94% of UK workers will need reskilling by 2030. Let that sink in for a moment – it’s a huge number. With many businesses already reporting their number one impediment to growth is a lack of skilled talent, this looming skills shortage can feel like a tidal wave on the horizon.
This is where reskilling can become the differentiator between failure and success. Accurate intelligence is needed to make best talent decisions in a hypercompetitive labour market. Without it – or indeed a wide pool of available talent in the first place – business leaders and senior HR personnel can find themselves in a situation where hiring alone is no longer a solution.
The changing world of work
As talent demand continues to outstrip supply and a digital skills shortage becomes ever present, it is not surprising businesses are reporting a lack of suitable skilled talent is impeding their growth.
The main reason behind this current talent shortage – one that I believe is here for the long term – is that the world of work has permanently changed. Alongside a growing skills shortage, employees’ expectations have changed too.
They need to have greater opportunities within roles and have a need for greater fulfilment at work, in both business and personal terms: work needs to align with their personal values; work needs to be flexible; work needs to be remunerative in more ways than just their paypacket (ongoing upskilling/reskilling opportunities once employed, an Employer Value Proposition they believe in, etc.).
All these factors feed into the fact the playing field has changed irreversibly. In an age when there are more jobs than workers, those who choose to work can be highly selective as to where and when they deploy their labour – making the reskilling of existing staff more essential than ever before.
Unfortunately, many employers are also failing to appreciate more than 50% of current jobs will require new skillsets by 2027, with poor digital skills affecting +33% of the entire UK labour force. Many employers also have poor understanding of the current and transferable skills within their own organisations and are often unable to discern which type of training programmes they need and how to deploy them to achieve the skills they will need in the future.
And the problem of legacy staff being left behind by the ‘new world of work’ isn’t the only growing issue. According to McKinsey, university graduates are also woefully underprepared, with 60% of employers saying that new graduates coming through the system are “unprepared for a commercial career”. 40% state the biggest reason they cannot fill entry-level vacancies “isn’t a lack of people, it’s a lack of adequate skills”.
Some businesses are rising to meet the reskilling challenge – tackling the talent shortage by upskilling and retraining, to build from within. But they can often fail to properly meet the business’ needs. Schemes can often be flawed because of execution problems – most critically a lack of outcome focus, insufficient understanding of required skills, and weak incentivisation. And, when schemes are deployed, poor planning, low investment, weak programme take-up, and high drop-out rates can also lead to many internal training programmes delivering a distinct lack of return.
“Building talent is often more effective than recruiting, and is now considered essential for success”
Reskilling programmes require sharp planning, strong experience and a clearly-delivered outcome to succeed and, when done so, 75% of completed reskilling programmes are economically positive – typically delivering productivity increases of up to 12% per worker.
Reskilling for the future
Business leaders can develop and reskill the valuable workers they already have by developing a strategically planned reskilling programme, to fill gaps in organisational skills now and in the future. This needs to be at the heart of any successful organisation’s talent strategy.
According to the World Economic Forum, employers who invest in training and upskilling find it easier to retain staff and, with a recent PWC survey revealing that 39% of employees say they’re concerned about not getting sufficient technology training from their employers to help keep skills up to date - the time is surely now.
It’s time to switch away from a traditional, restrictive, experienced-based view of jobs to a modern, adaptive skills-based view. To succeed, businesses need to incentivise the outcomes and build the internal capabilities that walk learners through skills exposure, education and experience.
To find out how to reskill your workforce to meet the coming demands of an ever-changing business landscape, read more in our Reskilling Guide - available now.