WEF report analysis: Reskilling won’t work for businesses – here’s what will
13 Oct 2021
Before COVID hit, times were tough enough for CTOs charged with sourcing and retaining the talent needed to deliver on digital strategies. And according to the World Economic Forum (WEF) ‘The Future of Jobs Report 2020’, it’s about to get a whole lot tougher because of the ongoing pandemic.
Driven by global lockdowns and recession, the report reveals that 84% of companies are now accelerating digitalisation plans. But there’s a problem – the solutions offered by WEF while altruistic, are not the best option for businesses’ bottom line.
How the rules of employee retention have been reversed
Retaining talented developers has been an ongoing issue for CTOs over the past decade. WEF believes the severe economic impact of the pandemic could lead to all that work being undone, as skilled staff are let go to reduce fixed costs.
With wage schemes currently subsiding nearly 60 million workers in the OECD region alone, few sectors can realistically predict how many employees could actually face redundancy once that support ends. The current signs, sadly, aren’t positive: From Consumer Goods and Manufacturing to Finance, nearly every sector has been negatively affected. Even Software and IT sector hiring rates are down 14% as of the end of September 2020.
How the pandemic leaves CTOs operating in the dark
Such uncertainty puts CTOs in an unenviable position, expected to deliver on strategies for accelerated digitisation but without the benefit of reliable forecasts for hiring budgets.
This, in turn, represents a double-edged sword: Overcommit to hirings and a business could face an existential threat when government support is finally withdrawn. Under-commit and the enterprise’s transformation plans could well stall as suitable in-house skillsets have been lost due to redundancies, leaving CTOs stranded.
Why company-wide reskilling is a potential route to failure
The report highlights that businesses are aiming to plug any skill gaps through mass-scale reskilling programmes. Reportedly many employers are already embracing the tactic, providing reskilling opportunities to 62% of their workforce.
The problem here is two-fold; first, 42% of employees are not taking up such reskilling offers. Second, only 21% of businesses state they can access public funds to help subsidise these extremely costly reskilling programmes. Costs will undoubtedly be higher for more specialist roles too, creating yet another hurdle for CTOs to clear.
What reskilling actually means for enterprise bottom lines
Successful skills training also takes time: On average, companies estimate that roughly 40% of workers will require reskilling of up to six months with 50% of all employees requiring reskilling. That’s a significant undertaking and one that has C-Suites nervous about ROI.
While an average of 66% of employers expects a return on investment within one year, the financial shock caused by COVID means for many employers, that’s too long. Nearly 20% say they are uncertain if they will even see an ROI. The report also indicates that companies are struggling to quantify the scale of investment they currently make for reskilling.
Why it always, always leads back to talent… and the lack of it
Inevitably though, it’s sourcing suitably skilled staff/hirings in the first place that remains the biggest roadblock. Why do you need to reskill if you can already hire skilled staff?
More bad news for CTOs: 55.4% of businesses are concerned about filling skill gaps via the local labour market while 46.7% believe they will struggle to attract specialised talent. And to add insult to injury for CTOs, 41.4% of enterprise says there are technology-focused skills gaps in the boardroom itself.
All in, the WEF report offers a set of solutions to the current talent problems but in the harsh light of day, they just don’t cut it during an economy rocked by the pandemic. There are too many hurdles to overcome from reskilling issues through to insolvency-baiting ROI concerns. It’s why CTOs need to consider another, more realistic solution – Elastic Teams.
Changing mindsets: How Elastic Teams offer a clear, practical alternative
First, CTOs should stop viewing the whole situation as ‘a talent problem’. Instead, start with the product or process to be implemented, and then decide what talent is required to build it. Once done, side-step in-house talent shortages entirely (and those costly individual contractors) and instead, hire in an outsourced Elastic Team.
These can be put together with the required specialists in under 48 hours whether it’s for software development, database creation, or any other digital project. There’s no delay, no need for reskilling 50% of all employees; just a team that is ready and exceptionally qualified to begin on the project almost immediately. Not to mention a happier, smaller internal team that feels supported by experts.
Using an on-demand service is more cost-effective, agile and scalable than any traditional in-house solution. It means CTOs can help reduce fixed costs and allows the C-Suite to focus instead on protecting and reskilling their most valued employees. Importantly, taking the Elastic Teams approach to digital will ensure that a company is in the best possible position to navigate its way through this cruel COVID era – and emerge the other side intact.