Why upskilling and reskilling is essential in 2023

Companies need qualified talent to meet market demands. This is a condition that is unlikely to change. But as market circumstances, technologies and organizational requirements evolve, in-demand skills will do the same. Throughout history, forces such as globalization have reshaped the work of most employees. Technology, including AI, is set to further revolutionize these positions.

Soon, some jobs may no longer exist, while many will look different than they do now. Other functions that companies have not yet imagined will be needed. These are solid reasons why companies can’t afford to grow complacent. Fortunately, leaders have two highly effective talent development tools at their disposal: upskilling and upskilling.

Upgrading and reskilling employees prepares companies for the changes that are happening now. These activities also prepare companies to deal with rapidly approaching developments, which may require greater agility. As companies plan for changing talent needs, several factors will make upskilling and reskilling essential in 2023.

Main differences between qualification and requalification

While there is some correlation between the two approaches, upskilling differs from reskilling in that it does not seek to move someone into a new role. Upskilling enhances an employee’s existing skills by teaching them new tricks of the trade. A position may require brand new knowledge, but there is still a business need for it. An example of a qualification is an IT technician taking certification courses on newly released software.

In contrast, reskilling prepares current workers for different roles. The positions they have held for several years may be on the verge of disappearing. Although there is no longer a market demand for employees’ existing skills, the company does not want to replace them. Instead, the company can train these workers to embark on altered career paths.

The emergence of artificial intelligence is a clear driver of this phenomenon. Let’s say AI will eliminate receptionist jobs in the coming years. HR departments can identify employees in receptionist roles and offer to prepare them for various customer service specialist roles. The training these workers receive equips them with the skills needed for the transition. Upskilling does not simply build on existing skills, but can increase transferable ones.

The benefits of upskilling

Many managers believe that talent walks out the door because of the money. While they aren’t necessarily wrong about this, low pay isn’t the only contributing factor. Lack of career growth is one of the main drivers of turnover in organizations, regardless of industry. Employees don’t want to feel trapped in a dead-end job. They want to be challenged, take on challenging assignments and progress in their careers.

Advancement does not always mean ascending to management. Placing an employee in a senior specialist role with new responsibilities can keep them committed to the organization. Upskilling is a way to give workers the learning opportunities they want. It also creates an internal talent pipeline, saving the company from having to find external candidates for high-level positions.

When employees see a company investing in their career growth, it can boost productivity. Learning opportunities tend to increase job satisfaction, which leads to better outcomes. And the improved skill sets themselves contribute to more desirable business outcomes.

The benefits of reskilling

The Organization for Economic Co-operation and Development predicts that technology will transform 1.1 billion jobs over the next decade. AI and machine learning will be behind many of these changes. The shift to green technology and the aftershocks of the pandemic will also play a role. Business leaders are likely to face growing skills gaps if they do not implement upskilling programs.

There may be more than a shortage of available workers and open positions to worry about. Disparities in demand for skills roles and in the knowledge that employees possess can create additional problems. Team members will not be proficient enough to transition into the roles businesses need to function. And finding qualified talent outside the organization will become more expensive than it is today.

Upskilling shows that leaders are thinking about the future. Once a function becomes irrelevant or redundant, it’s an unnecessary expense. Team members who hear rumors of downsizing are more likely to jump ship. Those who stay may become increasingly dissatisfied as their roles lose meaning, making it challenging for the business to remain competitive. When companies prepare employees for what’s to come, they can avoid layoffs, voluntary departures, and loss of morale and productivity for the employees who stay.

Enabling Adaptability

The ability to adapt to change is what allows companies to survive. Better yet, staying ahead also increases a company’s chances of success. While not every leader is good at innovation, almost everyone can analyze trends and developments. Without resource shifts, it’s nearly impossible to pivot business models to meet emerging realities.

Qualification and requalification programs make human resources more versatile. The person who excels at providing routine customer support can learn to extend those skills to the growing backlog of complex requests. Likewise, companies in declining sectors can reshape themselves into emerging sectors such as green energy.

When a business is agile, the risk of becoming a forgotten name decreases. When employees have up-to-date skills, companies don’t have to worry about how they will meet market demands. Companies gain the ability to save costs through different working models such as remote teamwork. And fully-featured employees can take on new or expanded roles in less time.

The business case for skills development

Without a talented team, a company is just an entity on paper. People are needed to develop customer relationships, manage technology, and achieve growth goals. But as the business world changes, employees need skills training to keep up with the times. Without sufficient learning opportunities, workers and the companies that employ them are at risk of becoming obsolete.