Bridging the Skills Gap: Understanding the Problem

Dr. Hatch

Understanding the Skills Gap Problem

Globalization and changes in the structure and nature of competition have created what is commonly referred to by employers as a skills gap in the U.S. labor market. Though the presence of a skills gap has been the subject of debate among researchers and policy makers, the problem can be understood as a mismatch between the attributes of job seekers and employer needs, a phenomenon that can profoundly hinder growth due to occupational vacancies and result in long periods of unemployment for job seekers. Employers often distinguish between the “hard” or technical skills they need and “soft skills” related to communication, problem solving, overall professionalism, work ethic, attitude and reliability. Though the presence and severity of the skills gap is dependent on the degree to which firms are involved in training, one of the driving forces is the emergence of the knowledge-based economy which has resulted in a higher demand for human capital, flexibility and adaptability. This is particularly the case in manufacturing and other technology-intensive growth industry clusters where advanced techniques have ramped up the demand for workers with postsecondary education, technical skills and job experience.

Historically, employers played a critical role in upskilling new recruits, virtually molding the unskilled into skilled, productive workers through in-house training programs and on-the-job training (OJT). Yet competitive pressures have compelled many firms to reduce or abandon training efforts altogether in favor of leaner practices. In today’s business climate, companies increasingly expect the education system to turn out fully qualified candidates who can hit the ground running following recruitment. Though the impetus has shifted to the schools, at the same time, they have moved away from providing vocational education (though they are now slowly returning). These programs provided crucial hands-on learning in the school environment, enabling students to pick up valuable skills that could be expanded upon at an employer via OJT, or at a trade/apprenticeship program or other technical postsecondary programs.

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Where is Rural America in this Narrative?

The problem resonates deeply among employers and communities across rural America, where educational attainment is lower by comparison to its non-rural counterpart. Brain drain of the young and educated who increasingly flock to cities for economic opportunity coupled with persistent population loss across many age cohorts results in a smaller potential workforce. Rural workers are also aging, and employment growth is lagging that of urban centers. Poverty, by no means a rural phenomenon, is on the rise across rural America, particularly among children, presenting barriers to high school completion and basic career readiness. New immigrants have dramatically increased the availability of workers; yet they bring with them linguistic and cultural barriers to community integration.

These examples highlight the many challenges that rural areas of the U.S. face, where labor markets have become increasingly bifurcated as globalization intensifies. These pressures put small towns at a competitive disadvantage when it comes to producing and attracting, on the one hand, a skilled and agile workforce that can flexibly adapt to a rapidly changing and increasingly technological workplace, one that is pressured to produce goods and services that circulate not only domestically, but in global markets. On the other hand, the growth in big box/retail, hospitality, personal care and other service industries demand lower skill/entry level workers for part time, poorly paid and often precarious work. Meanwhile, the agriculture sector has become largely dependent on immigrants (whether authorized to be in the country or not) to fill jobs that would otherwise go unfilled, given wages and difficult working conditions inherent in these industries.

It is this socio-economic context that forms the backdrop to “Bridging the Skills Gap,” a data-driven pilot project that investigated rural communities located in the Great Plains and funded by the Rural Futures Institute at the University of Nebraska.  The project brought together Community Development and Extension scholars and practitioners from Purdue University, the University of Nebraska and South Dakota State University to look at ways rural communities can more effectively address workforce development needs in this era of reshoring and global competition.

This site provides an overview of research and key findings and a set of best practices geared to assisting communities within and beyond the pilot study region to be more strategic and competitive in addressing local skills gaps and enhancing labor supply. By emphasizing community-wide collaboration, a call for employers to step up to the plate and be full partners in the planning process, and by adopting a data-driven approach identifying growing and emerging industry clusters, small communities can make significant strides. We invite you to read more.

Carolyn Hatch, Purdue University
Principle Investigator, Bridging the Skills Gap: Workforce Development in Rural Communities in the Great Plains

Key Takeaways for Communities

 

Introduction
Understanding the Problem
Project Overview
Community Process & Collaboration
Importance of Labor Market Data
Promising Practices
Resources
Bridging the Skills Gap Team