Employers have traditionally relied on colleges and other educational institutions to provide the necessary workforce. While traditional education can still be essential, employer-led learning is expected as most employed workers (92%) expect their workplace to increase or maintain learning and development opportunities, according to the latest Pearson Skills outlook.
The economy is changing fast, driven by new technology and shifting market pressures. Businesses are shedding old skills and adding new ones as they seek a competitive advantage.
The number of positions advertised without a degree rose by 40% between 2019 and 2020. And the trend is accelerating. The World Economic Forum's Future of Jobs report emphasizes that half of all workers will need reskilling by 2025. And it won't end there.
Businesses that fill these competency gaps by embracing skills-based hiring and strategic workforce planning are finding success. Others risk falling behind.
An engaged, agile workforce that prioritizes learning and continuous improvement can be an essential competitive differentiator in the marketplace for talent.
Nearly half of human resources leaders surveyed by Gartner said that not only do they not know what skills gaps exist in their organization, but they also can't develop their skills development solutions fast enough to keep up with the needs of their organizations.
If not knowing where to begin is keeping you from addressing competency gaps in your workforce, meeting current demands and preparing for imminent and future opportunities, these three steps will get you started.
The impact is hitting all industries, no matter where they operate. By 2025, more than 85 million jobs globally will become obsolete; at the same time, there will be 97 million new jobs that didn't exist before. This shift in skills requirements will create significant gaps for many employers.
There is no one-size-fits-all approach for everyone. But a clear first step is categorizing and classifying the skills in your organization. A comprehensive skills ontology doesn't just catalog and map your organization's skills; it shows the relationships between the skills.
Classifying jobs based on the skills required to meet expectations for performance, instead of job descriptions, helps you identify the gaps between the skills you have now and the skills you need for tomorrow. Skills mapping will help you fill the missing pieces in your workforce.
Implement skills mapping to identify career paths and job corridors to create a robust talent pool. That means having people with the right skills, in the right roles, at the right time.
Once you identify the career paths, it's time to fill them with engaged people. There are three options for this: upskilling, reskilling, and hiring.
Upskilling is the process of improving workers' skill sets, preparing them to advance in their current roles and move up through the organization.
Many leaders believe skill building is the best way to close skills gaps, preferable to hiring, contracting, or redeploying workers to new roles. But sometimes skill building, or upskilling, isn't the best choice. So, what's left?
Reskilling is training workers with new skill sets, including entry-level employees. Reskilling is not preparing workers for advancement; it's preparing them for entirely different jobs.
Reskilling can be a good option when your business strategy is shifting in ways that will eliminate some roles but also require new, comparable roles that require different skills. Reskilling opportunities for existing employees can communicate that you value them, leading to greater engagement and productivity.
Maybe your audit reveals you do need to hire new talent. The gap between your workforce's skills and those required may be too big to overcome with upskilling or reskilling programs. Or perhaps the number of employees with different skills is too large for your existing workforce to fill.
Attracting the best talent is becoming more complex. Generational shifts, changing demographics, and new ideas about what makes a job desirable are augmenting the hiring market.
Offering training and professional development opportunities can make your organization more appealing, giving it an edge when attracting new talent.
Gallup-Amazon research shows that 48% of workers in the U.S. would be willing to switch jobs if offered skills-training opportunities; 65% say employer-provided upskilling is a priority when evaluating a potential job.
Skills-based hiring with clear career paths outlining skills development opportunities and upward mobility can give you an edge when competing for talent in this new landscape.
Timing is another important question when choosing between reskilling, upskilling, and new hires. Short-term strategic shifts may mean you need to find ways to add new skills quickly. A longer-term perspective gives your organization time to be more measured.
Skills mapping can help you understand your time frame for closing competency gaps. Do your workers have the skills to meet business goals this quarter or this year? Or will skill gaps be a problem two or three years into the future?
The further you look into the future, the more significant the skills gaps will likely be. But that also means you have more time to prepare and consider strategies that may take more time to implement, such as upskilling and reskilling.
Strategic workforce planning can align your business strategy with industry trends and forecasts to reduce urgency and make more calculated and informed talent management decisions.
Finally, consider the total cost of each of your options. Churn, recruiting, and onboarding all have clear costs that you can measure in financial terms.
Other impacts on company culture and employee morale can ripple through your company both positively and negatively. Sometimes the impact is immediate, but other times it can take a few quarters to see the results.
Skills development strategies like upskilling and reskilling require time and financial investment. They're unlikely to fix significant skill gaps quickly but may be a good option for smaller ones. Ask yourself these questions.
Assess whether the skills gap can be efficiently closed through training or if hiring new talent is a more scalable solution.
Note that career paths and skill mapping will also help you determine which roles and people can be efficiently upskilled and which can't. For example, a financial analyst could successfully retrain as a cybersecurity specialist, but a warehouse forklift driver probably isn't going to become a data scientist with a few workplace courses.
Consider the value of retaining institutional knowledge and earning workforce loyalty.
If there are opportunities to offer skills development to your existing workforce, and you hire anyway, you might hurt employee morale.
When you train people, they know you're investing in their success. They then become more invested in the company's success. Increased worker engagement means increased productivity, better customer service, and lower turnover.
Failing to invest in skills training might lead to a slow talent drain, reducing innovation and leading to a loss of competitive advantage.
A blend of new hires and new career paths for current employees fosters a culture of continuous learning. While your competitors try to recruit talent with next-generation business skills, you'll build an engaged, agile workforce.
How does Credly's Workforce platform work?
The Workforce platform provides data and insights and enables you and your workforce to take productive action. Here's how it works:
Ready to address your skills gaps and build the agile and adaptable workforce required for success now and in the future? Schedule a demo to see how Workforce can work for you.