What skills do employers want?

By Guillermo Montt.

Previous discussions on skills mismatch or the future of work highlight the importance of skill demand to develop skill policies and an efficient linkage between skill development and skill use. Skills demanded at work can be grouped in four broad categories: basic information-processing skills, advanced cognitive skills, technical job-specific skills and socio-emotional skills. Of these four broad categories, what are the most relevant for work? Popular claims (see picture on the right-hand side) and a review of employer-based surveys suggest that employers pay special attention at soft skills when hiring. Surveys of job advertisements, on the other hand, argue for the importance of technical job-specific skills.

How can we reconcile these two apparently contradicting claims?

On a recent working paper W. Cunningham and P. Villasenor carry out a meta-analysis of 27 surveys measuring skills required by employers, as reported by the employers themselves. They find a “remarkable consistency across the world in the skills demanded by employers. While employers value all skill sets, there is a greater demand for socio-emotional skills and higher-order cognitive skills than for basic cognitive or technical skills. These results are robust across region, industry, occupation, and education level. Employers perceive that the greatest skills gaps are in socio-emotional and higher-order cognitive skills.” This claim supports a generalist approach to primary and secondary education, focused on higher-order cognitive and socio-emotional skills, which are largely developed up until adolescence.

On the other hand, M. Jackson analyses job advertisements in the UK and finds that, for all occupational categories (higher managerial and professional, lower managerial and professional, intermediate, lower supervisory and technical, semi-routine and routine), advertisements are more likely to require technical skills (50%) than social skills (28%). In all occupational categories, technical skills rank higher than any other skill or signal (with the exception of advertisements for higher managerial and professional jobs where qualifications – which, among others, certify technical skills – rank the highest, slightly above technical skills).

Employer surveys usually ask hiring managers or human resource officers about the skills that employers are looking for when recruiting. To a large extent this presupposes an initial selection: individuals will apply to jobs that are related to their area of expertise; by applying and getting past any screening phase, technical skills are already documented. As a result, hiring managers are already confronted with a pool of candidates who, more or less, already have the technical and basic skills. The final recruitment decision is then based on socio-emotional or higher-order cognitive skills. However,   this does not mean that technical or basic skills are less important than socio-emotional skills for employers but rather that they are taken for granted in the pre-selected group of candidates. Given two candidates with similar technical skills, an employer may be inclined to choose the candidate with stronger socio-emotional or analytical skills.

Let’s take the example of an engineer, or any other profession thereof. The technical skills underlying the practice of an engineer are what define the practice. In most countries, engineers can only practise if they have gained professional registration that certifies having the technical skills and knowledge. Socio-emotional and higher-order cognitive skills will, most likely, not get a non-engineer an engineering job if he/she does not have the certification or experience to show for the relevant technical skills required in the job.

Employers’ stress on socio-emotional skills does speak of the relevance of these skills in today’s workplace. However, more than their unavailability or scarcity in the labour market, it could stem from the fact that they are not being put to use. Developing socio-emotional skills and putting them to use is also employers’ responsibility. Motivation, persistence, co-operation, teamwork, trust, etc. can be developed and used effectively with employee involvement in decision-making, a more horizontal organisational culture, autonomy, merit-based promotion prospects, adequate compensation schemes and other organisational attributes.

The OECD has made available an online version of the Survey of Adult Skills: Education and Skills Online. It is an assessment of literacy, numeracy and problem solving in technology-rich environments, well-being and skills-use (including socio-emotional skills). It provides individual-level results linked to the Survey of Adult Skills (PIAAC), allowing employers (but also educational institutions, researchers, governments and NGOs) to measure their workers’ skill proficiency and skill, as well as that of potential recruits.

Results from employer surveys need to be taken with a pinch of salt. They do not necessarily reflect the skills needed in the labour market or their relative importance vis-à-vis other skills. Adequately measuring skill needs requires multiple sources of evidence to inform policies at the level of education and training systems and the firm level.