How can organizations prepare employees for a future of work that is volatile, uncertain, complex, and ambiguous? The answer is reskilling.
The way we work has changed a lot recently, and that transformation isn’t likely to stop soon. An environment characterized by constant change can be described with the acronym VUCA: volatility, uncertainty, complexity, and ambiguity. Under VUCA circumstances, it can be difficult to forecast the next quarter, much less the next year or decade. Preparing for an unpredictable future is a formidable challenge for organizations, but reskilling is an integral part of success.
Among the numerous drivers of the need for reskilling, two stand out most. The automation of work and the pandemic’s effects on the economy have led to significant changes in work around the globe. As many as half of all employees everywhere will need reskilling by 2025.1
Read on to learn what reskilling is, reasons to implement reskilling, and how Hogan can help.
What’s the Difference Between Reskilling and Upskilling?
Reskilling isn’t the same as upskilling. Upskilling refers to learning new technical skills or disciplines, usually through apprenticeships, certifications, or degree programs. It tends to be job specific, training someone for a known role. Reskilling is a retention strategy to develop talented employees to deploy them elsewhere within the business. Reskilling tends to be generalized because the intended job isn’t known ahead of time. In fact, the job may not even exist yet.
The core competencies and widely applicable skills gained through reskilling equip employees to be agile and adaptable. An important category of skills that help employees flourish in a changing environment is socioemotional skills. At Hogan, we define socioemotional skills as including social skills (e.g., getting along with others), self-regulatory skills (e.g., emotional control, impulsiveness), motivation (e.g., values, interests, preferences), and other personality characteristics including ambition (status-striving) and openness to experience (curiosity).
Among the many reasons to emphasize socioemotional skills in a reskilling plan are that they are most in demand by the most workers and that they offer the best response to VUCA environments in the workplace.
Why Do Employees Need Reskilling?
Reskilling helps companies respond to automation, arm against talent shortage, strengthen retention, and save money. Reskilling is also an employee-positive response to job change. VUCA situations are challenging even to people whose personalities tend to take uncertainty in stride.
Reskilling addresses the rise of automation.
Organizations that reskill employees belong to a large-scale effort to address skills gaps created by automation. In 2019, more than two million people in the US were reskilled or upskilled through more than 70,000 organizations.2 That number, while commendable, is only a small percent of employees who will soon need reskilling.
Automation has become and will continue to be an increasing part of work. McKinsey reported that by 2030 up to 800 million people globally might need new jobs because of automation.3 The report also pointed out that many occupations currently have activities that are automatable, meaning that employees in those roles will likely need to learn new skills and perform new tasks. Reskilling empowers workers to better perform tasks that cannot be automated or to integrate automation into new workflows.
Reskilling addresses the rise of job openings.
Reskilling is an efficient and economical way to address the surge of job openings. Currently, there are more than 11 million job openings in the US but only six million unemployed workers, according to the US Chamber of Commerce.4 While automation might help assuage the technical skills gap in part, reskilling workers by boosting their socioemotional skills will help organizations address talent shortages in two ways. First, they will be able to retain talent with the socioemotional skills to reskill more easily in the future. Second, they will be able to hire from a broader candidate pool with the confidence that talent with socioemotional skills can be more easily developed.
Furthermore, most people are willing to reskill to keep themselves employable. The dual forces of automation and the pandemic have put employees in a frame of mind open to reskilling to retain employment. In fact, research indicates that over two-thirds of workers worldwide are willing to retrain.5
Reskilling increases employee retention.
Reskilling is a direct link to retention. Not only are employees willing to reskill, but they expect and desire development opportunities. In one study, new hires were 42% more likely to be retained if they received job training.6 Forty-six percent of learning and development plans in 2022 wisely prioritized upskilling and reskilling because employees who feel their skills are underused are 10 times more likely to search for a job than those who believe their current job uses their skills well.7
Employees might be disposed to quit organizations that do not offer opportunities to grow in a preferred job and career. According to the Work Institute’s 2021 Retention Report, career reasons—which encompass development, career change, promotion, school, and job security—represented 18% of total turnover in 2020.8 Of those who reported leaving for career reasons, which has been the top-cited cause of turnover for over a decade, 31% named development as their motivation.
In short, people often leave if they don’t receive skills development, but they tend to stay if they do.
Reskilling saves money compared to rehiring.
Reskilling pays for itself quickly. Reskilling programs can cost $10,000 to $15,000 per employee—or even less.9 Rehiring, on the other hand, can cost from 33% to 200% of the employee’s salary depending on the industry and role.10 It’s simply more affordable to retrain and retain than to rehire.
