‘Skills gap’ threatening to impede economic growth in California
California employers aren’t hiring as quickly as they could — but the economy isn’t the damper.
The problem? Bosses are increasingly looking for qualities that many candidates don’t have.
The so-called skills gap is now threatening to impede economic growth in California, a state that suffered more intensely than most during the recession.
More than half of the companies in a new survey said they have struggled to recruit candidates for open positions — especially at the higher end of the wage spectrum.
Hourly laborer positions are much easier to fill in California than in the rest of the U.S., according to the Society for Human Resource Management.
“There’s a larger, organic change in jobs — they’re becoming more knowledge-based, more specialized in some cases,” said Evren Esen, director of survey programs for the professional group.
Filling skilled trades jobs — electricians, carpenters, plumbers and others — seems to be easier for organizations if they’re based outside California, according to the survey. Employers inside the state had trouble placing full-time educators such as teachers and professors, as well as scientists, engineers, managers, executives and computer specialists.
The split between available jobs and the Californians who want but can’t land them can be blamed on a subpar educational and vocational training system, according to some policy analysts and economists. Educators have argued with government agencies and businesses for years about who should assume the heaviest burden of career preparation programs.
Intense competition for top talent among the highly skilled also hurts — 2 in 5 respondents told surveyors that candidates had turned down job offers in favor of higher pay elsewhere.
Other experts say that restrictive immigration policy exacerbates the situation, or that employers have unrealistic expectations of the labor pool.
“If HR people want something very specific — like an MIT grad with five years of experience for $15 an hour — you have to take it with a grain of salt when they report it as an unfilled opening,” said Stephen Levy, director of the Center for Continuing Study of the California Economy.
The skills gap may be cyclical, he said. Baby boomers will begin to retire in hordes in the next few years, leaving a mass of jobs for which job seekers are largely untrained.
And “it’s always harder the further you get into recovery, because the best people, the most skilled and experienced workers, get re-employed first,” he said. “The remaining pool of people available to be hired is more challenging.”
California’s job growth is recovering at a faster clip than the U.S. as a whole. The 7.3% unemployment rate is the lowest in more than six years and down from 8.1% at the beginning of the year.
This week’s survey, which was conducted in December 2013 and January 2014, found that 95% of 572 respondents had added new full-time employees in the prior 12 months. Of those, 6 in 10 said brand-new positions were available.
Optimistic organizations are looking to branch into new markets, products and services. They’re asking applicants for more skills, flexibility and credentials.
A September report from labor analytics group Burning Glass Technologies found that employers are increasingly demanding a bachelor’s degree for positions that historically haven’t required one, such as executive assistants or people who supervise mechanics. That drags out the amount of time employers need to fill open spots, according to researchers.
Often, candidates lack technical ability or work experience, according to the survey from the human resources group. Other major skills deficits include English language competency, reading comprehension and math, as well as more nebulous qualities such as critical thinking aptitude, professionalism and leadership.
To better connect job seekers with available positions, the human resources group suggested that employers consider more on-the-job training, partnerships with local schools or government development programs. Creative compensation packages, market rate salaries or flexible benefits wouldn’t hurt either, the group said.
Larry Frank, president of the Los Angeles Trade Technical College, said Wednesday at a conference at the UCLA Anderson School of Management that although vocational schools were once eyed with some skepticism, they’re now growing in popularity.
At the same event, Jim D’Agostino of Suffolk Construction Company said job mentoring programs should be tailored to the changing labor force.
“Forty years ago, my point of entry into this industry was with shovels,” said D’Agostino, who is executive vice president of Suffolk’s Los Angeles office. “For my son, the point of entry was through computers and software.”
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