Leaders Work to Close Gap Between Education and Labor Market

By Caralee J. Adams — October 27, 2014 3 min read
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Too often, educators and employers have different perceptions of what is takes to be job ready.

At The Close it Summit in Washington, D.C., today business, government, education, and nonprofit leaders discussed the changing dynamics of the labor market and how educators can best prepare students for the workforce.

Rather than just a job skills gap, perhaps what the country is facing is a gap in communication or understanding, suggested Brandon Busteed, the executive director of Gallup Education, at the event hosted by Innovate+Educate, a nonprofit focused on closing the national skills gap.

While 96 percent of college provosts believe they’re effectively preparing students for the workplace, just 11 percent of business leaders strongly agree that college graduates have the skills and competencies needed for success on the job, according to recent Gallup polling.

In other research, Gallup discovered that 43 percent of 5th to 12th graders plan to start their own businesses. “That’s an incredible amount of entrepreneurial energy,” said Busteed. Yet, only 3 percent of the students polled were running their own businesses, 5 percent were interning with a local organization, and 17 percent had worked one hour or more within the last week.

Schools should think about how to identify and support kids with entrepreneurial talent, just as they do high-achieving students or those with good athletic abilities, suggested Busteed. When thinking about mentoring or other ways to encourage career pathways, he noted of the students surveyed, middle school students’ desire to start their own business was stronger than high schoolers’ (51 percent to 33 percent) and minority students want to be business owners more than white students.

Leaders at the summit suggested smart employers realize they need to boost investment in training and work with schools.

“We need business, government, education, and innovators to close the gap between what education imparts and what employers seek in hiring,” said Bryon Auguste, deputy director of the White House National Economic Council.

While the college wage premium is still very high, many employers are increasing the education requirements for jobs to include a college degree because of the excess supply in applicants, said Auguste. This is creating a bottleneck and an expensive training system where students are coming out of college without skills that are particularly well-aligned with what employers need. Businesses should do more to train talent from within and develop partnerships with educators to inform them of needs of in-demand jobs.

Peter Cappelli, professor of management at the Wharton School of the University of Pennsylvania and the author of Why Good People Can’t Get Jobs, said schools are doing a better job of educating students but it’s difficult to project what fields will be “hot” four years from when a freshman enrolls in college because the lag time is too long. “It’s almost impossible to do. The economy is way too volatile,” he said. The demand for many jobs is cyclical and skills that employers want are often very specific.

With apprenticeships shrinking, higher education wants to fill the gap but Cappelli suggests colleges aren’t particularly good at workforce training. A more realistic approach might be for educators to aim at preparing students for work skills and businesses being responsible for training, he said. “Employers are taking a shorter-term perspective. They want people with work experience before they hire them,” said Cappelli.

Mara Swan, the executive vice president for strategy and talent at Manpower Group, said in a more global, transparent, and competitive market employers are looking for talent that can do the job from day one. “We don’t have the luxury of time,” she said. Rather than using college as a proxy, Swan suggested hiring practices need to change to identify the range of applicants’ skills, perhaps with more video interviewing.

Cappelli noted the hiring managers value work experience over grades and that message needs to reach students who want to be competitive in today’s labor market.

A version of this news article first appeared in the College Bound blog.