August 10, 2022 |
What is Skills Mismatch and Why You Should Care 

The emerging technologies and digitalisation have caused the nature of work to change rapidly. The rise of automation, as well as artificial intelligence, have effectively transformed workplaces into something that we could have just imagined a few years ago. Although there is no exact effect identified in these significant changes in the way we work, the skills that businesses require from their people are definitely changing. The skills we thought we do not need in the workplace are suddenly in demand, and the skills we taught ourselves so hard years ago are becoming more and more irrelevant. Employers struggle to hire people that are appropriately trained because of skills mismatch.  


What Is Skills Mismatch? 

International Labour Organization defines skills mismatch as a discrepancy between the skills that are sought by employers and the skills that are possessed by individuals. When the skills of the individuals and the jobs offered by companies do not match, this indicates that either the economy is not producing employment that matches people’s skills or that education and training are not producing the skills needed in the workforce.    


According to a poll conducted by the National Trades Union Congress (NTUC) in collaboration with NTUC LearningHub, 63 per cent of company leaders in Singapore believe that skills mismatches continue to be the most common type of mismatch. This is in comparison to experience mismatch (18%), wages mismatch (17%) and expectations mismatch (2%).  


The common misconception about skills mismatch that businesses need to deal with is the lack of technical or hard skills (e.g. coding, digital skills, cybersecurity, etc.). What many people do not realise is that there is also a major gap in soft skills, including leadership. In fact, almost three out of four companies claim that it is difficult for them to find college graduates who possess the soft skills they require. The fact that 91 per cent of talent acquisition experts believe soft skills will be crucial in the future raises warning bells. 


Over the coming years, the following skills gaps are some of the most significant ones: 


  • advanced mathematical and data analytical abilities 
  • processing and interpretation of complicated information 
  • IT expertise and programming
  • Taking charge and overseeing others 
  • Decision-making and critical thinking 
  • flexibility and ongoing learning 


Types of Skills Mismatch 

Skills mismatch comes in different forms – its prevalence could mean that most of us are affected by it and we are unaware of it. Here are the most common types of skills mismatch.


#1: Overskilling  

When a worker thinks they have more skills than they actually do, or they have more expertise than what is required by their current position, it is referred to as overskilling.  


#2: Underskilling 

Under skilling, on the other hand, refers to the circumstance wherein the employee feels that the job’s requirements are not met by their existing skill set.  


#3: Horizontal mismatch 

Horizontal mismatch usually happens to fresh graduates, and it occurs when their chosen profession is unrelated to their primary course of study.  


#4: Skill Obsolescence 

This type of skills mismatch happens when the skills of the workers become obsolete. Skill obsolescence happens due to ageing which reduces the value of some manual skills caused by economic or technological development. This renders some skills unnecessary or unutilised.  


#5: Skill gaps 

This is the degree to which employees lack the abilities required to execute their current job. It is similar to underskilling to some extent, it’s just that skills gaps happen in the employer level while underskilling takes place at a firm level.  


#6: Skill Shortages 

Skill shortages occur because of empty or difficult to fill positions that have resulted from a lack of eligible applicants for open positions.  


It is possible for different kinds of mismatch to coexist, such as when someone is both overqualified and underskilled. This frequently occurs when the field of education does not match the field of employment.  


How Can Skills Mismatch Affect Employees 

Skills mismatch can affect us in so many ways. In fact, if you dread going to work this morning, that could be a sign that you are in a skills mismatch. Here are some of the ways it can affect you and your work performance.  


1. Abuse of Salary in the Available Labour Market 

 It began with a new task here and an added obligation there. You will soon discover that you are doing more than just your regular job. However, your pay has strangely remained the same. According to each employment level, there are associated duties and pay. You are not being paid fairly if you are working above what you first agreed to. You may already be performing the duties of two or three persons. 


2. Underutilisation of Your Actual Experience or Education 

 Some degree holders find themselves in positions for which they are either overqualified or underqualified. Because of this, they are left with an uncertain work future. You might find yourself in this situation when your job doesn’t make the most of the degree you paid for and spent a number of years learning. The uncertainty and the nagging feeling that you could actually do more than what you are currently doing subconsciously affects your work productivity and even your overall performance.  


3. Settling for Part-time When You Can Be Doing Full-Time 

 There is nothing wrong with being a part-time worker. But if you work part-time and have a background in a highly technical industry, you might be experiencing a mismatch. Your professional experiences should broaden your knowledge. However, you are being taken advantage of if you are not given the time to do so. This impedes your growth and skill development.  


