Reskilling for Tomorrow: Who Should Pay for Workers to Upskill?

There’s a need for more upskilling and reskilling programs, and for more effective programs. About half of organizations have upskilling/reskilling programs. Among those who have them, less than half say they are highly effective.

Kristen Fyfe-Mills, Associate Director of Communications for the Association for Talent Development

An article published earlier this year by the World Economic Forum points out that reskilling is vital for the average American employee to stay abreast of market shifts. Major economic players like Apple, Amazon, and IBM realized that it makes much more sense to invest in skilling initiatives for current employees than it does to assume that those same individuals will require replacement. But what does this look like when it happens in the real world? Who should pay for workers to upskill? The employer? The employee? Or perhaps the government?

The Association for Talent Development is an advisory group that researches job trends, learning, teaching, reskilling, upskilling, and a number of emergent new-collar fields. They published Upskilling and Reskilling: Turning DIsruption and Change Into New Capabilities, a research report which identifies current trends in how organizations can address employee training efforts. Last year, the ATD released a whitepaper about workforce development called Bridging the Skills Gap, which provided much of the evidential basis for the Upskilling and Reskilling report.

Read on to learn more about the future of adult learning in the private sector, the efforts of the ATD to disseminate data-backed resources for employers, and how the perception of skills has evolved since the 20th century.

Kristen Fyfe-Mills is the associate director of communications for the Association for Talent Development (ATD), where she leads brand, external, and internal communications globally. She also directs the association’s global awards programs and public policy efforts; serves as executive producer for corporate and marketing video campaigns; advises senior leaders; and leads internal communication initiatives.

Fyfe-Mills also designs, develops, and executes strategic communication plans for all association business lines, which have seen increased social media engagement. She holds a BS in radio and television and an MS in journalism from Northwestern University, and a certification in the foundations of management excellence from the Yale School of Management.

A recent World Economic Forum study found that nearly 95 percent of the 1.4 million American workers who are expected to be displaced by technological advancements in the next ten years can be transitioned to new positions with higher wages that utilize similar skills.

The WEF predicts that the total cost of reskilling all these workers is approximately $34 billion—an average of $24,000 per worker. In a recent report, the Association for Talent Development discovered that 33 percent of talent recruiters or human resource development managers understand that advancements in technology require that systems be reevaluated and employees upskilled to meet the demand. However, few have taken the necessary steps to put a workable upskilling framework in place.

“The World Economic Forum is a great resource when it comes to the topic of the future of work,” says Fyfe-Mills. “We agree that organizations need to be proactive in looking at how they will upskill and reskill their workforce with future-ready skills. Our latest State of the Industry report from 2018 shows that on average companies are spending $1,296 per employee on learning.”

As automation is poised to affect nearly every aspect of the global economy, assessing cost benefits and the true relationship between workers and machines could become more challenging. In this critical transition between a traditional workforce and one that will have to reskill frequently, interest in research that illuminates the relationship between reskilling and candidate turnover will take center-stage. Fyfe-Mills and ATD are committed to taking their place at the forefront of such studies to diagnose the many complications inherent to the job market.

“What our research has found is that there’s a need for more upskilling and reskilling programs, and for more effective programs,” says Fyfe-Mills. “About half of organizations have upskilling or reskilling programs. Among those who have them, less than half say they are highly effective.”

So what will it take to get employers on-board? One might presume that employers, who stand to gain from reskilling, would be leading the charge for training ambitions. If reskilling is employer-led—as it should be—then those in charge need only to identify challenges to skilling and then design systems which account for them. Partnerships, collaborations, and teamwork ethics are the key.

“There is room to improve internal collaboration when it comes to reskilling and upskilling between talent development teams and internal stakeholders, like business function leaders, senior executives, et cetera,” says Fyfe-Mills. “There is also room to improve external collaborations.”

In Bridging the Skills Gap, the ATD determined that closing the skills gap, which would involve extensive reskilling, will take efforts from multiple organizations on varied fronts. They identify a practice of lifelong learning, noting that it is a quality common to successful people and organizations everywhere.

In collaboration with the Boston Consulting Group, the World Economic Forum published yet another report in January 2019 to coincide with the article referenced above. It is entitled Towards a Reskilling Revolution: Industry-Led Action for the Future of Work outlined market- and data-based solutions to a growing concern that the American economy might have difficulties creating a smooth, efficient transition to a tech-heavy jobs economy.

As the Fourth Industrial Revolution impacts skills, tasks, and job availability, there is growing concern that both job displacement and talent shortages will impact business dynamism and societal cohesion. On the one hand, large parts of the labor market will be impacted by intelligent systems and automation—a transformation we can already observe today. On the other hand, technological integration will change the business models of all industries, giving rise to a number of emerging jobs.

Given the vested interest of employers in maintaining a competent and competitive workforce, it is clear that reskilling and upskilling initiatives must be largely employer-driven. Such an approach requires collaboration between governments and private employers, but this is already a well-established component of modern business.

Going forward, it is critical that private companies work closely with advisory agencies, think tanks, university research cohorts, and governmental bodies to help usher in a new era of jobs. Only through ongoing transparency and collaboration between all players will employers see the benefits of investing in the reskilling of their own workers. And only with a renewed focus on lifelong learning can the American job market truly grow.