Upskilling and Reskilling: A Sustainable and Strategic Solution to the Widening Global Skills Gap

The global economy is characterized by one visible trend: The Widening Skills Gap.

Skills are one of the single most important resources in the business and economic sphere of human life. With the right skills, you are capable of engaging the local and global economy while expanding your capacity and the better and more relevant your skill is, the higher your market value and reward will be.

Due to the ongoing global shift in recent times, the concept of upskilling and reskilling has become a critical topic of discussions revolving around the future of work in efforts to combat the Widening Skills Gap.

So, why are these conversations around The Widening Skills Gap suddenly becoming so critical? The answer is simple; Digital Transformation.

Technology has changed the future of the workplace and leadership, creating new possibilities that can only be fully realized by transitioning the workplace to a hybrid and largely virtual work design.

According to Gartner Inc., physical work meetings will drop from 60% (as of 2019) to 25% by 2024, indicating a global shift towards remote and virtual working.

New business models are emerging as a result of technological advancements, disrupting industries while establishing a fully digitalized economy.

Consequently, employees must be upskilled and reskilled to ensure their value addition and effective deployment as the 4th Industrial Revolution continues to transform the workplace.

What is the Difference Between Upskilling and Reskilling?

According to the Cambridge dictionary, upskilling is learning new skills or teaching workers new skills. On the other hand, reskilling is the process of learning new skills so you can do a different job, or of training people to do a different job. Both are veritable strategies proven to be effective against what might become a perennial skills shortage.

Business organizations around the world have embraced digital transformations in ways that have directly and indirectly disrupted the lives of people and global economies.

Due to the unprecedented changes brought about by the digitization of almost all spheres of the global economy, there is an increasing demand for new capabilities as new industries emerge to replace others.

According to the World Economic Forum, about 85 million jobs could be lost to digital transformation by 2025. At the same time, more than 97 million jobs are projected to be created by the same phenomenon, technological advancement, and continuous digital transformation.

For the jobs that are left “standing”, 40% of the core skills needed to keep the jobs must change.

Three Major Reasons Why the Global Economy Faces a Widening Skills Gap

Millions of people are going to lose their jobs by 2025.
Millions of new jobs will be created by 2025 but people will need to learn new skills first. ( Upskill )
Millions of jobs will change and the people working these roles have to be retrained. ( Reskill )

All of this points to the fact that every organization needs to upskill and reskill employees to maintain relevance and competitive advantage. Failure to do that will only result in a higher risk for increased polarization in society; people with in-demand skills will continue to thrive and feel empowered while workers who lack specialist and in-demand skills fall further behind.

However, we must not make the mistake of thinking that upskilling/reskilling the workforce is only for organizational competitive advantage and sustained profitability. There is much more at stake here.

🎯The lives and livelihoods of 85 million people (and their dependents) are at stake. This cannot be left in the hands of only corporate executives and business investors.

Closing the Skills Gap involves, simply put, helping the 85 million vulnerable workers to acquire the skills and knowledge needed to engage the 97 million projected jobs. This calls for large-scale, intentional, and well-designed proactive Reskilling strategies. While businesses must be willing to invest in these initiatives for long-term sustainable resilience, other key players must become active to achieve the ambitious vision of reskilling employees globally.

The 3 Key Players Needed for Successful Upskilling and Reskilling Strategies

The Private Sector

These are the primary agents of whatever Global Reskilling Plan is adopted. Organizations and businesses must adopt human-centered approaches to decision-making. Undoubtedly, adopting digital technologies in workplaces have immense benefits, especially for costs and profits. Beyond sustained profitability and efficiency, organizations and their leaders have a responsibility to help society deal with the downside of digital transformation, particularly the widening skills gap, job losses due to cuts, global digital divide among others.

We are witnessing a ruthless and almost inconsiderate implementation of digital tools that improve productivity for some workers and displaces others, further driving up unemployment figures. This is a call to organizations around the world to embrace a balance between profit and the welfare of their employee, especially in these times of economic uncertainty. We must always remember that behind statistics and figures are real people with real lived experiences.

The Public Sector ( Governments / Policymakers )

Governments need to spearhead partnerships among these players on the platform of the National Upskilling/Reskilling Policy. Such collaborations allow for effective, achievable, widely acceptable, supported, and thorough outcomes. Governments must prioritize reskilling their population, especially young people, to promote increased productivity, economic development, and societal welfare. In addition, policymakers must create the right environment, regulatory frameworks, and incentives for the parties involved.

The Private Sector

Educational institutions must work with businesses to identify the dynamics of work and to integrate this knowledge into learning materials as the requirements for global employment continues to evolve. Some countries such as Germany and Singapore already have excellent vocational training systems in place. Through these systems, young people (about 50% in Germany and 70% in Singapore) are enrolling in apprenticeship programs covering different professions in various industries.

These kinds of hybrid learning (on-site/off-site) allow people to learn relevant skills that may not be easily covered by conventional academic institutions. These apprenticeship systems must be replicated across countries, especially in Africa, The Middle East, South, and Central America, and Asia.

In all, we must come to terms with the fact that the world is changing and this change has presented us with a rare chance to reshape our world and empower people.

Business strategies must be aligned and anchored in human-centered corporate and moral designs to ensure that digital transformation remains uplifting and empowering to humans.

Natalie Schrogl - Author

Founder & Managing Director, The Interface Leadership

Natalie Schrogl is a sought after leadership strategist, keynote speaker, and creator of "The ARMOUR of Leadership", a template for leadership transformation and a solid guide to crafting a sustainable response to the changing leadership landscape.