Reskilling for Success: Adapting Your Workforce to the Challenges of Tomorrow

Upskilling and reskilling have become popular workforce development strategies because businesses are having difficulty recruiting qualified employees.

The worldwide talent shortage is part of the reason hiring has become more challenging. However, the main reason is we have a massive skills misalignment because applicants do not have the skills companies need. Companies worldwide report having critical job openings that are vacant because they cannot find qualified talent.

Business leaders and the government agree that a massive reallocation of labor is needed, and helping workers improve their skills is a critical part of the solution. In 2014, the U.S. Department of Labor set up a Dislocated Worker Grant program to provide training and temporary for dislocated workers. They recently expanded the program by $100 million.

What Are Upskilling and Reskilling?

Upskilling and reskilling are similar because both aim to develop talent and help employees learn new skills. However, they achieve different results.

Upskilling means helping employees improve their skills by providing training and development opportunities. For instance, a Java developer could learn PHP or C++ or complete the necessary coursework to become a systems analyst. A marketing specialist who has mastered search engine optimization (SEO) and social media could become a web content manager or digital marketing manager.

Reskilling means teaching employees new skills to move into an entirely different job. For example, an accountant interested in cybersecurity could get the necessary training to move into a cyber forensics job, or a teacher could transition into sales or corporate training.

Reskilling is also used to retrain employees whose jobs have become irrelevant due to advances and changes in technology. For instance, if a retail company closes all or some of its “bricks and mortar” locations, a retail store manager could acquire the training needed to become a webmaster or e-commerce content manager.

Why Upskilling and Reskilling Are Important

The benefits of upskilling and reskilling employees have become increasingly evident during the past decade. A 2021 World Economic Forum showed that over 50% of employees globally must be reskilled or upskilled by 2025. These are some ways companies can use upskilling and reskilling to prepare for the future.

• Beat the Talent Shortage: There is a talent shortage in almost every industry, and the situation will not improve soon. Around 83% of HR leaders find it challenging to recruit candidates for important job roles; 75% said most applicants lack even basic skills. Since employers cannot find qualified candidates, they must develop the talent they already have. Upskilling and reskilling can help them do it.

• Avoid Future Workforce Disruptions: The hiring landscape has changed. If organizations want to stay competitive in the marketplace, they must invest in their most lucrative asset—their staff. This is a win-win situation for employers and employees because workers acquire new, more marketable skills, and companies can build a talent pool of qualified workers who can quickly adapt to marketplace changes. 

• Reduce Turnover: Voluntary turnover costs U.S. companies $1 trillion each year. According to a Gallup study, the cost to replace an employee can range from one-half to two times the person’s annual salary. So, an organization with 100 employees who earn an average salary of $50,000 could have annual turnover and replacement costs of approximately $660,000 to $2.6 million.

• Attract Top Talent: Top candidates want to work for organizations that are committed to training and development. A Gallup report shows that almost 90% of Millennials, the largest U.S. worker segment, value professional development and career growth opportunities. They are less likely to seek new opportunities if their companyinvests in their growth and development. So, organizations that want to attract top candidates must implement upskilling and reskilling programs.
  
• Build a Talent Pool: Technology will continue to replace jobs. However, it will also create new opportunities. So, organizations that use upskilling and reskilling can “future-proof” their workforce. Employees must upskill to perform their current job at maximum capacity or reskill to transition into a new role. Those who do not, or cannot, will be left behind.

Upskilling and Reskilling Improve Productivity

Upskilling and reskilling improve productivity and enable employees to work more efficiently. A Capgemini study showed that upskilled employees can complete mundane tasks faster and focus on activities that drive more organizational output.

Google, Wal-Mart, Verizon, McDonald’s, and Marriott International Organizations are examples of organizations that have invested billions in upskilling and reskilling. Employees can improve existing skills, learn new skills, and pursue a college degree. This enables them to take on additional job responsibilities, transition to new jobs, and move into management.

Benefits of Upskilling and Reskilling Employees

Upskilling and reskilling programs are an investment that saves organizations money in the long run. Businesses can reduce the need to recruit, hire, and train new talent by developing current staff and retraining entry-level and mid-skilled workers whose jobs are at risk of becoming eliminated or disrupted.

Get Started With Upskilling and Reskilling

Time-honored workforce development models are obsolete because they cannot track in-demand skills or align employees with relevant training opportunities. The eSkill Talent Assessment Platform^TM allows employers to create customized skills assessments to track and monitor workers’ skills and proficiency levels.

Do you want to learn how upskilling and reskilling employees can help you “future-proof” hiring? Contact eSkill to request a demo.