Upskilling: What It Is and Why It’s Important

Through upskilling, professionals can broaden their career options and companies can better retain top performers.

Written by Matthew Urwin
Published on Sep. 06, 2023
Upskilling: What It Is and Why It’s Important
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Upskilling is the process of learning new skills to accelerate one’s career advancement. For example, employees may attend training sessions to improve their communication skills or take online courses to learn the latest technologies. Workers invest in these opportunities to enhance their skill sets, so they can excel in their current roles and level up their career prospects.

Upskilling Definition

Upskilling refers to the acquisition of new skills and knowledge, so employees can better perform their current roles and become equipped with the competencies needed to advance in their careers.

While upskilling gives professionals a competitive advantage under any circumstance, it’s become essential in today’s rapidly changing work environment. 

“The half-life of the skill continues to reduce,” said Andy Morgan, executive vice president of corporate development and head of enterprise at edX. “The need for upskilling and reskilling the skills needed to be successful in one’s job, in one’s career and to progress in your career continues to change, and that pace of change increases every single year.” 

In fact, over 40 percent of workers’ skills will be disrupted within the next five years, making the ability to adapt more vital than ever. Below, we take a closer look at why upskilling matters, what benefits it offers and how companies can begin upskilling their workforces.

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Why Is Upskilling Important?

While a number of factors are driving upskilling efforts, here are some of the major trends that have workers bolstering their skill sets.
 

To Keep Up With Evolving Technology

As new technologies emerge and reshape business, workers in various industries must learn to adapt. For instance, companies are trying to figure out how employees should work alongside AI and other tools, so they can be more productive within their roles. Otherwise, they risk falling behind as more tasks and jobs are automated.    

“We’re in the midst of a period of big change in how we use technology,” said Stephen Wagner, professor of management at Governors State University. “Advancements have brought about these capabilities in AI that make these tools accessible to workers who aren’t necessarily IT professionals but might represent a broader range of the business’ specialties.”

 

To Meet Constantly Changing Business Needs

New technologies and trends are pushing companies to restructure their workforces to meet the changing demands of their industries and customers. While this could eliminate existing positions, it could also lead to the creation of jobs that allow employees to apply skills they’ve been developing and are eager to put to good use.  

“My job didn’t exist 10 years ago,” said Kevin Buechler, senior director of learning and development at BigCommerce. “The opportunity is there for smart people and for smart people running the organizations to identify where the gap is and who the talent we should be promoting to do that is.”     

As a result, employees who are willing to learn different skills may set themselves up for future roles designed to address unprecedented business needs.

 

To Stand Out in a Competitive Labor Market

While the term ‘upskilling’ has become more popular in recent years, upskilling in practice is nothing new — especially for candidates who have grown up in the digital age. Online courses and tutorials make it easier to pick up concepts, and everyday media have served as avenues for acquiring knowledge. 

For younger job candidates, learning new skills is just a part of life. Those who fail to maintain their own skills development may then lose out on jobs to candidates who have demonstrated a more obvious desire and ability to grow as professionals.

 

To Supplement Traditional Education

In previous decades, workers may have relied on the skills they learned in college to build an entire career in the same field. But even those with college degrees are now finding their education didn’t prepare them for shifts in their industries. For example, a majority of learners in edX’s exec ed business have earned their master’s but still want to upskill, according to Morgan.   

The longer a professional stays in the workforce, the more likely they are to have to gain new skills — ones they didn’t learn in college — to stay employed and relevant. Companies and sectors are advancing at a rate that higher education simply can’t keep up with, meaning workers may need to pick up new skills even in the later stages of their careers.

 

To Adapt to Remote and Hybrid Work   

The rise of remote work and other flexible work arrangements has emphasized a new set of digital skills. Employees may now spend their days joining meetings on video conference platforms like Zoom, reaching out to teammates through communication platforms like Slack and managing projects with organizational tools like Asana.  

Working from home or locations outside a central office also requires workers to become fluent in cybersecurity best practices. Online hackers may try to penetrate individual devices with phishing scams, malware and other cyber attacks, so professionals must develop the digital literacy needed for avoiding traps and navigating a variety of scenarios.

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Upskilling Benefits 

Mastering new skills takes time and practice, but those who put in the work can enjoy benefits that make their jobs and careers more rewarding.
 

Stronger Job Security 

The skills that workers have now are becoming obsolete, especially as automation takes over more jobs. By learning new skills and technologies, professionals can become more efficient and effective in their current roles. Better performance adds value in the eyes of an organization, making it more likely that an employee keeps their job and even goes on to fill other roles that their expanded skill set qualifies them for.       

“Upskilling is insurance against that creative destruction that technology brings to jobs,” Wagner said. “One of the clear benefits is that employees will have the skills that are in demand now, or in the future.”

 

Higher Pay 

U.S. workers who choose to participate in an upskilling program earn an average of $8,000 more than those who don’t. This may reflect the fact that upskilling can hasten one’s career advancement, but higher pay doesn’t always signal a promotion. Earning specific certifications may automatically qualify one for a raise, depending on the company and industry.

 

Wider Career Options

Pursuing upskilling opportunities — like taking on work projects that tap into different ways of thinking — may reveal to employees that there are other jobs, even ones outside of their field, that may appeal to them. These experiences also allow professionals to build a portfolio they can use when pursuing a new position or making a career change.

 

Faster Career Advancement

A willingness to learn new skills shows managers that a worker has leadership traits, like taking initiative and owning more responsibility. These efforts can catch the attention of company leadership and convince them that an employee is ready to take the next step up the career ladder. 

“What drives maximum impact is career progression,” said Morgan, describing why users invest their resources in edX products. “They’re looking to change their lives, and they’re looking to upskill, reskill usually to seek a promotion, change job[s] or switch careers.”

