2016 Employer Needs Survey Joshua Levy Senior Policy Analyst Labor and Economic Analysis Division (LEAD) NC Department of Commerce

Background In search of the “Skills Gap” History and recent research How do we know it when we see it? Background

Research Defining the terms Labor markets are markets Shortages and mismatches, hiring difficulties Geography, industry, and occupation Labor markets are markets Surveys, Supply and Demand models, Wage growth Research Use some of Andrew’s research on mismatch, incorporate other recent research

What is the current and recent state of hiring by employers in the state? Are employers having difficulties hiring, and if so, which employers and to what extent? What reasons do employers give for hiring difficulties? What can job vacancies tell us about hiring demand and potential difficulties? What are employers’ current strategies for recruiting and retaining employees? Survey Goals

Survey Overview Update & enhancement of 2014 survey 1,903 surveys collected all sized companies (previously 10-499 employees) industry mix similar to the state all 100 counties participated Phone interviews by NCSU Center for Urban Affairs & Community Services Focus on four industries: Manufacturing, Construction, Healthcare, and STEM Survey Overview

Trends Compared to 2014… Hiring remains strong – same as 2014 Hiring difficulties still exist – same as 2014 Still no difference between urban & rural counties Top 3 reasons for difficulties remain Increase in citing soft skills difficulty Trends Compared to 2014…

Hiring Overall sample—68% attempted to hire in the past 12 month 1-9 employees, 52% tried to hire 10-499 employees, 89% tried to hire (same as 2014) Four Industry groups similar (50-60% for all sizes, 70-80% for 10-499) Hiring Fix this

Trends Compared to 2014*… Statistically the same as 2014 - despite a more competitive market 70% said difficulties are “about same as last year” 11% perceive improving 19% perceive declining * Comparing only those w/ 10-499 employees

Work Experience Education, Certification, Training Technical Skills Soft Skills Criminal Record Low Pay Failed Drug Screening Hiring Difficulties *among all hiring employers experiencing difficulties

Hiring Difficulties *all hiring employers by Industry * Healthcare difficulty mostly in establishments w/ 10+ employees

Top Reasons for Hiring Difficulties by Industry Many Similarities Between Industries Technical or Occupation-Related Skills Relevant Work Experience Education Level, Certification, or Training Some Differences Manufacturing and Construction—over 50% chose technical skills and work experience, only 25% chose education Healthcare—nearly 50% chose education, then technical skills, work experience. Low pay an issue for 25% STEM—over 50% chose technical skills and work experience, followed by education and soft skills Top Reasons for Hiring Difficulties by Industry

Other Reasons for Hiring Difficulties Lack of work ethic, dependability issues Low number of applicants, rural location, transportation Lack of interest in industry/occupation Increased competition improved economy Negative characteristics of workplace or job Inability to offer higher wages Other Reasons for Hiring Difficulties

Hiring Difficulty by Position Experience Required Among the Four Industries… Entry-level positions much easier to fill The more experience needed, the greater hiring difficulty 58% of “experienced” positions are very difficult to fill Experience Gap ? Hiring Difficulty by Position Experience Required Entry Mid Experienced* Manufacturing 23% 30% 50% Construction 33% 38% 65% Health Care 13% 15% STEM 10% 14% 62% * Experienced positions = 5 or more years experience

Recruiting Resources all industries Word of Mouth Internet Job Boards Company Websites Community Colleges Social Network Sites Local Newspapers Universities NCWorks Online NCWorks Career Center Recruiting Resources all industries 24% used Word of Mouth Exclusively, had less difficulty

Skill Training Resources On-the-Job Training Private Vendors Community Colleges Universities Apprenticeship Programs Skill Training Resources OJT: Area of Future Study What level of On-the-Job Training is offered? Types of training and for whom? How many companies do not offer structured training? Fix other, 13%

45% of all organizations plan to hire in the next 12 months 61% with 10+ employees 30% of small employers (<10 employees) Similar across all 4 industries Hiring Outlook Delete All Industries

Conclusions The Big Takeaways Policy Implications Hiring Difficulties remain the same—4 out of 10 overall Work Experience, Education, and Skills all matter Different issues for different industries and occupations Policy Implications Opportunities for Workforce Development System Apprenticeships to provide work experience Increased engagement with employers for recruitment as well as skill development of existing workforce Sharing findings with and learning from jobseekers Conclusions

Questions ?