Reskilling is the process of providing employees with the resources and opportunities to switch their career paths to new, unrelated positions – and it’s a critical strategy for the future.
The world is moving fast, and the demand for skills is shifting. One study found that 50% of the workforce will need reskilling by 2025 to stay current and competitive.
For example, this rise in new technology may make your business more reliant on cloud computing, and reskilling makes it simple to fill these fresh roles with internal hires.
Further, modern employees need career growth and thrive on novel challenges. Providing people with learning and development opportunities keeps them engaged and interested, which makes reskilling a winning talent retention strategy.
This blog discusses how essential reskilling is in today’s working world, listing the benefits and describing the top strategies to execute reskilling successfully.
Reskilling employees is similar in concept to upskilling, but the two are quite different.
With reskilling, an employee builds fresh skills to take on a different position. The new position may still have a few skills in common, particularly transferable skills, but isn't traditionally related.
This is distinct from upskilling employees because upskilling helps employees gain skills to reach related positions.
For example, a sales rep upskills into an account executive, but a sales rep reskills into a marketing associate.
The process of both is similar, but the main difference is the result.
Here’s a quick summary:
- Providing employees with opportunities and resources to transfer to a new position
- Training employees at a lower level to get new skills up to speed
- Using transferable and adjacent skills to make the switch easier
- Providing employees with opportunities and resources to enhance and expand their role
- Offering employees more responsibilities
- Providing employees with resources to help them perform better in their current role, which prepares them for a new, related role
Upskilling, like reskilling, is a great strategy to reduce employee turnover rates, providing people with unique challenges and opportunities.
For our full comparison and when to choose which strategy, check out our blog post on reskilling and upskilling.
Reskilling the workforce helps organizations stay ahead of the curve, teaching employees emerging skills and moving them into brand-new roles.
The world is moving fast and reskilling in the age of AI enables companies to bridge critical skills gaps, which are increasingly prevalent.
One report found that 44% of global organizations say they expect to face skills gaps soon, and 43% say they face them currently.
This means that an astounding 87% of global organizations face skills gaps or expect to within the next few years.
Many of these skills gaps are due to automation and AI and their heavy impact on thousands of job roles.
Only 30% of US jobs will be unaffected by AI in the coming years, with 7% being completely replaced and an impressive 63% being complemented.
Few employees will be outright replaced by machines. The large majority will be complemented, which means that these workers need new skills to handle this massive shift.
Let’s take a look at a few reasons why reskilling plans are essential for modern companies:
Helps you meet future demand: Reskilling helps you meet near-future demands, but it's more than that. Encouraging reskilling and building a learning culture helps keep you ready for sudden, unexpected market shifts.
Identifies hidden potential: Reskilling helps you discover skills you didn't know your workforce had. For example, you may not know your main analyst has keen AI skills until they begin reskilling.
Creates a culture of continuous learning: Reskilling promotes a culture of education and growth to encourage people to not only learn but reach beyond their existing skill sets.
Encourages internal mobility: Reskilling promotes an overall adoption of internal mobility, reducing costs on external hiring and satisfying more employees who want advancement.
Reskilling programs are also important to employees, offering them fresh perspectives and challenges and fostering better work stability.
Let’s take a closer look:
Keeps skills relevant and ensures job security: It can be an intimidating thing to see requirements and responsibilities change, but reskilling gives employees confidence knowing that as the world shifts, they will, too. This helps promote employee wellbeing.
Enables them to explore new roles and use their potential: Many employees want to face fresh challenges. It keeps them engaged, motivated, and satisfied.
Makes them feel valued: Reskilling tells employees that the company cares about their future and wants to leverage their talents, despite market shifts.
No one wants to feel obsolete – reskilling the workforce tells your people that roles change, but talent could never be obsolete.
When so many jobs are at risk of changing, the benefits of reskilling cannot be overstated.
Reskilling in the age of AI increases employee retention, helps your organization stay competitive, and attracts modern talent looking for an agile company.
Reskilling programs show employees that they’re valued and keep their roles relevant, increasing your employee retention rate.
Your workforce knows about market changes – 67% of workers are aware of coming disruptions in their industries and are willing to reskill to stay employed.
Moving workers into new roles shows them their skills are essential to the company and they aren’t simple to replace. Employees stay 41% longer at companies with high internal mobility.
Making reskilling plans is much better than resorting to layoffs during organizational change. If your company is equipped with the resources to reskill, you can minimize layoffs and external hiring – reducing costs, retaining excellent employees, and maintaining your corporate reputation.
