Understanding the Local “Skills Gap”
Over the past ten years, as the baby boomer generation has begun to retire, many economists, policy analysts and consultancies have done extensive research on what people call the “Skills Gap” in the United States and other developed nations… And more recently the term has been thrown into a variety of highly politicized environments as somewhat of a catch all for conversations involving automation, American manufacturing, and technical education. In a nutshell, however, these folks are speaking about the fact that there’s a “hollowing out” of the middle class as productivity continues to rise and stable-income opportunities decline. MIT Professors Erik Brynjolfsson and Andrew McAfee call this “the Great Decoupling”.
While Brynjolfsson and McAfee raise a compelling argument that this decoupling is a result of the automation of repetitive tasks replacing human labor, there is constant debate about what’s causing this phenomenon and to what degree: the rise of automation, the stifling of impactful U.S innovation, or globalization…or all three. What really isn’t up for debate anymore is that as these tasks do get “automated away” the preexisting workforce is left with insufficient capabilities to fulfill the needs of the future economy. In fact, there is strong evidence to suggest that the supply of “middle skill” talent will fall short of the demand for these jobs (some estimate by as many as 5 million jobs by 2020), and that the gap is continuing to create a polarizing effect on income inequality.
At a macro-level, these issues have been discussed ad nauseam. While much of this debate is positively contributing to awareness at the policy level and even generating wide range of proposed solutions: anything from the new STEM initiatives in K-12 to federal tax incentive programs for U.S employers to stay stateside, the conversation typically does not extend to the primary infrastructure and human capital problems that actually present themselves every day in regional economies and townships across the country.
What this series will focus on is what is happening at the local level, where employers face increasing pressure to find highly specialized talent to keep up with the pace of technology and educators face similar pressure to supply it.
My co-writer in this series and co-founder of Covalent Networks, Matt, and I have spent the better part of the last year speaking extensively to many of the dedicated local policy makers, workforce development professionals, non-profit leaders, and educators who spend their lives working to build meaningful wage-earning careers for people within their communities.
In three posts, we will unpack some of what we’ve heard as the core issues that these local stakeholders face as this pressure mounts:
1. The Fragmentation of Workforce Development
2. The Untapped Value of Incumbent Employees
3. Training Providers and the Obscurity of Market Demand
Finally we’ll spend a post or two illustrating some of the best practices we’ve seen from various organizations across a spectrum of industries as well as some of our thoughts about what needs to happen at the local level to shift the paradigm and reconnect the supply and demand of talent.
(Co-written by Matthew Delaney)
