Learn more about Springboard for Business
We’re living in a business climate that’s dominated by change. Technology is advancing at a blistering pace, one that requires constant workforce recalibration. The half-life of skills is on the decline, so ensuring your team has the right capabilities to drive business growth is getting harder by the day.
According to the WEF Future of Jobs Report 2023, six out of 10 workers will require upskilling or reskilling before 2027—but only half of them will be given access to the resources they need to advance their skill sets.
If you don’t want your business to lag behind, you must take action now to implement a robust, always-on upskilling and reskilling strategy. Keep reading to learn more about the benefits of upskilling and reskilling, and to dig deeper into why a targeted L&D program is absolutely critical to keeping up as the future of work continues to evolve.
What is upskilling?
Upskilling refers to helping employees learn new skills or improve their existing abilities to increase their value in their current roles. This helps them keep up with the ever-changing nature of their roles – and to use new skills to eventually garner promotions and increase their organizational impact.
An always-on upskilling program promotes a culture of constant learning, which is crucial now more than ever. With the pace of technological change, the skills required for employees to succeed are changing rapidly. Upskilling programs ensure that workers don’t fall behind by equipping them with the skill set necessary to thrive – which won’t be the same two years from now as it is today.
The difference between upskilling and reskilling
While upskilling means leveling up the skills your employees currently possess, reskilling means building entirely new skills that will then help them transition to a new role within the company. Depending on the role and the industry, reskilling might prove to be a better way to fill critical skills gaps and retain talent.
Upskilling builds on the skills that an employee already has, be it from their education or their work experience. It means they won’t be completely changing careers, but they’ll be able to adapt and thrive in their current role when faced with new challenges and responsibilities.
If a role evolves significantly or becomes obsolete, reskilling is often the way to go. Employees who reskill learn an entirely new skill set that’s often only loosely related to their existing job, preparing them for an influential role in a different part of the organization.
Why upskilling and reskilling are growing in importance
There’s no way to beat around the bush – the pace of tech disruption is only set to speed up, making upskilling and reskilling a strategic imperative for businesses. Here are some reasons why they’re increasingly important to helping your workforce grow.
Tech advancements are accelerating, changing the nature of work
The shelf life of skills is shrinking as rapidly as new advancements in tech continue to reinvent the way we work. The current AI boom was already brewing pre-pandemic, but most AI solutions were still vastly inferior to what we’re dealing with today. These days, AI adoption is widespread, and it’s inarguably changing business operations.
To many employees and companies alike, AI can be an uncomfortable topic to consider—and with good reason. According to the WEF and IBM, AI, and automation are set to displace up to 85 million jobs globally by 2025. However, it’s not all bad. The same report predicts that AI and automation will also create 97 million new jobs. That’s a net gain of almost 10 million jobs (and skilled roles that will need to be filled).
This flurry of changes goes hand-in-hand with the fact that skills, on the whole, just don’t last as long as they used to. According to HBR, the average half-life of a skill is now under 5 years, but in tech, those skills can become out of date in as little as 2.5 years. The WEF’s Future of Jobs Report 2023 shares another grim prediction: up to 44% of workers’ skills will be disrupted in the next 5 years.
With skills disruption and obsoletion on the horizon, companies must act now to institute company-wide upskilling and reskilling initiatives to stay ahead of the curve.
Workforce management is now about skills, not jobs
Gone are the days when getting a college degree meant obtaining a skill set that would remain relevant until retirement. Today, abilities and knowledge both have to significantly evolve alongside the ever-shifting business landscape.
Hiring based on skills rather than jobs is one way that your company can combat the fact that a job that’s relevant now may no longer be useful in a couple of years. In fact, LinkedIn job listings already reflect this, with a 21% increase in postings that search for skills as opposed to qualifications.
This skills mindset is also already dominant among leading companies. Deloitte reports that only 19% of business executives and 23% of workers say that it’s best to structure work through jobs rather than skills, and those numbers are likely to grow smaller over time.
Talent shortage is the greatest threat to business in 2024
Executives across many industries are all facing the same challenge: talent shortage. For more than two years now, the number of available jobs has exceeded the number of available workers, according to the U.S. Bureau of Labor. Plus, there’s a dearth of skilled talent for highly skilled roles in particular.
Despite employing skilled talent acquisition staff and upping recruitment budgets, your company is likely facing this issue, too. It’s a serious problem: operating with an underskilled workforce (and critical roles unfilled) is a recipe for disaster, negatively impacting productivity, innovation, and ability to grow in an increasingly competitive market.