PwC, a professional services company, is an excellent example. This company aims to reskill every employee because of uncertain shifts in job positions.
Bob Moritz, its global chair, says he can’t guarantee that the entire workforce will remain in the same position, but they’ll always have a place there.
The world is changing fast, and the skills necessary for success are shifting. This means that while upskilling is a crucial strategy, it won’t be enough to keep up.
Reskilling in the age of AI is essential. More than 100 million workers need to switch roles by 2030.
The half-life of skills now tends to be less than five years, which means that the skill will be half as useful in five years. This is already pressing, but in some technology fields, the skill half-life is as low as two and a half years.
Building reskilling programs now future-proofs your organization for predicted changes, such as the rising importance of artificial intelligence, but it also increases your overall agility so you can better respond to sudden crises.
Companies that offer growth opportunities are attractive potential employers.
Reskilling, along with other programs that promote skills-building and learning, is one of the most desirable employee benefits.
One study found that 48% of workers would switch jobs if the new position offered training opportunities and 65% believe that employer-provided development is very important when evaluating a potential employer.
Reskilling programs also improve your employer branding because they show you have a solid strategy for your people and the future of work. It also creates a reputation that attracts adaptable, ambitious, growth-minded candidates.
Hiring the right people for a future-proof organization is much easier when you attract applicants who have keen learning prowess and curiosity, increasing the overall agility of your company.
When the job market shifts, companies traditionally used to turn to a strategy of layoffs and external hiring.
However, 70% of executives are now focusing on reskilling rather than hiring.
Reskilling employees is 20% more cost-effective than external hiring, reducing the costs associated with new hires and enabling you to retain employees who have key company knowledge.
External hiring has a lot of added costs, including:
Job board costs
Extensive onboarding and training
Even after all of this work and extra money, there’s still no guarantee that the external hire is more skilled than a reskilled internal employee. There’s also a chance that the external hire quits.
Building reskilling programs is a vital practice for every modern company, but many organizations aren’t prepared to leap straight into it.
Here are our top tactics for employee reskilling, including identifying your primary reskilling needs and fostering a culture of learning.
What it accomplishes
1. Conduct a skills gap analysis
Identifies which skills your company needs in the future so you can precisely target reskilling programs
2. Help employees design reskilling plans
Encourages better knowledge absorption and digestion by tailoring programs specifically
3. Leverage an internal talent marketplace
Matches employees to reskilling opportunities and gigs to help their skills grow
4. Promote a culture of learning and growth
Makes learning the norm, improving company opinions of reskilling and helping you react well in a crisis
5. Consider and offer a variety of training resources
Provides employees with multiple ways to learn, facilitating different education styles
6. Empower reskilling with talent assessments
Enables you to leverage data-driven insights and accurately gauge your reskilling plans
7. Encourage an agile, skills-first organization
Makes development and a focus on skills (rather than experience) second nature
A skills gap analysis determines the deficit between the skills your organization needs to succeed and the skills your workforce currently has.
Identifying your future needs enables you to align reskilling programs with your company's business goals.
Perhaps the analysis shows that your company needs two cloud engineers in the time ahead. You can then design reskilling plans for two of your IT specialists that are specific, informed, and laser-focused.
Here’s a quick run-through of a skills gap analysis:
Talk with business leaders to determine current and future goals
Determine if you need to conduct individual or team analyses
Measure your workforce’s skills with talent assessments
Choose how to bridge the gap with different methods, including reskilling, upskilling, and hiring
Measure and monitor your progress
That last step is crucial – measuring the success and progress of your skills gap analysis provides you with essential HR analytics, such as training efficiency.
For our step-by-step guide, check out our blog on conducting a skills gap analysis.
Work with your employees to design personalized reskilling plans. This not only provides important structure, it also helps align the program to an employee’s specific needs.
Talk to your team members and ask about their professional goals and learning styles. Employee surveys help you gather this information, but you can also take a more personal approach and discuss skills development during one-on-one meetings.
You can also use these meetings to help people build professional development plans. These documents help employees clarify their objectives and how they can reach them, further illuminating your reskilling plans.
It’s important to practice employee listening. Discussing reskilling with people and asking their opinions increases employee engagement because it shows them that they won’t be left out of valuable conversations.
The company may be changing, but the workforce won’t be in the dark.
Personalizing each plan also helps you strategize how each role would be best taught. Perhaps an employee reskilling into a data analyst role could be mentored by your current data analyst, who’s an excellent coach.
