What is reskilling?

Reskilling is the process of teaching employees new skills to equip them for different roles or responsibilities within an organization, especially as job requirements evolve due to technological advancements or shifting business needs.

What is the importance of reskilling in today’s workplace?

Reskilling is crucial in today’s rapidly changing work environment for several reasons:

• It helps organizations stay competitive by ensuring their workforce has the necessary skills to adapt to new technologies and market demands
• It minimizes the need for external hiring, which can be costly and time-consuming
• By investing in reskilling programs, companies can retain valuable employees and reduce turnover rates

As role competencies change at a rate of knots, the World Economic Forum predicts that more than 1 billion workers worldwide must be reskilled by 2030. 87% of companies are aware they’re already suffering from a skills shortage or will be in the next few years, according to McKinsey.

Stay updated with the latest statistics and trends:

• Employee Development Statistics You Need to Know in 2024
• 9 Learning and Development Trends to Future-Proof Your Workforce

Who can benefit from reskilling?

Reskilling is not an employee-centric activity—it’s an organizational one. Here are some examples of reskilling employees:

• A reskilled data analyst as a machine learning engineer can develop predictive models that improve decision-making across the business.
• A reskilled salesperson as a marketing manager can create content and campaigns that generate leads and close deals.
• A reskilled payroll assistant as a human resources coordinator can reduce employee turnover rates.

In each case, the reskilled employee obtains new skills and knowledge to solve problems in their department and across the organization. This leads to increased efficiency, innovation, and profitability.

How does reskilling benefit employees?

Reskilling offers numerous benefits to employees:

• It enhances job security by making them more adaptable to changes within their industry
• Employees gain new competencies, which can lead to career advancement opportunities and potentially higher salaries
• Reskilling also fosters a sense of personal growth and job satisfaction, as employees feel valued and invested in by their employers

How does reskilling benefit employers?

1. Reskilling reduces hiring costs

External candidates with specialist skills often find themselves at the center of a bidding war between different recruiters. These job-seekers are in a fantastic position to earn inflated salaries, meaning companies pay through the nose for relevant skills they could have acquired through staff reskilling programs.

Josh Bersin, president and founder of Bersin & Associates, concludes that it’s six times more affordable to build skills from within rather than buy them from outside once you’ve paid for recruitment fees, onboarding, advertising, etc. The average cost of reskilling a US worker is $24,800 per person.

So, apart from reducing recruitment costs, reskilling also means benefiting from your existing workforce that already possesses strategic company knowledge.

2. Reskilling builds more versatile employees

When continuously upskilling and reskilling your workforce, you’re supporting employees to discover new talents they can apply to future roles and bridge skill gaps. Research suggests that 85% of the jobs we’ll be working on ten years from now don’t currently exist.

The only way to prepare individuals and companies for the upcoming shift is to keep investing and applying skills training. Versatility ensures your company will overcome any skills crisis.

3. Reskilling supports effective succession planning

Succession planning is a business strategy where companies invest in identifying and training future leaders. The aim is for a smooth transition between an outgoing leader and the person stepping up to fill their shoes.

Pinpointing suitable succession candidates is step one of the process—the next is offering a wide range of upskilling and reskilling opportunities along the specific career path you’ve mapped out for each successor. These might include job rotations, shadowing, mentoring, and formal training.

4. Reskilling helps companies meet sustainability goals

As companies strive to become more sustainable, they need employees with the skills to make this happen. For example, developing a solid environmental policy requires a green workforce, and the current talent numbers don’t add up.

LinkedIn’s Global Green Skills report shows that only 1 in 8 workers have one or more green skills, far from the green skills penetration that we need.

Companies can solve this problem in advance by reskilling their current workforce with relevant sustainability training and green career growth opportunities.

5. Reskilling improves team performance

Reskilling can significantly enhance team performance by ensuring all members have up-to-date skills complementing each other’s strengths. It promotes a culture of continuous learning and adaptability, which can lead to more innovative problem-solving and efficient workflows. Teams with reskilled members are often more agile and capable of tackling new challenges, thereby driving overall business success.

How does reskilling benefit employees?

Reskilling offers numerous benefits to employees:

• It enhances job security by making them more adaptable to changes within their industry
• Employees gain new competencies, which can lead to career advancement opportunities and potentially higher salaries
• Reskilling also fosters a sense of personal growth and job satisfaction, as employees feel valued and invested in by their employers

What are some effective reskilling strategies for HR departments?

HR departments can implement several effective reskilling strategies, including:

• Assessment of current skills: Conducting skills gap analyses to identify areas where employees need development
• Personalized learning plans: Creating tailored training programs that align with individual career goals and company objectives
• Mentorship programs: Pairing less experienced employees with seasoned mentors to facilitate hands-on learning
• E-learning platforms: Utilizing online courses and virtual training sessions to make learning accessible and flexible

Free templates:

• Skills Gap Analysis Template
• Training Matrix Template

How long does reskilling take?

