Reskilling employees vs hiring new ones: Which is the better option?
During disruptive times like the current pandemic, companies big and small need to reevaluate their workforce to ensure staff and managers are prepared to handle new business directions.
Scores of employees are being laid off or furloughed as some companies face the harsh impact of COVID-19, but many are still able to stay afloat – or even flourish – during these turbulent times.
For those caught somewhere in between, they need to take quick action to ensure they don’t go under during difficult economic times.
At such a pivotal time, should companies hire new employees with the right skills or look into reskilling their current ones? Survey shows that with current hiring freezes and the growth of online learning platforms, reskilling is the better option.
A white paper by edtech firm upGrad and industry body FICCI, ‘High-Impact Online Learning at Scale’ found that business leaders in India are looking to reskill their existing talent pool rather than hire new employees.
According to the report findings, 87% of the business leaders upGrad interviewed during the Covid-19 crisis said that they are looking to reskill over hiring and that reskilling existing employees is the more economical option compared to hiring new ones.
75% of the respondents to the upGrad survey also said that they considered reskilling successful in their respective organisations.
While the survey only looked at the Indian business market, the findings are consistent with global hiring and reskilling trends even before the COVID-19 crisis.
The disruption and rapid advancement of new technologies such as Artificial Intelligence, (AI), machine learning, and big data were already leading to a reskilling revolution.
CNBC reported that AT&T – the largest telecommunications provider in the US – invested US$1 billion in 2018 to reskill its workforce after finding out that only half of the employees had the necessary STEM skills needed.
Bill Blase, senior executive vice president of human resources said, “We could go out and try to hire all these software and engineering people and probably pay through the nose to get them, but even that wouldn’t have been adequate.
“Or we could try to reskill our existing workforce so they could be competent in the technology and the skills required to run the business going forward.”
The COVID-19 crisis has kicked the reskilling revolution into high gear, forcing many companies to fast-track its reskilling strategies to remain competitive with economic instability on the horizon.
The pandemic has changed the world in several ways. For example, e-commerce has seen a surge in demand as people now prefer to shop online rather than hit the traditional brick-and-mortar shops. Delivery services have also seen an uptick in demand as people are relying on these services more than ever.
With online learning growing rapidly as people stayed home and worked remotely, business leaders should look into reskilling and upskilling their existing employees through online courses and master’s degrees delivered on platforms such as Coursera and EdX.
AT&T’s global retraining programme included online courses delivered through collaborations with Coursera, Udacity, and leading universities in areas such as data science, cybersecurity, agile project management, and computer science.
Anthony Carnevale, director and research professor of Georgetown University’s Center on Education and the Workforce, told CNBC that reskilling workers allow a company to keep long-term employees who “already have two to three tiers of skills because they’ve learned the structure and culture of the institution.”
He said, “When you have workers that already possess much of what you need, it makes a lot more sense to retrain them than to go out and hire new workers—who may be more educated—and then wait a year or more for them to get up to speed with how the company operates.”