Tuesday, May 30, 2017

Understanding Utah’s Future Skill and Knowledge Needs

The Utah Department of Workforce Services releases Skill and Knowledge-based Projections

By Lecia Parks Langston, Senior Economist

“It is possible to fly without motors, but not without knowledge and skill.” Wilbur Wright

The following skill and knowledge projections suggest that the foundation for future workforce preparation relies on those old favorites “readin' and 'ritin' and 'rithmetic.” Technical skills and knowledge areas are also important, but rely on an excellent foundation in basic skill and knowledge areas.

• Utah occupational projections and the Occupational Information Network (O*Net) provide the foundation for these skills and knowledge estimates.

• “Basic Skills” dominate the top 10 in-demand skills, suggesting a need to ensure training on “the basics” for all prospective workers.

• Basic skills needs cross occupational and educational boundaries. • Basic skills make changing occupations possible as the labor market changes.

• Communication skills and reading rank highest on the top skills list, followed by critical thinking. • The top five skill and knowledge areas are the same for every region of the state.

• The top 10 in-demand skills change very little regardless of the occupational training level.

• Customer Service ranks, by far, as the knowledge area with the highest projected demand.

• For occupations requiring formal training past the high school level, competence in English, computers/electronics, and mathematics becomes increasingly important — although these skills are in demand for employment at all training levels.

• Short-term shortages for certain technical skills may seem to displace the overarching need for all workers to have a strong foundation in basic skills in training discussions.

The Source?

Data for skill- and knowledge-based projections are a melding of information from two sources — Utah’s 2014-2024 Occupational Projections and the Occupational Information Network (O*Net).

The O*Net database offers the nation's primary source of occupational information. O*NET categorizes 35 different types of skills and 33 elements of knowledge — both considered worker-oriented descriptors. For this analysis, a particular knowledge or skill descriptor is assigned to an occupation when it is at least moderately important to the occupation and when at least a moderate level of competence is required. Then, projected employment levels are calculated for each skill and knowledge area. In the visualization below, skills and knowledge areas are projected for total 2024 employment and also total projected job openings between 2014 and 2024. Openings can occur due to growth or the need to replace individuals who leaves an occupation. Interestingly there is little difference in the knowledge and skill rankings for employment and openings.

O*Net defines a skill as a developed aptitude, capacity or ability. Knowledge areas equate to organized principles and facts. For example, a worker may need to “know” correct English grammar to write a manual. But, that doesn’t mean they have the “skill” to write an effective manual.

By matching projected demand for occupations to O*Net’s information about job requirements, the Utah Department of Workforce Services has generated an overall picture of the skill and knowledge needs of Utah’s future economy.

Skills with the Highest Projected Demand

Basic skills dominate the top “in-demand” skills. In other words, basic skills rank as the most important skills in the labor market-regardless of education or occupation. Basic skills are so important because they prepare workers to acquire other skills. In particular, active listening, speaking, reading comprehension, critical thinking, writing and monitoring are critical for tomorrow’s workforce.

Definitions of some of the most important basic skills follow:

• Active listening simply means listening to what other people say and asking appropriate questions.

• Speaking can be as simple as directing tourists or as complex as arguing a case before the Supreme Court.

• Reading comprehension involves understanding the written word.

• Critical thinking requires the use of logic.

• Writing includes everything from writing a telephone message to composing a novel.

• Monitoring means assessing how well someone learns or does something.

Other In-Demand Skills

Social perceptiveness (seeing and understanding others reactions), instruction and service orientation (looking for ways to help people) also rank as high-demand social skills. Coordination appears as the only high-demand resource management skill. No technical or system skills (capacities used to understand, monitor and improve socio-technical systems) are included among the most highly-demanded skills for the future Utah workforce. While technical skills typically get all the “press,” basic skills form the foundation of workforce preparation.

Skills by Education and Area

Remarkably, the high-demand skills lists for occupations requiring different levels of education are very similar. Even as jobs require more education, basic skills show the highest levels of employment demand. Moreover, the top five skills and knowledge areas are the same for every region of the state (although in slightly different positions).

Knowledge in High Demand

If adequately prepared with the in-demand basic skills, workers will be able to obtain knowledge in high-demand areas. These top knowledge areas provide guidance for training emphasis. Customer and personal service far outranks any other knowledge requirement area.

Knowledge of the English language also ranks high on the knowledge area ranking. This doesn’t mean a worker just needs to speak English. They must know grammar, sentence structure, spelling and punctuation. English knowledge may be an area particularly at risk for a generation that has grown up doing more texting than academic writing. It’s here — within the in-demand knowledge areas — that the need for specialized training becomes apparent.

What are other important knowledge areas?

• Clerical (a high portion of Utah’s jobs require clerical skills)

• Education/training

• Building/construction

• Mathematics

• Psychology

• Computers

What Employers Want

For more than a decade, the National Association of Colleges and Employers has surveyed employers about their “most-wanted” attributes. As you can see from the visualization, transferable soft skills are those that are most important to employers — regardless of the job’s pay or rank. You’ll also notice that these skills dovetail nicely with the skills and knowledge areas the projection data indicate will be in the utmost demand. Technical and computer skills rank fairly low on the list.

Why Does the Need for Technical Skills Get All the Press?

Currently, Utah’s unemployment rate is at its lowest level since the end of the 2009 recession. The labor market is tight and certainly at or near “full employment.” However, rumored shortages of technically-qualified workers have abounded for years. Employers often lament their need for workers with more technical skills. Indeed, our projections do show that many STEM (Science, Technology, Engineering and Math) occupations should grow at a faster than average rate providing many new jobs openings.

However, keep in mind that economic theory advises that a labor shortage is simply a wage “shortage.” In other words, wages aren’t high enough for a particular occupation to bring the market into equilibrium. At higher wages, fewer jobs would be available from employers. In addition, some employers may have unrealistic expectations when it comes to filling high-tech positions. The cost of labor to an employer typically includes training workers for job-specific activities at their particular firm (as opposed to occupation-specific skills). In a departure from the past, many employers don’t want to “pay” the “time” it takes for workers to gain company-specific expertise.

The knee-jerk reaction to cries of shortages may focus money and efforts towards filling short-term technical skills training gaps (the squeaky wheel syndrome), while ignoring the basic skills. Yet, basic skills are critical in the long-term for the majority of jobs. A basic-skills deficiency may preclude obtaining highly-coveted technical skills — especially in the short-term. A strong underpinning in basic skills provides workers with the resources to learn new technical skills and quickly switch occupations as labor force demand changes.

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