TVETipedia Glossary

Skills mismatch

Skills mismatch is an encompassing term which refers to various types of imbalances between skills offered and skills needed in the world of work. ...

Vertical mismatch: The level of education or qualification is less or more than required.
Horizontal mismatch: The type/field of education or skills is inappropriate for the job.

Source:
ILO, Skills mismatch in Europe, 2014
ILO, Skills mismatch in Europe, 2014
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This brief is part of the efforts that the ILO Department of Statistics is undertaking to contribute to the statistical understanding and quantification of skills mismatch.The brief provides an overview of approaches to measure skills mismatch, and illustrates two approaches using data from the European Social Survey (ESS).

Skill mismatch, a particular form of labour market mismatch, refers not only to skill shortages or gaps, but also to qualifications, knowledge and skills exceeding job requirements. Depending on the extent of substitutability between labour of different skill levels, skill imbalances may not necessarily be equivalent to skill shortages, for instance when shortages for medium-qualified workers are easily filled with higher educated individuals (which, nevertheless, may result in rising qualification mismatches in the form of higher overqualification rates). Skill shortages usually refer to recruitment difficulties when firms struggle to hire suitably skilled workers in the external labour market (outside the firm). By contrast, internal skill gaps and skills obsolescence are phenomena that concern the currently employed.

Source:
Cedefop, Skill shortages and gaps in European enterprises, 2015
Cedefop, Skill shortages and gaps in European enterprises, 2015
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By exploring a wealth of available European data sources, the report attempts to single out the extent to which employers' general difficulties in recruitment can be truly attributed to skill shortages, as opposed to other possible factors. It also traces the evolution of skill shortages in EU Member states over time. Finally it scrutinises the critical role that organisations have in adressing not only the skill gaps of their present workforce but also those that may arise in the future due to skill obsolescence.

Situation of imbalance between the skills – and qualifications – possessed by the workforce (supply) and those needed by the labour market (demand).

Comment

Skills mismatch can take different forms:

skill shortage: the demand for a particular type of skills exceeds the supply of the workforce with these skills;
skill surplus: the supply of the workforce with a particular type of skills exceeds demand in the job market;
skill gap: the type or level of skills of the workforce does not match demand in the job market;
skills obsolescence: the skills of the workforce are outdated for performing a job adequately – or no longer needed;
overskilling: the workforce has more skills than required to perform a job adequately;
underskilling: the workforce has less skills than required to perform a job adequately;
horizontal mismatch (inadequate qualification): the type or field of education of the workforce is inappropriate;
vertical mismatch (overqualification/under-qualification): the workforce holds a higher/lower qualification than required;

Skills mismatch can be analysed at individual, enterprise, regional, national or sectoral level.

Source

Cedefop; ILO, 2017

Source:
Cedefop, Glossary. Terminology of European education and training policy, (accessed 03/2023)
Cedefop, Glossary. Terminology of European education and training policy, (accessed 03/2023)
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This multilingual glossary (provided in a multitude of European languages) defines a selection of key terms used in European education and training policy. It is a revised and expanded version of the “Terminology of European education and training policy – A selection of 130 key terms” (2014). It considers new priorities of European Union policy, mainly concerning skills intelligence and employment. New definitions have been developed in collaboration with the experts of Cedefop’s departments VET and Skills and VET and Qualifications.

(skill mismatch)

A situation where there is a (qualitative) discrepancy between the qualifications and skills that individuals possess and those that are needed by the labour market.