of companies. Corporations and governments need to fortify the business landscape by promoting a sustainable skill development path for employees. This blog provides an in-depth view of the present conditions of the skill gap, its governing factors, and some crucial workforce optimization strategies.
The State of the Skill Gap in 2023
A 2023 Wiley Report, ‘Closing the Skills Gap’, shares in-depth insight into the talent shortage problem regarding how the demand for rapidly evolving skills, specifically digital, is evolving too fast for companies to keep up. Here is a summarized capsule of relevant statistics from the report:
- 69% of the surveyed HR professionals believe their respective organizations suffer from a skill gap, which is a 14% rise from 2021
- The talent shortage results in up to 20% of unfulfilled job postings
- At least 50% of the interviewed professionals claimed that in the current job market, hard skills have a shelf life of merely two years
- The expertise of soft skills alongside hard technical skills is critical to arresting the digital skill gap
A look at these facts makes it evident that the parameters of measuring workforce competencies are also evolving along with the needs of the market. So what explains the difference between the in-demand organizational skills and what employees possess right now? The answer may be found in the success or failure to adapt to the disruptive force of technology.
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What Is the Role of Technology in the Skill Gap?
A 2022 Forbes article pointed out an interesting contradiction to explain why the skill gap exists. Despite Gen Z being the first truly ‘digital native’ generation, 55% of them admitted to having deficiencies in understanding the core tech trends of the time, namely, Artificial Intelligence (AI), cybersecurity, edge computing, or quantum computing.
Intel’s general manager Trish Blomfeld holds traditional academic disciplines responsible for this hard skill/soft skill disparity among the workforce. On the one hand, students from traditional STEM (Science, Technology, Engineering, and Mathematics) backgrounds lack soft skills in communication, creativity, and design thinking. On the other hand, studying only arts subjects fails to empower learners with the necessary tools to leverage technology to its maximum potential.
A holistic technical education that accommodates the latest soft-skill requirements is the best way to navigate this climate of digital transformation. Replacing STEM subjects with STEAM—where A stands for ARTS—would be an appropriate response within mainstream education to remedy this widening skill gap.
At a more advanced stage, the talent shortage can be tackled by educating the workforce.
Addressing the Skill Gap through Workforce Education
Workforce education comprises the following:
- Employee development initiatives
- In-house training resources
- Strong awareness of this skill disparity among the leadership
However, executing learning and development systems can be quite a challenge for companies. Referring to the same Wiley Research report, over 40% of companies said they do not have the resources to implement strong employee upskilling strategies. Nevertheless, platforms such as Emeritus also exist in the upskilling roadmap alongside the following:
- Scholarships awarded by companies
- Course discounts sponsored by universities
- Granting paid leaves for training purposes
- Tuition reimbursement
- Apprenticeships in other branches of an organization
- Online company-sponsored training courses
As more employers offer these benefits, they can assume greater employee retention. A 2022 SHRM study states that 76% of professionals expressed willingness to stay in an organization that offers continuous training. This will eventually lead to the development of an agile workforce that can weather contemporary technological changes and ensure consistent business growth. Moreover, with remote opportunities becoming the norm, the talent pool will broaden and diversify with time. All of this indicates that capitalizing on workforce education is an effective remedy to fill the persisting skill gap.
Upskilling for the Future of Work
The pandemic has upended the professional world. Today’s competitive business environment requires a strong work culture powered by technically-equipped individuals who also have strong emotional intelligence (EQ) skills. EQ enables a strong understanding of client needs and arms you with the necessary tools to understand company data in its full context. In short, the requirement concerns multidisciplinary professionals with hard and soft skills.
Which Skillsets Have the Highest Demand?
Here is a list of hard skills that recruiters actively seek in candidates in 2023:
- Data analysis skills
- Digital communication skills
- Project management
- Coding skills
- Machine operations
- Research skills
As far as soft skills are concerned, HR professionals list the following as having the highest demand:
- Time management
- Change management
- Leadership skills
- Managerial skills
- Adapting to Innovation
The Benefits of Addressing the Skill Gap
Let’s look at how addressing the skill gap affects organizations and individuals in different ways:
- Provides deep insights into the existing workforce
- Streamlines the recruitment process
- Offers a clear understanding of company needs and their alignment with long-term business objectives
- Enables strategic workforce planning
- Boosts competitive advantage
- Diverse talent pools attract better creative solutions to new business challenges
- Opportunity to partake in a continuous learning environment
- Better communication skills lead to maximum management-employee synergy and higher productivity
- Psychological empowerment leads to more professional confidence
- Opportunity to future-proof one’s career and thoroughly understand market needs
Closing the Skills Gap with Emeritus
Emeritus collaborates with the most prestigious institutions across the globe, bringing the highest-quality technical education to you. Acquire the new-generation toolbox of soft and hard skills with these online courses from Emeritus and learn more about our enterprise solutions to upskill your workforce.
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