4. Happiness, Fulfilment and Satisfaction Are Missing 

 This might seem intangible, and even irrelevant to some, but these hugely affect your overall performance at work. You’d barely produce a quality output if you are not happy with what you are doing – unfulfilled and unsatisfied. In the end, you’ll just do half-baked work which can be improved if only you have the right skills for the right job.  


How Can Skills Mismatch Affect Employers 

Skills mismatch can cost employers and firms a lot. While mismatched employees may have issues in their work productivity and performance, the entire business can be affected if they have a number of employees who do not have the right skills for the job.  


When there is a skill mismatch, it can affect the business in several ways.  


1. Increased employee engagement and dissatisfaction 

 While this can be at the employee level, it can become a company-wide problem if there’s a significant number of employees that are unhappy with their current jobs. May it be because of lack of opportunity for self-development or simply the lack of job offerings that match their skills, if they are unhappy and unproductive, they can affect the overall productivity of the business.  


2. It can be a cause of delay in goals and milestones 

 Unhappy employees are unproductive, and when they are underskilled, they deliver half-baked outputs. If the company has a target deadline or a milestone to achieve, that can be delayed because the workers do not have the right skill to execute a project. It can be delayed because the people working on it are less motivated and would rather be somewhere else. 


3. Disgruntled Clients and Loss of Customers 

Underqualified and untrained employees often lack the skills to do basic customer service. In this day and age where companies are expected to be customer-centric, businesses that do not have skilled customer service personnel could lose potential customers and could even produce disgruntled clients as a result of poor work quality.  


4. Loss of Opportunity and Wastage of Company Resources 

 The company might want to introduce a new product or service, but underskilled workers can ultimately delay this, and even prevent the business from ever moving forward. There are a lot of opportunities that both the company and the employees could be missing just because they are trying to work on something that doesn’t fit at all.   


Solutions to Skills Mismatch 

Skills mismatch can cause many inconveniences and even disillusionment, but there are things we can do to avoid it, and even shift if we feel like we are trapped in this situation. Here are some things we can do.  


For Individuals: 


1. Choose the right degree 

 Make sure the degree you get is tailored for the career you want to pursue if you don’t want to end up at the wrong desk. You will need to study more diligently because these degrees are some of the hardest. 


2. Stay Up to Date 

 It’s acceptable if not all of us are intelligent enough for seven years of medical school. If you want to prevent employment mismatch but don’t want to be a doctor or lawyer, all hope is not lost. If you follow current developments in the economy, you can make a good degree decision. 


3. Use Online Courses 

 One of the freedoms the internet has given us is the ability to retrain while continuing to work and earn money. Online courses can assist us in developing new talents or honing those we already have so we can use them in a freelance career. 


One of the best ways to find something that you enjoy is to become self-employed, but be ready to put in a lot of effort in the beginning.   


For Businesses: 


1. Write clear job descriptions that detail the skills needed. 

 The hiring procedure is guided by the job descriptions provided. They let potential candidates know what level of competence you’re searching for so they can apply for the position. In order to ensure that your candidate pool has the proper competencies, job descriptions are essential. 


2. Streamline your online candidate search to uncover more promising candidates. 

 Nowadays, posting jobs online is by far the most efficient approach to finding candidates. It still isn’t simple, though. You must find a strategy to differentiate yourself from the competition because many of your rivals are also looking for talented applicants in your field. 


Include a thorough job description that outlines the degree of expertise and experience you require. By doing this, you can avoid having to sift through blatant mismatches and ensure that your application pool filters itself. 


3. Use skills evaluations to get rid of skills mismatch. 

 Assessments of skills can take many different forms, including simple test questions, comprehensive test projects, and even job simulation activities. However, nothing works better for the first screening phase than skills testing. You can rank candidates swiftly and objectively using online exams developed by subject matter experts, thereby removing skill mismatches. 


4. Outsource to address the skills gap in your area. 

 Regional skill shortages are possible. Fewer people may be able to provide the necessary abilities when certain employment emerges in some regions of the world because of either exceptionally high demand or a low supply. 


Most of us need to work, and it’s admirable to work a job you don’t particularly enjoy in order to maintain your employment. But it’s best to avoid job mismatch whenever you can for your own personal satisfaction (and to prevent burnout). 


Increase your potential to land the job you want and follow the career path of your choice. Training Vision Institute offers self-development courses and programmes for higher learning that are up-to-date and can easily be transferred to the workplace.  


Take charge of your upskilling and reskilling and avoid landing on the wrong desk. Check out our programmes and sign up for the one that suits you best!