Is Lack of Worker Skills Responsible for High Unemployment?

David Wessel had an interesting article about the effect of one area of corporate cutbacks — human relations.  HR departments adjust by relying on electronic services to evaluate applications.  The process is so rigid that virtually no applications are suitable.

One company drew 25,000 applicants for a standard engineering position only to have the HR department say not one was qualified.

One interesting implication is that the corporate types who complain about having trouble finding workers may not all be lying.  Some may have been shooting themselves in the foot.  Maybe it is not so much a lack of skills as corporate short-sightedness.

Here is the article:

 

Wessel, David. 2012. “Software Raises Bar for Hiring.” Wall Street Journal (31 May): p. A 2.

 

http://online.wsj.com/article/SB10001424052702304821304577436172660988042.html?mod=ITP_pageone

 

 

“In an essay in this newspaper last fall, Peter Cappelli, a professor of management and human resources at the University of Pennsylvania’s Wharton School, challenged the oft-heard complaint from employers that they can’t find good workers with the right skills. “The real culprits are the employers themselves,” he asserted. “It is part of a long-term trend,” he adds in an interview, “and the recession caused employers to be able to be pickier, to get even more specific in the skills they think they can find outside the company and to cut back on training”.”

 

“Not surprisingly, his essay drew a lot of response. What did surprise Mr. Cappelli — as he describes in a book, “Why Good People Can’t Get Jobs,” to be published in June — was the frequency of complaints about the hiring process itself, particularly the now-ubiquitous use of software to screen applicants.”

 

“A Philadelphia-area human-resources executive told Mr. Cappelli that he applied anonymously for a job in his own company as an experiment.  He didn’t make it through the screening process.  The job market is more than a professional concern for Mr. Cappelli. His son, now 25 years old, graduated in 2010 with a degree in classics from St. John’s College and couldn’t find a job. Told that health care was hiring, he enrolled at New Orleans’s Delgado Community College and got a certificate in phlebotomy, learning how to draw patients’ blood. However, he discovered that work experience was essential to land a job. Also, many potential employers were consolidating two medical-related occupations into one, so a phlebotomy certificate alone wasn’t enough. He is still looking.”

 

“For the entire U.S. economy, a lot rides on correctly diagnosing today’s job market. If the chief problem is one of too many workers and not enough jobs, then today’s unemployment is treatable and there’s a case for more fiscal and monetary policy to stimulate demand, or at least for deferring fiscal austerity. But if the problem is chiefly a mismatch between skills employers need and those the jobless have, then more fiscal and monetary medicine won’t do much good. That kind of unemployment is treatable only in the long run-with better education and training.”

 

“Mr. Cappelli leans toward the first view but argues that there’s more to this. “For every story about an employer who can’t find qualified applicants, there’s a counterbalancing tale about an employer with ridiculous hiring requirements,” he says. In many companies, software has replaced recruiters, he writes, so “applicants rarely talk to anyone, even by email, during the hiring process”.”

 

“As in other parts of the economy, software has its benefits. It makes applying for a job easier. One doesn’t have to trudge down to the HR office to fill out forms. It has broadened the pool of applicants from which employers can choose. It saves money.  But at a time of widespread unemployment, the volume of applications is swamping HR departments, many of which have been downsized to cut costs.  That has led employers to further automate hiring — and to become incredibly specific about experience and skills they seek. Screening software weeds out anyone whose application lacks particular key words.”

 

“With so much talent looking for work, why not get what you really need? Here’s why: Managers pile up so many requirements that they make it nearly impossible to find anyone who fits.  Neal Grunstra, president of Mindbank Consulting Group, a temporary-staffing company, calls this “looking for a unicorn.” Mr. Cappelli’s favorite email came from a company that drew 25,000 applicants for a standard engineering position only to have the HR department say not one was qualified. One job seeker said “he had been told he was perfect for a given position — except for the fact that his previous job title didn’t match that of the vacancy,” a title unique to the prospective employer.”

 

“As anyone who has applied for a job lately knows, the trick is parroting all the words in the job description but not just copying and pasting the text, which leads the software to discard the application. It’s a whole new skill: Clearing the software hurdle is as important as being able to do the job.”

 

“Much of what is broken in the U.S. job market will take a lot of work and time to fix. The current approach to training needs repair, for instance.  But some fixes are easier. Employers could, as Mr. Cappelli puts it, “back off the strict requirement that applicants need to have previously done precisely the tasks needed for the vacant job” and “see if they could do the same with some training or ramp-up time.” And employers could insist that vendors redo the software so it isn’t so picky and flags for personal consideration — rather than discards — an applicant who doesn’t quite fit the specifics but might be able to do the job.”

 

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