Is it the skill gap or demand for multiple skills?

A research paper by Alicia Sasser Modestino, Daniel Shoag, and Joshua Balance, which was presented at the annual conference of the American Economics Association, revealed that the skill gap is just a myth, and that it is actually during recession that employers get stringent with their job descriptions and seek individuals with multiple skills and capabilities.

When unemployment is rampant in the economy, you have a larger pool of people available to work. During such times employers get choosier while selecting candidates. They also make their job descriptions more competitive due to higher competition. It is almost as if organisations are hunting for a white elephant, which is rare to find, while the work can actually been done by a normal elephant too.

According to the paper, as the economy gets better the problem of skill gap gradually diminishes. The jobs come back and everything starts returning to normal. But does this theory work in the Indian economy as well?

We do know that there is a large population of unemployed labour in India. If you ask any HR leader about the biggest problem that troubles their sector, most will come up with the same answer— ‘skill gap’.

“Organisations are exploring new businesses and they want readymade talent. They seek candidates who can perform from day one”

Going by the theory given by the research paper, is the skill gap a myth in the Indian context? Are HR personnel mistaking the problem of skill gap for the increase in the demand for multiple skills in an individual?

Certainly many organisations are foraying into new businesses, which requires different kinds of skills. According to Subir Verma, head-HR, Tata Power, there is not much of a skill gap in traditional businesses.

“Organisations are exploring new businesses and they want readymade talent. They seek candidates who can perform from day one,” says Verma.

He also believes that there is not as much of a skill gap in the core skills or the hard skills as there is in behavioural skills, such as soft skills.

“There is a huge difference in skill development in our country. There is a gap in skills which the industry needs and the skills being provided to youngsters in institutes”

However, the findings of the research mentioned earlier may not apply in the Indian context. The quality of education in our country is way different from that of the Western countries. Universities in the US provide more updated curricula as compared to India.

“There is a skill shortage in India and our country has not built the base to develop the required skills in an individual”

Let us look at the IT sector alone. While on the one hand the world has moved on to technologies, such as artificial intelligence (AI) and machine learning (ML), the technical institutes in India seem to have failed in updating their education. According to the India Skill Report, only about 46 per cent of the graduates are employable.

“There is a huge difference in skill development in our country. There is a gap in skills which the industry needs and the skills being provided to youngsters in institutes,” mentions Adil Malia, CEO, The Firm.

“One of the main skills that is missing from the current crop of professionals, in our field in particular, is the ability to organise and analyse data so as to give meaningful insights into their sales, clients, finances, and virtually anything else that can be measured”

“There is a skill shortage in India and our country has not built the base to develop the required skills in an individual,” Malia adds.

He explains this with a simple example. A German carpenter knows different styles, methods and techniques of drilling but an Indian carpenter does not possess such skills. There is a lack of skill development, which is a problem.

Sharad Mishra, VP & head of HR, Anderitz India, also believes that a skill problem persists in the Indian workforce. He says, “Skills which encompass both hard and soft skills alike are noticeably missing in the workforce. Hence, there is no possibility of a seasoned HR leader misinterpreting skill gap as increase in demand for multi-skilled employees.”

“The companies should collaborate with institutes and try to negate the skill problem. At Seimens, we used to conduct courses for young students and update their knowledge”

Talking about the hydro sector, Mishra says that there is a skill shortage in hard skills, such as data analytics.

“One of the main skills that is missing from the current crop of professionals, in our field in particular, is the ability to organise and analyse data so as to give meaningful insights into their sales, clients, finances, and virtually anything else that can be measured. This is paramount even in a field as non-technical as HR to help identify different markers and trends prevalent in various departments, to not only help the organisations hire the right talent for these departments but also help HR professionals become successful stakeholders,” mentions Mishra.

We can meet this skill problem in two ways. First, companies should have a robust training and development programme to reskill and train their workforces with the skills which are relevant. Second, is they should partner with various institutes to train youngsters in a range of trending skills, which are in demand.

“The companies should collaborate with institutes and try to negate the skill problem. At Seimens, we used to conduct courses for young students and update their knowledge. Also, individuals should be proactive in learning and updating themselves,” shares Ramesh Shankar S, former CHRO at Seimens India.