With an increase in digital automation, you may have heard some buzz about upskilling in the workplace. What is upskilling? Upskilling places an emphasis on continually providing opportunities to train employees in new areas and help them pursue other career pathways within the company.
How Can Employers Benefit From This?
Putting employees through new training programs can be an expensive endeavor, however, proponents of the practice feel that it provides a worthwhile return on the investment. Employees are likely to feel a stronger sense of loyalty to the company and a renewed sense of enthusiasm and purpose. This can translate to financial savings by reducing the cost of recruiting new talent and the time it takes to get them up to speed, where a long-time employee already has that background knowledge.
Offering upskilling opportunities also makes the company more attractive to job seekers. NYU Professor, Ari Ginsberg shares, “Generation Z is already fairly tech-savvy and is more likely to be attracted and stay in a place where they can get technology learning.”
Why Is It a Risk?
Amazon recently made news with its announcement in July that it start a $700 million retraining program for its employees to help them further their careers at Amazon in other fields.
In an article published by UPenn., Wharton professor of management, Matthew Bidwell has this to say: “There is the concern that if you give people training in transferable skills, either they leave, or the threat that they’re going to leave means that they can demand much higher wages — and that eats away any of the returns [from the] training,” he said.
Investors and shareholders are more comfortable laying off workers who no longer have skill sets needed by the company and hiring newer, more tech savvy staff. Most don’t see the monetary value in investing in a complete training program for employees who may have capped out their salaries and could be replaced by better skilled talent at a lower overall cost.
To invest in current employees seems to be an open invitation for those employees to take their years of experience and newfound skills to another company, wasting the money spent on training them. Accepting upskilling as a standard practice will take time for shareholders and investors to embrace.
A recent article in The Wall Street Journal shares, “Cumulatively, firms spend billions of dollars every year on technology devoted to digital transformation, but executives admit to confusion and uncertainty about the impact. A recent Accenture survey of 1,200 executives found that, while nearly half say skill shortages are a major concern for the future of their firm, only 3% said they will significantly increase their training budgets over the next three years. In a separate survey conducted in 2017 by consultancy McKinsey & Co., 35% of U.S. executives said they believe they will realize their digital goals mainly or only by hiring new talent.”
How to Make Upskilling Work
Can upskilling benefit your company? It’s easy to say that upskilling is a win-win for all involved, however the truth is that upskilling is not a one-size fits all answer. Each company has to evaluate the pros and cons to determine if it would work for them. However, helping employees develop a logical career path with the appropriate training can certainly help with retention, employee engagement, and job satisfaction, if done correctly. Watching what other companies, like Amazon, are doing with their upskilling initiatives can help you determine if this is a path that will benefit your company in the future.