Industry, technology and economic disruption has created a perfect storm that is having a significant impact on the types of skills required and the demand for and availability of those skills in global labor markets. This is one of the most significant issues impacting economic vitality:
- Without the adequate talent, public and private sector organizations will not be able to effectively innovate and continue to deliver value to citizens and shareholders, grow their businesses and create new jobs. Private sector companies will be forced to seek out regions where they can obtain the necessary talent to enable them to be competitive.
- Without adequate talent, regional economies will not be able to retain and recruit industries which provide high skilled / high paying jobs. A decline in the quality of talent in regions will significantly impact the economic competitiveness and value proposition of the region –leaving only opportunities for lower skilled / lower wage jobs. Lower paying jobs will lead to a decline in GDP, reduce tax revenues and increased dependence on public services.
- Without skills to compete for higher paying jobs, individuals will be forced to remain in lower skilled / lower wage jobs and fall victim to further income inequality and increase their reliance on public services.
Governments are not currently able to battle this storm on their own as they are overwhelmed in dealing with operational complexities resulting from multiple forces. Additionally, government resources are already constrained in most countries due to stagnant and declining economic conditions. Higher education institutions have not proven capable to meet the demands and needs of students and industry. And most in the private sector are looking to government to lead on this issue and most organizations have not made skills development of employees a priority.
This existing disruption is further complicated by the fact that we’re seeing complacency by all groups as to the scope of the problem and their ability to deal with it at a country level. And there are significant disconnects between ecosystem actors as to what the problem is, how it should be addressed and who should be responsible for addressing and resourcing it.
There is no silver bullet to resolve these challenges. The research in our most recent Institute for Business Value (IBV) study, Facing the storm – Navigating the global skills crisis, outlines key strategies for business, education and government leaders to work together to address this challenge. This study is based upon research conducted in cooperation with Oxford Economics of more than 5,600 global executives representing 18 industries and 48 countries, including 800 leaders of government institutions and 1,500 from higher education institutions.