As the Covid-19 pandemic continues to strain hiring and recruiting efforts for companies, some chief human resources officers and management leaders say the secret to outcompeting industry rivals is investments in upskilling and reskilling employees.
Heidi Brooks, a professor at the Yale School of Management, said at CNBC’s Workforce Executive Council Summit in November that companies need to set learning as an objective to recruit and retain talent.
“The orientation has been a lot of companies thinking, ‘You get to work here.’ Now the shift is more in the direction of, ‘We get to have employees.’ That’s a pretty big perspective shift for a lot of leaders and managers,” Brooks recently told CNBC. “Especially in some of the elite companies that people have been really yearning to be part of. It’s a little bit of a shock to them to have to switch their perspective and be in recruiting-and-retention mode as an ongoing basic perspective.”
Although upskilling — teaching employees additional skills, such as technical capabilities as well as interpersonal, organizational and self-management skills — is not a new concept for companies, investing in employees has gained increased attention as more companies use education to win talent.
“There’s a lot of concern about the Great Resignation, people switching jobs and having some sense of agency in their work. There’s a question of how organizations and leaders can reasonably respond to that sense of pressure,” Brooks said. “One of the ways to respond is by offering educational opportunities through upskilling.”
Investments in education can not only attract new talent, but it can help retain workers on the verge of burnout, which has been exacerbated by the pandemic.
“If companies can invest in people learning and growing, their best people will stay longer and part of that is not burning out their best people,” said Henry Albrecht, chief executive officer at Limeade, a corporate solutions company that offers tools to transform workspaces and improve employee wellbeing.
Overall, employees want their needs recognized and wellbeing prioritized, Albrecht said. When companies invest in upskilling, education and learning, it shows workers that they’re valued.
“When people perceive that their organization cares about them, they’re seven times more likely to want to stay three or more years, and they’re four times less likely to burn out and feel that they can’t participate,” said Albrecht, citing a 2019 Limeade Institute report that looked at employee experiences.
Education is a competitive advantage
One concern that many companies and HR chiefs have about upskilling is whether the investment leads to greater employee retention.
Marcus Bryant, the managing principal at Vantage Custom Solutions, a human resource management and diversity training consultancy firm, said this concern should not discourage companies from investing in their employees, and it can make companies more attractive to employers.
“[Employees] are going to go out and still promote great skills and great talent within the industry, sort of a long-term perspective, but also think in the short-term perspective. Imagine if we don’t train them and they stay at our organization,” Bryant said. “They’re underperforming or not performing to their maximum ability. We can’t worry that they’re going to overperform somewhere else when they’re underperforming here.”
In September 2020, the median number of years that wage and salary employees had been with their employers was 4.1 years, according to the Bureau of Labor Statistics. The era of employees staying at companies for several decades is over, but employers can still have a competitive advantage in hiring if they invest in education.
Bryant said that competitive advantage is more important than ever, especially with differences in how generations of workers value their jobs and companies.
“Millennials, in particular, are getting into their mid-level, upper-middle management, even executive-level jobs,” Bryant said. “At this point, there’s an expectation with that age group and demographic that says: ‘I want more from my employer. I want to know what the purpose of the job is. I want to know that when I show up every single day, I’m making a difference.'”
If companies don’t invest in those priorities, Bryant said employees will walk out the door.
Fuse learning into workplace culture
Education and learning may not solve every issue in the current labor market, but it can help recruit new talent and offset the cycle of being understaffed leading to greater labor shortages.
“I think it’s incredibly important to be able to build your workforce up in such a way that even if you have to pivot the strategic direction of the company, that’s not at a cost for skill,” Bryant said. “We have to have people who are knowledgeable, who are ready to go at any given time. You have to have a culture that supports a growth mindset.”
Other CHROs said their companies have invested in education to support the wellbeing and growth of employees regardless of their tenure at the company.
“We prioritize training and development for all associates no matter their current situation. We want to see all of our associates grow whether they strive to be in a leadership position [at H&R Block] or expand in their current role,” said Tiffany Monroe, chief people and culture officer at H&R Block.
While a switch in company culture won’t happen overnight, Brooks said it begins when leaders and executives communicate with their employees and with each other.
“I’m not entirely sure that a lot of leaders and managers feel prepared for the ‘career curiosity’ kind of conversations that might be the new face of managing and leading with a workforce that’s not necessarily planning to stay,” Brooks said. “It’s less about where people work and more about what people do, and that’s a really fundamental shift in thinking about how to manage.”
Overall, Albrecht said companies need to invest in employees as humans, not just as workers.
“There are companies who realize that if they don’t win the hearts and minds of the people who work for them, especially with what’s going on with the Great Resignation and the Great Decentralization of Work, they can do all the upskilling they want, but they’ll be wasting their money,” Albrecht said.
Missed this year’s CNBC’s At Work summit? Access the full sessions on demand at https://www.cnbcevents.com/worksummit/
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