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There is no “skills gap.” Employers are just cheapskates

Written by Elizabeth Bromstein
Posted on

Suspect that whole “skills gap” thing is a crock and that employers are just cheap bastards? A new study suggests that may actually be the case – at least when it comes to STEM jobs.

Research from the University of Warwick suggests that a lack of workers with skills in science, math, engineering and technology (STEM), along with a lack of ‘soft’ communications skills, is not so much a lack of qualified applicants with appropriate training and education as it is a shortage of people willing to work for what employers are offering to pay.

The research was conducted by Dr Thijs van Rens, associate professor in the Department of Economics.

He said, according to a media release, “It is often taken for granted that the skills gap and skills mismatch is a supply problem and appropriate training is not available to workers. However US data shows that market wages do not reflect the relative demand for different types of skills.

“Businesses complain about the lack of workers with STEM skills but are unwilling to raise wages for these workers – or reduce wages for workers with skills that are less in demand.”

In an upcoming discussion of his policy briefing paper titled The Skills Gap: Is It a Myth? Dr van Rens will argue “that the position often taken for granted in the public debate – that the skills gap is a supply problem – is incorrect.”

Van Rens says that the labour market can adjust to a skills mismatch in two ways: “the workforce may adapt to the demand for skills, for instance by acquiring training or changing occupation, or firms may adapt to the supply of skills.” But for either of these things to happen, wages must reflect the relative supply and demand for these skills.

The release says, “As long as wages do not reward certain skills workers will be less likely to acquire them, and even if they do, will find employment in higher-paid occupations that do not utilize these skills.”

In other words, workers can either suck up the low wages or employers can pay them more. But since workers seem able to turn down jobs and employers are complaining about a shortage, the onus would appear to be on employers to shut up and pay up.

Separate research from earlier this year found that inadequate pay was the number one reason people turn down jobs (followed by schedule and hours), while another study found that 26% of candidates who turned down offers do so because they compensation isn’t enough.

What this means? Maybe employers need to stop making noise about a “skills shortage” and realize they are, after all, just cheap.

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