The other day, I was listening to the radio when one of the guests was a senior executive at LinkedIn. Although I knew the importance of this social network in recruitment, I hadn’t quite realised how vital it has become. In terms of recruitment, it is beating other sites that specialise in job hunting. Notably, however, the person from LinkedIn being interviewed pointed out that over the past year, the site has seen a 21% decline in the number of job advertisements.
A recent analysis by Statista also showed how the jobs market is changing. It used data from the US Bureau of Labor Statistics to show a dramatic fall in the number of employment opportunities in the USA. In the UK, there has been a similar decline in jobs. All of this comes at a time when millions of students graduating from universities around the world are hoping to start their first real jobs this autumn. They are in a challenging situation.
I was discussing this with a class of students the other day. They are not due to graduate until 2026, but some are concerned that the job market will worsen even more over the next year. They said that many jobs are being replaced by artificial intelligence. According to the World Economic Forum’s “Future of Jobs” report, artificial intelligence will eliminate 83 million jobs by 2027. The report estimates that AI will help create 69 million new roles, but this is still a sizable reduction of 14 million posts.
So, I asked some students why they were studying a degree in business. One answer was illuminating. The student was already running a successful business that employed a team of people. The reason for taking time out to get a degree in business was not to learn more facts or to gain knowledge. Instead, the reason for pursuing the degree was to gain a deeper understanding of communication, presentation, and teamwork. This is a bright student who has recognised that “soft skills” will be even more critical in the future than they are now.
That is backed by a study published earlier this year from Northwestern University. It showed that “soft skills” matter more now than they have ever done. Such skills provide the gateway to higher salaries, the researchers discovered. Knowing information is all well and good, but if you can’t communicate what you know, present it clearly, or discuss it in a team setting, you may as well not have that knowledge.
Much of the world operates in the “knowledge economy,” where facts and data form the foundation for most businesses. But why do any of us need to remember facts or know anything when we can access such knowledge with the click of a mouse from a search engine or ChatGPT? The only knowledge we really need is how to use such tools. That’s a soft skill. The ability to apply, contextualise, and communicate knowledge is the focus of future business.
The financial trading company, Jane Street, emphasises this on its website by saying to potential employees, “We believe that asking great questions is more important than knowing all the answers”. The ability to ask incisive questions is a soft skill.
In the world of recruitment, the adage that it is not what you know, but who you know, has held good for centuries. Networking remains a fundamental part of securing a good job for most people. However, if you’ve benefited from the network effect in obtaining employment, I’d hazard a guess that the person recommending you did not talk about your factual knowledge. Instead, they probably chatted about your good communication skills or your attitude to being a team player. In other words, we should not be surprised that soft skills are the foundation for successful careers.
However, in the world of AI and digital knowledge systems, those soft skills are being emphasised even more. It means focusing on improving your presentation skills, writing ability, design skills, and flexibility in teamwork, as these are the areas that become most critical to focus on.
In the future, nobody is going to be impressed by what you know. They can get the same knowledge within seconds by asking AI. It is your soft skills that will make the most significant impression. So the question for your business is: how are you training, measuring, and rewarding soft skills in your teams? Your future could depend on that.
