This section will start with a brief overview of the main skill shortages and gaps faced by employers in this regional setting. As employers’ engagement with HE does not take place in a vacuum, the forms and intensity of these activities are likely to be influenced by either the skill problems at the graduate level or the perceived costs and benefits associated with that collaboration. We will therefore delve deeper into the actual engagement activities developed with HE before examining the perceived barriers and facilitators to that engagement in the next section.
4.1. Employers Engagement with HE at the Regional Level
Skill problems include skill shortages, translated into hard-to-fill vacancies, and skill deficits or gaps which relate to the employers’ perceptions of graduates’ level of preparation for the world-of-work. These gaps were further typified under the categories of soft skills, work attitudes/maturity, and technical skills.
Regarding skill shortages and hard-to-fill vacancies, a non-negligible proportion of the employers (8 of 19) refer to difficulties in finding and retaining graduate employees in the region, giving rise to constraints in their activity. Most of these vacancies are found in technical areas such as Engineering (F6; F15; F18; F1; F11), ICT (F6; F10; F12), and Physics (F15). Three sets of factors are reported by the sampled employers to explain skill shortages. First, they blame HEIs for a skill shortage that causes an undersupply of graduates in these areas, despite the massification of HE. Second, the good labor market conditions, notably low level of unemployment and the greater bargaining power of graduates, which increase the labor costs: “it’s a region of full employment […] in all areas of expertise it is now very difficult and it’s the candidates who choose where they want to go and what they want to do.” (F16); “I would say in engineering nowadays you are only unemployed if you choose to be (…) people are much more selective today” (F15). Finally, the brain drain of young qualified people is a problem that affects the sampled firms. The demand for talented youngsters from large neighboring cities and the international labor market makes it more difficult for employers from the relatively small town where these firms are based to attract and retain a skilled workforce.
In terms of graduates’ preparation for the world-of-work, there is widespread consensus that HE graduates are well endowed with technical skills, “technical skills are excellent” (F8), and “nowadays students have a far higher skill level than when I finished university” (F6). However, employers claim graduates are poorly prepared in soft skills and work attitudes (12/19). They report graduates often lack soft skills such as written and oral communication, problem-solving, and transversal skills in general: “In terms of technical skills, they are better prepared but what they lack is some behavioral and social skills” (F6); “I feel that teamwork is an issue as is communication; the ability to communicate both orally and in writing is definitely a problem”. (F13); “Nowadays, we give as much value to behavioral skills as we do to technical skills, something which did not happen a few years ago” (F3).
The work attitudes, commitment, and behavioral skills of recent graduates are a major concern (15/19). These characteristics are highly valued by the firms and are widely regarded as instrumental for the use of other technical skills to the benefit of the organization (F4; F11; F3, F2). Thus, HEIs are often blamed for not sufficiently addressing soft skills and attitudes, alongside the technical skills (F6; F1): “They [graduates] have difficulties in interaction and communication (…) but I don’t see the universities addressing this issue of soft skills” (F1).
The next question is the employers’ willingness and/or ability to engage with HE to tackle skill problems. Table 2
displays the engagement activities of the sampled employers, as well as the barriers and facilitators of this engagement. As can be seen, HEIs serve as a recruitment channel to access the best candidates and engage in the training of graduates through internships. All firms develop at least one of these types of interaction and a non-negligible number (9/19) engages in three. Firms sometimes also participate in job fairs and events at the university (F16; F5).
The internship programs are regarded as an opportunity to provide some real-world training to students while allowing for candidates to be screened to create a pool of talent. The internships target both graduates (masters and PhD) and non-graduates and occur throughout the year or in the summer. Internships also result sometimes from students visiting the firm (F16). F4 regrets that some students have never had any contact with an organization and, consequently, are unaware of the world-of-work. These internship programs are often implemented through formal agreements between firms and HEIs and are reported as beneficial by the sampled employers:
“That has been the way recently, we establish protocols with the universities in the region to receive interns and then recruitment comes from those visits (…) the truth is that they are very receptive to what we have to say just as we are very receptive to what they have to show us.” (F16);
“Yes, we work with different internship programs and we have our own program too. We like to receive those interns, especially because in nine months or so they will enter the labor market. And if we can have this contact before and the student can also get to know the reality of a company, it can facilitate their choice afterwards” (F1);
“We have some people coming here for internships. Some come to do their Master thesis. They usually have to face a problem and then come up with a solution. (…) It is good, it is a way of evaluating people and knowing if they are good enough to stay.” (F18).
