Failing to find qualified candidates for open jobs can cost your business thousands of dollars a year.
A new study from CareerBuilder revealed that, on average, a company loses more than $14,000 for every job that stays vacant for at least three months. In addition to lost revenue, organizations with open positions also suffer from a drop in productivity.
Specifically, 41 percent of employers with open jobs said they have seen work fail to get completed, while 25 percent have experienced an increase in employee mistakes, resulting in a lower quality of work. Additional ramifications include lower employee morale, delays in delivery times, declines in customer service, less-motivated workers and increased turnover.
The study shows the costs are adding up for many employers. More than half of the organizations surveyed currently have open positions for which they can't find qualified candidates, with 35 percent of those saying they have positions stay open for at least 12 weeks.
"There is a growing disconnect between the skills employers need and the skills that are being cultivated in the labor market today," said CareerBuilder CEO Matt Ferguson "This causes workers and companies to miss out on realizing their full potential and, in turn, causes the economy to fall short of its potential."
Employers face a greater challenge filling some positions than others. Businesses hiring in 2014 said the areas in which they are experiencing the most difficulty in filling open positions are:
- Computer and Mathematical Occupations
- Architecture and Engineering Occupations
- Management Occupations
- Health Care Practitioners and Technical Occupations
- Installation, Maintenance and Repair Occupations
- Legal Occupations
- Business and Financial Operations
- Personal Care and Services Occupations
- Sales and Related Occupations
- Production Occupations
"The onus is on businesses and the public sector to work side by side to identify where there is a deficit of talent — and reskill workers to close the gaps within their communities," Ferguson said. "This is not a problem that can be solved overnight, but it can be solved."
Employers point to a handful of drivers behind the skills gap, such as:
- Education gap: The educated labor supply in the United States is not keeping up with demand. For example, in 2012, around 1,600 people graduated with petroleum engineering degrees, despite the United States producing around 2,600 job openings every year in that field.
- Gaps in expectations around wages: Employers may not always be able or willing to pay what the market dictates for a particular position. Research revealed that 35 percent of employers believe they can pay people less because of the high unemployment rate.
- Job requirements that are above entry requirements: The roles within organizations are becoming more complex. Nearly one-third of employers now hire college graduates for positions previously held by high school graduates.
- New/shifting technologies: Technology is changing so rapidly that it can be difficult to keep pace in an academic setting. According to research in a book authored by Ferguson, "The Talent Equation" (McGraw Hill, 2013), it is estimated that technology skills depreciate at about the same rate as physical assets.
The study was based on surveys of more than 1,000 U.S. employers and 1,500 job seekers.