The Skills Gap Is Rapidly Widening — Here's What We Must Do To Close It. As the need for employees with AI, machine learning, cloud computing, social media, and product management acumen increases, investing in upskilling initiatives is key to closing a still-widening capabilities gap.
Key Takeaways
- A lack of 21st-century-applicable workplace abilities continues to hamper progress and profits.
- Upskilling initiatives for businesses of all sizes can close the skills gap, retain talent and build happier and more productive staffs.
- A significant ratio of employees has shown a willingness to be flexible about salary requirements if sufficient learning opportunities are present.
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Employers and other leaders, along with most employees, know all too well that it's a challenging time to be a worker. With the adoption of artificial intelligence and social media marketing particularly, the nature of productivity and what it means to be a skilled worker is transforming. Simply being attentive and hardworking used to pass muster, but today there is a plethora of digital skills that individuals must possess to be competitive. In fact, a 2022 report, "How Skills Are Disrupting Work: The Transformational Power of Fast Growing, In-Demand Skills" detailed that need for employees with skills in AI/machine learning, cloud computing, social media and product management was the highest ever in that year — and growing rapidly.
The trouble is — an ever-widening skills gap prevents a large percentage of the unemployed and underemployed from being qualified for such jobs. For instance, that same report stated that over its preceding five years, the average U.S. employee had to either replace or upgrade 37% of skills in order to carry out the duties of their position. A 2023 study conducted by my own organization, Amazon Web Services (along with Gallup), found that 68% of employers in the United Kingdom are struggling to find staff members with the necessary digital knowledge. A more troubling figure still is that just 11% of workers in the U.K. possess the skills needed to obtain and retain these higher-tech jobs.
When it comes to this skills gap, small and medium-size businesses find themselves in a unique position. While some leaders might feel daunted as they try to keep up with better-resourced and larger competitors, there are also advantages to being smaller and nimble. They can pivot quickly, testing out new pilot programs that arm smaller staffs with more certifications and training.
Related: Are You In A Dead-End Job? Here Are The Tell-Tale Signs
How upskilling creates revenue
Largely trained in a time before AI and machine learning took over the conversation, today's workers are also struggling with the effects of the pandemic. How can they keep up? One answer is "reskilling" (aka "upskilling"), in which employees set out to learn new skills either on their own or with the help of work-based programs. And not surprisingly, employers offering high-quality learning and development programs benefit from such an investment.
Owners will be cheered to note that this doesn't have to represent a massive time commitment: Training for specific tasks associated with higher digital skills can take as little as an hour, and offer an immediate return. To be most effective, however, such instruction needs to be outcome-driven, and approachable. For example, Amazon Web Services offers free training in many areas (including basic generative AI solutions) that's designed to be easy for non-technical people to follow.
Offering such opportunities doesn't just mean more talented workers: That same Amazon Web Services study showed that revenue for companies engaged in training of this type was 168% higher than those with lower levels of digital skill advancement. Better still, employees with intermediate digital skills stand to earn 40% more annually than those with basic digital skills, while those in the advanced bracket earn a whopping 65% more. A 2023 white paper by authors representing MIT, Stanford University and the National Bureau of Economic Research confirmed this — that the promise of generative AI benefits less experienced workers the most. The goal is to level the playing field, allowing those with less experience to gain skills faster — upending inequality in productivity.
Related: How to Keep Employees Engaged and Productive in the Age of AI
Smaller organizations usually have smaller workforces, which means that the value of every employee (as a percentage of overall productivity) is much higher in a small and medium-size business than in a larger company. Similarly, the benefits of an upskilling program will ripple faster in smaller organizations, whether that means having more highly skilled managers in place or simply spreading the word about upskilling's benefits.
Lastly, such programs can go a long way towards recruiting talent. Smaller enterprises, pretty much inevitably, will wind up duking it out with much larger and resource-rich ones with which they simply can't compete when it comes to salaries. In a PwC study on HR and recruiting, however, 51% of respondents reported a willingness to give up higher salaries for personal flexibility and training opportunities.
Related: Employees With Advanced Digital Skills Contribute $507.9 Billion To India's GDP: AWS Report
Investing in the future
At first blush, the cost of helping your workforce garner needed skills might seem hefty — even out of reach for some — but they don't have to be. There are many free resources available to help train staff in cloud computing and other areas. For example, the Amazon Web Services Skill Builder offers free on-demand labs and hands-on learning for a variety of skill levels.
