Wanted: Soft Skills and the Training That Builds Them

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Chapter 1: the labor market challenge

Soft skills needed | Labor market challenges | Lack of skills costs companies

Which soft skills do employers want most? Cleveland Fed research analyzing 2,300-plus skills across 600-plus occupations reveals that communication, customer service, and leadership top the list—and demand increases with higher wages.

Yet employers report a widening gap: Too many job candidates lack these critical capabilities. From manufacturing to food service, businesses face costly turnover when workers can’t show up on time, communicate effectively, or work collaboratively. In today’s “low-hire, low-fire” labor market, these soft skills matter more than ever.

Discover:

• What the Occupational Mobility Explorer reveals about in-demand skills
• How the lack of soft skills costs companies real money
• Why at least one area manufacturer needs soft skills from day one

6-minute read | April 3, 2026

Chapter 2: skills gap—what’s changed

Generational differences | Technology’s impact | Student perspectives

Is technology to blame for declining soft skills? What about COVID-related isolation? Or are generational differences simply being misunderstood?

College professors, workforce development leaders, and students themselves weigh in on why career readiness challenges have intensified. From reduced face-to-face interaction to changing workplace expectations, this chapter explores multiple perspectives on the postpandemic soft skills landscape.

Read about:

• How COVID-19 affected workers’ social and professional development
• What Gen Z students say about soft skills, including professionalism
• The role of education systems, parents, and employers in developing soft skills 

7-minute read | April 8, 2026

Chapter 3: upskilling solutions that work

Talent development strategies | How the Fed is involved | Practical training approaches

Who’s taking action to close the soft skills gap? From the Federal Reserve Bank of Cleveland’s Essential Skills Academy to innovative employer training programs, this chapter showcases upskilling strategies aimed at enhancing career readiness and supporting economic growth.

Learn how workforce boards, universities, and businesses are collaborating to provide job training that prepares students and young workers for real-world success. Plus, access free tools like the Occupational Mobility Explorer to identify which skills matter most for your career path.

Explore:

• The Cleveland Fed’s Essential Skills Academy curriculum
• Practical tips for teaching communication and networking
• How employers are teaching soft skills onsite
• Free workforce development resources available in every community
• Why soft skills training connects directly to the Fed’s dual mandate

11-minute read | April 13, 2026

Why the Federal Reserve focuses on soft skills and workforce development

Upskilling programs that boost career readiness connect directly to the Fed’s dual mandate, which includes promoting maximum employment. When workers have the soft skills employers need, businesses grow, communities thrive, and the economy strengthens.

Cleveland Fed community and business contacts report that the gap between the soft skills employers need and what job candidates possess has widened. This workforce development challenge affects

• Economic growth – Businesses cannot expand without qualified workers
• Labor market participation – Workers who lack soft skills face longer job searches
• Community development – Regions with skilled workforces attract investment
• Employers – High turnover due to soft skills deficits costs companies resources

By investing in job training and career readiness programs, the Cleveland Fed supports individuals, businesses, and communities in building stronger economic futures.

Soft skills for young workers: what employers are looking for

Cleveland Fed research identified these soft skills as most in demand across the labor market:

1. Communication – Requested in 34.2 percent of all job ads nationally
2. Customer service – Specified in 26.9 percent of postings
3. Management – Listed in 23 percent of job ads
4. Sales, operations, and leadership – Each appeared in about 15 percent of job ads

The higher the wage, the more critical these capabilities become. Yet many employers report that job training programs focus heavily on technical knowledge while overlooking the soft skills that determine workplace success.

Feaured voices on soft skills

This storytelling features insights from

• Kyle Fee, community development policy advisor, Cleveland Fed; cocreator of the Occupational Mobility Explorer
• Davonta Milbry, Sam Tyler, and Lakisha Higgins, outreach coordinators, Cleveland Fed; soft skills instructors
• Erik Chiarelott, teaching professor, Bowling Green State University; business communication expert who has taught soft skills for 20 years
• Bridget Back, deputy director, Eastern Kentucky Concentrated Employment Program; leads regional workforce development across 23 counties
• Michael Gordon Jr., vice president of sales, Tendon Manufacturing Inc.; reports soft skills gaps in job candidates
• Dan Young, board chair, Young’s Jersey Dairy; trains 300-plus young workers annually in soft skills
• College students from Bowling Green State University; provide Gen Z perspectives on career readiness

Related Cleveland Fed resources

• Career Readiness Hub
• Occupational Mobility Explorer
• Community Development Initiatives
• Using the Occupational Mobility Explorer to Understand Which Skills Are Most in Demand
• Gathering Perspectives on Work in the Fourth District
• How to Find Higher Paying Jobs: Try the Occupational Mobility Explorer

Frequently asked questions about soft skills and career readiness

What are soft skills?

Soft skills (also called essential skills) are interpersonal and professional capabilities like communication, teamwork, time management, problem-solving, and professionalism. Unlike technical “hard skills,” these abilities apply across all occupations and industries.

Why do soft skills matter for economic growth?

When workers possess the soft skills employers need, businesses can hire qualified candidates, reduce costly turnover, and expand operations. This workforce development drives economic growth at individual, company, and community levels.

How did COVID-19 affect soft skills development?

The pandemic reduced face-to-face interaction during formative years for many young workers and students. Isolation, remote learning, and virtual work environments limited opportunities to practice in-person communication, teamwork, and other interpersonal skills.

What can job seekers do to improve their soft skills?

Connect with local workforce boards, use free tools like the Occupational Mobility Explorer to identify in-demand skills, participate in upskilling programs, and practice professional behaviors like communication, punctuality, and active listening.

How can employers address soft skills gaps?

Implement in-house training programs, partner with educational institutions, create mentorship opportunities, and focus interview processes on identifying candidates with strong soft skills who can be trained in technical competencies.

What workforce development resources are available?

Every US community is served by a workforce board offering career readiness resources. The Cleveland Fed provides free tools including the Occupational Mobility Explorer. Many universities and community colleges also offer job training programs.