How is technology changing the skills gap?

As many industries undergo rapid transformation fueled by technological advancements, the skills gap has emerged as a pressing issue for both employers and workers alike. This is not only impacting individual roles and organizations but also has far-reaching implications for the economy. In this blog, we explore the widening skills gap, its effects on various industries, and how organizations can face this challenge moving forward.

What is the skills gap?

In short, the skills gap is the disparity between the skills needed by employers and those possessed by the workforce. This mismatch can make it hard to fill roles and will reduce organizational productivity over time. A skills gap can also be detrimental to workers, as many candidates struggle to keep up with employer demands. On a wider scale, the skills gap could harm the US economy to the tune of $454 billion by 2028 and force employers to look for talent abroad.

The skills gap is getting worse

As technology continues to advance at an unprecedented pace, the skills gap has become a main concern for both workers and employers. In 2021, 55% of HR professionals believed their organization had a skills gap. That number is at 69% in 2023, indicating a growing crisis. As to the cause, 40% of professionals think this is due to retention problems, while 26% say it’s a result of recruitment issues.

Nevertheless, industries are rapidly adopting new technologies, which in turn are reshaping the job market and the skills required for success. This rapid transformation has left many workers struggling to keep up with the evolving demands, resulting in a workforce that is often inadequately prepared for jobs. Employers, on the other hand, are unable to find skilled candidates. Studies show that 78% of large businesses say a skills gap reduces company performance through lower productivity and innovation.

A skills gap and opportunity for hospital and clinical workers

The healthcare sector is particularly vulnerable to the widening skills gap, given its high turnover rates and critical need for up-to-date knowledge and skills. One study found that the three of the top much needed skills in healthcare are information technology related.

Upskilling initiatives have been shown to improve employee retention in this industry, and a focus on career mobility initiatives could also benefit workers as 42% of healthcare professionals find it hard to change roles within their organization.

New technology has a plus side for employers facing a shortage in healthcare workers.

To reduce employee workload and streamline operations, many healthcare employers are investing in advanced technology, such as electronic health record systems and automation. This has cut costs by $122 billion, and a further $16 billion could be saved through more task automation. While these investments are beneficial, they also require workers to develop new skills and knowledge, emphasizing the urgent need to address the skills gap in healthcare and clinical settings.

New hard skills are required for unskilled labor

Industries such as automotive, manufacturing, logistics, and biomanufacturing are experiencing significant skills gaps as a result of rapid technological advancements. The shelf life of technical skills is getting shorter, with new technologies and processes constantly emerging, requiring continuous adaptation.

Recent research shows that 73% of distribution and 77% of warehousing companies are experiencing labor shortages because of a lack of qualified candidates. Other studies reveal that 83% of manufacturing companies are prioritizing talent retention and hiring, while 45% of executives in the sector are rejecting business deals due to talent scarcity. 

These issues could become more prominent as production methods evolve. The adoption of automation and advanced machinery is accelerating, which in turn requires workers with specialized skill sets.

Furthermore, AI is revolutionizing the way these industries operate, as it becomes more advanced and capable of completing more tasks. This is having an added effect on employee morale and retention.

Surveys indicate that 14% of manufacturing workers are extremely worried about losing their job to AI, and 45% say AI has made some of their skills less valuable.

This drastic shift has resulted in an urgent need for higher-level cognitive, technical, and even soft skills for deskless roles. This highlights the importance of addressing the growing skills gap to ensure growth and competitiveness in these sectors.

Aspire Academy can help you tackle the skills gap

To address the widening skills gap, employers must proactively invest in training and development initiatives that help workers acquire the necessary skills for their roles. As technical skills may need to be updated at least every two years, implementing continuous training is the best way to ensure your employees can deliver their best work.

One effective approach is to collaborate with staffing companies like Adecco. We offer specialized training through our Aspire Academy, providing upskilling opportunities in over 8 areas related to manufacturing, logistics, distribution, industrial, and leadership, equipping workers with the knowledge and expertise needed to meet changing industry needs. We’re well aware that 48% of HR professionals are concerned about progressively updating employee skills, and that’s why the Aspire Academy was specifically designed to help Adecco associates stay ahead of the curve with the latest upskilling opportunities. Our programs are highly engaging and effective, perfect for connecting with the 9 out of 10 workers that think continuous training is valuable.

To learn more about how your organization can bridge the skills gap through Adecco’s training programs and expertise in workforce management, contact us today.