Recent statistics from Korn Ferry paint a concerning picture: by 2030, over 85 million global job positions may remain vacant due to a shortage of qualified workers. This shortfall can be attributed in part to demographic shifts in developed nations. For instance, in the U.S., a substantial number of baby boomers retired between 2010 and 2020, leaving a leadership void that younger generations haven't had adequate time or opportunity to fill.

Compounding this issue is the impending tech skills crisis, poised to have substantial economic repercussions. According to AND Digital research, if Britain fails to bridge its digital skills gap, it risks losing $285 billion of economic growth by 2026.

In the face of this talent crunch, a proactive approach is imperative, and this is where upskilling and reskilling step in.

So, what exactly are upskilling and reskilling?

While similar, upskilling and reskilling serve distinct purposes.

Upskilling entails training an employee in new skills to enhance their performance in their current role or to prepare them for a potential promotion. On the other hand, reskilling equips employees with the skills required for an entirely different position, one they have no prior experience in.

Both approaches involve addressing skill gaps from within an organization rather than resorting to external hiring. This is an indispensable strategy for cultivating a resilient workforce amidst the burgeoning talent scarcity.

The Significance of Upskilling and Reskilling

In a candidate-driven job market, retaining employees poses a considerable challenge. They hold the reins, often able to find new opportunities with higher salaries or better benefits. However, financial incentives aren't the sole motivator for employees seeking change; career development is a primary concern.

A LinkedIn survey revealed that 32% of employees changed jobs because their employer didn't offer upskilling or reskilling opportunities. Providing avenues for skill development or even career shifts has been proven to foster loyalty, enhance engagement, and consequently, boost employee retention. In fact, a previous LinkedIn survey indicated that 94% of employees expressed a willingness to stay at a company longer if their employer invested in their career growth.

Hiring new employees is a costly endeavor. According to the British Business Bank, hiring a new staff member with an average UK salary of £27,600 actually incurs a cost of around £62,890 for their employer in the first year. Upskilling and reskilling can significantly mitigate these expenses, even when factoring in training costs. Upskilling enables existing employees to step up into new roles, while reskilling allows for seamless transitions to different departments, saving HR departments both time and money.

Moreover, for businesses looking to attract fresh talent, a well-structured upskilling and reskilling program is likely to pique the interest of the most promising candidates, especially among the millennial and Gen Z demographics. In a Deloitte survey, 29% of respondents cited learning and development opportunities as the top reason for choosing their current organization.

Empowering the Workforce Through Upskilling and Reskilling

We hope to have convinced you of the pivotal role upskilling and reskilling play in the ongoing talent war. Businesses that embrace these strategies will undoubtedly emerge from this crunch in a stronger position compared to those who merely pay lip service to the idea.

To begin, businesses must foster a culture of continuous learning and development within their organization. This means providing employees with ongoing opportunities to acquire new knowledge and skills. It's a dynamic process that unfolds over an employee's tenure, driven by specific goals.

Achieving these goals necessitates the implementation of structured learning programs. Instead of relying solely on informal or on-the-job learning, which may lack proper measurement, businesses should grant employees access to formal courses with clear learning objectives, timelines, and assessments.

Leveraging online learning platforms is an effective way to ensure employees can access industry-recognized learning experiences, seamlessly integrating courses into their day-to-day responsibilities.

Ultimately, by embedding a culture of learning and prioritizing upskilling and reskilling in organizational practices, and by communicating these opportunities both internally and externally, businesses can effectively navigate the talent crunch.