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An average of nearly 4 million U.S. workers quit their jobs each month in 2021, according to the Society of Human Resource Management (SHRM). That represents the highest resignation average on record, and it has been one of the major contributors to the widening skills gap in the workforce today.
A skills gap is the disparity between the required skills a business needs from its employees to function well and the basic skills their employees bring to work. The skills gap naturally widens as new skills emerge while current skills evolve and yesterday’s skills expire. Socioeconomic conditions can exacerbate this natural tendency. U.S. employers have recently experienced a perfect skills gap storm with the “great resignation,” the COVID-19 pandemic slowing down skills development, too few qualified candidates, and inflation driving high salary expectations.
Finding the right mix of methods to close the skills gap in your business isn’t just a way to address a temporary crisis; it’s about ensuring that you can improve employee retention, nurture your talented employees into positions of greater responsibility, and even reshape your business when that becomes necessary. The capabilities to develop talent and promote from within are essential to your leaders' ability to operate your business steadily, especially through economic disruptions.
With that in mind, these suggestions should help you to close your current skills gap and keep your employees well-prepared for the work ahead:
While every generation values professional development, Millennials and Gen Z workers care about developing their skills even more than their predecessors. The pace of business in today’s global economy is continually accelerating and demands it. They know that their futures depend on employers who invest in them and plan for their growth.
LinkedIn’s 2021 Workforce Learning Report offers many convincing reasons to ramp up your professional development activities for internal mobility. Here are a few:
Times have changed. A few years ago, employees resigned when they didn’t get a promotion they felt qualified for, but now they’re not waiting until the writing is on the wall to move on. When they realize their company is not investing in their development, that’s when they look for better opportunities.
This work will identify the skills your company needs to meet its business goals. Begin by measuring current skills with assessments, surveys, interviews, feedback from performance reviews, and skills management software packages. Evaluate skills on three fronts:
Next, consider your company’s current job descriptions and future roles. Assess the gaps for specific skills between your current levels and what your leadership team would agree is ideal.
According to the 2022 Prudential Pulse of the American Worker Survey, 68% of workers expect to be promoted between 2022 and 2024, and more than half will look for a new job if their expectations are not met. Stability matters, with 56% of respondents prioritizing it over salary.
Upskilling, which utilizes L&D programs to build on existing skill sets, and reskilling, which trains in entirely new skills, are the keys to meeting your workers’ expectations. The survey reveals that 46% of workers say they need upskilling in the next year to do their current jobs, and 53% would retrain (reskilling) for a different job if given the opportunity.
Workers need training in a combination of soft and hard skills. Most leaders seek to develop key soft skills in their high-potential employees, including leadership and management capabilities, remote and hybrid team management skills, critical thinking, decision-making, flexibility, digital literacy, communication, and creativity. Hard skills include data analytics, business strategy, digital transformation, AI/ML, and automation.
Upskilling and reskilling can be approached in a variety of different ways. We suggest a blend of the following:
One thing to consider as you determine which forms of training to offer individuals is to look for skills they possess that are adjacent or closely related to what you need.
With the cost of replacing an individual employee ranging from one-half to two times the employee’s annual salary, conservatively estimated by Gallup, innovative companies are betting big on training and retaining their employees. Closing the workforce skills gap isn’t just essential to your employees’ futures; it’s every bit as important to the future of your business.
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