Psychologist K Anders Ericsson, author of The Role of Deliberate Practice in the Acquisition of Expert Performance, famously introduced the idea that it takes 10,000 hours of practice to gain skills or expertise.

On the other hand, Dan Coyle, author of The Talent Code, disagrees with a culture of hour-counting, arguing that employee training can be much quicker so long as there is a conscious effort to learn.

So, with companies facing a race against time, how does this translate into reskilling in the workplace?

A Future of Jobs Survey determines that 40% of employees need a maximum of 6 months to reskill. However, the time may be extended for people working in the financial services or energy sectors.

Reskilling often happens internally, with 94% of companies expecting their employees to learn during on-the-job training. Online learning platforms and external consultants supplement their development.

How can companies get started with reskilling?

Once you’ve decided to prioritize reskilling, follow this ten-step plan to build skills from within your organization.

1. Identify employees with transferable skills

Suppose your team has been using critical thinking and problem-solving skills to solve complex customer service issues. These same skills might also be useful in product development.

Brainstorm with your team and list employees with:

• The most in-demand skills
• The core skills necessary for meeting future demand
• Any underutilized talent

Tip: Gather data on employee skills using a combination of self-assessment surveys, performance evaluations, skills assessments, and tests, and 360-degree feedback.

2. Prioritize the essential skills

A skills assessment will identify your company’s collective skillsets versus those skills required to close the gap. To understand the most important skills for your organization:

• Consult with employees, managers, and subject matter experts to gather input
• Consider industry trends and changes that may impact the required skills

3. Offer incentives for reskilling

Offering enhancement opportunities as part of an employee benefits package can incentivize employees to reskill and reduce any feelings of anxiety about changing roles.

Tip: Showcase examples of people in your company who have reskilled and enjoyed successful internal mobility and individual career growth thanks to your training opportunities.

4. Seek out specific skills training

Get specific about how you’ll reskill your team. A blend of formal learning and informal learning often works best.

You might try peer-based development, learning in the flow of work, microlearning, or even on-the-job training mixed with remote or classroom-based training resources.

Customer success story: Learn how Freeletics upskills leaders with a blended learning program with Deel Engage

“Leaders drive our organization. With Deel Engage, we’ve introduced innovative learning tools to enhance their effectiveness and success.”—Daniel Sobhani, CEO, Freeletics.

5. Encourage job shadowing

Who better to learn from than a skilled employee who can impart their wisdom to a trainee? Job shadowing is an excellent way for employees to learn new skills while continuing to work.

And it’s not just the trainee who benefits. The shadower also gets a sense of satisfaction from helping someone reskill. Perhaps they’ll also develop their leadership and communication skills during training.

6. Help employees leverage their expertise

Your employees are experts in their field, each with a wealth of reskilling knowledge to share. This knowledge could be shared through blog posts, talks, or even informally mentoring a colleague.

Not only will this help your business develop new content and improve your employer brand, but it will also give your reskilling program some valuable social proof.

7. Provide cross-training opportunities and rotations

Cross-training refers to training opportunities where employees learn to do the job of another team member. It gives employees a better understanding of the workings of different parts of the business machine and builds a more collaborative culture.

Tip: Create rotation programs where employees spend a set period working in different departments.

8. Collect and analyze metrics of success

Make sure your reskilling program has measurable goals so you can track progress and ensure it meets your business’s needs.

Perhaps you want all customer service reps to be reskilled in product development within six months. Or maybe you want half of your marketing team to be reskilled in data analysis within a year. Whatever your business goals, collect data throughout the reskilling process to track progress and identify any areas that need improvement. You could include surveys, focus groups, interviews, or informal 1:1 check-ins.

Evaluate and adjust as needed.

The effectiveness of reskilling programs can be measured through various metrics, such as:

• Employee performance: Monitoring improvements in job performance and productivity post-training
• Career progression: Tracking promotions and internal mobility to assess how reskilling has impacted career growth
• Employee feedback: Collecting feedback through surveys and interviews to gauge satisfaction and perceived value of the training
• Business outcomes: Evaluating the impact of reskilling on key business metrics, such as revenue growth, customer satisfaction, and market expansion

9. Celebrate the successes of your reskilling initiatives

Employee recognition is a powerful motivator, so celebrate the successes of your reskilling program along the way to prove you’re committed to developing careers.

You could celebrate individual reskilling milestones, such as when an employee completes a course or achieves a certification.

Or you could celebrate the program’s success, perhaps with a company-wide event or an award for the most successful reskilling team.

