Since 2009, I have observed organizations seeking incredibly precise and sophisticated skills for their many IT positions, but not paying the appropriate compensation to go along with them. At first, I chalked it up to the state of the economy: Perhaps, due to the increased supply of highly skilled-workers, wages had dropped. But as the economy improves, I see this trend continuing.
Organizations often want IT workers with high-level certifications such as CISSP, ITIL, Six Sigma, PMP, and others -- but these organizations also want to pay salaries that are well below market value. When asked to explain, the usual response is: “This is what we can afford.” Asked if they are having trouble filling the positions, the response is: “Yes, we have interviewed several people within the range and found them to be unqualified. We have been unable to fill the position for several months.”
And then you see articles discussing the so-called “skills gap."
Multiply this scenario across hundreds of organizations, and what we have is actually an artificial skills gap. I was fascinated by discussions about this on LinkedIn and The New York Times.
Yes, in some cases, organizations may have a true skills gap, and must invest in training workers to solve this problem. But at salaries of $10 to $18 an hour, it appears unlikely that a skilled IT employee will have a decent living wage in most major cities in the United States.
On the other hand, the spiraling cost of education -- despite technological advances to fix this -- is putting higher education out of reach for many families. (See: Web Eliminates Classrooms, but Learning Improves.)
Some organizations recognize their compensation is under-market, but cannot adjust due to budget issues. So, they hire someone they will need to educate. Unfortunately, organizations frequently lack the people needed to train this person, and think the new hire will learn on the job.
Who will train a chief information officer (CIO) or a chief information security officer (CISO)? How is someone supposed to learn this role on the job, particularly in a highly-complex organization?
Sometimes, organizations hire someone unqualified without realizing it. About a year later, they decide they're not getting the right value from the role. So, they make organizational changes; sometimes they alter the reporting relationships, and sometimes they even get rid of the role.
This phenomenon appears to be happening in a wide range of industries, since IT is a business driver in basically every industry (almost every worker needs some level of IT skills to get anything done). Yet, some organizations appear to be reluctant to train people.
Failure to hire the right candidate simply because of money is a major mistake. Hiring the wrong candidate will cost the organization much more, and may cause good workers to leave. Quality employees want fair market compensation, and in return, they will give value back to the organization. This is simple management.
Artificial budget reasons are leading to an artificial skills gap -- the modern equivalent of “penny wise, pound foolish.”
This needs to stop. I believe it's hurting the organizations, it's hurting the work force, and it's hurting the economy. Long-term, it may even create challenges in global competition. Organizational leaders must get rid of the artificial skills gap. It's the ethical and patriotic thing to do. If you cannot find quality employees at a particular salary range, you must adjust your range.
Analyze every position's salary and ensure compensation is fair and market-based. Without such a basis, the problem will continue to exacerbate.
If you do manage to hire someone below market, you will be unable to retain the person for long. When a good employee leaves an organization, there is significant cost -– knowledge loss, training costs, interviewing and recruiting costs, as well as productivity loss for all the positions that the person was connected to within the organization.
Underpaying workers does not equate a skills gap.