You likely hired the employees you currently have at your business because they’re smart, capable and motivated. Unfortunately as time goes on, their skills can fall a little behind the times, especially when it comes to technology.

According to a recent PwC report, 79% of CEOs surveyed reported a lack of skilled workers is threatening the growth of their businesses. The good news is that there is a solution. Upskilling — training existing employees to learn new skills — can help businesses succeed, even in difficult times.

The value of upskilling has not gone unnoticed. Just last year, tech giant Amazon announced plans to invest over $700 million to provide upskilling training programs to employees. 

Upskilling is Cost-Effective

Hiring new employees is extremely expensive, and replacing existing ones costs even more. “It can cost as much as six times more to hire from the outside than to build from within,” according to Corporate Talent, Learning and HR Technology Expert Josh Bersin.

Attracting, vetting, hiring and training employees are all pricey parts of bringing someone new on board. 

A Gallup survey also reports that “the cost of replacing an individual employee can range from one-half to two times the employee’s annual salary.” In other words, hiring someone new to fill a role that earns $100,000 a year could cost up to $200,000.

Upskilling, on the other hand, is just a fraction of that cost. While it is an initial investment, the overall cost does not come close to double their annual salary. If you’re able to train your current employees, your company may see cost savings.

In fact, Udacity for Enterprise data found that “by upskilling its internal talent, multinational telecommunications company Telenor has saved over $9 million to date by improving efficiencies and reducing the need for contractors or third-party consultancies.”

Upskilling is Efficient with Company Time

When upskilling employees, you’re providing professional growth opportunities to help them build upon their existing knowledge and gain new skills relevant to the job they have today. These are the skills that will help make your company more competitive. 

That being said, in the long run, helping employees upskill is significantly faster than finding a new person to hire who already has those specific skills, and more productive to your business than sending them off to a bootcamp or community college.

Hiring new employees takes a lot of time. Not only do you have to find candidates and schedule interviews, but regular employees have to take time away from their work to interview candidates and make decisions about who to hire. 

Once a new employee accepts your offer, they must still go through onboarding, do some knowledge building about their role — they’re not ready to hit the ground running. Overall, trying to upskill current employees is much more efficient.

Upskilling Improves Morale and Decreases Turnover

When employees feel like their jobs are secure and the company they work for truly cares about their well-being, they’re likely to do much better work. Upskilling your employees shows that you don’t view them as just a commodity, but an integral part of your company’s success. 

As valued members of an organization who can be trained to reach new levels, instead of just replaced, they will be incentivized to stay and contribute to the company’s growth.
The best part of this is that studies have shown workers are interested in training and upskilling. According to a PwC report, 77% of employees said they would like to learn new skills. Why not give the people what they want?

Upskilling Your Workforce

If your company is falling behind the times and suffering due to a lack of technical prowess, it’s time to start upskilling your workforce. Not only is upskilling a cost-effective and efficient way to digitally transform your business, but it makes employees happier too. 

In fact, in a recent PwC report, 41% of CEOs said that their upskilling program has been “very effective” in creating a stronger corporate culture and engaging employees.

Contact our Enterprise team to learn about upskilling solutions for your company today.

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