What to expect in the upcoming skill gap crisis
Tech evolution and the millions of job displacement and creation as a consequence are inevitable. It is estimated that by 2025, 97 million new job roles may emerge due to advancement in technology and its adoption in organizations.
These are the so-called “jobs of tomorrow”. As technologies like artificial intelligence and non-humanoid robots are becoming more mainstream, there has been a significant increase in companies’ expectations to adopt them across industries.
Adopting cloud computing, big data, and e-commerce in businesses is among high priorities, with over 70% of companies citing them as adopted or likely to be adopted by 2025. Due to growing concerns about security with increasing digitalization, cybersecurity and encryption have gained significant interest.
Furthermore, a study conducted by Microsoft estimates that 149 million new tech jobs will be created by 2025. Of which software development is estimated to account for 66%, data analytics & AI is estimated at 14%, cloud and data roles at 15%, cybersecurity at 4%, and privacy & trust at 1%.
This growth in new job roles will be accompanied by a displacement of 85 million job roles. For workers that are set to remain in their roles, the share of core skills is expected to change by 40% in the next five years, and 50% of all employees are expected to require reskilling.
The rate of technological change is far outpacing skills development, even if training programs are in place. These training programs may not be robust enough to keep up with the rate of technology change. It is logical to expect a deepening skills gap in the labor market.
So, what can be done to mitigate the looming talent crisis?
Well, the ideal solution is worldwide training to reskill and upskill the entire global workforce. It would require foresight and strategy to prepare the global workforce for the inevitable changes in the labor market. To not plan for a skills shortage sets everyone up to lose.
There are initiatives by governmental bodies to support reskilling and upskilling for at-risk or displaced workers but it’s not enough. Employers must shoulder this responsibility too.
Employers expecting to hire their way out of skills problems will find that the candidate pool for tech talent is pretty shallow, especially in emerging tech areas. Hiring new talent is always more expensive than retaining talent in the organization.
Besides, implementing a proper training plan to reskill and upskill the workforce is a great way to invest in employees. When a specific skill is required, it is wiser to evaluate the benefits of training a current employee versus hiring new talent.
The good news is that employers worldwide expect to offer reskilling and upskilling to over 70% of their employees in the next five years. However, the challenge lies in how to engage the workforce in these training & development activities.
The World Economic Forum – Future of jobs 2020, reported that the actual percentage of the workforce engaging in reskilling and upskilling opportunities was only 42%. This shows that simply providing learning programs isn’t working.
Employee engagement in these training courses is lagging. This is ironic considering the demand for learning & development opportunities is high among employees.
It is also concerning as the pandemic has accelerated the adoption of technological advances, creating a wider skills gap to catch up to. If the current workforce isn’t well prepared, the economies worldwide will face a talent crisis.
And it will become harder for employers to find the right talent and retain them with increased competition. This is something that we are already seeing in the case of tech talent.
Why employees are not engaging in these courses?
In a survey conducted by Dice 69% of IT professionals reported classroom training as “very effective” or “extremely effective” while 51% felt the same way about on-demand training. But in reality, 66% attended on-demand training, and only 39% trained in a classroom.
The type of training these professionals are receiving does not match their preferences. It seems there’s a disparity in training preference and effectiveness, and how employees prefer to train.
Another factor that might be contributing to this lack of engagement is the attitude towards these training activities. There is this sentiment that “it’s useless”. Because employees are not applying the learnings on their current job, and they eventually lose the skill.
Further many employees see it as time-consuming, they say they don’t have the time for it. These sentiments and information overload in this digital age contribute to the lack of motivation in engaging with these courses.
Effective training must be tailored to employee and business needs. Providing relevant, short but continual training might be the solution to changing this attitude. Simply offering learning programs is not enough, companies have to find ways to engage their workforce actively in these programs.
On top of these learning and development activities, employers must also develop appropriate compensation strategies to retain these talents. Effective training and proper salary and incentives make employees feel valued and empowered, which fosters loyalty and engagement with the company that provides that training.
Provided the employees are offered the right mix of interesting work, professional development, and compensation, communication is the key to retaining them.
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