New SHRM Report Unpacks Labor Market Complexities
Understanding the current labor market is increasingly challenging for both employers and job seekers. According to a new report from the Society for Human Resource Management (SHRM), the U.S. labor shortage is not just about a lack of workers—it’s about a misalignment between available jobs and the qualifications of unemployed individuals.
SHRM’s latest research, titled Help Wanted: Understanding the US Labor Shortage, highlights the growing issue of “occupational mismatch.” This refers to the disconnect between the specific experience employers require and the background of job seekers.
Occupational Mismatch: A Barrier to Employment
James Atkinson, SHRM’s Vice President of Thought Leadership, explained the issue in a press call. “We have more unemployed people than job openings,” he said. “But that assumes any unemployed person can fill any available job, which we know isn’t true.”
The study reveals that 32.7% of job openings cannot be filled by an unemployed individual who last worked in the same occupational group. This lack of alignment is making it difficult for businesses to hire and for job seekers to find appropriate roles.
“Organizations are struggling to fill positions because there’s not that supply of unemployed people with the necessary occupational experience,” Atkinson noted. “On the flip side, many unemployed individuals are unable to find jobs that match their most recent roles.”
One in Four Job Seekers Face Roadblocks
SHRM’s findings illuminate the severity of this mismatch. While one in three job openings are unfillable due to a lack of matching experience, one in four job seekers are unable to find roles within their previous occupation category. This mismatch exacerbates the labor market’s complexity, even as unemployment remains relatively high.
“If we simply say that to fill a job, you must have specific occupational experience, we find that many openings go unfilled,” Atkinson said. “This is mirrored on the job seeker side, making it a two-way problem.”
Healthcare Industry Offers Innovative Solutions
Some industries, particularly healthcare, are adapting to these challenges with innovative recruitment strategies. According to Atkinson, hospital systems are increasingly partnering with local high schools and community colleges to recruit and train future workers.
“That is one of those recruitment strategies that is really high touch,” Atkinson explained. “They’re engaging potential candidates before they even enter the labor market.”
Many hospital roles require on-site presence, making local recruitment essential. These institutions focus not just on hiring but also on guiding candidates through the certifications and training needed to qualify for healthcare roles.
Leveraging Skills Technology and L&D Tools
Beyond traditional recruitment, SHRM’s report emphasizes the role of learning and development (L&D) technologies in addressing the mismatch. New tools can help employers identify “skills adjacencies”—skills that are similar or complementary to those required for a role.
These technologies allow HR professionals to look beyond job titles and focus on skill sets, both internally and externally. This opens the door for more candidates who may not have direct experience but possess transferable skills.
Atkinson also criticized the rigidity of job descriptions, suggesting they often hinder the hiring process. “Sometimes our job descriptions are organizations’ worst enemies,” he said. “They can filter out qualified talent unnecessarily.”
He encouraged employers to broaden their criteria and consider candidates with relevant, if not identical, experience. By doing so, companies could significantly expand their talent pool and better address labor shortages.
What HR Teams Can Do Moving Forward
To mitigate the effects of occupational mismatch, SHRM suggests HR teams rethink traditional hiring practices. This includes:
- Partnering with local educational institutions to build talent pipelines.
- Using L&D tools to identify transferable skills and train current employees.
- Reevaluating job descriptions to focus on core competencies rather than rigid qualifications.
- Expanding the definition of qualified candidates to include those with skill adjacencies.
By adopting these strategies, organizations can better align their talent acquisition efforts with the realities of today’s labor market.
As the labor landscape continues to evolve, flexibility and innovation will be key to bridging the gap between job seekers and job openings. SHRM’s report offers a critical lens into the underlying factors affecting hiring today, and provides actionable insights for HR professionals tasked with navigating this complexity.
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