Not Upskilling Your Workforce? 4 Reasons It’s a Must Now
The shortage of skilled talent is plaguing just about everyone. Most industries are feeling the hurt from a lack of qualified talent, and companies are struggling to secure the skilled talent necessary to fuel their growth.
It makes upskilling your workforce critical.
The crisis is worsening, with the U.S. Chamber of Commerce reporting 8.5 million job openings in the U.S., yet only 6.5 million unemployed workers.
Many factors have converged to create this dynamic. For one, the labor force participation rate has dropped, and remains low at 62.7%. If we kept the same participation rate we had in February of 2020, we would have had more than two million more Americans in our workforce.
Workforce demographics are changing, too. We are experiencing the largest increase of retirement-age Americans in history, with more than 4 million Americans turning 65 this year and each year through 2027.
Upskilling Your Workforce for the Future
In addition, younger generations’ job preferences have shifted and they seek greater flexibility and balance between their professional and personal lives. In fact, those aged 25-34 have reported prioritizing personal growth over searching for a job.
A survey of those who lost their job during the pandemic revealed that more than one-third of those within the 25-34 year old age bracket were focused on acquiring new skills, education or training before re-entering the job market.
Workers are eager to learn more and to be trained, but many don’t know how to make that happen. In addition, many employers have yet to fully embrace training as part of their business strategy. This combination often leaves upskilling by the wayside.
With the data clearly supporting a continued talent shortage, training is no longer an optional nice-to-have. It’s imperative that organizations take the talent available, upskill or reskill them, and maximize their workforce to meet their business goals.
Upskilling Isn’t Up to the Candidate
Upskilling, the process of learning new skills or improving existing ones to enhance your expertise, has been around for some time. It’s often embraced by workers themselves to remain competitive in the job market, as it can lead to career advancement, increased earning potential, and personal growth. But it’s not always easy for workers to find a way to plug into this type of training.
At one time, it was expected that candidates show up to interviews and start new roles with all the necessary skills in place. In today’s world, this is an unrealistic expectation. With the scarcity of qualified talent, the fast pace of technology advancements, and company direction changing often, individuals can’t keep up with all these elements by themselves. At the same time, many companies have not taken the time to upskill their teams. The result is frustration, attrition, the inability to recruit new hires, and loss of productivity.
Beyond Recognizing the Problem
Most executives admit there’s a talent problem. Over three-quarters (78%) of CEOs say talent scarcity is reaching crisis proportions. PwC reported that 93% of CEOs recognize the need to change their strategy for attracting and retaining talent, and 63% are increasingly worried about finding talent with the right skills. The elephant in the room: 61% of them haven’t yet taken the first step from intention to action.
So how do companies take that first step once they’re committed to training talent? It doesn’t mean they need to take training in-house. Many organizations exist with the sole purpose to provide training in one form or another, and to partner with one of them can be among the easiest and most cost-effective ways to get started.
For instance, Tooling U-SME, one of our partners, offers industry-recognized manufacturing training and certification for all workers. Here’s one example of how this works.
Automotive Evolution to EV
The automotive industry is a prime example where upskilling is essential to the survival of the labor force. As the focus on electric vehicles (EV) continues to grow, with worldwide sales expected to grow more than 20% this year, so does the need to train workers in this new area because the skills required differ from traditional vehicle manufacturing.
Tooling U-SME’s Electric Vehicles Fundamentals (EVF) Certification prepares candidates for entry-level positions in automotive assembly and the production of electric vehicles. Upon completing training, candidates are prepared for roles as assembly technicians, production associates, team assemblers, manufacturing technicians and more.
Expanding Your Talent Pool
In addition to upskilling current employees, training new hires must be a part of your recruiting strategy. With the shortage of available talent, companies are looking to recruit from new and diverse talent pools, then train them.
Organizations are increasingly realizing that transitioning military personnel brings with them a host of experiences and skills that make them exceptional candidates. Because of the quality of their experience and what they’ve already learned while on Active Duty, upskilling service members is a natural and smart decision.
The Department of Defense SkillBridge program offers skills training and internships for military service members transitioning to civilian careers. This training builds on the skills they have already acquired during their service and prepares them for successful civilian employment. It occurs during their last 180 days of service, while they are still receiving military compensation and benefits, and individual training programs vary in length.
Companies can save money on both training and onboarding when partnering with a third party. One of our clients leverages the SkillBridge program to upskill its workers. After putting its team members through the program, the organization reported a significant cost savings of more than $27,000 per hire. Because SkillBridge covers the salary, travel, lodging and training for several months, the client no longer had to incur those costs.
How AI Will Elevate and Customize Training
AI is revolutionizing learning and development, creating more engaging and effective training programs that can provide more personalized learning experiences by analyzing participants’ strengths and areas of improvement.
Customization is key. “A learning technology that may be effective for one type of learner could be ineffective for another,” said Leah Houde, Chief Learning Officer with PwC.
Before training programs begin, AI analyzes data to determine which skills are needed most and which skills the trainee already has. This personalization means they won’t be trained in skills they already possess. In addition, AI considers the trainee’s learning style and pace to personalize their learning materials and release training modules on a timeline that works best for the individual. Using AI to customize and personalize training programs is something many companies have yet to tap into but holds a great deal of future potential.
Upskilling=Retention
In addition to filling talent gaps within an organization, upskilling also helps to improve retention. Employees are looking for career paths, and if there is not a clear way forward within your organization, they’ll look for opportunities elsewhere.
Augmenting your team members’ skill sets allows them to grow into new and more challenging roles at your organization, which builds engagement and loyalty and increases retention rates.
Make Upskilling Part of Your Business Strategy
Organizations that have invested in upskilling their workforce have seen a real difference in company productivity levels. They are filling open roles both by building up the talent they already have as well as hiring candidates who are eager to learn.
Incorporate these four critical components when building a successful upskilling strategy.
- Get buy-in from the C-suite. Use data points to illustrate the talent crisis in your industry and include stats on how upskilling can help.
- Partner with an organization that has established training programs in place and is well-connected with a strong talent pool.
- Manage oversight of the partnership, working closely with both program candidates to ensure the career path is right for them and with department managers to confirm which skills are most needed in their workforce.
- Incorporate a continual feedback loop to confirm the skills they’ve learned are in fact helping them perform in their role. If not, make changes to the training as needed, and always reassess.
Companies that have made upskilling part of their workforce planning and development are seeing their talent needs met and productivity levels rise. This is the time to make upskilling an active part of your organization’s business strategy.
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