Tag Archives: Skills Shortage

June 18, 2013 · 4:30 am

Forget the Skills Deficit: How About Filling Open Jobs?

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So the unemployment rate went up a little in May, from 7.5% to 7.6%. The Bureau of Labor Statistics deems this increase as “essentially unchanged.” Despite 175,000 more people working. How does this math work?

I’ve written about the how the unemployment rate in the U.S. is determined here and here. But here’s another slice of data to consider. It’s the number of job openings. The Job Openings and Labor Turnover Survey (JOLTS) published each month alongside the unemployment numbers, shares really interesting data each month. Along with the data about quits and hires, are data about job openings. Fascinating. Really.

JOLTS June 2013

So, although there were 3,757,000 job openings in April (down 118,000 from March, or “little changed” as the BLS describes it) the difference between hires and total separations was just 146,000 month over month. So on the surface, a net of 175,000 new jobs is curious.

More curious is matching the number of job openings to the number of unemployed people by industry. Economist Heidi Shierholz published a piece for the Economic Policy Institute last week that shows in stark relief that unemployed workers still significantly outnumber job openings in every major sector.  Based on analysis of the JOLTS and other data, the following chart is a snapshot of current job openings numbers by industry and the numbers of unemployed workers in those industries. It’s rather eye popping and raises lots of questions.

Unemployed far outstrips available jobs June 2013

Ouch! So think about this data when you read about employers not being able to find the right skills for their openings. Is it really skills they can’t find? Or something else? How hard are they looking? What BFOQs are they using that overlook millions of job seekers?

Curious, yes?

There are so many data points around employment, job openings, quits, hires, workers, unemployed workers, discouraged job seekers, skills, education levels, education spending… The data points come from bonafide sources (like the U.S. Bureau of Labor Statistics and  the Georgetown University Center on Education and the Workforce), quasi bonafide sources with bias (like the Economic Policy Institute, SHRM, U.S. Chamber of Commerce and AARP), vendor sponsored research and white papers, and millions of blogs and other media sources.

Lots of sources. Lots of data points. Lots of analysis. Lots of conflicting findings and conclusions.

The best we can do is be pro-active in finding sources that are transparent about their data and analysts who seem unbiased. And then be persistent in looking at all sides of an issue and smart in believing what you read.

On the issues of skills, jobs and unemployment, though, it seems that we don’t know what we’re doing. We may not even really know what the truth is. Except this:  we’ve got to do better at matching job openings with available talent. It’s clear that we haven’t figured this out. Not government, not business/employers, not education providers, not workers, not vendors, not recruiters.

Forget the skills deficit. What about filling the open the jobs?

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Filed under Bureau of Labor Statistics, China Gorman, Data Point Tuesday, Economic Policy Institute, Employment Data, HR Data, Job Creation, SHRM, Skills Shortage, Structural Unemployment, U.S. Department of Labor, Unemployment

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May 21, 2013 · 4:30 am

Tech Professionals’ Pay by the Numbers

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Dice, the career site for technology and engineering professionals, published their annual Tech Salary Survey in January. And as Chairman, President & CEO of Dice Holdings, Inc., Scot Melland observed, “The fact is you either pay to recruit or pay to retain and these days, at least for technology teams, companies are doing both.” The constant being pay.

According to the responses of 15,049 employed technology professionals between September 24 and November 16, 2012, tech professionals have garnered the biggest pay raise in a decade. The survey report is highly consumable and I recommend it to anyone involved with hiring or managing technology professionals.

The contents include:

  • 10-year trend in tech salaries
  • Salary by employment type
  • Bonus trends
  • Salary by metro and region
  • Tech employee motivators
  • Tech salary satisfaction
  • Salary by industry
  • Salary for high paying skills
  • Average salary by experience and education level

The last section, average salary by experience level, is eye popping. Check it out.

Dice Tech Salary Survey Education Level Salaries 2013-2012

First of all, we can tell by these salaries that STEM education pays off from a career opportunity perspective.

Second, we can tell by these salaries that the market perceives low supply.

Third, look at the high school graduates’ salary vs. vocational/tech school and some college salaries. What’s up with that?

Fourth, the year-over-year change in the salaries of military veterans vs. every other category is head snapping.

Let’s look at these observations.  First, I think we can all agree that there’s no downside to focusing on STEM education. No downside for employers who perceive low supply and no downside for employees whose lifetime earnings are among the highest.

Second, supply vs. demand economic principles seem firmly in charge of these salary trends. We can debate whether or not there truly are skills shortages in the marketplace today. But it seems clear that the market believes there is a shortage and is paying accordingly.