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Improved Confidence

Learning new, relevant skills is one way professionals can gain the confidence they need to take on unfamiliar challenges. In turn, this novelty can make a worker feel more engaged in their day-to-day duties, boosting their job satisfaction

“One of the key motivating factors is just making people feel competent,” Wagner said. “You’re much more likely to be engaged or engage in a challenge if you feel competent to address the factors within that challenge.”

 

Meaningful Personal Achievements

Besides professional progress, upskilling can lead to personal victories. For example, someone looking to strengthen their interpersonal skills and become a better communicator may volunteer to lead more team presentations. In the process of developing into a seasoned presenter, they may also overcome their lifelong fear of public speaking, which can enhance their quality of life both inside and outside the office.

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Difference Between Upskilling and Reskilling

Although they seem similar, upskilling and reskilling serve two distinct purposes. Upskilling involves learning new skills for a current role or becoming qualified for the next role in one’s career path. Reskilling refers to learning new skills to take on another role unrelated to one’s current job or to make a career change. 

Adapting to new technologies within a role, keeping employees familiar with emerging industry trends and instilling confidence in workers to better perform their current roles are a few reasons to upskill. Retaining employees whose roles have become irrelevant and training employees for new roles in other departments are situations better suited for reskilling.

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How Companies Can Upskill Employees

While upskilling can breathe new life into professionals’ careers, it also benefits organizations. Companies that invest in upskilling initiatives can raise their employee engagement levels, make their teams more resilient to change and attract talented candidates looking for a place to build a long-term career. But perhaps the biggest advantage of upskilling for companies is employee retention

Upskilling employees is then crucial for organizations looking to gain a competitive edge. The following tips and strategies can help business leaders jumpstart their upskilling process.
 

1. Identify Key Skills Gaps 

Companies can start by pinpointing skills that are vital to their processes but aren’t demonstrated by many of their workers. Managers can solicit feedback from clients and customers to determine what skills are needed to improve their products and services. In addition, leaders can reach out to employees and ask them what skills they need to perform their jobs at a higher level.

 

2. Create a Personalized Learning Plan

The next step is to sit down with employees and come up with a learning plan that best meets their current needs and future career prospects. This plan can be tailored to a team or each individual. Either way, managers and leaders need to have a conversation with employees beforehand if they want to maximize the impact of their upskilling initiatives.  

“If you’re not asking your learners what they need before you’re teaching them, you’re wasting time,” Buechler said. 

Leaders can collaborate with employees to determine details like the ideal times and learning mediums for them. Employees may also need support, like a group discussion, after each learning session to reinforce the content and make sure it stays with them.

 

3. Develop More Focused Content

While providing online courses is a solid start, this format may not work well for all employees. Adapting the content to the needs of the learners can help teams get the most out of their upskilling plans. 

“Just throwing a content library at your employee base and hoping something sticks, I think that very clearly doesn’t drive ROI,” Morgan said.  

For example, breaking up content into short microlearning sessions may be most effective for workers with busy schedules. Leaders may also decide to use group discussions to help employees grasp more complex subjects. Teams can even rotate between different learning formats, depending on individual needs, content difficulty and other factors.

 

4. Schedule Time for Employee Learning 

Structuring time into employees’ schedules makes upskilling more accessible for workers, as opposed to them dedicating time outside of work to upskilling. A manager may give an employee an hour a day to explore a subject of their interest, play around with a new technology or pursue a passion project. Even if there’s no clear purpose for what employees learn during this time, these skills may become more meaningful later on.

 

5. Cultivate Mentoring and Coaching Relationships 

For more in-depth training, companies may establish mentoring and coaching programs that focus on one-on-one relationships. This way, workers can ask questions and get feedback specific to their roles and circumstances. Employees have more control in this situation and can ensure the skills and advice they receive help them move toward their own career goals

Leaders can also train their managers on how to create space during one-on-one meetings to discuss upskilling and what kinds of opportunities they can provide employees eager to learn new skills. Upskilling can then become a part of everyday conversations and naturally be perceived as a core tenet of the company culture.

 

6. Encourage Team-Based Learning 

Sometimes employees require more interaction and hands-on learning, which is where team-based projects come in. Assigning employees to complete a task together while applying new skills allows workers to learn from each other and gain a broader understanding of the many ways skills can be put into practice. 

Group-based test cases and projects can also lead to greater risk-taking and innovation since employees may feel more comfortable making mistakes and asking questions among their peers. And because they’ve been able to experiment with different approaches in a low-stress environment, workers can feel better prepared to handle a variety of on-the-job situations. 

“If you’re doing something with two or three other folks who are on a similar path but not the same path, you’re going to learn perspective, you’re going to be able to teach as well as learn,” Buechler said. “It’s so much more powerful.”

 

7. Leverage Third-Party Content and Services

While companies may want to design their own upskilling programs, not every organization has the capacity to do so. Thankfully, third-party learning platforms already feature courses and certifications on a range of skills, tools and topics. But if this content doesn’t support the needs of employees, companies can reach out and collaborate with these content providers.

Businesses still dictate what content they want to focus on and how it’s delivered to their employees, but learning content providers do the heavy lifting of designing content for distinct audiences. This saves organizations time while connecting their employees to resources they may not have been able to offer through their own skills programs.

 

8. Reward Employees for Learning New Skills 

Upskilling does nothing for companies if employees take their newfound talents to other organizations. Employees who acquire coveted skills will want to apply those skills and be compensated for contributing more to the business. While stretch assignments are a nice change of pace, promotions show employees the company truly values them by giving them more responsibilities and a pay raise to match. 

Buechler can confirm as much. “If you upskill well,” he said, “it means that you’re promoting.”

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