Hire, reskill, or upskill? A guide to smarter skill development

The pandemic has forced many business leaders to realize that the skills their organization will need in the future will not be the ones they've needed in the past. The quick shift to working remotely exposed the gaps in the capabilities of many organizations and their people. It's also led to employees demanding more autonomy and wanting to engage in more strategic work.

At the same time, more companies are automating day-to-day tasks, which provides their staff with more time to innovate and focus on growing the company.

With that in mind, organizations are now looking for people who have a mix of soft, technical and digital skills, according to PwC's Talent Trends 2020 report. Going forward, those soft skills––critical thinking, clear communication, empathy and more––will become increasingly important.

Creating a workforce with the right mix of skills has always been a challenge for companies, and 74% of CEOs are concerned about finding skilled workers. That problem will likely only increase as the definition of work, and the needs of employees, evolve in a post-pandemic environment.

So, what can companies do?

There are three main ways businesses can manage skills shortages: hire new talent, reskill current staff or upskill employees. Here's the breakdown of each approach.

For companies, it's easier to close skills gaps through upskilling because employees are learning how to deftly use digital tools and are developing a better understanding of the business, its changing processes and the jobs that will be needed for the future.

Hiring new talent (and why it can be problematic)

Companies often hire new talent to acquire the skills they need, rather than training their current staff. It may seem like the natural solution, but there are potential issues with this approach.

These days there simply aren't enough people in the market with the skills most organizations need. Even if you can find talent with the experience you need for your business, those skills may not evolve as quickly as your company does. According to the World Economic Forum's (WEF) Future of Jobs Report 2020 the core skills required by companies will change by 40% in the next five years and 50% of all employees will need reskilling. At that pace, even new hires will require training more frequently and within a shorter period of time.

It can also cost companies thousands of dollars to hire a new employee, in addition to the time spent trying to find the right person. Beyond that, there's an additional productivity gap between onboarding and integrating those new employees into your organization.

It is important to take into consideration that an employee who's worked for your organization for years has an in-depth understanding of both your culture and your customers. Their institutional knowledge makes them comfortable with your corporate structure, adept at using your company's tools, systems and the vocabulary that may be unique to your company.

Reality of reskilling

Training can deliver huge benefits to the organizations that do it well. In fact, 66% of employers expect an ROI for upskilling and reskilling within one year. But while both are important, they mean different things.

Reskilling involves teaching employees new skills so they can perform different jobs in the future. It often requires looking for people with "adjacent skills" that are close to the new capabilities your organization needs. Reskilling provides a learning experience that enables a lateral move from one job to another.

Companies estimate that, by 2024, approximately 40% of workers will require up to six months of reskilling. And nearly all business leaders, 94%, expect employees to pick up new skills on the job.

Employees also want to see more significant investments in their development, with a recent PwC survey finding that 77% of workers are ready to learn new skills or completely retrain.

Why upskilling is essential

Upskilling goes further than reskilling by delivering continuous education that allows your people to advance their careers in more meaningful ways. It's more focused on helping staff think strategically, critically and holistically, across the entire organization, while teaching them how to use tools that can help automate day-to-day tasks. These automation efforts can free up time for employees to try new roles and focus on strategic objectives.

For companies, it's easier to close skills gaps through upskilling because employees are learning how to deftly use digital tools and are developing a better understanding of the business, its changing processes and the jobs that will be needed for the future. This allows your people to take an active role in driving innovation and transformation. You're also teaching employees how to learn, which makes your staff more resilient and much better prepared for an accelerated pace of change.

Revolutionize your approach to talent development

When you consider whether you will need to upskill, reskill or hire, the answer may be "all of the above." It is estimated that upskilling will lead to the net creation of 5.3 million new jobs by 2030, according to the Upskilling for Shared Prosperity report from the WEF. Over that time, human labor is expected to be increasingly complemented by new technology, rather than replaced by it. The number of jobs that require creativity, innovation and empathy will likely rise, as will the need for information technology skills.

No organization can make itself entirely future-proof, but by improving your talent acquisition process and creating a culture of ongoing learning, you can prepare your employees—and your business—for the workplace of tomorrow. To do this, you need a platform that can help you quickly identify skill gaps and find upskilling and reskilling opportunities. The right solution can help you fill those gaps faster and more cost-effectively than hiring ever could.

Invest in tomorrow

PwC has long believed in upskilling, which, for us, involves citizen-led innovation. We continue to upskill our entire global network by developing and sharing technologies to better support our clients. Our employees are increasing their digital acumen as work changes and applying their new skills right away.

To date, PwC staff have used their newfound skills to build over 6,400 automations, visualizations and bots. Our employees have downloaded these digital assets more than 5 million times and have automated more than 6.5 million hours of work. While these results speak for themselves, studies show that 82% of CEOs still haven't invested in upskilling programs yet, citing challenges associated with defining the skills they need, motivating employees to learn/apply learning, a lack of resources to conduct upskilling and the overall effectiveness of their learning function.

ProEdge is an option to consider since it addresses many of the challenges that CEOs are concerned about. It's an end-to-end workforce planning and upskilling platform designed for digital business transformation and citizen-led innovation. It can accelerate the upskilling journey, close skill gaps from within and help organizations stay competitive by giving people the experience they need to innovate at scale.

This unique platform allows you to pinpoint critical skill gaps and effectively help close them with automatically generated personalized learning pathways. Leading curated content, coursework and hands-on learning empower your workforce to make an immediate impact through citizen-led innovation. Access to digital tools enables solution-building that scales across teams and quickly translates to the automation of an employee's day-to-day tasks. This is how ProEdge helps your people to perform at their highest level: giving them the power to help transform your entire organization.