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The benefits of upskilling & reskilling in 2024, explained

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In just two short years, the workplace and the job market hardly resemble themselves. COVID-19, remote work, and the Great Resignation have led to a transfer of power between employers and employees that has forever changed the American workforce. Whereas employees once feared getting fired on Friday afternoon, employers now fear that their employees won’t come back from lunch on Friday afternoon.

It’s been said that people and companies generally change for one of two reasons: inspiration or desperation. It could be for both of these reasons that many organizations are investing heavily in upskilling and reskilling. The changing workplace and the urgent need to recruit and retain talented employees have made these two tactics cornerstones of a renewed commitment by employers to create cultures of employee empowerment and growth.

What is upskilling & reskilling?

Upskilling is the practice of teaching employees new skills to better perform the duties of their current job occupations. Reskilling means teaching employees a new set of skills in order to perform a different job function within the same company. Both are valuable tools for professional development and workforce retention, regardless of industry.

To best explain and illustrate what upskilling and reskilling are, let’s use an imaginary employee named Art, who works for the Disney Corp. as our example.

Art has been a “mostly happy” Disney employee for just over five years. He was hired as a customer service representative/cashier in one of the company’s theme park stores and has remained in that position since his first day of employment.

A source of Art’s now diminishing happiness at Disney has been the installation of more “self-checkout” kiosks in the stores located in their parks, including the one in which Art works. As a result, he’s becoming increasingly concerned about being laid off.

Art’s manager has always raved about his work ethic and people skills, and has always approved Art for merit increases when he was eligible.

It’s apparent that Art has genuine cause for concern: new technology is reducing the need for cashiers. Art’s hours are in danger of being cut, which creates a real problem for Art and his family.

But, Disney also has a problem. The company has five years invested in Art. He’s been trained, has mentored new store employees, and has even acted as the store manager on a few rare occasions when his manager suddenly became ill and couldn’t make it to work. Losing Art certainly won’t cripple Disney, but it will hurt the particular profit center Art is a part of.

If Disney wants to retain Art, they need to consider reskilling and upskilling.

Reskilling Art will mean teaching him a new set of skills for him to perform a completely different job for the company. For example, Art’s finely honed people skills might make him an excellent candidate to work as a Park Ambassador. This is a position in which Art would walk throughout the park each day and answer guests’ questions, address any concerns they have, and let them know how much their presence is appreciated.

Upskilling Art would mean teaching Art new skills for him to remain in his current job. In Art’s world, that could look like Disney teaching him to manage his store’s inventory in addition to checking out those guests who aren’t able to use the self-checkout kiosks in Art’s store.

Both of these strategies could make the difference between keeping Art on the payroll for years to come or having him leave the company to go work for a competing theme park. Disney’s bottom line indicates that keeping Art on the team is the preferred outcome, rather than him leaving.

[ Related: 20 of the best employee benefits in 2022 ]

Why upskilling & reskilling is important

It’s no secret that employee turnover is a losing proposition financially for companies. According to Gallup, the cost of replacing an employee can be as high as two times the employee’s annual salary. Compared to those costs, upskilling or reskilling is a much smaller investment for a company than recruiting, hiring, and training a new employee.

Upskilling and reskilling employees does more than just boost a company’s bottom line. It also:

  • Improves retention. The number one reason people leave a company isn’t because of money; it’s about appreciation. Companies show employees they’re appreciated by investing money in their skillsets; it shows their people they care about their careers and their futures.
  • Boosts morale. Employees provided training and development opportunities by their companies are happier in their roles and are more enthused and optimistic about their future. Both upskilling and reskilling help employees see a path to career advancement; it gets them excited about new possibilities.
  • Improves customer satisfaction. Happy employees lead to happy customers because they do better work with a better attitude. And, attitudes are contagious. Plus, employees with better skill levels are more motivated to stay up to date with industry trends, make better recommendations, and offer better insights to clients and prospects.
  • Attracts new talent. Cheerful, engaged employees become stronger brand advocates. They’re more likely to recommend their organization to their friends, family, and social networks. A company can’t get a much stronger referral than an employee’s glowing post on LinkedIn or Glassdoor.

One of the major motivators people are giving for quitting their jobs is that the pandemic has led them to realize that life is too short to keep working for a company that doesn’t value them as a person. So, how can employers be better at this?

How to upskill & reskill your team

Every company wants to gain and keep a competitive edge. Growing and maintaining a loyal and skilled employee base takes an intentional, focused effort. Here are three tips for employers to successfully upskill and reskill their team members:

  1. Make training available for everyone. Top employers don’t just make training and development opportunities available for their “elite” employees; they make sure every employee has access to those opportunities. The cream that rises to the top is often not who they expected.
  2. Let employees choose their path. People who feel they have the freedom to choose areas they’d like to develop in are more motivated to grow than someone told to blindly follow a program dictated to them by a manager or training department. Wise employers let employees take ownership over their personal and professional development.
  3. Reward employees for their efforts. Financial incentives are merited when employees complete training and development programs, but positive recognition leading to a happier, more productive workforce must not be overlooked.

[ Related: 6 best practices for diversity, equity & inclusion in 2022 ]

“Us vs. them” won’t cut it

For a company and an employee to thrive in today’s world, they must be on the same side of the table. Employees have more options than they’ve ever had, whether it be going to work for a different company or flying solo as a freelancer or small business owner.

Consumers are the ones who ultimately suffer when companies and employees are headed in different directions, whether it be product and employee shortages or increased prices. Everyone pulling together in 2022 will be needed for American industry to withstand inflation and all of the other forces pushing against it.

The information and content provided herein is for educational purposes only, and should not be considered legal, tax, investment, or financial advice, recommendation, or endorsement. Breeze does not guarantee the accuracy, completeness, reliability or usefulness of any testimonials, opinions, advice, product or service offers, or other information provided here by third parties. Individuals are encouraged to seek advice from their own tax or legal counsel.

— Published February 1, 2022
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