Background paper prepared for the Education for All Global Monitoring Report 2012 The report explores the issue of skills gaps and reviews the literature on 120 employer surveys from developed and developing countries. It documents the extent of the skills gap in different countries, describes some of the causes for the skills mismatch, and unpacks what employers mean when they say graduates are not “employable.” It argues that while the impact of skills shortages (insufficient numbers) will be felt most heavily in the developed nations due to aging of the population, closing skills gaps (insufficient skills) is especially important for the world’s young people aged 15-24, most of whom live in developing countries where there are few opportunities for productive employment.