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The Cost Of Reskilling

As we enter the fourth industrial revolution where adaptive processes, automation, machine learning and AI fundamentally change the nature of work, much of the conversation we heard at Davos this year was around the dual crisis of future skills gaps and the need to reskill employees.

Change has to happen. Companies that resist change will be superseded by new entrants into the market, or by those companies that do change. The job market is going to be disrupted: some jobs will be lost, or cease to exist, while new jobs we have not even thought of yet will be created. As with any change, or venture into the unknown, there is trepidation and uncertainty. Yet we also know that the way we work and consume today is unsustainable. Change will need to happen anyway and we have an opportunity to direct that change responsibly. We have a workforce that is facing a mental health crisis. The way we structure work is not healthy. As repetitive tasks, developed over the last 30 years are being taken over by robots, we have the chance to put humans to work with a focus on ‘human’. What were once classed as ‘soft skills’ are now being rebranded as ‘crucial skills’. The saving grace for humans and the future of work is exactly what makes us different from robots—our humanity. And it is these skills that ironically will improve our mental health at work. Skills such as creativity, complex problem solving, empathy, judgement and cognitive flexibility are exactly what sets us apart from machines and a lack of these skills in the workplace can lead to increased stress, depression and poor mental health.

As we move towards a workplace that is increasingly more man plus machine, there is a mounting need to reskill, upskill and fill skills gaps. An interesting theme I have encountered recently when talking to business leaders and educators is who is to bear the costs of this reskilling? What is sustainable for an organisation? Is it the government? Is it the individual? A recent report from The World Economic Forum, ‘Towards a Reskilling Revolution” found that 95% of the 1.4 million US workers who are expected to be displaced in the next decade can be transitioned to new positions with similar skills and higher wages. But the total cost of reskilling all these workers is $34 billion – an average of $24,000 per displaced worker.

When looked at as a direct cost it looks daunting, however we all know that education, reskilling and upskilling cannot be seen only in the context of the cost of training. There are other questions we need to answer. What is the cost to the company for not reskilling with regard to lost productivity, employee welfare, workplace accidents, customer satisfaction, and competitive advantage? What is the cost to society when looking at the increased need for welfare, crime, family disruption, citizen unrest?

The fundamental question we need to ask today is this: ‘what is the future we want to live in and how do we get there?’ It is a tough question for companies to make time for when they are under pressure from shareholders to make short-term gains and returns. We already know that the average lifespan of a fortune 500 company has dropped from 58 years to just 18 years. Business is getting harder, but we also know on a fundamental level that it is the short term thinking that is contributing towards their shrinking lifespan.

It is inevitable that responsibility for this learning lies in a combined and collaborative approach involving all stakeholders from corporations, governments, educational institutions and innovated new approaches. The future is about connected ecosystems, collaboration and connected thinking.

It is an exciting time to be asking these questions. We at Box Media have been tackling these questions over the last two years. We are taking this opportunity to hack learning, to reimagine not only what we need to learn in order to remain relevant in a future workforce, but also how learning itself needs to change. Workplace learning is seldom fit for purpose today and it is certainly not fit for purpose for tomorrow. Finally, we have a convergence of need, technology, human understanding, data and content production. We are excited and determined to play our role in shaping a responsible and sustainable future.

Author: Alasdair Munn