How to fill the widening skills gap

Skills gap

Over the next five years, machines and algorithms are projected to take on more tasks that humans perform on the job worldwide, but demand for new skills and the emergence of new professions are expected to offset the declining number of jobs, research by the World Economic Forum suggests.

But businesses, governments, and other stakeholders must quickly come up with strategies that benefit the workforce or they may be forced to respond to developments largely out of their control, according to a World Economic Forum survey of chief human resources officers and CEOs at leading global employers. Respondents to the 2018 survey represented 15 million employees across industries.

Here are some key drivers of the changes affecting labour markets worldwide:

  • Technological advances, such as artificial intelligence, robotics, machine learning, and ubiquitous high-speed mobile internet, will promote automation, boost efficiency, and support new business models. Nearly 50% of organisations surveyed expect that automation will lead to some reduction in their full-time workforce by 2022.
  • Adoption of technology will accelerate. By 2022, 85% of respondents expected to adopt big data analytics, 73% expected to adopt machine learning, and 45% expected to adopt blockchain technology.
  • The geography of production, distribution, and value chains will change. More than half (59%) of respondents expected to significantly modify how they produce and distribute their products and nearly half expected to modify where they operate over the next five years.
  • Skills required to perform a job will shift significantly. More than half (54%) of employees represented in the survey will require new skills by 2022. Proficiency in new technologies will be in increased demand, as will human skills such as creativity, critical thinking, complex problem-solving, emotional intelligence, and leadership.

The report estimated that 75 million jobs will be displaced by automation, while 133 million additional new roles could emerge in large multinational companies. Complementary trends are expected in small and medium enterprises.

Any workforce strategy to prepare a business for the changes should be led and informed by the business’s objectives and road map for digital transformation, said Jacky Carter, group digital engagement director for strategic partnerships at recruitment firm Hays. That would allow for existing skills to be inventoried against those required in the future and a skills gap analysis conducted over a transition period while skills and operational change evolve alongside.

“The most successful organisations, in my view, will be those that pull change towards them rather than those that try keeping it at bay,” Carter said.

Creating a reskilling plan

Organisations first need to understand where automation can be applied, said Jodi Chavez, group president at Randstad Professionals, Randstad Life Sciences. These efforts should be directed towards minimising the highest volume but least impactful operational tasks so professionals can focus on higher level, strategic work.

The next step would be to map out the impact on specific roles. Automation may free up a percentage of time in some roles, or eventually eliminate others. The third step would be the critical one of looking at organisational gaps and demands to understand how people will need to be upskilled and redeployed, said Chavez.

More than half (54%) of employees will require reskilling and upskilling, according to the survey. One in ten will require training of more than a year. Nine per cent will require reskilling programmes between six to 12 months in length, while 35% of employees will need training of less than six months.

Also, while it may be easier to reassign employees with higher levels of education to value-added work, those in jobs such as cashiers and sales staff in the retail sector may need broader initiatives such as cross-industry collaborations to reskill and find new roles. The involvement of external stakeholders such as educational institutions, labour unions, and governments in such efforts should not be underestimated, the report said.

The most significant shift, according to Carter, will be the change towards job types and skills rather than job titles. Roles will need people to be much more fluid and flexible, and to possess creativity and emotional intelligence. Paradoxically, coding and knowledge of technology will remain a very important skill in an increasingly automated world.

Across regions, the availability of skilled local talent is the topmost factor that attracted employers, followed by labour costs. Reshoring to advanced economies due to automation may be offset by domestic consumption in emerging ones, the report anticipates.

Stakeholders should work on making the business case for investment in workforce transformation, the report recommended. Given the shifting scenario, businesses should also focus on transforming themselves into learning organisations that leverage technology to augment current roles to create greater value and maximise employee potential. Multi-stakeholder cross-sector initiatives are crucial as the changes are sweeping.

According to Chavez, as automation becomes widely adopted, business leaders and HR need to take a very hard look at what truly differentiates their organisations. As data and automation become more of a commodity and all businesses have the same edge on efficiency, it is the human element and service that will become chief differentiators.

Establishing a trademark approach and ensuring the workforce is ready to add that value on top of technology will be key for businesses to come out the other side of this disruption successfully, Chavez said.

Shilpa Pai Mizar is a freelance writer based in the UK. To comment on this article or to suggest an idea for another article, contact Sabine Vollmer, an FM magazine senior editor, at