The way to combat an employee shortage is simple—instead of trying to hire more people, help your existing employees upskill or reskill. Upskilling and reskilling are also more affordable than recruitment, which costs half to twice an employee’s salary. This investment pays dividends almost immediately.
Benefits of upskilling and reskilling your workforce
Investing in your existing employees instead of trying to fill the gaps with new ones can bring a lot of benefits to your company. Here are some of the main ones.
Achieve business goals more efficiently
Once you set clear goals for your business, you’ll undoubtedly encounter critical skills gaps in your existing workforce. Given that it’s more cost- and time-effective than recruitment, upskilling and reskilling your people is a no-brainer. Training people who are already familiar with your mission and company culture can help you zone in on strategy execution much faster, and that can translate to significant financial gain.
Look for upskilling programs that prioritize tangible business impact. For example, the Data-Driven Strategic Thinking course from Springboard for Business has participants tackle an on-the-job project so they can immediately apply newly acquired data literacy and critical thinking skills. Three-year Springboard client HP has seen an average gain of $187K per project completed in the 8-week course.
Move with greater agility & support business transformation
Considering that as many as 61% of workers will require retraining by 2027 (according to the WEF), bridging skills gaps is the main barrier to business transformation. An investment in upskilling and reskilling today will ensure your organization can adequately evolve as the business landscape changes.
Running a talent development program is a surefire way to future-proof your operations. No one truly knows what any industry will look like five years down the road, but by taking a skills-based approach to employee training, your business will be prepared for anything. Any necessary strategy pivots will be met with greater readiness, and new technologies won’t be as big of a disruption—instead, they’ll be an opportunity to evolve your business to an even better place.
Employee engagement and retention
If recruiting people with the skill set your organization needs is proving to be hard, upskilling and reskilling your current employees will solve many problems. According to Deloitte, companies that follow a skills-first approach are 107% more likely to effectively match up talent against the current business needs, and 98% more likely to retain their top performers.
Upskilling people who have already proven themselves at your company fulfills what top job seekers look for in this day and age—it’s not just about the money, but also about room for growth and company culture. Employees often appreciate the individualized investment, and you’re likely to see gains in employee satisfaction and retention. Closing skills gaps is a win-win for both employees and businesses.
When searching for upskilling and reskilling partners, seek out those that run cohort-based programs. Small, cohort-based L&D programs like those offered by Springboard for Business have employees from a single organization or team upskill or reskill together. This approach deepens in-course conversations because of a shared understanding of company goals and culture. Additionally, cohort-based learning breeds a sense of community – one that has staying power even after a particular upskilling or reskilling course ends.
Create a more equitable workplace (DEI)
Following a skills-based approach will help you create a more diverse workplace that helps you execute your Diversity, Equity, and Inclusion (DEI) mission.
Internal mobility is a critical mechanism for creating diversity in management. According to Bain & Company, companies should develop a path for “raising up diverse talent” from more junior or front-line positions to fill critical roles from within. And LinkedIn reports that upskilling and reskilling are especially important for promoting diversity and ensuring an equal playing field is available to BIPOC employees.
If you mainly focus on a person’s skills rather than educational or work background, you’re likely to successfully democratize internal mobility. As per Deloitte, a whopping 75% of execs all agree that prioritizing abilities can help with providing your employees access to the opportunities they want and deserve. And that, of course, translates to a greater sense of belonging, increased engagement, and retention.
Upskilling and reskilling for a future-proof workforce
The ever-evolving landscape of technology and work demands a paradigm shift in how we manage talent. In an age of disruption and skill obsolescence, relying solely on traditional recruitment strategies is no longer sustainable. The answer lies in embracing a proactive approach – fostering a culture of continuous learning through upskilling and reskilling.
Investing in your existing workforce isn’t just about plugging skills gaps; it’s about building agility, fostering innovation, and creating a resilient organization that thrives in the face of change. It’s about recognizing that your employees are your most valuable asset and empowering them to adapt and grow alongside the business. By prioritizing a skills-based approach, you not only equip your team with the tools they need to excel in their current roles but also unlock their potential for career progression and internal mobility.
Upskilling and reskilling aren’t just buzzwords; they’re the cornerstones of a future-proof workforce. Remember, the only constant in the future of business is change. By nurturing a continuous learning mindset and embracing ongoing skill development, you empower your team to navigate the unknown with confidence and propel your business toward continued success.
Since you’re here…
Springboard for Business grows businesses by empowering leaders and their teams with the critical thinking, data, and technology skills central to the future of work. Companies like Amazon, Walmart, HP, JPMorgan Chase, and Visa have partnered with Springboard for Business to upskill and reskill employees around the world. Click here to learn more.
