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The Challenges of Reskilling — and How to Overcome Them

This was originally posted on Training Industry

Why Reskilling Is Essential

The automation of the workforce is not a new concept. It dates as far back as Samuel Slater’s 1790 textiles factory and continues to cause feelings of job insecurity among workers. McKinsey reports that by 2030, automation could displace between 400 million and 800 million workers. Fortunately, organizations are recognizing the importance of reskilling their workforce — that is, retraining employees by teaching them new skills.

According to McKinsey, 62% of executives “believe they will need to retrain or replace more than a quarter of their workforce by 2023.” This statistic shouldn’t come as much of a surprise. It’s impractical to expect employees to spend their entire careers with the same skill set. It’s the responsibility of learning and development (L&D) teams to ensure that organizations have the skilled workforce they need to be competitive in the market.

Comparing Costs

Amazon is one of several corporate giants to recognize the benefits of reskilling. After a recent technology adoption that automated warehouse operations, the organization plans to reskill one-third of its workforce rather than lay off warehouse employees. Over the next six years, the company will invest $700 million in developing technical skills around information technology (IT) support, machine learning and software engineering within its pool of factory workers. Of course, there are other notable benefits of building a more skilled workforce. The initiative will help to attract key talent in addition to retaining the talent Amazon already has.

Reskilling can be cheaper than rehiring. In a recent survey, 95% of learning professionals reported spending less than $10,000 to reskill an employee. On the other hand, research by the Work Institute found that employee turnover costs 33% of the departing employee’s salary. That’s a significant cost that only increases with salary.

Moreover, employees with fresh knowledge and skills may be scarce, hard to attract and expensive to hire. Research by Indeed found that 42% of employers are concerned about finding qualified candidates. Considering the pace of technical advancements, even new hires will need to update their skills relatively quickly. Reskilling existing employees is more cost-effective than hiring new ones, and it helps make employers more competitive.Organizations are recognizing the importance of reskilling their workforce.

Investing in Your Employees

The large millennial workforce is known for job-hopping, but Gallup found that 87% of millennials value professional development and career growth opportunities in their jobs. They recognize the benefits of effective employee onboarding and continuous learning, which makes training a way to attract and retain young talent.

Amazon’s reskilling program will certainly improve its operations in the long run, but it’s also an investment in its workforce. Employees will have new career trajectories whether they stay or take their new skills somewhere else, but by investing in its employees — showing them that the company values them and their success — Amazon will help make them want to stay.

Programs Challenges

Performance Mapping

It’s often difficult for companies to identify which skills their employees have, which skills they need and how to fill the gaps. That’s why thorough needs analyses and performance mapping are vital. Even after you deploy a training program, it might fail to bring about positive outcomes if it doesn’t address underlying performance challenges. Reskilling initiatives have to start with organizational goals in mind. Which skills does your organization need immediately, and how might those needs change in the next few years?

The Half-life of Technical Skills

Technical skills change quickly. Industry standards for technologies and processes shift more quickly than educational systems can turn out learners. A survey by Prudential found that only 46% of full-time workers think their skills will make them competitive in 10 years. This finding reflects the claim in Douglas Thomas and John Seely Brown’s book “A New Culture of Learning” that the half-life of skills is only five years. Unless L&D teams can speed up the design, development and deployment of reskilling initiatives, organizations will struggle to find and keep skilled candidates, and current skilled employees will lose relevance.

Training Delivery

Retraining is most successful when it happens on the job, and employees are most likely to retain information if it’s immediately applicable. Learners need to be able to connect what they’ve learned in training to their day-to-day responsibilities, and the best way to help them do so is to integrate training experiences into the flow of work. The best training strategy includes microlearning and mobile learning tactics to enable this on-the-job learning. Mobile performance support systems, for example, can provide easily accessible training content to employees by scanning objects and finding relevant training content.

Corporate skills, particularly technical skills, are rapidly changing. Keeping up with those changes is vital for employers to stay competitive. Though there are still some notable challenges to reskilling initiatives, the benefits can be remarkable. The task falls on L&D groups to promote continuous learning and maintain a thriving workforce.