What Are the Steps for Reskilling?
To build a productive reskilling program, follow these three steps:11
Step 1: Conduct assessments.
Even though you may not know which jobs or skills will change, you can still expect to need to reskill employees for new or evolving roles. To identify these talent gaps, organizations need to assess individuals to identify current skills and future potential.
You will be able to create a specific plan for change only if you understand your starting point. Take inventory of the skills currently represented within your organization. Assess your talent, technology, and processes. Be sure not to overlook personality strengths. Personality assessment enables organizations to understand the unique qualities of each employee, as well as the distribution of strengths across the employee base.
Step 2: Strategize needs.
Compare the skills available in your organization with the skills that you are likely to need. Consider what skills may be necessary for new activities in current roles, as well as for altogether new roles. Understanding how values play into employees’ needs is important too. Values speak to the working environment that someone will strive to create. What work do employees want to do? What do they find rewarding?
Instead of being exclusively reactive or predictive in your reskilling strategy, stay dynamic instead. A dynamic approach involves operating within a VUCA environment while identifying talent who are prepared for and receptive to reskilling.
By leveraging what Harvard Business Review calls “skills adjacencies,” organizations can quickly reskill workers who already have foundational knowledge related to new skills.12 For example, a former science educator might excel in B2B tech sales with very little reskilling because she can already communicate complex technical concepts to a nonscientific audience. Or a former journalist might readily reskill into an outstanding podcast host because she already has mastery of interviewing techniques.
The concept of skills adjacencies is essential to the step of strategizing needs because it can often be easier to hire someone who understands statistics than it is to hire a data scientist with at least five years of experience, for instance. Arguably even more than technical skills do, socioemotional skills offer ample skills adjacencies for nearly every role, especially those changed by automation.
Step 3: Create an action plan.
Depending on your organization’s needs, reskilling might look like a program, pathway, or curated experience. It could also be conferences, coaching, or company-wide initiatives. Reskilling should be part of a broader talent development strategy that accounts for employee personality strengths and values.
In putting together your action plan, don’t overlook socioemotional skills. Employers need employees with socioemotional skills—and employees desire to develop socioemotional skills. It’s a combination that begs for reskilling.
The need for socioemotional skills in the workplace has increased dramatically with the evolution of work. According to Pew Research Center, “The value placed on social and fundamental skills in the modern workplace reflects the rapid growth in employment in jobs in which these skills are most important, by 111% and 104% from 1980 to 2018, respectively.”13 With the continued emphasis on workplace automation, the need for socioemotional skills in employees is only likely to increase even more.
Not only do employees need socioemotional skills, but they also value them highly. Nearly all employees want to develop their socioemotional skills, with 84% saying that such training is important to them.9 Leadership is the most desired socioemotional skill of 54% of respondents.9 Recalling that two-thirds of workers are willing to retrain and that socioemotional skills are in extremely high demand, personality-driven talent development makes an essential component of any reskilling plan.
How Can Hogan Help with Reskilling?
Hogan provides data-driven talent insights that help organizations assess the personality strengths and values of their talent.
Strengths – The Hogan Personality Inventory (HPI) has seven primary scales that assess day-to-day, bright-side personality characteristics. The HPI is one of the most versatile of the assessments and can be used across the employee lifecycle. Most related to reskilling are talent acquisition, career pathing, development planning, and succession planning.
Values – The Motives, Values, Preferences Inventory (MVPI) contains ten primary scales that describe what we call the “inside” of personality, or what motivates talent to succeed. The MVPI provides data concerning organizational culture, career motivation, preferred work environments, and leadership characteristics. An employee who wants to interact with people and use science to solve problems would likely show enthusiasm and commitment toward reskilling that involves interpreting data gained through automation for various stakeholders or customers—because it supports their core drivers.
The first stages in creating a reskilling plan are assessing what skills or strengths exist and determining what are needed. Hogan belongs in the assessment stage to provide an evaluation of strengths and values. This helps organizations identify the everyday behaviors of their talent, as well as the environments they value.
Based on those results, Hogan personality data can facilitate development planning to boost the socioemotional skills that are lacking in the workforce, especially among early-career professionals. With hiring managers reporting that socioemotional skills, such as leadership, problem-solving, communication, and teamwork, are lacking in job-seeking college graduates,14 the need for socioemotional reskilling is pervasive.
Whether to reskill teams or individuals or to determine selection criteria, Hogan assessments are the foundation for a reskilling strategy that properly prioritizes socioemotional skills.
A version of this article appeared on hoganassessments.com, posted on November 1, 2022
EXPERD, Human Resources Consultant, Jakarta – Indonesia