With US unemployment at its lowest level in decades and skills gaps persisting in tech fields like cybersecurity, it’s slim pickings out there for employers in the labor market. No wonder that retraining your existing workers is suddenly the all the rage. And that’s good news for employees.
The threat of automation looming over middle- and low-skill workers seems to have employees and employers on the same page: both favor upskilling and reskilling. Employers want to keep their workers around and use them to fill talent gaps—which are partly their fault in the first place (see “The myth of the skills gap”). Employees want to keep their skills up to date and robot proof.
According to a survey by Accenture, 67% of workers believe they must develop their skills to work with intelligent machines. “[Employers] can receive a return on their investment, because millennial workers demand investment,” says Jaime Fall, the director of UpSkill America. “If they aren’t willing to help them to develop, they won’t stick around.”
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But switching from a more manual job to working alongside AI, for example, isn’t as simple as just taking an online class.
AT&T dropped $1 billion on a training effort called Future Ready after its own research showed that only about half of its employees had the technical skills it needed. It committed $200 million per year to online courses, training, and an internal upskilling platform. The platform tracks which internal jobs are growing or shrinking, helps employees understand what skills they need to gain to get certain roles, and serves as a sort of internal LinkedIn.
Employees weren’t asking for this training, but they need it to remain relevant, says Jennifer Fitzmaurice, AT&T’s assistant vice president of training. So far that money has paid for about 18 million hours of training a year.
AT&T isn’t alone in putting millions on the line. Within the last year, Boeing put $100 million toward employee education, and Disney launched a $50 million education program. Accenture has committed $200 million over the next three years. According to the Association for Talent Development, 2016 (the last year for which data is available) was the fourth year in a row to see increases in employer investment in worker training and worker time spent on skills training. The average amount spent per employee has risen from $1,081 in 2009 to $1,273 in 2016.
But is it enough?
When big corporations make these investments it can make a difference, but it’s still just a drop in the bucket. Only 3% of organizations plan to dedicate significantly more resources to upskilling in the next three years.
And even for companies that are investing in reskilling, it’s hard to ensure that everyone benefits from the programs. Rather than trying to train everyone, PricewaterhouseCoopers (PwC) has launched a program called Digital Accelerators, which gives 1,000 people a year significant time and resources for training in technologies like AI, digital storytelling, and VR. It plans to use these people as internal influencers who can get the rest of the employees on board with new technologies.
Will businesses continue to have the same investment mind-set when the next economic downturn hits? Right now many companies are performing well and have a major incentive to retain workers. But Alicia Sasser Modestino of Northeastern University says that when job candidates are readily available, companies aren’t as willing to back training. “During the recession, [manufacturers] definitely increased their skill requirements. Everybody had to have five years’ experience and maybe even an associate’s degree,” says Modestino. “When the labor market recovered, they very quickly wiped those off and were just looking for work ethic and basic math skills, and they will just teach you the rest.”
About a third of employers she looked at who had increased their requirements for education and experience went on to decrease them as the economy recovered and the labor market tightened. But she also found an ongoing trend toward job postings that ask for new or more advanced skills no matter what’s happening in the job market. Modestino attributes this to continuous technological innovations within companies. As they adopt new programs or more advanced technologies, the digital skills needed to work there also advance (see “Tech illiteracy will get you fired long before automation does”).
While not every job is at risk, the need to stay in touch with the latest technological developments will continue to affect more workers. For PwC, retraining is the way to keep up. “This may feel like a strategic choice. But that train left the station a long time ago,” says the company’s chief digital officer, Joe Atkinson. “It’s a necessity."