Ireland’s skills mismatch - students urged to reconsider CAO

THIS week Leaving Certificate students have the chance to change their minds on their CAO forms, and some of the top employers in the country want them to do just that.

Ireland’s skills mismatch - students urged to reconsider CAO

Ireland has one of the widest gaps in Europe between the skills of the workforce and the needs of employers. Those with jobs to offer are having to poach skilled workers from rival companies, develop retraining programmes, or go abroad to get the people they need.

All three options are expensive and make little impact on the length of the country’s dole queues.

A lot of this is a hangover from the property boom. Construction and its spin-offs pushed young people towards trades, conveyancing, architecture, and civil engineering.

There is an oversupply of skills for a country that is now building less than 10% of the volume of houses it was five years ago.

Also, after the bust, emigration led to people from Europe, who moved here during the boom, returning home and taking with them language skills which our education system has consistently failed to produce.

This happened at a time when the country was touting for investment from the world’s top technology, pharmaceutical, and health science companies.

In the meantime, policy shifts on issues such as the milk quota have opened up fresh avenues for growth and development in the food science sectors.

In such a flux, a situation has arisen where there are people who need jobs and have an appetite to work, but do not have the skills required to take advantage of vacancies.

During the boom, about one quarter of all young men were employed in construction-related businesses. Last year, one fifth of all jobs advertised were IT based. The largest potion of these were companies looking for programmers and software engineers. This is within a sector that already employs 84,000 people but is predicted to grow substantially over the next few years.

The appetite for office space in Dublin and a profile of the job announcements that have come on stream in recent months show that IT multinationals continue to see Ireland as a favourable destination.

It was not just the corporation tax. Ireland has a climate ideal for hi-tech equipment because it rarely gets so hot as to require expensive air conditioning to keep servers cool.

However, the skills of the workforce have not kept pace.

Una Halligan, chairwoman of the expert group on future skills needs, said despite the unemployment rate, there are roles where workers are in short supply.

“There are a number of occupations for which vacancies are proving difficult to fill, mostly professional posts [in IT, engineering, science, health, and business] as well as multilingual sales and customer care roles.”

The IDA brought 12,722 jobs to Ireland last year with its client companies. By and large, they were replacing roles lost in other sectors, but the nature of the work has shifted the balance in terms of the positions available.

IDA chief Barry O’Leary said a significant proportion of these jobs were in IT and this trend was likely to continue. In an appeal for students to carefully consider their CAO choices, Mr O’Leary said in the early part of 2013, the big job announcements were technology-based.

However, Mark Ferguson, director general of Science Foundation Ireland, said there were jobs open across a range of positions. He said this included entry-level positions for skilled graduates as well as PhD-level students.

He said alignment between the output from universities and the needs of industry is improving, and there had been a number of positive initiatives that helped the situation in the past number of years. He said there have been, and will continue to be, shortages of workers in software engineering, social media, and gaming but employers have been proactive at retraining.

“We have to realise that there are people who made career choices that for whatever reason there is a shortage of work in now, but that does not mean they have to stay at that for the rest of their lives.”

Mr Ferguson also said second- level students and their parents needed to be mindful of the needs to be flexible and learn different skills. He cited the example that if a student studied science and chinese, they would have very little difficulty finding work after college.

“To be honest I would not be as concerned about the specific subject a person chooses, because across a wide range of science subjects people are learning the basic disciplines. But I do think people need to keep flexible and be able to adapt to the situation.”

He also said taking science, technology, engineering, and maths (STEM subjects) did not necessarily mean people were pigeon-holed in similar companies.

The recent Smart Futures STEM Careers Week was set up to speak to second-level students about rethinking their CAO choices.

The programme has been supported by top employers such as Microsoft, Abbott, Ericsson, HP, Dell, Storm Technologies, DPS Engineering, and Cook Medical.

Indigenous firms have also leant their weight to the campaign. Among these is Conor Winders, CEO of Redmond Securities, who said the areas of software engineering and programming is a very exiting sector for people who want to pursue careers.

“There are so many jobs in gaming. There are so many really cool jobs starting up.”