An internal talent marketplace is a central platform where employees list their skills and aspirations, and the system matches them to roles and openings.
This platform is perfect for reskilling efforts, as well as other talent development initiatives like upskilling. It makes it easier to find opportunities for employees and empowers employees to find opportunities they're interested in.
A few examples of reskilling with an internal talent marketplace include:
An employee is matched with a new role by listing their transferable skills and related interests
An employee uses the platform to find real-life gigs that help them expand their latest skill set
This marketplace also helps your organization complete tasks and projects in-house and further promotes a culture of internal mobility.
For more information, read our blog on building an internal talent marketplace.
Resistance to innovative practices is a huge obstacle when building reskilling programs.
Employees and managers alike can resist the idea of reskilling. Managers may be traditional and question the concept of moving between roles and departments, and employees may believe that asking them to reskill is telling them they aren't relevant.
You can help both of these issues by encouraging a culture of learning. Here are a few ways:
Adopt internal mobility as a core company value
Regularly show off the benefits of reskilling
Promote consistent employee feedback
Frame everything as a learning opportunity, including mistakes and conflicts
Nurturing an environment of continuous learning also helps make adaptability and education the norm, rather than a sudden reaction to a crisis.
This atmosphere is healthier for your workforce, encouraging psychological safety and providing a better employee experience.
Varied employee training programs improve your reskilling initiatives, making them more effective and productive. Unique roles require different learning methods, and each employee digests information in their own way.
Here are some different skills training methods:
Formal academic classes
Employee coaching and mentoring
For example, when reskilling a remote work editor into a content manager, you may choose to build a program with online lessons, mentoring via video conference, and microlearning.
It’s also important to make sure employees are aware of these resources because many learners don’t know about the wealth of opportunities an organization provides.
Try occasionally reminding your workforce about them over your group chat or making a list and keeping it within easy access.
Another great tool to assist your reskilling programs is talent assessment software, which enables you to monitor and measure skill growth. Let’s talk about that next.
Talent assessment tests and reskilling go together perfectly. Because they evaluate a person’s talents, they help you focus on skills and competencies rather than work history and experience.
These skills tests facilitate career switching for external hires, but they can also be used to reskill current employees.
Talent assessments help reskilling programs by:
Assessing staff competencies before training to gauge beginning ability levels and evaluate transferable skills
Monitoring skill progression during retraining
Verifying capabilities after reskilling is complete
Here’s a look at how it’s done with TestGorilla assessments:
First, have employees take assessments to determine their base skill levels and what type of training to offer them. Check for adjacent hard skills and transferable soft skills, such as communication and time management.
Then periodically assess employees again to monitor their progress as they learn.
You can see here that the employee is still a little low in understanding the accounts. Knowing this, you can target their next course to teach them that weaker skill.
When training is complete, gauge their skills once more to verify them.
This gives you firm, objective data so you can confidently place your reskilled employee into a brand-new position.
Reskilling is about focusing on an employee’s adjacent and transferable skills to move them into a new, advantageous position. This means that a focus on capabilities over experience is non-negotiable to pull off reskilling plans successfully.
This perspective comes naturally in a skills-based organization.
Skills-first organizations encourage employees to shift to any task they have the ability to complete, increasing company agility and encouraging talent sharing.
This attitude decreases reliance on traditional job roles, which can hold back reskilling programs. However, a skills-based mindset makes reskilling natural and smooth.
A focus on skills also helps all employees develop key core skills – which can be a little different for every organization, but most of them fall under these four categories:
This is related to capability building, the practice of ensuring your workforce has certain core competencies needed to fortify your company for the future.
Now let’s take a look at some real-life reskilling examples. These organizations adopted reskilling for various reasons, from reacting to a crisis to adopting agility as a core value.
They all have their own motivations, but they’re all successful examples of reskilling.
Why it’s successful
Adopted adaptability as a core value and encourages talent sharing
Combated challenges during the pandemic by leveraging reskilling
Aims to reskill thousands of employees to prepare for the rise of AI
Unilever, a multinational consumer goods company, leverages reskilling with the help of an AI-powered internal talent marketplace.
This company needed to promote more cross-functional teams, so it adopted agility as a core value and began using an AI marketplace.
This platform provides employees with opportunities that align with their personal goals and business objectives, ensuring Unilever’s workforce is engaged, but also that each initiative supports the company’s goals.
This creates a network of agile talent that can be deployed wherever they’re needed.
