Wednesday, 17 October 2012
Solving the skills gap problem
Unemployment seems to be on the increase in many countries, a number of companies and industry has complained about the lack of skilled personnel. Universities and tertiary institutions have considerable increased over time; which makes you wonder, how can there be a shortage of skilled labor? One more thing that’s mind boggling is that the world economy had even gone in recession; which means it can’t an increase in demand. Which leaves only one scenario, decrease in the supply of skilled labor.
The shortage of skilled labor has been attributed to lack of the willingness of the companies to train graduates from the universities and colleges. I agree to that notion, and I completely resonates well such a situation; I am also a graduate who can’t seem to find a job. The problem is that companies are looking for someone with a tonne of experience which someone graduating from college obviously doesn’t possess. Given this barrier to entry; the industry’ skills pool become limited to those already in. This scenario doesn’t do any one a favor. Companies are left with limited supply of skills which skyrockets the price of labor. Graduates are just left to waste; with most ending up taking jobs that do not match their skill set and level of education.
Without skilled labor, I don’t see how a company can have a shot at success. The solution in my opinion is very simple. Companies must hire with the future in my mind. It should not just look at meeting their short requirements only. That is they should create a situation where they won’t need much skills from outside when the time comes, when they need this skills.
In order to implement this solution companies need to develop a trainee programme. In simplest terms they should just give the graduates the experience they are looking for. While many may argue that it can be expensive to train people other than just hiring people when you need them. I think it’s much cheaper to get people who haven’t had a lot of experience and then train them, than hiring experienced people comfortable somewhere else. You would need to convince them; in other words make them an offer they can’t refuse. Sometimes the cost of hiring these experts can be just ridiculous; a lot of money is required to pay human resources agencies and sometime in case of technology you might need to buy a company for just its labor.
Given that it’s probably easy to estimate the skills requirements of a company in the future; I think it’s cheaper to train people yourself. It’s inevitable that you are definitely going to lose some employees to retirement, death and other factors. So to me its fool hardy to wait for it to happen and then try to look for replacement; I would say good luck. Given a lot of tools available, I believe companies can easily predict their labor requirements.
Obviously there are very few companies willing to invest in training people. Others are just big sharks waiting to capitalize on the hard work of others. So if a company decides to employ such a solution they almost employ tactics to retain the hard earned skilled labor. Attractive salaries, benefits, offer opportunity for personal development and fostering a great culture; are just but something of the things they can do to retain skilled labor.
If most of the companies invest in training and offering graduates an opportunity to acquire skills everyone benefits. The increase in supply of skilled labor would reduce the inflated cost of hiring. Unemployment would obviously drop, putting a smile on the graduates, governments and society at large.