Nearly two-thirds (60%) of talent managers across Europe claim that the high turnover of young people and the inability to find people with the right experience and skills to replace younger leavers is their biggest barrier to solving the skills shortage.
According to the 2023 Global State of Upskilling and Reskilling Report more than a third (38%) of companies surveyed across the UK, France, Germany and the US said losing the knowledge of the older generation when they retire was highly problematic. This problem was most pronounced in the UK among 48% of respondents.
In France and the US, finding enough new hires with the right competencies was cited as the most overwhelming skills challenge, found the study from learning platform 360Learning.
The data shows that these problems are exacerbated by companies finding it hard to upskill and reskill their employees fast enough when both young and old people leave. In fact, the loss of knowledge from departing staff members was seen to be more impactful to UK businesses than the monetary cost of replacing those members.
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In the US and France, significant staff turnover was said to be demotivating for those left behind, while in Germany, the cost and delay of trying to fill roles made vacant by staff turnover was the biggest problem cited by managers. Employees who struggled to see where their next move with their company might come from, were more inclined to look externally for a new job, the report shows.
Across all of the countries surveyed, a quarter of talent teams prioritise internal hiring over bringing people in from outside. In the UK, US and Germany, talent teams were predominantly taking a 50:50 approach to internal and external hiring, while there was a slight preference for external hiring in France.
When asked how effective their organisation had been in upskilling them, almost two-thirds of respondents described it as inadequate. More than half (58%) said that the sharing of knowledge between more experienced colleagues when they moved internally, was “well-meaning – but full of gaps.”
The report authors pointed out that research by LinkedIn has shown that employees are more likely to stay at companies that invest in their learning long-term, demonstrating the positive impact that implementing upskilling/reskilling initiatives can have on workforces.
David James, chief learning officer at 360Learning, said: “The skills crisis is putting significant pressure on businesses of all sizes with the loss of internal skills and knowledge, whether from high turnover among younger employers to baby boomers retiring and the inability to hire skilled talent. As a result, the demand for talent is far outstripping supply.
“To rectify this, employers need to create a culture of continuous learning and give their teams the tools and opportunities to advance their skills. In this way, they can build resilient and adaptable workforces without having to resort to lengthy, expensive hiring processes.”
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