According to the 23rd Annual Global CEO Survey published by the “Big Four” professional services firm PricewaterhouseCoopers (PwC), “the Fourth Industrial Revolution has ushered in new business models and new ways of working that require critical new technical, digital, and soft skills. Those skills, however, are in very short supply.”
The construction industry is not excluded from this rapid shift in how we work, which is why implementing an upskilling program is critical for companies in the industry.
Why is Upskilling Important?
Hewlett-Packard released a report in 2022 that provided an analysis of skill development across many different industries, including construction. The report cites that “advances in technology have made upskilling necessary [across] the entire AEC industry.”
Upskilling includes all functional areas of organizations. Specifically, the lack of critical skills held by craft professionals could prove to impede business goals and increase human capital costs in the commercial construction industry for decades to come.
The dual impacts of the “greying of the workforce” and the global labor shortage require decisive action to be taken today. If not, the industry will face the compounding effects of ignoring the problem and the expense of placing bandages on symptoms.
These skills gaps, if unaddressed, will directly hurt the industry in the following ways:
- Difficulty in keeping up with the pace of innovation effectively.
- Human Capital costs may rise more than expected to meet the technical skills required for project completion.
- Quality standards and client satisfaction will be affected.
- The pursuit of market opportunities will be limited.
- Key strategic initiatives will need to be canceled or delayed.
The key is understanding how to implement a program to prevent these issues from negatively impacting the industry. It starts with gaining clarity on exactly what upskilling is.
What is Upskilling?The Britain-based learning and development organization, Growth Engineering, defines upskilling as “a focus on the improvement of skill sets of your existing workforce by training for additional skills or strengthening previous knowledge.”
The practice of upskilling is founded on leaders being “forward-leaning” and forecasting solutions that meet the demands of the rapid pace of business, economic, or technological transformation, as well as innovation.
Fundamentally, it must be understood that skills training is not a short-term solution or a quick fix to maintain company growth. Upskilling, and, in general, skills training, is an investment in the long-term performance and retention of the workforce.
Both employee engagement and overall retention rates increase when employees are offered clear career development pathways designed to improve their knowledge, skills, abilities, and competency.
– Patrice Low of the Cengage Group asserts, “Employees want to understand future career opportunities and what skills, competencies, and capabilities they need to get there.”
– Susan Vroman and Tiffany Danko state the following in an article entitled “How to Build a Successful Upskilling Program,” published in the Harvard Business Review:
The questions for company operational and HR leaders become …
- What is the right way to identify and implement upskilling for our workforce?
- How do we empower our employees to own their career development?
- How do we integrate recurring themes in employee feedback sessions and surveys with our upskilling plans and offerings?
- How do we clearly define skills development and career pathways?
Let’s answer these questions.
Identifying and Implementing an Upskilling Program for Your Workforce
The first step in the critical alignment of the need for skills development with business goals is identifying those skills that will be needed to answer the challenges the company will face in the next one to three years.
Cross-functionally, the leaders of the organization can segment the skills gap analysis into the following areas:
- Organization-wide – Consideration of the company’s overall business strategy and objectives. Leaders can identify 2 to 3 competencies needed by the entire company to achieve business objectives.
- Departmental – Critical skills are identified at the department level, and associated skills training is prioritized across the workforce of that department.
- Individualized – Identified competencies are unique to each role and career level. There must be a clear linkage between career paths, employee input, and career conversations.
Once the critical skills identification process is completed, the competent organization moves toward assessing employee competencies. The competency mapping process provides a performance baseline for the workforce and creates a mechanism for assessing progress. How does this work? Take a look at this C3 blog for a review of the competency mapping process.
The final step is the development of upskilling goals. In general, this process involves examining the baselines that the company developed during the competency mapping process and determining the future skills that the market is demanding to fill these skills gaps.
Here the organization’s leaders can create a list of the most in-demand skills for each career role. There will not be 20 or 30 key skills, nor will the leader have to address every competency, but there will be 3 to 5 key skills that training can be mapped to enhance employee skills.
This analysis can be even more effective using employee surveys or sensing sessions that provide a deeper understanding of the technical skills that employees carry out daily and the specific challenges inherent in their work. These sessions increase employee involvement and ownership of the upskilling process.
There are many modalities for skill development that can be of value. However, the most common ones are as follows:
- In-house Training.
- Apprenticeship Programs.
- Vendor Partnerships.
- Post-Secondary/Technical School Partnerships.
The final step in implementing upskilling is to continuously examine the success of the initiative. The most illuminating metrics for training programs are if the employees retain the new skills and can competently translate the training into action on the job.
The company must be able to map the development of key skills and track progress, preferably through a skills evaluation or annual appraisal program. Tracking skill development for each employee allows the organization to track people metrics at a granule level. These other metrics could include:
- Highest and Lowest Rated Skills (Those skills that your workforce is excelling in and those skills that could be considered critical key skills).
- Skills by Department or Team.
- Skills by Role/Career Path.
- Certification and Credentials Earned.
Now, you are positioned to track the growth of each employee, team, and role. This effort will support your retention efforts in building a competent, capable, and motivated workforce.
The Impact of Upskilling on Employee Retention
Upskilling creates a clear pathway to building best-in-class employers of choice. World-class learning organizations fill critical knowledge gaps, help employees be more capable, and, most importantly in today’s economy, increase employee retention.
According to 360Learning, a successful Learning Management System vendor, “successful upskilling programs prove that employees don’t need to job-hop between companies to advance their careers or change their career path.”
When companies focus on competency mapping and future-based skills development, the leaders have created an effective retention campaign focused on the following:
- Promoting a Continuous Learning Culture. Workers are encouraged to be lifelong learners and are motivated to seek opportunities and innovate.
- Reducing Skill Gaps. Employees will feel more confident in their roles, maintain interest, be motivated, and engage at work.
- Increasing Employee Productivity. Employees understand and receive communication concerning how their efforts impact the business. This understanding produces more confidence and engagement.
- Supporting Career Growth. Millennials and Gen Z prioritize career growth and are invested in companies that provide career mobility.
- Streamlining Succession Plans. Prioritization of career growth and skill development promotes internal movement, allows workforce development to be proactive, and keeps employees engaged.
Learn More About the Value of Upskilling
As you can see, upskilling is critical for the future success of the construction industry. We encourage stakeholders to develop and implement an upskilling program as part of a larger commitment to positively impacting the future of the industry by investing in craft workers.
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