Upskilling is undeniably an essential strategy for creating employee happiness and improving retention. Instead of letting crucial knowledge walk out the door into the offices of a rival company, upskilling keeps employees engaged and reduces the need for unnecessary hiring costs. Let’s dive into why companies need to have upskilling at the very forefront of their minds.
In a recent global impact survey, 94% of employees admitted they would be more loyal to their employer if their employers invested in their continued progression and development. Added to that, Gallup’s State of the American Workplace report highlights that employees feel more engaged at work when they are continuously learning new things.
If employers can meet this very clear demand from employees, they are bound to see better loyalty and longer tenures because employees feel valued and see a clear path for their professional development. In addition, from a purely monetary perspective, the other reasons why you would want to consider upskilling are pretty clear—it increases profitability by an average of 23% for companies with highly engaged employees.
Unfortunately, although every recruiter dreams of hiring the next great talent, recruiting and onboarding new employees isn’t a walk in the park. It can take a long time to find a candidate who fits the company culture and has the required skills. Even then, there are no guarantees that a new hire will fit into the organisation’s way of working, which is why companies need to look within their own teams to address the skills gap.
Let’s dive into why companies need to have upskilling at the very forefront of their minds.
Making Key Cost Savings
It is well-established that the potential financial penalty of employee turnover is enormous― Gallup estimates that the cost of replacing an employee can range from 50% to 200% of their annual salary. That is a hefty price and a financial risk that most companies can’t take. These costs can mount up when you consider hiring-related expenses, lost productivity, and the time required for new hires to get up to standards.
And it’s far from being just a numbers game the loss of institutional knowledge when employees leave is something that’s not always easy to quantify, but it can really put a spanner in the works. This is where you need upskilled employees to step into their shoes to take on more responsibilities and complex tasks, reducing the need for hiring external talent.
This internal development strategy can be more cost-effective in the long run, particularly for roles that require advanced knowledge. Quite simply, engaged employees are also just more productive, utilising all that they learn from workplace opportunities and contributing to higher sales-up to 20% more in some cases!
Improving Company Culture and the Skills Gap
The huge chasms left when employees leave can really jeopardise a company’s goals. Whenever there are market shifts or unforeseen circumstances that require quick attention, existing employees can be more helpful, having developed an array of skills and expertise in the company.
Another underrated aspect comes from long-term working relationships. These intra-team relationships have the potential to build trust and camaraderie among team members. After all, employees feel they are more likely to share knowledge and support each other’s development when they are growing alongside their peers. Lastly, employees who have that shared sense of experience are more likely to want to rely on each other.
Upskilling Efforts Within a Company
It’s all good talking about the benefits of upskilling, but you also need to have a way to implement it to ensure that it actually bears fruit.
Firstly, you need to identify where the skills gaps are. To do this, you can conduct regular assessments. For example, a tech company might note that its software development team excels in a particular area of coding and project management, but it lacks the same expertise in AI and ML. Providing learning opportunities in that area ensures that upskilling efforts are aligned with business objectives and market demands, maximising the return on investment.
After that is taken care of, you can make skills development a core component of performance evaluations and individual development plans. This shows that your commitment to employee growth is super clear and also helps track progress and set clear career paths. Lastly, within the skills development program, regularly monitor the progress of upskilling initiatives and provide employees with challenging assignments that extend their capabilities.
External opportunities
Now, upskilling also doesn’t have to remain entirely within your company, sometimes partnering with educational institutions and professional training providers can give your employees a range of learning opportunities. Things can get stale if you keep everything in- house, so reaching out to these institutions and their online courses, workshops, and seminars, allows you to cater to everyone’s needs. You could also offer benefits for these opportunities, such as reimbursement for external tuition.
Aside from colleges and other institutions, there are plenty of experts who can deliver targeted training that meets your specific organisational needs. You just have to flick through Linkedin to see tonnes of experts who can speak on a variety of subjects.
Upskilling is undeniably an essential strategy for creating employee happiness and improving retention. Instead of letting crucial knowledge walk out the door into the offices of a rival company, upskilling keeps employees engaged and reduces the need for unnecessary hiring costs. If companies can properly focus on employee development, they are more likely to have both a highly skilled workforce and one that is loyal and motivated.
Source: GWFM Research & Study