Future Focus: Skills Gap Holds Back Some Grads

By Jennifer Schramm August 1, 2013

Entrants to the labor market face a mixed outlook. Those without college degrees are up against a difficult environment. College graduates and postgraduates are seeing improved conditions, but challenges remain—even for the most educated. HR professionals report that there is a skills mismatch between applicants and available positions, according to the Hiring 2013 College Graduates survey from the Society for Human Resource Management (SHRM).

The March survey of 468 randomly selected HR professionals found that more than half of their employers plan to hire 2013 college graduates, mostly for full-time positions. However, economic conditions continue to hinder hiring. A lack of current openings was the most common reason cited by respondents whose organizations had not yet hired or don’t plan to hire graduates.

A lack of key skills is another factor. One-fifth of the HR professionals in the survey said they had not yet hired graduates or don’t plan to because the graduates are underqualified for the open positions at their organizations. Though this may be partially due to lack of experience, nearly half the HR professionals said 2013 college graduates lack basic writing skills, including grammar and spelling skills. HR professionals also cited a lack of math and speaking skills.

Finding college graduates with the needed applied skills is even more difficult. Half the HR professionals surveyed said 2013 graduates are deficient when it comes to work ethic and professionalism. Respondents said new graduates lack business acumen and written communication skills.

Companies in specific pockets of the economy are having a particularly hard time finding new graduates with needed skills. HR cited the following professionals as the most difficult to find: engineers; high-skilled technicians and programmers; skilled trades workers, such as electricians, carpenters and plumbers; and managers and executives.

Shortages in these fields have not yet translated into higher wages for graduates. Most organizations are offering "about the same" compensation, including salary and benefits, as they offered during the past three years.

This could all change if the labor market improves. A Business Roundtable survey of 141 U.S. chief executive officers in June found that about one-third of them expected to hire more workers in the next six months, representing a small improvement from prior surveys. In addition, data from SHRM’s Jobs Outlook Survey Report show that HR professionals are growing slightly more optimistic about the job market.

Meanwhile, the U.S. Bureau of Labor Statistics found that more Americans quit their jobs in April and May than in March, representing another sign of confidence in the job market. Jobless claims are also down.

If the positive trends continue, the picture could become even brighter for new graduates. The downside will be that job seekers without the skills and education employers need will continue to struggle. And those skills shortages that HR professionals are concerned about? They could become even worse.  

Jennifer Schramm is manager of the Workplace Trends and Forecasting program at SHRM.



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