The Millennials’ skills gap – why, so what and what to do about it?
No student or graduate has ever been fully prepared to enter the world of work. Recent studies of employers and Millennials find both groups agreeing that current education systems do not help students attain the required ‘human’ skills and behaviours to succeed in business.
A recent Youth Speak Report found over half of Millennials students (53%) believe there is disconnect between what they learn today and what they will need tomorrow[i] and a recent survey by Deloitte found that skills gained in higher education only contribute a third of those required to achieve organisational goals.[ii]
Business leaders who agreed that under-prepared college graduates harm the productivity of their organisation’s day-to-day business
Why should a skills gap among Millennials be of concern to business?
By 2020, half of the workforce will be from the Millennial generation. They will be the future leaders in business, responsible for future growth, building relationships and taking key business decisions.
A recent study by Bentley University should therefore be of concern for business leaders. It found two-thirds of business leaders (64%) agreed that newly hired recent college graduates who are not well prepared harm the productivity of their organisation’s day-to-day business.[iii]
What fraction the skills gained in higher education contribute towards achieving organisational goals.
|Why isn’t further education giving students the required skills to thrive in a real business environment?|
|1. Too focused on technical theory – many business schools are still teaching management concepts from the 1990s which don’t relate to the real world
2. Students “play the game” at University in order to get the best grades.[iv]
3. Success measured in credit hours (mainly in the USA). Time spent in the classroom, reading books, attending lectures, taking tests and exams, all done with the hope of a passing grade.[v]
4. Universities are too narrow, rewarding success in written exams and coursework.
5. Decline in Liberal Arts and Humanities degrees (which inherently require critical thinking, skills in analysis and communication skills) in favour of business and occupational degrees.[vi]
What key skills do businesses really need?
Business leaders agree that the key skills they require are ‘human’ skills. Behaviours that cannot be taught in a lecture or read in a book but instead acquired through human experiences, interaction, explanation, modelling, collaboration, coaching, feedback and mentoring.
One recent study found just 19% of business professionals believe hard skills are more important than soft skills, and only 40% say job-specific knowledge is important.[vii]
“Yes, they can pass a calculus exam, but can they identify or solve problems on the job, or negotiate, or lead a meeting?”[viii]
While basic technical knowledge (i.e. legal/accounting/marketing) is important, many employers agree however, that technical knowledge can easily be taught and acquired on the job.
The percentage of business professionals who believe hard skills are more important than soft skills
We believe the fundamental skills and behaviours required to succeed in business, which underpin all core business activities (business development, negotiation, presenting, leadership) are ‘human’ skills.
Moving beyond the concepts of ‘soft skills’ and ‘emotional intelligence’, a recent study by the World Economic Forum and BCG helps to categorise the ‘human skills and behaviours’ required to succeed in business into two groups: competencies and character qualities:[ix]
1. Competencies: critical thinking, problem solving, reasoning and communication
2. Character qualities: leadership, adaptability, social skills, self awareness
What can be done?
Millennials are keen to learn and develop career skills and they acknowledge that the learning experiences they have encountered before entering the world of work have not equipped them with the skills and behaviours to succeed in the real world.
The future is bright. Compared to Generation X, hiring managers see Millennials as more open to change, creative and adaptable.[x] Having grown up in a fast-paced, digital world, Millennials are used to embracing change, instant communication and have developed an ability to access huge amounts of data at the click of a button.
The next step for employers is to determine exactly what skills and behaviours should make up a professional services career skillset for Millennials? This forms the basis of our third Millennials in Professional Services Point of View…
Discover our entire Points of View series on Millennials
‘Millennials’ – also known as Generation Y – are individuals who were born in the early 1980s to late 1990s and will come of age in the early noughties (2000s).
For some, Millennials are lazy, narcissistic, job-hopping, praise seeking, entitled, skill-lacking, under-prepared digital addicts. Others see them as digitally proficient, adaptable, confident, creative, knowledge-seeking catalysts for accelerated business change.
From recent client conversations and speaking to many professional services firms we know that one of the key questions currently being asked by senior managers and directors of professional services firms is how to face the challenges and embrace the opportunities offered by the Millennial generation…
Recent research of both employers and Millennials has found both groups agreeing that current education systems do not help students attain the required skills and behaviours to succeed in business.
This Point of View article outlines potential reasons why education is not giving students the required skills to survive in a real business environment and discusses why the perceived skills gap should be of concern to business leaders in professional services.
The article finds only a small percentage of business professionals believe that hard skills are more important than soft skills and argues that the fundamental skills required to succeed in professional services are ‘human’ skills, which can only be acquired through human experiences, interaction, coaching, explanation, modelling, collaboration, coaching, feedback and mentoring.
