February 19, 2020

Landscape Analysis: Improving Signaling of In-Demand Skills

2020 Workforce Landscape Analysis Report

American employers are feeling the pain of acute skills gaps, driven by a tight labor market and technology’s influence on a rapidly evolving world of work. But while employers are struggling to identify, attract, and retain workers, individuals often see the skills that they do have overlooked by hiring and promotion processes that rely on college degrees and other proxies for talent and weren’t built to track, communicate, measure, or quantify today’s most in-demand skills.

The result is a talent marketplace that is broken, limiting both economic opportunity for individuals and economic growth for companies. 

The challenge stems, in part, from a troubling communication gap: our education and employment systems don’t speak the same language or communicate effectively. Employers can’t share what they need and individuals can’t share what they can do in a way the other understands. Against that backdrop, the burden of charting a path to economic opportunity often falls on individuals, who are poorly equipped to do that.

The challenge of education-employer interoperability is compounded by a lack of technical infrastructure that would allow this communication to happen. It’s a challenge other sectors have faced and have overcome. For example, using a credit card requires a massive network of players—merchants, banks, hardware providers, and other intermediaries—that must all digitally “talk” to and trust one another in order to seamlessly turn the physical interaction of paying someone into a digital transaction. A similarly complex interoperable network is needed for opportunity seekers to share what they know and can do with employers. But the challenge in the talent marketplace is, in many ways, even more profound. Financial networks, after all, deal in currency that has a recognized form and value. In contrast, the systems that will support a talent communication ecosystem have the added challenge of defining and sharing something much more amorphous: skills.

Fortunately, a growing number of organizations and initiatives are focusing on closing the communication gap. But as they’ve grown in number, the challenge of differentiating between and among players, their overlapping solutions, and the complex relationships among them likewise grows.

This paper aims to demystify that landscape and how the major initiatives, including three led by the U.S. Chamber of Commerce Foundation, fit together.

Specifically, it unpacks the work being done in five critical areas:

  • Navigating Credentials and Opportunities: Creating better data and tools for opportunity seekers to understand the workforce value of specific skills and credentials.
  • Communicating and Authenticating Skills: Enabling opportunity seekers to share what they know and can do more clearly and in a way that employers recognize and trust. 
  • Communicating Skill Needs: Helping employers identify, describe, and share the discrete competencies required for open roles within their organization. 
  • Understanding Skills that Matter: Creating the processes for employers to understand what skills matter for roles at their organization and to communicate where gaps exist.
  • Improving or Creating Technical Infrastructure: Developing the shared standards and technical infrastructure to facilitate better communication.

Vast improvements in each of these areas are necessary to unlock their collective potential to transform the way we think about, measure, and communicate skills. It’s simply not enough to recognize the role important competencies should play in hiring, or even to develop a common understanding of what skills are. We have to build the technical infrastructure that actually allows employers, educational providers, and individuals to speak clearly to one another.

To meet this need, the U.S. Chamber of Commerce Foundation has pioneered three key initiatives:

  • Talent Pipeline Management® (TPM)
  • The Job Data ExchangeTM (JDX)
  • The T3 Innovation NetworkTM

Together, these initiatives are designed to provide a Rosetta Stone for the talent ecosystem, translating both supply and demand signals into a common language and broadcasting these signals to relevant actors throughout the supply chain in near-real time. They also provide the foundation for other innovations necessary to create a more dynamic and inclusive talent market.

Just as the financial infrastructure that facilitates credit card payments is largely invisible to the end user, these initiatives are, in many cases, enabling tools that will create a more seamless way of connecting talent to employers and individuals to opportunity.

Those who care about creating a more equitable labor market based on skills rather than inefficient proxies must first be clear about what players in the sector are doing, what they hope to accomplish, and who they need to bring along in the process. This paper is designed to build that common understanding.