Closing the Global Skills Gap

In the world of work, skills are worth their weight in gold. Yet, according to a recent survey of more than 800 global companies, only four in 10 workers have completed the necessary training to keep up with the skills that are most in demand. That’s led to a widening skills gap, creating a mismatch between the skills an employer expects their employees to possess and the actual skills employees bring to the table.

Left unchecked, this could have a seismic impact on the economy. One estimate, released prior to the pandemic, placed the global price tag of a skilled talent shortage at nearly $8.5 trillion in unrealized revenue by 2030—equal to the combined GDPs of Germany and Japan. Across the EU, where many countries are facing a steep climb in their efforts to ease persistent labor market tension, roughly three-quarters of employers report facing at least “some difficulties” finding skilled talent, with 26 percent reporting a large degree of difficulty.

This situation is unfolding against the backdrop of a global labor market that remains in flux. In the U.S., inflation continues to rear its head, delaying the Federal Reserve’s attempts at a soft landing—at least for now. As employers collectively hold their breaths, the competition for workers remains hot. Although the ratio of job openings to employment came off its peak in 2022, this critical indicator of labor market tightness is still sitting roughly one point higher than prior to the pandemic.

The way we work is changing, too. With the rise of AI, new research has shown that an estimated 40 percent of all jobs will be impacted by this emerging technology. While there’s no doubt this will reshape our global economy, there’s cause for optimism: AI has the potential to create new opportunities, increase productivity, and empower the workforce to focus on more creative and meaningful tasks.

These themes form the basis for AgileOne’s Workforce Solutions Market Overview: 2024 Mid-Year Update. This report is the latest in a series of insights from workforce solutions leader AgileOne aimed at helping companies around the world navigate the complexity of today’s employment landscape. In this edition, we focus on the Skills of the Future, presenting current data on the fastest-growing jobs within three regions of the world, expertise from our data and AI researchers, and key trends across finance and accounting, automotive, and life sciences.

Here are five takeaways from our report:

1. With AI poised to impact at least 40% of jobs, adapting your workforce strategies is essential. Supplementing your traditional workforce with contingent workers builds flexibility and resilience, enabling you to ride the tide of change and uncertainty with grace and ease.
2. Economic and technological changes will disrupt an estimated 44% of today’s skills within five years. To stay competitive, investing in reskilling and upskilling initiatives is a must to prepare employees for future challenges and enhance organizational agility.
3. The tight labor market highlights the value of a diverse talent pool. As demographics shift, diversifying your team is a powerful asset, bringing a wide range of perspectives, skills, and experiences that enhance innovation and problem-solving.
4. Despite widespread AI adoption, only 10% of employees feel confident in their data literacy skills. Meanwhile, just 21% believe their employer prepares them for a data-driven workplace. Implementing a comprehensive data literacy program bridges this gap, preparing your workforce for a data-centric future.
5. Skilled workers are happier and more likely to stay, with more than three-quarters of employees valuing continuous training. Rewarding workers for acquiring new skills fosters a continuous learning environment. Financial incentives, flexible work arrangements, and extra paid time off can motivate employees to seek learning opportunities.

The global skills gap represents a once-in-a-generation challenge for businesses of all sizes. The economic consequences are significant, underscoring the urgency for companies to invest in programs aimed at bridging the gap and preparing the global workforce for a future in which innovation, automation, and economic uncertainty are constantly changing the way we work.

At AgileOne, we have a pulse on what's happening and stand ready to help companies lead with confidence. Our Workforce Solutions Market Overview series is just one of the tools we’ve made available to assist organizations in navigating these complexities. By providing up-to-date data, expert analysis, and actionable insights, our reports empower businesses to make informed decisions about workforce planning and development.

Together, we can tackle the skills gap head-on and ensure that your workforce is not just prepared for the future—but thrives in it.

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Download AgileOne’s Workforce Solutions Market Overview: 2024 Mid-Year Update here.