CEOs Focus on Upskilling their Workforce

79% of CEOs worldwide are concerned that a lack of essential skills in their workforce is threatening the future growth of their organisation, according to research by PwC. This compares to just 63% in 2014, confirming that concern over skills has risen in line with the advent of new technologies over the past five years.

The PwC report finds that a lack of skills is a key concern in all regions across the world. CEOs in Japan (95%) and Central and Eastern Europe (89%) are the most worried, whereas their peers in Italy (55%) and Turkey (45%) are the least anxious about skills. Of those who are most worried, 55% say their business is not able to innovate effectively as a result, and 52% that it is pushing up their people costs faster than expected.

The survey finds that CEOs are shifting how they fill talent gaps. 46% say significant retraining/upskilling is the most important initiative to close a potential skills gap, against just 18% who say it’s hiring from outside their industry. This is in contrast to previous years’ surveys, which have shown CEOs exploring the idea of hiring from other sectors, particularly industries that are further along the innovation journey, and using ‘gig economy’ workers.

This focus on reskilling resonates with employees according to PwC research. A global survey of more than 12,000 workers found that employees are happy to spend two days a month on training supplied by their employer to upgrade their digital skills. This refocusing on upskilling is taking place against a background of rising use of automation and artificial intelligence (AI). While these technologies will inevitably displace some workers, CEOs’ opinions vary on the scale and speed of that shift.

What’s clear is that investment in digital upskilling is just one part of what’s needed to create the workforce of the future, because engaging workers to acquire new skills also requires a strong learning culture to be inextricably woven into a high-quality workplace. To create good work, organisations will need high-quality workforce data and while 86% of CEOs say the right people data is vital, only 29% believe the data they currently receive is adequate.

CEOs are also aware that automation’s impact on the workforce has implications for public trust. Half of the respondents see a lack of trust in business as a threat to growth and they know that how they handle automation will publicly test that narrative. In light of this, CEOs are divided on where the responsibility for workers displaced by automation and AI should fall: 66% believe government should provide incentives for the development and use of AI, while 56% think it should provide a safety net for displaced workers. This debate clearly has much further to run.