A look at various causes and explanations for Skills gaps.

1. The SkillsSkills
The Gap Gap

2. john@hrxanalysts.com

3. Overview
• Identify and Explain
• Changes Driving Skills Requirements
• Changes in Skills Utilization
• Perceptions of
• Five Facets of Skills Shortage

4. History
• All volunteer military / no draft
• Decline of corporate training dept
• New answers to make or buy
• New focus on the core
• Healthcare / IT
• Rapid demand growth
• Changing Status
• Literal search for action ready talent

5. Any job that can be automated will be
Any job that can be outsourced will be

6. Cities Are Becoming Guild - Like

7. Population Times Economic Activity

8. The Standard of Living is Rising Everywhere

9. Consequences of Offshoring
• Offshoring happens at a specific location in a specific region.
• Those workers become surplus in the local economy
• There’s no shortage (or the jobs would be ‘strategic’)
• Workers have two choices
• Apply for better paying gigs: they’re underqualified
• Apply for lower paying gigs: they’re overqualified
• Offshoring creates an abundance of underqualified applications

10. Blueseed

11. The education system has failed

12. Supply and Demand
• 95 M workers w/o college degrees
• Compete for 80 M jobs that don’t require
• Most newly minted jobs require college
• Production does not meet needs
• This group has to compete w/college crowd
• = More unqualified applicants

13. Unemployment Rate Varies with Education
11.1% 8.4% 6.8% 4.5%

14. Does Education Matter?
• Peter Thiel Fellowships
• Unimaginable Jobs Can’t Be Planned
• Technology Shifts Employer Expectations
• Most Jobs Becoming Tech Jobs

15. New Ways of Evaluating Tech Talent

16. Typical Under 32 has 10,000 Hours of Gaming by Age 21

17. Misunderstood Resource
• 10,000 Hours of Video Gaming =
• Volunteering For / Completing Hard Work
• Discovering Unwritten Rules
• Learning Through Progressive Failure
• Collaboration
• Mentoring
• Persistence
• Determination
• Envelope Pushing / Hacking

18. A Generation
• Ready to Be Trained
• Knows How To Learn
• Undaunted by Failure
• Knows How to Collaborate In Uncertainty
• Rewarded by Self-Direction
• Needs Feedback (even if it’s harsh)
• Oriented Towards Next Problem Set

19. Companies don't know how to hire

20. Basic Paradox: Surplus causes slower hiring

21. Complaints of Skill Shortages are a Symptom of Labor Surplus
Complaints of Hiring Slowness are a Symptom of Shortage

24. Literal Matching
1 ≠ one
Engineer ≠ developer
Program manager ≠ product manager
Mgr ≠ manager
Lead designer ≠ design supervisor
CEO ≠ VP
ATS: Good For Compliance
ATS: Bad for Selection

25. • Surprise
• This view held by MBA professors
• Market Fooled By Appearance of Low Quality Surplus

26. The problem is entirely regional

28. The world today is more about cities than countries

29. Each City Has It’s Own Demographic Fingerprint

30. National statistics are noise.
Local statistics are information

31. • Fortune 2500
• 18% of US Population in Top 50 Cities
• 22% of Workforce
• The Rest (78%)
• Cities Under 300K

32. This is What Every Regional Labor Market Looks Like
Ecosystem
Ecosystem 1
1I
Retail Hospitality Education Health Care Safety Govt
Infrastructure

33. Meet your new
robot overlords
Technology is destroying work as we know it

35. One grain of rice on the 1st square.
Two grains of rice on the 2nd square.
Four grains of rice on the 3rd square.
1 Billion Grains on the 32nd Square

36. 1 Billion grains of rice = 6,500 gallons of rice

37. Moore’s Law in Context
Transistors per Chip
iPad
iPhone
Facebook
Google
World Wide
Web
IBM PC #1
Apollo Program
You Are Here

38. Expect
• Disruption
• Massive Skills/Work Mismatch
• Increased Emphasis on Training and Agility
• More Difficulty Understanding Matches
• Learning as a Survival Skill

39. Conclusions
• Skills Shortage
• Is an Expectations Problem
• Is a Perception Problem
• Is a Real Problem
• Understand Supply and Demand in Your City

40. Questions

41. • John Sumser
• 415.683.0775
• John@hrexaminer.com