Fortunately, it is found that Millennials are keen to learn and develop skills and behaviours that will help them progress throughout their careers.
The next step for professional services firms is therefore to determine of what skills and behaviours a rounded business career skillset should comprise and then to establish how these skills and behaviours can be learned, developed, practiced and refined within the firm.
In order to formulate a learning and development strategy to overcome the perceived skills gap among Millennials, firms must first define the rounded skillset required to succeed in a 21st Century professional services environment.
Based on research and experience, the 21st Century professional services rounded skillset for Millennials is defined as
- Digital proficiency
- Technical knowledge
Which is most successfully applied when combined with:
- Human’ skills and behaviours
Fundamentally, Millennials working in professional services will most successfully apply technical expertise and digital proficiency when it is combined with ‘human’ skills and behaviours. Core business operations are all founded on learning and developing core ‘human’ skills and behaviours.
Moving beyond the concepts of ‘soft skills’ and ‘emotional intelligence’, the article defines human skills required by Millennials as either:
- Competencies – needed to approach complex challenges at work, and
- Character Qualities – needed in the new work environment
Millennials are different, with their own unique attitudes and values. They want to learn and they want to work hard, they just want to learn and work differently to previous generations. Firms who show commitment to the learning and development of their Millennial workforce will gain loyal, committed and engaged employees.
This article provides a potential framework that professional services might follow to develop ‘human’ skills among their Millennial workforce. The proposed framework is based on the McKinsey Quarterly article of June 2003 entitled “The Psychology of Change Management”.
Capability Building: Professional services firms should ensure that the necessary infrastructure and mechanisms are in place for Millennial employees to learn, practice, develop and then refine the human skills required to succeed in business based on an analysis of individual skills and capabilities gaps.
A Compelling Story: Employees will only change their mindsets if they can see the point of change and agree with it, which has interesting implications when considering the learning and development needs of the Millennial generation.
Research suggests that Millennials want ‘meaning’ at work, self-determination and to know their work is making a difference. Professional services firms need to give their Millennials a story they can believe in by helping them to understand how developing ‘human’ skills and behaviours will not only aid their future career ambitions but also their clients and society as a whole.
Consistent Role Modelling: In order for Millennials to learn the required ‘human’ skills, they must be exposed to “significant other” role models (those in a position of influence) in their professional services firm who “walk the talk” and are able to coach them in and also demonstrate the right behaviours.
Reinforcement Systems: The final building block is to ensure that firms put in place ‘reinforcement systems’ such as feedback; appraisals; coaching and opportunities for Millennials to practice newly acquired human skills on an on-going basis, in a live business environment.
5. Can a ‘traditional’ professional services firm’s culture be compatible with the attitudes of Millennials?
Professional services firms should be under no illusion – the Millennials are coming. In the next few years, Millennials will make up the largest proportion of the workforce and will become the leaders of your firm.
Over the last few months PSfPS have extensively researched the role of Millennials in professional services with regards to their attitudes and existing skills set and it has become clear that some firms have already started to adapt their policies and procedures to satisfy the unique attitudes, desires and expectations of their Millennial employees.
However, when specifically focusing on professional services an overarching question still remains:
Can a traditional professional services firm’s culture ever be compatible with the attitudes and expectations of Millennials?
Using real examples, this Point of View article examines how firms should start to adapt their cultures (behaviours, processes and mindsets) to make them more compatible with their Millennial employees.
Ultimately, firms need to redefine ‘traditional’ before Millennials and the market do it for them…
[i] Improving The Journey From Education To Employment YouthSpeak Survey Millennial Insight Report 2015
[ii]“Mind the gaps” – The 2015 Deloitte Millennial Survey p.8
[iii] The PreparedU Project: Millennials in the Workplace, Bentley University 2014
[iv] Rebecca Flanagan, The Kids Aren’t Alright – Rethinking the law student skills deficit, B.Y.U. Education & Law Journal 2015
[v]See fastcompany.com – This is the future of college
[vi]Rebecca Flanagan, The Kids Aren’t Alright – Rethinking the law student skills deficit, B.Y.U. Education & Law Journal 2015
[vii]The PreparedU Project: Millennials in the Workplace, Bentley University 2014
[viii]See fastcompany.com- This is the future of college
[ix] “New Vision for Education – Unlocking the Potential of Technology” World Economic Forum & Boston Consulting Group 2015 p. 3
[x] Dan Schawbel And Jaleh Bisharat, Businesses Need Millennials If They Are To Remain Competitive, Talent Development, January 2015 p.22