By Jolly Wong
In 1997 the term “war for talent” was first coined by Steven Hankin of McKinsey and Company. Hence it is not a new phenomenon that demand for highly qualified employees is outstripping supply. The situation has become even more urgent in 2022 because birth rates have been declining and the workforce has been aging. So if it’s so difficult to find the right talent and win the war, what about keeping the talent you have?
In this article I want to investigate if upskilling the workforce is a workable solution for retaining staff and attracting new talent. How can it create a landscape in which both your business and employees can flourish?
In a nutshell, upskilling the workforce makes the business case for providing employees with learning and development opportunities to expand their horizons while minimizing skills gaps. Attracting the best talent starts in-house because they understand the culture and command respect. For an employee to leave an organization, apart from strong personal reasons, it may be because they feel underappreciated, stuck, or unfairly treated.
More than 50 percent of the respondents in the 2021 KPMG CEO Outlook Pulse Survey [1] rated workplace flexibility in terms of skills and resources for career development as critical. Therefore, providing additional training and demonstrating a culture of learning through the organization cannot only map out a pathway of progression for current employees, but also help to attract new talent. Fortunately, digitization provides an array of tools that can help in the learning and development process. AI-driven learning platforms, psychometric assessment, and predictive performance can all come in handy.
The current skills shortage is primarily affecting trade sectors. According to the JobsDB survey and data in Q4 2021[2], the three most in-hot-demand sectors in Hong Kong, probably true in the US, are IT, banking & finance services, and corporate sales and business development. But what is causing the skills shortage in these specific sectors?
IT, for example, has been suffering from labor shortages for a long time, with peaks during the pandemic. There are several reasons for that. First of all, Hong Kong has a small talent pool and thus faces shortages in cutting-edge IT areas such as cybersecurity, cloud computing, or data science. Next, the ongoing pandemic restrictions have served as a double whammy by keeping foreigners away while locals mull migration. Finally, more companies have become committed to digital transformation as a means of navigating the challenges faced during the pandemic, driving the soaring demand for IT talents.
Taking banking and financial services as another example, the development of virtual banking, e-payment and FinTech businesses in financial institutions greatly increased the demand for IT job functions, and even led to a 58 percent growth in the number of virtual banking-related job advertisements compared with the same period last year, according to the same JobsDB survey [2]. However, most banking employees aren’t trained to operate such technology, especially those who have decided to make a switch to embrace digital.
The current talent shortage calls for upskilling both hard and soft skills. Companies are increasingly demanding candidates with hard skills in emerging tech (proven by technical certificates and programming courses) – but also candidates with the soft skills to implement new processes, and to work in tandem with technology experts to optimize customers’ experience.
While a few years ago the recruitment focus might have been on hard technical skills, now soft skills are seen as essential, which makes the market more competitive, and the talent shortage even more acute. Although this situation is challenging for businesses, employees, and the economy, it presents an opportunity to rethink your business model and upskill your current workforce. In the long run, you will have valued employees that are trained to the best of their abilities and with a clear future in your organization.
Digging Deeper
[1] KPMG, “2021 CEO Outlook Pulse Survey,” 29 Jul 2022 [Online]. Available: https://home.kpmg/dp/en/home/insights/2021/04/ceo-outlook-pulse.html
[2] JobsDB Hong Kong, “JobsDB Survey and job ads data in Q4 2021,” 24 Jan 2022 [Online]. Available: https://hk.jobsdb.com/en-hk/wp-content/uploads/sites/2/static/pressrelease/2021/220124_YOY_PR_ENG.pdf
About the Author
Jolly Wong is a consultant, strategic adviser to boards on innovation and technology, cybersecurity, digital transformation and ESG data. He is also a Visiting Professor for the Beijing University of Posts and Telecommunications, the Shanghai University, and a Policy Fellow for Center for Science and Policy (CSaP) at University of Cambridge. Please contact him via his Email.