Activities such as teaching, collaboration in course design, or participating in HE governance bodies are scarcely reported by employers. However, they intend to engage more actively in these activities and some firms, namely medium and larger firms, are sometimes invited for this kind of collaboration. In such cases, these types of firm are consulted in the design and demanded an assessment of the course: “Well, I know that one of our engineers here participates in one of these [governance] bodies (…) sometimes they ask to use some of our machines, they have visits here or we donate some equipment. I know they sometimes discuss some new degrees, pedagogic content, what makes more sense or not” (F19). Nevertheless, employers call on the expertise of HE institutions if they are unable to properly prepare graduates: “We have people with a lot of know-how that want to pass on that knowledge [to graduates] but they don’t know how to do it (…) so what we did was a partnership with the … Business School” (F17).
However, this is a random activity, often resulting from the employers’ interpersonal relations with HE professionals, so it is far from a systematic and internalized process. Overall, the sampled employers indicate that there is room to deepen the engagement and they are willing to do so. Nevertheless, as we will see later, there are barriers that hamper closer ties.
The collaboration in R&D activities attracts wide attention and prevails in 8/19 firms. It should be noted that the firms in the sample are industry-based and need to develop new products and technologies, which entails close interaction with HEIs. At the same time, firms and HEIs have strong incentives and a long history of cooperation in R&D: “Nowadays we have two R&D projects in cooperation as well as several in the 2020 [program] in the areas of innovation and markets, especially because we have opened up to cooperation with universities. Beforehand secrecy was the soul of business but not anymore…” (F7). “In R&D we have seven people, three of whom are doctorates (…) we will always have to resort to research centers because they have other skills that we don’t have.” (F3). The engagement not only involves R&D but also post-graduate training and sometimes the recruitment of master or PhD graduates that participate in the development of products and technologies. A sectoral pattern emerges in the collaboration with HE in R&D in that firms from the agri-food and textile sectors seem to be more engaged in collaborative R&D than those from other sectors, namely metallurgy, machinery, and components for the automobile industry. One possible explanation is that the textile industry in the region has undergone a strong technological upgrade in recent decades that has been widely recognized, and therefore resorts more to this sort of collaboration. However, these results should be treated with caution because other industries, namely those related to the automobile industry, may be more prone to producing in-house R&D (or in collaboration with other firms in the sector).
In sum, the reported engagement activities show that employers are aware of the relevance of HEIs as skill suppliers and often contact them to acquire talented people. However, they are still far from participating systematically in the skill formation process, although some are trying to do so. As noted, the sampled employers are available and intend to extend their engagement, so it should be possible to make progress in the future. Currently, R&D continues to be the major activity of contact between employers and HEIs.
4.2. Barriers and Facilitators to Employers’ Engagement with HE
The sampled employers reported a set of barriers and facilitators of engagement. More specifically, cultural differences that prevent fruitful communication between HEIs and firms are perceived as the major issue. HEIs are generally accused of being distant from firms (F16; F6; F8; F7; F18; F4; F11, F2) and from the world-of-work. “The world is moving at one pace and universities are another” (F6); “I believe the universities are still distant (…) the students should be put in contact with firms sooner in their university trajectory as they are in programs abroad where the connections with firms start in the first year of college” (F8). HEIs continue to be focused on academic activities and disregard the requirements of employers. According to these employers, it is the HEIs that fail in setting shared goals and a common language that would increase proximity and develop ties: “We need a stronger connection with reality (…) and that does not happen. It does not happen on either side because firms try to get closer and then often lose their patience because of bureaucracies (…) and universities often use firms just for statistics so that they can say they have links with firms and present those numbers” (F2). This detachment exacerbates the mismatch between the skills acquired at HE and those required by employers (F8; F18; F11; F2). Two employers (F3; F11) highlighted their willingness to collaborate with vocational schools. They noted the benefits of working with vocational training institutions rather than with universities or polytechnics, notably the flexibility to adapt the curriculum and pedagogical methods, and teachers’ knowledge of skill requirements that help a better match of the skill supply.
