Upskilling: The key to higher productivity & employee retention
The global workforce faces a massive skills gap, and many organizations need help finding qualified talent.
Research from McKinsey & Company found that 87% of companies worldwide are either aware of a skills gap or will have one within a few years.
The solution?
Upskilling, and a lot of it.
Springboard for Business’s The State of the Workforce Skills Gap 2024 polled 1,000 corporate professionals (in leadership roles) and asked them how they planned on addressing the current skills gap within the following year.
63% claim they will focus on teaching employees new skills via an upskilling strategy.
It’s a wise tactic, as most modern employees lack the necessary skills to perform their roles properly, and there are multiple culprits to point fingers at.
Artificial intelligence is on the rise. Rapidly evolving technologies, such as automation, machine learning, and blockchain, are transforming the workplace. These changes have dramatically shortened the lifespan of technical skills.
In the past, most hard skills (technical skills specific to a position) had a half-life of at least ten years before upskilling was necessary.
Today?
That number has shrunk to just four years.
Besides technological advances, skilled workers are retiring in large numbers, and there aren’t enough qualified workers to replace them.
In short, upskilling programs and opportunities are now necessities for virtually any organization, so read on to learn how to make them a reality.
What is upskilling?
Put simply, upskilling happens whenever you expand on an employee’s existing skill set. This means the new skills they learn will directly correlate with the demands of their current position.
There are a variety of reasons why upskilling employees may be necessary, including:
- Technological advancements such as automation and AI programs
- Digital transformation – where a company brings analog tasks into the digital space
- Continued education and certifications to reach new career goals and qualify for promotions
Therefore, upskilling always involves building upon an employee’s knowledge and skills.
The ultimate goal is to make employees more proficient, knowledgeable, and productive in their current roles.
In other words, you’re helping build the absolute best version of the employee by providing upskilling opportunities.
However, in recent years, upskilling efforts have focused more on keeping up with rapid technological changes than on forging stellar workers.
Why is that?
For one, the COVID-19 pandemic kicked off a digital transformation revolution, forcing thousands of companies to adapt to online channels for the first time. Before 2020, they had yet to migrate into the digital space.
This meant the lockdowns immediately presented the need for upskilling in these organizations, particularly for transforming manual tasks into digital ones.
Then, in November 2022, OpenAI introduced its ChatGPT, which kicked off the AI takeover we’re still in the middle of today.
According to research by Exploding Topics, 77% of companies are either already using AI or plan to adopt it soon. 83% of companies polled reported that while they aren’t using AI right now, it’s a top priority in their upcoming business plans.
AI chatbots and other programs are still very new, so upskilling and reskilling are necessities for companies that want to adopt the technology.
What’s the difference between upskilling and reskilling?
In professional development, the terms upskilling and reskilling are used almost interchangeably, but there is a distinct difference.
Upskilling always refers to expanding existing skills to make employees more effective at their jobs, meet emerging demands, or develop new competencies.
An example of upskilling would be a digital marketer learning to use an AI chatbot to conduct SEO keyword research. Since the marketer already knows how to research keywords, using AI to aid with the process is expanding on an existing skill.
Reskilling is when an employee learns brand new skills that aren’t related to their current role. They could be preparing to be promoted to a higher role, or their job responsibilities could have changed so starkly that they must learn new capabilities.
For instance, an assembly worker at a factory has their job uprooted by automation. To stay at the company, they must learn computer programming and maintenance to become an automation technician, an example of reskilling.
Since the assembly worker didn’t have previous experience working with automation technology, he had to learn many skills to land a new job.
Organizations use upskilling and reskilling to close the skill gap and build productive workforces.
What are the benefits of upskilling?
Upskilling doesn’t happen overnight, and it certainly isn’t free. Properly upskilling an employee requires a significant investment of time and resources on your organization’s part.
After all, developing training programs and implementing mentoring can be ridiculously expensive.
Is upskilling your employees truly worth the time and effort?
The answer is yes because the benefits are significant and outweigh any costs involved.
Here’s a look at the top advantages of providing learning and development opportunities for your employees.
Growth opportunities and better retention rates
Upskilling opportunities have a substantial impact on employee retention.
This is because employees are always eager for learning experiences and development programs that will help them advance in their chosen career path.
Nobody wants to feel stuck or stagnant in a role, and providing upskilling opportunities will give your employees plenty of maneuverability, making them more likely to stay with you.
A study by Lorman Education Services found that 74% of workers are willing to learn new skills or re-train themselves to remain employable. Also, 59% of millennials claim that development opportunities (or lack thereof) are a major deciding factor when determining whether to apply to a position.