Third, as we consider the counter-intuitive data showing high school graduates earning significantly more on average than votech grads and some college/associates’ degree holders, we might be seeing generational effects coming in to play. More recent high school graduates may have more current hardware and programming learning than those who attended the votech programs of the 1970’s, 1980’s and 1990’s.  Certainly with the ability to connect to communities of interest via the social web, today’s high school students have a leg up on learning that their parents never had. Additionally, while employers aren’t spending the money they used to on internal training, technical training programs continue to be present.

Fourth, it appears that military veterans with current technology skills can enter the market at higher levels and command higher salaries. And I think we’d all agree that this is a very good thing.

This is a very useful snapshot of the salary landscape for a portion of our employees. Wouldn’t it be interesting to see the same data for other functional skillset areas? Like marketing, finance, or even HR?

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Filed under Average Wage, China Gorman, Compensation, Data Point Tuesday, Dice, Skills Shortage, STEM, Technology Salaries

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April 23, 2013 · 4:30 am

Youth Unemployment: A Growing Problem

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You probably know a good kid like this. Graduating from high school in June. From an OK high school. Not the best student. Probably not able to get in to college – even if they could afford it and were motivated to try. They had a part-time job a couple of years ago, but got laid off. Haven’t really looked for a job since then. No real skills that employers can use. No idea how to look for a job. Starting to think about the future. No idea where to start.

Guess what? Their prospects are not good. And they need help.

You know we have an unemployment problem. Did you know we have a youth unemployment problem?

Employers of every size in every sector lament the lack of skills available to them in the talent pool.  Whether you’re reading reports from McKinsey, the Georgetown University Center on Education and the Workforce, or countless other research organizations, the message is all too similar:  our post-secondary education system isn’t delivering enough degreed individuals to meet the demands of employers world-wide. And it’s only going to get worse. Something I’ve written about here, here and here.

But it isn’t just the post-secondary education system. The secondary system is doing even worse. The youth labor market has collapsed since 2000.  The rate of overall youth employment in the teen population has fallen from 45% in 2000 to 26% in 2012 – a 42% drop, to the lowest point in post-World War II history. In 1989 the youth employment rate was 48.5%.

Here are some sobering statistics from research completed in 20120 by The Center for Labor Market Studies at Northeastern University for Jobs for America’s Graduates:

  • In 2000, the share of employed, non-college-bound youth from the high school class of 2000 was just under 70%

  • In 2011, the share of employed, non-college-bound youth from the class of 2011 was 45%, the lowest since the survey started in 1965

  • In October 2011, the employment/population rates for these non-college-bound high school graduates ranged from a low of 32% among African Americans to a high of 48% among Caucasian youth.

  • Fewer than half of these employed, non-college-bound graduates were able to obtain a full-time job – yielding a full-time employment/population ratio of 21%

  • Among the non-college-bound population of high school graduates, only 25% of Caucasian, 24% of Hispanic, and 7% of African American youth were working full time.

And these are high school graduates.  In the U.S., the percentage of high school graduates by state ranges from 62% (Nevada) to 88% (Iowa), with an overall average of 78%. What about the 22% of young people who drop out of high school?  What are their prospects?

From an historical perspective, this chart shows the economic impact of dropping out of high school. But that lifetime earning amount of $1,198,447 will surely decline as fewer young people with – or without – high school degrees gain full-time employment.

Georgetown Projections of Jobs Education Requirements Figure V

And this is a problem. If unemployment in the teen population continues to rise, then a key argument to persist in high school to graduation begins to fade, further impacting college graduation rates. If unemployment in the teen population continues to rise, then key employment skills building experience will decline making employment less likely as they age in to their 20’s. If unemployment in the teen population continues to rise, then a whole host of societal challenges will grow – and none of them positive for people or the economy.

Involvement in organizations like JAG* (Jobs for America’s Graduates) can help. I’ve written about JAG here and here. It’s the longest-lived, most successful program in the U.S. that keeps the most at-risk kids in school through graduation and then stays with them through their first year of employment, college or military service. And it is making a difference in the graduation and employment rates of kids in 33 states.  Here are some current outcomes;

  • The employment/population ratio in spring 2012 was 72% for all young people in JAG versus only 42% for their national comparison group.

  • Nearly 60% of those JAG graduates not enrolled in college were employed full time in May 2012, compared to only 30% of their comparison group counterparts. Over three times the rate of teenagers in general who were working.

    • Nearly 48% of non-college enrolled African American JAG graduates were working full time versus only 17% of their comparison group peers.

    • 61% of Hispanic JAG non-college enrolled graduates were employed full time versus only 42% of their comparison group.

    • 68% of Caucasian JAG non-college enrolled graduates were employed full time versus only 31% of their comparison group.

