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Today creating effective learning and development programs is even more important than ever. Information collected in the latest ‘Job Openings and Labor Turnover Survey’ by the US Bureau of Labor Statistics has revealed a significant inconsistency in the market.
While the number of job openings has hit an all time high since the recession, the number of hires isn’t matching up. Experts are attributing this to a major skill gap in the market. Employers are now having trouble finding applicants with the skills they're looking for.
Business Insider /Andy Kiersz, data from FRED
In effect, this means that job openings are remaining unfilled for much longer than usual. According to a study conducted by CareerBuilder, a company loses more than $14,000 for every job that stays vacant for three months or longer. In fact, one in six companies lose $25,000 or more.
Simply raising salaries to attract more candidates is not the answer. Talent acquisition specialists are now realizing that they’ll have to reassess what they're looking for in an employee and turn to HR to do the rest. Sixty-four percent of employers who participated in a CareerBuilder study indicated they would be hiring people who have the majority of the skills they’re looking for and train them to do the rest.
The surprising thing is that evidence of a skill gap is not news. Experts have been discussing the US skills shortage since 2014 but companies have been resistant to revive aging L&D programs based on four misconceptions:
Meeting industry demands
Some are concerned that diverting time and resources to training and development will put them behind competitors. What they don’t realize is that high performing learning organizations are 92% more likely to innovate, 58% more prepared to meet future demand and 46% more likely to be first to market.
Rather than having a workforce that is highly skilled in one area, companies today need more flexible employees. With rapidly changing technology and industry trends, Deloitte reported that current job skills only have a life of 2 ½ to 5 years. This means that even if companies find talent with the exact skills they need, this will change quickly. In effect, what companies really need are candidates who are able to learn and adapt to changing business strategies quickly. To meet these demands, HR departments are putting a stronger focus on reinventing L&D programs to fit the modern learner.
Millennials are disloyal
The common stereotype about millennials is that they’re extremely disloyal and highly demanding, hopping from job to job over the span of a few years. While it’s true that millennials demand more from employers, they’re also prepared to give more. When given the right tools and environment to grow they can bring their tech charged, collaborative and innovative skills to the workplace.
Millennials have a desire to learn and develop constantly. Accenture’s US College Graduate Employment Study found that 80% of the class of 2016 expect their first employer to provide formal training, yet only 54% of graduates from the classes of 2014-5 reported receiving any. This represents a great disconnect between what employers are providing and what the millennial workforce expects.
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Millennials are usually multi-skilled and want room to develop their wide array of talents. However, the rigidity of traditional job descriptions and department specific training often makes it easier to apply for a new job in a different field than to move laterally within an organization. Why source talent for each skill when instead you can source talent from inside your organization?
There’s always next year
L&D is also a major concern for training the new generation of leaders in your company. The fact is that by 2020 millennials will make up half of the global workforce. Your Millennial employees are fast beginning to fill the resulting management gap. The question is are they ready?
Deloitte’s 2015 study on Millennials revealed that only 24% of recent graduates felt that leadership was a strong personal trait of theirs. Yet, the 2016 survey showed that companies were not doing much to change this. Sixty-three percent of respondents reported that their leadership skills are not being developed at work. This was a particular concern amongst those who are planning on leaving their current company within the next two years.
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L&D programs are expensive and ineffective
According to The Association for Talent Development, in 2013 companies spent on average $1,208 per employee on training and development. CareerBuilder found that 68% of companies are investing in in-house training programs. However, according to Deloitte, only 37% of companies believe their programs are effective. Almost all CEOs and CHROs believe their company is not developing skills fast enough or deep enough. Do traditional training programs fit the needs of the modern learner?
The tech generation’s solution to aging L&D programs
The new workforce is made up of digital natives. They’re used to receiving information instantly and on the go. PWC found that 41% of millennials prefer to communicate electronically at the office rather than face to face or over the phone. Raised on Facebook and Twitter, they prefer using more collaborative learning solutions that allow them to give and receive development advice from both managers and peers.
Rather than having HR spend time and money on devising expensive formal classes, companies are now investing in new HR tech tools that fuse millennials’ not so secret attachment to their smartphone with their desire for real-time learning. Instead of pushing managers to be more proactive with their coaching responsibilities, Impraise gives employees ownership over their own development by allowing them to ask for feedback on the skills they want, when they want. The system instantly generates people analytics driven reports that allow HR to track progress and see improvement over time. Reach out to us and see how we can help you create your own L&D culture.