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The Weekly Economic Briefing is written by two senior Deloitte Economists, David Rumbens from Deloitte Access Economics in Australia and Ian Stewart Deloitte’s Chief Economist in the UK. They provide a personal view on topical financial and economic issues. Subscribe to receive the Weekly Economic Briefing in your inbox!
This section of the briefing provides a snapshot of key economic data and issues of relevance to Australia.
Soft skills for business success
Improving human capital – harnessing the collective skills and knowledge of people to create economic value – is increasingly seen as important for economic growth. But do we fully understand the workforce skills necessary for success?
Business success is not just achieved by having people with the right formal qualifications and technical skills. There are also a range of equally important ‘soft skills’ – think communication, teamwork, problem solving, emotional judgment, professional ethics and global citizenship – which are vital in the workplace, and which Deloitte Access Economics explores in the recently released report, Soft skills for business success.
Globalisation, digital disruption and demographic change mean that soft skills will become increasingly important in the future. And as technological advancements see some business functions increasingly automated, employees roles will take on a more human-centric, customer service focus. The right people for these roles will need to be able to combine technical knowledge with essential human skills such as communication and empathy. In fact, soft skill intensive occupations are expected to account for two-thirds of all jobs by 2030, and the number of jobs in these occupations is expected to grow at 2.5 times the rate of other jobs.
For now, a range of studies show that employees with high levels of soft skills can lift business performance. Emotional judgment can lead to lower levels of staff turnover, global citizenship can help businesses reach global markets, and digital literacy and communication keep more customers engaged.
Does our workforce have the skills necessary to foster business success and be job-ready for the future? International evidence shows that Australia performs reasonably well in attainment of soft skills relative to other nations – over 90% of graduates are recognised by their employers as having problem solving and team work skills. A range of data on attainment of soft skills in Australia is shown in the infographic below.
Australian performance for key soft skills
However, despite Australia’s relatively high soft skill attainment, there is also significant under-reporting of this attainment, with just 1% of Australians reporting soft skills on their LinkedIn profiles. This under-reporting and under-recognition of soft skills is generating a gap, with 25% of employers having difficulty filling entry-level positions because applicants lack soft skills.
People are now more likely to change careers (and often more than once) over the length of their working life. In this context, its effective soft skills that can often be transferred across different career paths, and hence become a real job currency of the future.
For more information on the Australian brief, please contact the co-authors, David Rumbens and Christine Li.
A personal view from Ian Stewart, Deloitte’s Chief Economist in the UK. Subscribe to and view previous Monday Briefings at: http://blogs.deloitte.co.uk/mondaybriefing/
PS – Last week the Economist reported on how the e-commerce boom is disrupting the US retail sector. 4,000 US stores closed last year and the retail sector has shed 50,000 jobs since January. Despite strong US consumer confidence and growth in retail spending S&P Global Ratings expects more US retailers to default in 2017 than in the recession of 2009. Having read the article I checked the equity market performance of the overall US retail index. I was surprised to discover that, in the last 10 years, the sector as a whole has outperformed a strong rally in the wider US equity market. While some department stores have suffered, other retailers, including TJ Maxx, Foot Locker and Children’s Place, have done very well. It provides a good example of how, even in sectors seeing profound disruptive change, there are winners.
OUR REVIEW OF LAST WEEK’S NEWS
The FTSE 100 ended the week up 0.4% at 7,471.
Global stock markets recovered most of the losses they made earlier on over perceived risks to President Trump’s administration and his plans for tax cuts, infrastructure spending and deregulation.
Economics and business
Brexit and European politics
Politico reports that leading Irish cheese manufacturers – who supply around a third of the UK’s cheddar – are now contemplating switching to mozzarella production because of fears about Britain crashing out of the EU – Chexit.
David is a macro economist with extensive experience in applied economic and quantitative analysis of the Australian economy, along with considerable experience in labor market analysis. David is a regular commentator on macroeconomic trends, and prepares a weekly economic briefing newsletter.