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Talent Management Performance Management

Reskilling vs. Upskilling: What's the Difference?

April 4, 2023
4 min read

Total Talent Management System: Buyer's Guide


The pandemic kicked off a persistent labor shortage — more than 50 million people quit during the Great Resignation. Today, labor force participation is at just 62%, and 87% of companies expect to face shortages over the next few years. And there’s a mismatch between available talent and open jobs, meaning businesses are having a hard time hiring new employees with the right skills.

To beat the trend, many companies are investing in their employees with upskilling and reskilling, additional skills training that enables them to grow in your organization or fill skills gaps. Upskilling and reskilling initiatives also contribute to higher retention. 94% of employees said they’d stay at their company longer if it invested in their professional development.

Learn more about the difference between reskilling and upskilling, their benefits, and how to use them both to improve your talent management strategy.

How is your company dealing with the talent shortage? Find out how #upskilling and #reskilling can help attract and retain workers:

What is Upskilling?

Upskilling is when employees expand on their existing skill sets so they can take on additional responsibilities, earn promotions, and grow in their areas of expertise. Upskilling programs are for employees that have high leadership potential, are high performers, or have specific career goals.

Employees who want to work in leadership positions or who are following set career paths are good candidates for upskilling initiatives, which include:

  • Employee mentoring or coaching
  • Workshops or training to grow soft skills
  • Earning advanced degrees or certifications

What is Reskilling?

“HR leaders will continue to invest in talent because they’ve learned the lessons of not investing – your best folks always have options as to where to go.”
- Joyce Heckman, Vice President of Talent Development at AJ O’Connor Associates via HRD

Reskilling is when employees learn new skills which may or may not be directly related to their current roles. Reskilling occurs most often when roles become obsolete due to automation or are at risk of automation and during talent shortages when skilled labor is hard to find. It helps employees maintain relevant skills as the world of work changes and helps your company stay competitive.

Reskilling enables employees to learn “adjacent” skills or receive training for a new role in the company altogether.

Examples of reskilling include:

  • Technical skills training
  • On-the-job training or apprenticeships
  • Moving employees laterally to new departments where they’re a better fit or to fill skills gaps

Upskilling vs. Reskilling

The main difference between upskilling and reskilling is the outcome — strengthening the skills employees already have or equipping them with brand-new skills. Upskilling often results in upward movement within a company, while reskilling typically leads to lateral movement.

Do you know the difference between upskilling and reskilling? Compare the two and find out how they benefit employees:

There are tons of overlapping benefits of upskilling and reskilling and both are important components of talent management strategy. These are a few of the benefits of upskilling and reskilling:

  • Helps avoid layoffs when roles evolve
  • Increases in employee productivity
  • Saves on recruitment costs
  • Strengthens your employer brand
  • Cultivates an agile, innovative workforce
  • Creates leaders who have a wealth of company knowledge

Access to development opportunities is one of the best ways to reduce turnover, increasing job satisfaction for 71% of employees and showing them that your company wants to keep them around long-term. Development programs promote a culture of learning and innovation, help motivated employees grow, and attract applicants with the same mindset.

Talent Management Software Supports Upskilling and Reskilling

If the talent shortage hasn’t already impacted your business, it very likely will in the next decade. One study reports that by 2030, there will be a global shortage of 85 million workers. According to Deloitte, 73% of business and HR leaders surveyed agreed companies are responsible for employee development. Your organization’s need for upskilling and reskilling isn’t a matter of if, but when.

Your talent management plan must include developing or retraining your employees so you can spot and fill skills gaps, stay competitive in the talent market, and grow your business. Support an employee-first strategy with a robust end-to-end talent management solution.

ClearCompany Talent Management software is equipped with the features you need to recruit, develop, and retain your top talent. Evaluate employee performance fairly, identify good candidates for upskilling or reskilling, and find out what sets your A-players apart so you can keep hiring more of them.

Sign up for a personalized demo of ClearCompany Talent Management with one of our experts today and ask about how our software tools can help you identify high performers, help them grow, and hire candidates with the same potential.

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