Complimentary guide: Check out our exhaustive list of30+ employee recognition ideas.

What are some examples of reskilling programs?

Bosch

Bosch, a global engineering and technology company, committed €1bn in reskilling costs over five years.

Bosch began a drive called “Mission to Move” in 2018, with 500 employees already completing training which takes up to a year. They will expand the program to thousands more employees within their global workforce, offering reskilling opportunities covering areas like automation and artificial intelligence, electric cars, and “industry 4.0.”

pwc

PwC launched its “New World New Skills” reskilling program in response to a lack of digital skills in the industry. This initiative invites employees to “imagine an Olympics where only two athletes are good enough to qualify. That’s what’s happening in society today.”

Accenture

Accenture has invested an annual 1 billion USD in its reskilling, training employees, and learning initiatives to provide millions of training hours for employees.

More than 70,000 professionals have received training since March 2020. Plus, the company has increased training hours by 6% while reducing costs by 11%, thanks to digital learning platforms.

Amazon

Since 2019 and through 2025, Amazon has dedicated 1.2 billion USD to free training programs and college tuition for around 300,000 employees.

Amazon’s reskilling program targets Amazonians across corporate offices, tech hubs, distribution centers, retail stores, and fulfillment centers.

Kevin Kelly, Director of AWS Education Programs, spoke on the HR Happy Hour podcast about Amazon’s Get IT reskilling program:

“This encourages young women to consider careers in tech. We challenge some gender stereotypes within the industry and bring in role models and mentors so these young women can see themselves in these roles. We’re really trying to help early career talent get past imposter syndrome.”

What are some mistakes to avoid when reskilling talent in your organization?

Beware of these common mistakes when designing a reskilling program in your organization:

1. Lack of a clear strategy: A well-defined strategy for reskilling your employees is the first step to making reskilling a success. This strategy has to align with your overall business practices and goals. Without it, your company will struggle to identify which skills are crucial to develop and which training programs will be most effective
2. Limited investment: Reskilling can be a significant investment for a company in terms of time and money. So, your company has to be willing to invest in training and development programs. Otherwise, it may struggle to provide its employees with the necessary resources to acquire new competencies and knowledge
3. Inadequate assessment: Without a good understanding of the current skill sets of your employees, you would have difficulty developing effective training programs. So, you’ll need to thoroughly assess your employees’ skill sets and identify areas where training is most needed
4. Resistance to change: Some employees may resist learning new skills, particularly if they have been with the company for a long time and are used to doing things a certain way. So, you must get your employees to buy into the reskilling process. Some methods to achieve this include incentives for employees to engage in reskilling activities, such as promotions or salary increases
5. Rapidly changing skill requirements: In some industries, the skills required to succeed are changing at an unprecedented speed, and many companies struggle to keep up. Your company will be unable to anticipate changes in the skills landscape and adjust its reskilling efforts without conducting thorough skills assessments to understand employees’ current skill levels better and the core skills for the future
6. Poor training quality: You must ensure that your reskilling programs are high quality to ensure long-term success. Formally training employees may not be sufficient to help them acquire new skills. Effective training requires a well-designed curriculum, materials, and skilled trainers who can deliver the content effectively. Additionally, you will need to engage your learners and offer opportunities to put their knowledge into practice
7. Ineffective communication: Ineffective communication is one of the reasons why companies struggle with reskilling their people. Clear communication of the benefits of reskilling and the resources available to support it will help your people feel more engaged and motivated to participate

What industries benefit the most from reskilling?

While reskilling is valuable across all industries, certain sectors benefit more significantly due to rapid technological advancements and changing market conditions. These include:

• Technology: Constant innovation necessitates continuous learning to keep pace with new tools and methodologies
• Healthcare: Advancements in medical technology and practices require ongoing training for healthcare professionals
• Manufacturing: Automation and smart manufacturing technologies demand new skill sets for workers
• Finance: The rise of fintech and digital banking requires employees to stay updated with the latest financial technologies and regulations

Future-proof your business by reskilling your people with Deel Engage

For a company to continue to grow, its workforce must continue growing. Reskilling supports employee skill growth so your workforce is more versatile, capable, and prepared for the future.

Deel Engage has the tools to seamlessly integrate talent development into your company’s operations. With tools like skills matrix, training needs assessment, and career progression frameworks, you can:

• Assess your people’s existing skillsets
• Gauge their learning interests
• Show them potential career growth pathways in your organization
• Define reskilling plans for each employee
• Create custom AI-powered learning journeys to help your workers develop new skills and excel at their projects
• Curate content from prestigious content providers via the learning experience platform (LXP)

Additionally, Deel HR, our truly global HRIS solution, is always included for free.

Book a demo to see how our solutions will help you develop, motivate, and retain your best people.