Superior adaptability
If your organization is equipped to upskill its employees at any given time, it can adapt rapidly to change.
This is a huge advantage today, as adaptability consistently ranks as the #1 most important soft skill.
As stated in the intro, the average half-life for technical skills has shrunk significantly. This means that your employees may need to upskill again in four short years, so it’s worth getting set up for it.
Better employee engagement and well-being
A poll by SurveyMonkey found that 59% of employees say training programs improve their job performance, with 51% claiming that they improve their confidence.
These statistics reflect the morale and engagement boost related to employer-provided upskilling.
Employees appreciate skill development because it A) makes them more competent and B) helps them evolve past their current job position.
Upskilling considerations for human resource departments
Like anything else, there’s a right and a wrong way to go about upskilling your employees. Appropriately done, upskilling is a fantastic way to future-proof your team, as they’ll always be ready and willing to learn new digital skills as they emerge.
If you do it incorrectly, you could harm your workforce and business initiatives more than reasonable.
Here are the top considerations to consider when putting together an upskilling strategy.
Using old-fashioned training programs
In-person lectures, workshops, and training sessions are quickly becoming a thing of the past.
Why is that?
It’s because they’re expensive and difficult to schedule. Furthermore, there’s no guarantee that every employee will understand and retain everything said and demonstrated during the live training event.
To illustrate this, picture that you want to upskill your digital marketing staff and teach them how to use AI chatbots for SEO purposes.
If you want to hold a live training, you’ll have to:
- Find someone to host the training and find out when they’re available
- Discover the perfect day when all your employees can attend
- Pay for the training event and other logistics (snacks, equipment, etc.)
Compare all that hassle to using an online course or learning management system (LMS).
Since the training content is all online, your employees can complete it at their own pace. This gives employees ample time to fully comprehend and understand the training, which can be difficult during a one-off live event.
Digital training courses are also far less expensive and don’t require any scheduling or logistics to pull off.
Forcing a ‘one-size-fits-all’ approach
Another upskilling mistake is to try to use the same training program for every employee.
This is another reason why live training events are becoming antiquated since everyone receives the same training.
Instead, it would help if you aimed to personalize each team member’s training to capitalize on their strengths and minimize their weaknesses.
For instance, if one of your employees is a visual learner, you could show them training videos instead of text-heavy learning modules.
Tips for creating an upskilling strategy
As we’ve discussed, the future of work will require lots of upskilling, so it’s essential to know how to implement upskilling opportunities at your place of work.
Here are some practical tips for upskilling employees.
Step #1: Conduct a skill gap analysis
First, you need to know which skills your employees need but don’t currently possess.
The best way to do that is to conduct a skill gap analysis, which is where you analyze each employee’s current skill set to uncover:
- Which skills do they currently possess
- The skills they need to learn
- Skills that need working on
The process is intensive, but it is worth the effort. Once complete, you will know exactly which skills your employees need.
A skills gap analysis template is convenient in this regard, so don’t wait to download ours for free.
Step #2: Build training modules for missing skills
Take the list of missing skills you accrued in step #1 and start putting together training programs for them.
Remember, your best bet is to use online courses or a learning management system. These are the most affordable and convenient options for your employees.
Also, utilize a variety of training methods.
Besides online training, mentorship programs are also effective for upskilling and reskilling. Have your most capable employees train new hires. This ensures they learn all the necessary skills to perform their tasks.
Step #3: Accommodate different learning styles
People process and retain information differently. Tailor your training to appeal to various learning styles. This is essential for effective learning.
Some employees prefer visual content, while others may excel with written materials, so do your best to mix things up.
Microlearning is also on the rise, and employees are eating it up.
What’s that?
Microlearning is a set of very brief e-learning modules designed to combat learning fatigue. These modules contain quick information and last only a few minutes.
According to research, 80% of employees felt more accurate at performing their tasks after engaging in microlearning modules, so it’s something to consider.
Final takeaways: Upskilling in the workplace
Technology is advancing rapidly, and the workforce is retiring. These changes continue to reshape the workplace, and as a result, upskilling remains a necessity for the foreseeable future.
Upskilling employees is one of the best ways to improve your adaptability, which matters now more than ever.
Your organization should become future-proof as long as you have reliable upskilling and reskilling programs in place.
More Resources:
Types of employee training programs — which is the right fit?
Employee training plan templates — 3 training plan examples
What is employer branding? How does it help with hiring?