This was echoed by senior technical recruiter at CPO, Marian Garvey, who said the jobs they are being asked to fill are in technology but also in languages.

“We’ve got companies from large organisations who have just moved in to well-established companies to small-medium enterprises. It really is an exciting time to be in the technology sector.

“We are noticing a big demand for French, German, and Scandinavian languages or anybody with Spanish or Italian, a lot of the technology companies would love to see graduates with those types of languages.”

But employers cannot wait for second-level students to go through the third-level system and some are having to go out and redirect people unemployed or underemployed because their areas of expertise are no longer in demand.

At Hewlett Packard, which recently announced a further 150 jobs and the expansion of its Galway base, JobBridge, the national internship scheme, has been used to produce software engineers.

“HP has taken its own measures in this respect and recently engaged in a process through JobBridge to recruit jobseekers with multi-disciplinary backgrounds to engage them in a training programme to develop their skills in the area of software testing,” it said.

“This process worked very effectively and resulted in a 90% progression into employment for those interns. HP is looking to more of these types of measures to continue to attract the best talent into the organisation.”

In the midst of this, questions have been asked about the appetite of Irish students for some of the work coming on stream.

Louise Phelan, the head of PayPal in Ireland, said some graduates emerging from colleges lacked drive. She said having a degree was not unusual in Ireland and did not justify a sense of entitlement to work on behalf of graduates.

In contrast, SAP, which makes software to help companies run better, has praised the standard of graduates after targeting work placement programmes at the University of Limerick, Trinity, and UCD as ways to take students and train them for specific roles.

SAP has 78 interns at the moment. Its experience is that eight out of 10 return to full-time roles with the company, according to Liam Ryan, managing director.

“While we started from a lower base a few years ago, the standards of students coming through at second-level and third-level now is very strong and we have been impressed with the quality of the graduates coming out of universities and the strength of their skill sets. Attracting high-quality graduates is a priority for us asthey bring fresh and innovative thinking, which is crucial for the development and success of our company.”

However, John Logue, president of the Union of Students in Ireland, said problems with matching up graduates to the needs of employers was not the fault of students. And he said overall, there appeared to be satisfaction among multinationals with the quality of candidates applying for posts.

The image of Irish workers, irrespective of the skills deficit, appears to have improved in recent years aided by lower wage demands and almost universal access to some form of post-second level education.

The IMD World Competitiveness Yearbook for 2012 ranked Ireland in first position among it peers for the availability of skilled workers.

But that does not tell the full story because the skills of Irish workers, and the needs of employers, cannot be captured in broad brush stokes. Even within sectors, such as manufacturing, the shortage of skills can be quite specific. There is a particular gap in the availability of tool makers. The number of vacancies identified is very high relative to the small number of positions available.

The information available on vacancies from the future skills group is not perfect. It relies on positions advertised through FÁS and on a private jobs websites and this does not capture all positions that have opened up.

In particular, some high-end positions may not be advertised in such general arenas or some posts will appear twice.

But the gaps evident in the vacancy overview tally with similar complaints voiced by companies directly and from research carried out beyond Ireland. According to the EU Skills Panorama, the situation in Ireland has improved. There has been in a 3% drop in the number of employers experiencing difficulties recruiting specialist staff.

This compares with rises in excess of 7% in Sweden, Germany, France, Belgium, and Austria.

It calculated that there were 2m jobs available in Europe, without suitable candidates to fill them, even at a time of record unemployment in much of the eurozone.

In Ireland’s case, the European assessment is partly drawn from an earlier ESRI study.This predicted that by 2015, overall employment will fall from 2008 levels but would grow in certain key sectors.

Proportionally, the biggest increases are expected to bein hi-tech manufacturing, chemicals, and computer services.

However, this same study predicted a significant drop in agricultural roles yet since then, it has been seen as a growth industry due to the impending abolition of the milk quota.

Skills gaps are not just Ireland’s problem. In particular, a lack of skilled IT graduates is a problem in most of the developed world.

Yet Ireland still ranks joint third, from the 26 European countries surveyed, on the skills imbalance.

The breakdown in figures shows this has been exacerbated by the recession as more than one quarter of young men were employed in the construction sector.

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