Tuesday 1 June 2021 9:00 am Avado Talk

Defining the skills gap with Avado’s Beyond Skills report

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Last month, we launched our Beyond Skills report. We surveyed more than 1,000 executives and senior leaders across several sectors to assess the growing capability chasm. 

We found that more than 3/5 of business leaders agree that the events of 2020 have widened the skills gaps in their businesses. We also found that, across the board, 71% of businesses that saw growth last year did increase their training budgets. Our report breaks this down and identifies key pain points for each sector we focused on.

But it’s important to start with an explanation of the term capability chasm. We found a need to use this term because “skills gap” only scratches the surface. Calling it a capability chasm is much more accurate and does a better job at highlighting how critical solving this challenge is.

Read on to learn more about the terms and phrases we wove through our Beyond Skills report, and how they fit into conversations around the expanding capability chasm in the UK.

Capability 

We define a ‘capability’ as a thorough understanding of something, or an ability to do something that is not isolated and flows between different skills. Both individuals and businesses can have capabilities. “Business capabilities refer to the deep-rooted knowledge required across an organisation, not just in a single colleague or department.”—Mark Creighton, our CEO.

Capability chasm 

If there’s one thing the past year has taught us, it’s that some core skills are not enough in a crisis. When we need to innovate and adapt, we look to wider capabilities. This is the reason for the widening skills gap, and why we now face something more challenging: a capability chasm. 

Skills Gap

The skills gap is what the country has been discussing for many years. It refers to isolated competencies which, while useful in themselves, do not necessarily protect individuals, businesses, or the economy in the same way as capabilities. Again, capabilities refer to that deeper level of knowledge. 

Survival shift

In 2020, all industries prioritised survival over investment in their people. This was particularly pronounced in the case of finance, where 80% of respondents reported that focus on survival over skills. As we look ahead, it is imperative that all sectors aim to transition away from this ‘survival shift’ and move towards a less emergency-focused future.

Confidence in capital 

Most executive leadership teams and HR leaders, across all five sectors we covered (pharmaceuticals, fast-moving consumer goods, finance, technology and telecoms, and government and public services), feel that budgets will return to normal levels in five to eight months. This showcases a nation-wide confidence across all industries. Capitalising on this confidence in the coming year and seizing the opportunity to train our workforces will be crucial to rapid regrowth.   

The recruitment flexi-fix

Recruitment can often seem like a quick fix for a capability chasm, but it isn’t. Our research shows that many businesses turned in this direction during the past year. However, it also shows how this impacts the mental health of other members of the team without solving the real problems. This was particularly true for the government and public services, and tech and telecoms.

Move to mental health

Interestingly, a lack of capabilities was identified as impacting employee mental health, with 63% of UK respondents and 48% of APAC respondents agreeing. For this and other reasons, employee wellbeing must be a core focus for businesses across all sectors in 2021 and beyond.

We hope the Beyond Skills report helps underline the urgency of investing in human capabilities, and how connected that investment is to business success. We also want to move the conversation beyond skills and take it towards one about capabilities. When we’re able to do that, we believe both the UK and APAC regions will be better equipped to remain competitive in a recovering global economy.

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