It’s hard to argue with success. It’s even harder to argue with 32 years of consistent success. This video really captures the effectiveness of this approach:

Employers that hire skills that require high school graduation need to be concerned about the entire talent pipeline, not just the college degreed pipeline.

And by concerned, I mean involved in keeping young people in school until they graduate so that they are employable.

And by involved, I mean supporting programs like JAG that are focused on providing real, sustainable results.

And by support I mean financial support, political influence support and the promise to provide job interviews to every JAG student where they have a presence. (Archer Daniels Midland has done just that!)

You know we have an unemployment problem. Did you know we have a youth unemployment problem?

*I serve on JAG’s national board of directors.

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Filed under Archer Daniels Midland, China Gorman, Data Point Tuesday, High School Graduation Rates, JAG, Jobs for America's Graduates, Skills Shortage

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April 16, 2013 · 4:30 am

You Think We Have Skills Shortages Now? Let’s Talk in 2020!

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Skills shortages in 2020 will rise to an entirely new level. And I’m not talking about STEM skills, although they’re critical. Or the ability to speak multiple parched earthlanguages, which needs to be more common in the U.S. Or even the readiness of college graduates to take a place in the economy, which a majority of employers report is lacking.

I’m talking about the skills that the globally-connected, superstructured, computationally focused, smart-machine powered organizations of the future staffed by longer living and working, new media using employees will require.

We’re all thinking about that right? We’re re-writing job descriptions and re-wording job postings to incorporate the emerging skills we know we’ll need. Aren’t we? Well, maybe not. We know the names of the skills we can’t get today – those STEM, analytical thinking, communication and personal responsibility/accountability skills we’re sure our young people don’t have.

But really. What about the skills for the future?  I’m not sure what we’ll call those skills. I’m not even sure they’re skills, to be honest, but here’s what I do know:

  • People are living longer and will want/need to have longer careers
  • Smart machines are taking over the most routine workplace tasks
  • Data – big, medium and small – are changing the way decisions are being made at every organizational level
  • Text isn’t the only way we communicate any more
  • Organization structures and behaviors are changing due to social technologies
  • We say “Global” but what that really mean is that innovation and growth will be primarily driven through the integration of differing cultural norms and diversity

IFTF LogoThe Institute for the Future’s Future Work Skills 2020 highlights recent research that predicts the kinds of skills for which we’ll be recruiting in 2020 (which is only 6 and-a-half years away). Trust me when I write that the majority of HR/recruiting professionals are not ready for this. ATSs aren’t ready for this. LinkedIn, Facebook and Twitter aren’t ready for this. And clearly, our education infrastructure isn’t ready for this. And yet, here we are.

The IFTF identifies and defines ten skills that we need to begin to teach now so we can deploy them in six-and-a-half-years.  They are:

  1. Sense-making:  the ability to determine the deeper meaning or significance of what is being expressed
  2. Social Intelligence:  the ability to connect to others in a deep and direct way, to sense and stimulate reactions and desired interactions
  3. Novel & Adaptive Thinking:  proficiency at thinking and coming up with solutions and responses beyond that which is rote or rule-based
  4. Cross-cultural Competency:  ability to operate in different cultural settings
  5. Computational Thinking:  the ability to translate vast amounts of data into abstract concepts and to understand data-based reasoning
  6. New-media Literacy:  the ability to critically assess and develop content that uses new media forms, and to leverage these media for persuasive communication
  7. Transdisciplinarity:  literacy in and ability to understand concepts across multiple disciplines
  8. Design Mindset:  the ability to represent and develop tasks and work processes for desired outcomes
  9. Cognitive Load Management:  the ability to discriminate and filter information for importance, and to understand how to maximize cognitive functioning using a variety of tools and techniques
  10. 10.   Virtual Collaboration:  the ability to work productively, drive engagement, and demonstrate presence as a member of a virtual teaSocial intelligence (we call it EQ today, I think) and Cross-cultural Competency are certainly emerging in more sophisticated and global organizations currently. Perhaps we have a leg up with these two.

But have you ever seen a job description requiring Transdisciplinarity and a Design Mindset?

What kind of behavioral interview questions would you use to determine if a candidate has Cognitive Load Management and Novel/Adaptive Thinking Skills?

How would you Tweet those jobs? How would your careers page change?

And once onboard, how would you manage the performance of employees’ Virtual Collaboration and Sense-making?

And speaking of job descriptions and performance management, how will New-media Literacy and Social Intelligence change the very nature of these processes?

Whew! We think the current skills shortage is frustrating and scary. It could be that the future skills shortage will upend everything!

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Filed under Annual Performance Reviews, China Gorman, Data Point Tuesday, Hiring Difficulty, HR Data, Institute for the Future, Performance Management, Skills Shortage, STEM, Workforce Skills

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