The Truth About Upskilling: What it Means for the Global Economy, Your Organization, and Individual Employees

The core of upskilling is often self-explanatory; it refers to training existing employees with new skills to be able to contribute to their organizations in different ways as the business landscape changes. However, in practice, upskilling has a massive impact on individual employees, businesses of all sizes, and even the global economy.

It's important to understand the true value of upskilling and the momentum it can bring to any business. If you’re trying to move toward utilizing more digital tools, interact with customers differently, or even offer new services to your customers, upskilling is a more effective way to prepare your workforce to meet demands. Instead of hiring new, already-equipped employees into roles, upskilling allows you to save money, spend less time on onboarding, and avoid high turnover rates.

If upskilling isn’t on your radar, it needs to be. Understanding the power of upskilling is only the start. Once that’s complete, it’s time to start implementing upskilling initiatives within your organization. To learn more about upskilling and how to bring it to your organization, keep reading.

Upskilling and Employees

With each passing second, the need for upskilled workers grows. According to a survey of 52,000 employees around the globe conducted by The World Economic Forum, workers who believe that they have skills that are in short supply in the workforce are much happier and more empowered in their careers. 80% of those employees are satisfied with their jobs, and nearly 70% feel like their managers listen to them.

The message here is this: as the job market goes through competitive cycles, the time and effort of business leadership teams might be better spent focused on their existing teams rather than trying to source new ones. With the right resources and mindset provided by their employers, people can learn a range of new skills, broadening the ways that they can contribute to an organization’s success.

Upskilling as a concept also opens a lot of doors for individual employees. Perhaps there is a professional training that’s out of their personal budget but can be absorbed by their company. Or, maybe they only have a bachelor’s degree but are incredibly talented, and instead of hiring a new person with a master’s degree, their employer invests in their success, getting to where they need to be to advance. On an individual level, upskilling can change lives by opening doors, making people happier in their roles, and providing the support needed to thrive in the workplace.

Upskilling for Businesses

Looking from a business perspective, upskilling can seem like a costly and time-consuming endeavor. As HR professionals, we know first-hand that nothing is more costly or time-consuming than managing turnover, hiring new candidates, and getting them onboarded. Even if a current employee has to take classes for 3 months to learn a new skill, they’ll start adding value faster than a new hire with programming experience.

According to Harvard Business Review, it can take up to 8 months for a new hire to start adding value. They have to learn company dynamics, product offerings, and their day-to-day responsibilities, which often takes longer than helping an existing employee upskill. Not to mention, employee turnover costs businesses anywhere from 100% to 300% of that employee’s annual salary.

Financially, it makes sense to incorporate upskilling into your business strategy, but it also makes sense from a productivity perspective. Not only will upskilling your employees strengthen their trust in your organization, but it will encourage them to work harder, contribute more value, and make your business better.

Global Scale: The World Needs Upskilling

In 2021, the World Economic Forum collaborated with PwC to produce a report that detailed the importance of upskilling for shared prosperity on a global level. The findings in this report were staggering. For starters, major investment in upskilling could boost the global GDP by $6.5 trillion by 2030.

Addressing the Fourth Industrial Revolution -- which is expected to boost global productivity by an average of 3% -- upskilling can help organizations succeed in a digital landscape. Digital skills are probably to most sought-after skills in business today. All around the world, organizations are on their own digital transformation journey, and one of the sticking points is talent availability.

On the scale that this transformation is happening, upskilling is simply the only solution to keep up with demand. New hires aren’t entering the workforce fast enough to take on the brunt of this demand, so we, as global business leaders, need to open our minds to the idea of upskilling. It will benefit us, our employees, and our global communities in the years to come.

Start Small

Upskilling doesn’t have to be a massive undertaking right from the start. Within your organization, choose a few departments or teams that are facing a growing gap between skills that are needed and skills that currently exist, and begin solving those issues. Small pilots are a great way to bring upskilling into the fold without overwhelming current systems. Find employees that are eager and capable of adapting, get them in training programs, and start to redefine their career paths.

If the small pilots are successful, consider using them as a model for pilots in more areas of the organization. From there, leadership can decide if they want to invest more heavily in a boot camp or company-wide upskilling initiative. Don’t forget to involve your employees, get them excited about what’s to come, and listen to their thoughts on where upskilling is most needed.

With this thoughtful and phased approach, everyone – including leadership and your employees – can mentally prepare for upskilling initiatives, understand what they will entail, and feel less threatened by all the change. You might even find out that some of your employees already have valuable skillsets that are simply untapped.

Upskilling = Opportunities

With proper upskilling, employees are given new opportunities to shine, businesses find new ways to serve their clients, and entire global economies can figure out how to adapt to the current time. To skip over upskilling is to miss out on opportunities for everyone involved, your organization included. It’s time we start investing in the resources we have; helping our people become successful will result in our businesses becoming successful, too.