How Wide is the Skill Gap in the US? 5.7 Million Jobs-Wide
May 9, 2017
There are currently 7 million unemployed people in the United States, equaling an unemployment rate of 4.4 percent (that’s actually pretty low), according to the Department of Labor.
But here’s the rub – there were 5.7 million unfilled job openings in the US in March, according to the DOL. To put that in perspective, there were only 5 million people hired in March, meaning there were 700,000 more open positions out there than actual jobs filled.
If those 5.7 million job openings were filled, there would be a mere 1.3 million people unemployed in the United States. That would mean an unemployment rate of less than 1 percent, the lowest in recorded history.
So why do so many jobs in the US go unfilled? Two words – skill gap. There aren’t enough people in America with the skills needed to fill all the jobs that are out there.
Conversely, we are seeing people who do have desired skills increasingly having more flexibility. That’s creating a world of have and have-nots: people with desirable skills are highly in demand and have economic freedom, whereas people who don’t have those skills are in real trouble.
Where the skill gap exists
So where are the biggest skill gaps in the US? Well, the two industries with more than 1 million job openings are professional and business services and healthcare services.
With an aging population and expanded healthcare services, there aren’t enough doctors, nurses, physician assistants and administrators to fill the need. That scarcity in healthcare talent is leading to high pay, as a LinkedIn analysis shows healthcare jobs dominate the list of highest paying jobs in America.
On the professional and business services front, that’s an awfully vague category. But another LinkedIn analysis shows the top skills needed by businesses today – namely cloud computing, data mining, web architecture, networking security and SEO/SEM marketing – generally revolve around tech.
Again, much like healthcare, these are high paying jobs. That’s what makes America’s skill gap so frustrating: it isn’t just that people aren’t filling needed roles, but that those roles are good jobs with good salaries.
What life is like for people with the right skills
Here’s the opposite end of the coin. For people who have the right skills, the stats show their life is pretty good.
Specifically, the quit rate in America is as high as it’s been since 2001. This is a sign of a great economy: people (usually) quit their job if they get another or are confident they can get another.
But it’s not as if our unemployment rate is the lowest it’s ever been. So why are so many people quitting their jobs?
Because the people who have desirable skills are highly attractive to employers. Hence, they are highly confident they can get a new job, giving them the economic freedom to quit their current one.
What this all means to individuals and organizations
Seeing all of this, there are two realities for individuals and organizations.
For individuals, it’s clear today that skills are at a premium. Yes, soft skills are critically important for advancing a career, but to get hired in the first place the best route is learning highly desirable hard skills.
For organizations, this problem isn’t going to be fixed tomorrow. The skill gap has persisted and will continue to persist for some time.
That leaves organizations with two options.
The first is to work hard to recruit people with highly desirable skills, who are often very expensive and very time consuming to hire. The second is to find people who have the ability to learn these skills and then train them.
Both require a commitment. A training solution though is like tending a garden; whereas always recruiting is the process of always hunting. Generally, over time, gardening is much more fruitful than hunting.