Unilever adopted these practices in 2019, before the pandemic. This enabled the company to get used to the process before a crisis so it could more easily handle it.
It found great success with its reskilling programs, seeing a 41% increase in productivity metrics and completing 70% of its assignments by cross-functional teams.
Mastercard, a global payment processing and credit card company, adopted reskilling to solve crucial issues during the pandemic.
This company faced intimidating challenges in 2020. It needed to better support its customers, providing them with touch-free technology and transferring stimulus money to the needy.
These needs were brought to the attention of Mastercard’s workforce through solid leadership communication, and because of it, they were able to act.
This company used an internal talent marketplace to connect employees to different high-priority tasks, increasing agility and encouraging employees to take on new and different responsibilities.
Its early efforts were so successful that it invested in a higher quality platform so reskilling could become a part of its company culture.
Mastercard has experienced $21m in savings through internal mobility, and an impressive 75% of its workforce is registered on the marketplace.
Verizon, a wireless network operator, has an impressive goal to prepare 500,000 people for new jobs by 2030.
This company chose reskilling as a strategy because it wants to prepare its workforce for the future and is aware of how the working world is shifting.
This program is a $44m investment to help unemployed and underemployed people, as well as those whose roles are being displaced due to automation and AI.
It gives priority to certain employees, such as:
People without four-year degrees
When reskilling employees, it’s always important to consider diversity in the workplace and how marginalized or disadvantaged people are affected by labor market shifts.
For example, a displaced employee without a four-year degree may have a more challenging time finding a different job due to degree inflation.
Reskilling in the age of AI and numerous global changes isn’t just beneficial, it’s necessary. Organizations must learn how to move their people between roles and departments to retain them, reduce costs, and encourage agility.
Many companies have grand ambitions towards reskilling, but you can start small, reskilling one team or even one to two employees.
Even a small start encourages a learning culture and introduces a healthy, skills-based mindset into your company. For more information on this topic, check out our guide on internal mobility.
If you’d like to use talent assessments to inform your next reskilling program, browse our test library.
1. "The Reskilling Revolution". World Economic Forum. Retrieved December 20, 2023. https://initiatives.weforum.org/reskilling-revolution/home
2. "2020 Global Talent Trends". (2020). LinkedIn Talent Solutions. Retrieved December 20, 2023. https://englishbulletin.adapt.it/wp-content/uploads/2020/01/linkedin-2020-global-talent-trends-report.pdf
3. Hrala, Josh. (November 11, 2019). "CHROs: Here Are the Top Five Companies Investing in Upskilling in 2020". Career Minds. Retrieved December 20, 2023. https://careerminds.com/blog/here-are-the-top-five-companies-investing-in-upskilling-in-2020
4. Little, Jim; Thethi, Savi. (April 22, 2022). "The CIO Imperative: Is your technology moving fast enough to realize your ambitions?". EY. Retrieved December 20, 2023. https://www.ey.com/en_cz/consulting/tech-horizon-survey
5. Hu, Han; Jadoul, Quentin; Reich, Angelika. (August 17, 2021). "How banks can build their future workforce—today". McKinsey & Company. Retrieved December 20, 2023. https://www.mckinsey.com/industries/financial-services/our-insights/how-banks-can-build-their-future-workforce-today
6. Dondi, Marco, et al. (June 25, 2021). "Defining the skills citizens will need in the future world of work". McKinsey & Company. Retrieved December 20, 2023. https://www.mckinsey.com/industries/public-sector/our-insights/defining-the-skills-citizens-will-need-in-the-future-world-of-work
7. "How Unilever upskilled for the future". Gloat. Retrieved December 20, 2023. https://resources.gloat.com/resources/unilever-customer-success-story/
8. Herrera, Ann. (December 28, 2020). "Project Possible: How this employee answered a CEO’s call during the pandemic". Mastercard Newsroom. Retrieved December 20, 2023. https://www.mastercard.com/news/perspectives/2020/project-possible-how-this-employee-answered-a-ceo-s-call-during-the-pandemic/
9. "How Mastercard created priceless career development opportunities". Gloat. Retrieved December 20, 2023. https://gloat.com/resources/mastercard-customer-success-story/
10. "JFF and Generation USA Announce Partnership with 9 Colleges for Verizon Reskilling Program". (April 21, 2021). PR Newswire. Retrieved December 20, 2023. https://www.prnewswire.com/news-releases/jff-and-generation-usa-announce-partnership-with-9-colleges-for-verizon-reskilling-program-301273757.html
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