Some employers recognize that some steps have been taken in recent years to overcome organizational barriers (F16; F15; F18; F19), and some HEIs try to be more responsive to firms’ needs and engage more actively with them. However, for these firms, HEIs have not yet provided an adequate response to employers’ apparent willingness to engage more actively with HE, and the costs of these engagement activities incurred by firms still exceed the potential benefits: “The relations have improved, I’m not going to say they haven’t, but they still need to be closer” (F16); “I believe relations are increasingly better and I see HEIs making strides to come and ask the firms, something which didn’t happen before (…) [HEIs] are proactively trying to get closer to firms” (F15); However, the trade-off between costs and benefits is at the heart of the discussion. “We must also see what is the economic benefit for us (…) generally the end result is more of a burden and a loss for our activity” (F19). Employers suggest engagement is a risky activity that has uncertain benefits.
The barriers are not limited to HEIs with some firms (F11; F2) referring that they refrain from establishing closer links to HE. Others acknowledge that their willingness to engage is often lessened by the above-mentioned barriers and they must take initiatives to improve the ties with HE. Faced with the trade-off between costs and benefits, the sampled employers propose solutions to increase effective engagement.
The sampled employers enumerate some facilitators: They believe that personal contacts, notably through alumni and teachers, are efficient ways of finding appropriate partners inside the HEIs and conducting research projects and/or finding talented candidates: “We are not approached. Fortunately, we have a relationship (…) with universities and polytechnics, with teachers and alumni that allows us to implement our normal [hiring] processes. What we feel is that without these actions we would not be contacted either by universities or polytechnics” (F11). However, F3 reports that “Our relations with HEIs happen in two ways: either we proactively contact them because we have a specific need and then relations are established, or there is someone here at the firm that has a good relationship with someone at the university and then the collaboration follows through that different channel.” In other words, personal contacts appear to be a facilitator for closer ties between HEIs and the world-of-work.
Geographical proximity is an additional facilitator reported by the sampled employers. Regional universities easily create networks with local employers since they have a deeper knowledge of the region and employers’ needs. Consequently, employers refer to local interactions rather than national and distant partners (F16; F6; F15; F7; F10; F1; F12; F3). On the one hand, geographical proximity eases face-to-face interactions and access to information about institutions and people able and willing to establish partnerships. On the other hand, it helps create a pool of talents of young graduates in HEIs closer to their homes and searching for job opportunities in the local or regional labor market. Some employers speak about these advantages:
“We work a lot with the [local] University (..) we give priority to the [local] University because of a partnership we established several years ago, because of geographic proximity (…) we have a lot of people here from that university. We have a good relationship with the presidency and the vice-presidency and great proximity also with the school of engineering” (F15). “We work with several institutions on account of proximity, [local] University, the Polytechnic … [all in the Northern region of Portugal]” (F1). However, in addition to fruitful experiences, some underline the specificity of education programs and technological specificities of certain HEIs (F13; F18). Others are “available to collaborate with any HEI as long as the attitude is appropriate” (F4; F7; F8)
We now turn to the relationship between engagement activities and the barriers or facilitators reported by the sampled employers. One group is made up of firms that use HEIs as a recruitment channel but acknowledge that cultural barriers probably prevent other types of engagement (F8, F1, F2). Others follow the same strategy but take advantage of personal contacts and geographical proximity to overcome such barriers (F16, F6); use only of the proximity to overcome them (F7, F1, F4); or use only interpersonal contacts (F11). In other words, barriers are compensated by some facilitators, especially to allow firms to access talented graduates.
It is interesting to note that F19 is actively engaged with HEI and this was facilitated by personal contacts; however, he/she refers to skill shortages and admits that young graduates lack work attitudes and maturity. Furthermore, firms must also tackle cultural barriers to develop collaboration in R&D. This is given as the major factor inhibiting stronger university-business collaboration.
Finally, regarding the role of Famalicão Made IN, the local partnership, many employers recognize that it has already positively impacted R&D collaboration between HE and firms, access to funding, the visibility of firms, and the county and it has facilitated access to other local and national institutions and decision-makers. Some of the R&D partnerships and engagement activities have indeed resulted from post-graduate training work and knowledge interactions, and the county is currently trying to expand these projects. However, most employers are also aware that much work is required to address local skill problems and, more importantly, to align the supply of and demand for higher-level skills, as well as to overcome existing barriers between firms and HEIs. It should be noted that Famalicão Made IN has very recently taken steps to work with HE, and it can become an efficient broker to reduce cultural barriers in the future.