Reskilling: A strategic response to an evolving world of work

The Great Resignation is disrupting the world of work as we know it. With job resignations up nearly 23% compared to pre-pandemic levels, and almost 48-million workers quitting in 2021, organizations continue to face a tough talent climate. 

Beyond the labor shortage, employers are also facing major skills gaps – where the skills an organization needs don’t match up with the skills the workforce possesses. In fact, a survey conducted by West Monroe Partners found that 56% of HR professionals and employees said their organization’s skills gap is “moderate to severe.” Only 6% of those surveyed said their organization didn’t have a skills gap.

Although recruiting efforts certainly play a role in helping organizations face these challenges, reskilling offers an efficient alternative. During this unprecedented time, learning and development leaders can step in by crafting scalable reskilling programs that ensure the viability of their talent well into the future.

What is reskilling?

Sixty-percent of L&D professionals identified reskilling as one of their top priorities of the year. Reskilling is the act of training employees on new skills or job functions to help them transition into a different role within the organization. (Upskilling, by contrast, helps a learner optimize performance in their current role or prepares them for a promotion in their career path).

Organizations undergoing a radical transformation may need to reskill entire segments of their workforce; think: Netflix transitioning from a DVD-by-mail to streaming service. Additionally, someone whose job is being outsourced might be reskilled into an entirely different department within the organization, especially if they’ve proven to be a team player and quick learner. 

In an attempt to hit zero tailpipe emissions by 2035, General Motors plans to only produce electric vehicles in the future. So the company created the “GM Automotive Manufacturing Electrical College” and is reskilling its manufacturing workforce. For these employees, attending class is their primary job.

Jason Garrison, who’s in charge of GM’s electrical strategy, said of AMEC: “It’s a significant cost to staff it, hire people, and pay them their full salary for a year without getting any production out of them. But we feel if we train people, then in the long haul they will stay with GM and our warranty costs on electrical repairs will go down.”

In the same vein, Amazon launched reskilling programs as part of a $1.2 billion initiative, including the Mechatronics and Robotics Apprenticeship program. This program puts current employees on an entirely different career path, while meeting a key business need. It offers 12 weeks of paid training followed by on-the-job learning, reskilling workers with no technical knowledge into valuable positions at Amazon’s fulfillment centers.

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Another major initiative is the “Reskilling Revolution” that launched in early 2020. This is a global platform hosted by the World Economic Forum where hundreds of business leaders come together to understand the workforce issues challenging organizations today. The goal is to help drive scalable, collaborative systems that will provide one-billion people with better skills and jobs by 2030.

The benefits of reskilling for both workers and organizations

One of the biggest advantages of reskilling is its potential to help organizations prevent a talent crisis. Considering that the average cost-per-hire to onboard and train new employees is over $4,000 (as estimated by SHRM), organizations can save on their bottom line by reskilling current employees. But mitigating turnover costs is just one of a number of reskilling benefits. Reskilling also leads to:

• Attracting new talent. Reskilling programs give recruiting teams an edge because they’re an attractive benefit for outside hires. According to one survey, 92% of employees believe having access to professional development is “important or very important.” Reskilling can entice new hires with even more career opportunities in their future.

• Increasing employee loyalty. Organizations that continuously offer reskilling opportunities build loyalty and inspire better performance. In fact, companies that are able to promote talent from within are able to keep employees almost twice as long as companies that don’t. Employees are also 10-times more likely to look for a new job if they feel their current organization doesn’t put their talents to good use.

• Increasing equity and inclusion. Because there’s such a need for skilled workers, organizations are beginning to offer ancillary benefits such as tuition reimbursement and paid training leave to encourage employees to gain necessary skills. This creates a unique opportunity for learners of all economic backgrounds to access educational opportunities they wouldn’t be able to otherwise. 

• Preparing for the future. Global research firm McKinsey & Company believes that by 2030, up to 40% of all workers may need to move into new occupations. By reskilling the workforce today, organizations can be proactive. Reskilled employees can support the organization as it embraces new business models, and remain on the cutting edge of future-forward skills.

Building a reskilling program

When designing reskilling programs, L&D teams should utilize learning pathways that present employees with a clear series of steps to reaching their goals. Learners can get overwhelmed when presented with too much information at once, but these thoughtfully-designed sequences of instruction help them stay motivated. 

Depending on the goals of a program, reskilling can take anywhere from a few weeks to a year. One estimate says that most often, reskilling requires around six months of time. For longer programs and larger workforces, organizations may need to hire outside firms and vendors to help bring their reskilling programs to life. 

Regardless of a program’s size, here are some best practices for designing reskilling initiatives. 

1. Uncover skills gaps. L&D leaders can conduct a skills gap analysis by working with other leaders in the organization to identify necessary skills, and then measuring existing skills among employees.

2. Consider adult learning theory. Reskilling programs should account for adult learners’ biggest challenges. For example, a lack of time is one of the biggest barriers to reskilling, so it’s crucial that the significance and relevance of learning is highlighted throughout instructional experiences.

3. Diversify training methods. eLearning, on-the-job training, and social learning all have a place in reskilling initiatives. Be sure to give learners a variety of options that meet diverse learning styles.

4. Include soft skills. Reskilling programs that offer training on valuable soft skills teach learners how to navigate new norms – with capabilities such as digital literacy and critical thinking that stand the test of time.

5. Measure results. No reskilling program is effective without the data to prove it. To measure results, consider follow-up focus groups for employees who have completed a program. Most importantly, measure their post-training on-the-job performance by matching key performance indicators with the new skills. 

Which employees should be reskilled? Answering this question requires considering which job functions are likely to be disrupted in the coming years, whether by evolving technology or changes in business strategy. For example, blue-collar roles in industries like mining and manufacturing are seeing unprecedented changes due to digital transformation.

But many employees have real concerns about job security. A recent survey of over 30,000 workers showed that 39% believe their job will be obsolete in five years, and 60% are worried automation is putting jobs at risk.

The good news is – 77% said they’re ready to learn new skills or completely retrain, and 80% said they’re confident they can adapt to new technologies. Organizations looking to reskill their workforce should embrace these learners who desire growth and show an aptitude for picking up new skills. 

L&D leaders can also build reskilling into the DNA of their organization by creating a culture of lifelong learning. Today, many organizations are just scratching the surface of what their talent is capable of, but reskilling programs are an effective tool for unlocking untapped potential.