presents
THE FUTURE OF SKILLS:
Conversations and Insights on 21st Century Skills
Work is changing on a seismic scale and a huge portion of the workforce is going to need reskilling in the next 5-10 years. In the next few years (by 2025 in fact), the World Economic Forum estimates that 50% of all employees will need reskilling.
This shift is driven not only by automation and digitization, but by a reevaluation of which skills, credentials, and experience are most valuable. With this shift, we are witnessing the emergence of a skills-based labor market that represents a significant change in how employers evaluate workers and how workers navigate the need to periodically reskill in order to thrive and compete in the workplace. AARP Research shows that 66% of employers say their organization needs to place even greater emphasis on skills and less on education in the future – but making this change is not easy.
The way forward must be inclusive of workers of all backgrounds and leave no room for outdated myths and biases that have stymied inclusivity in the past. A skills-based labor market has the potential to address inequities in access to opportunity, and to counteract biases such as ageism in addition to other forms of discrimination. Workers that possess the skills a company needs should be evaluated on that basis, whether they are in the middle, toward the end, or just starting their career.
Key Trends
As the way we work changes, the following are the key trends we are seeing regarding the future of skills.
In 2019 at an American Workforce Policy Advisory Board meeting at the White House, Tim Cook noted that Apple was moving away from requiring degrees for many of its open positions. The shift away from the traditional four-year degree comes from the emergence of new opportunities for skills training and an employer preference for demonstrated, rather than assumed, skills. While four-year degrees remain valuable in the hiring process as a proxy for broad categories of knowledge and general intelligence, employers and businesses are thinking more about additional ways workers acquire in-demand skills.
To learn more about this shift, Heather Tinsley-Fix sat down with Humana Chief Inclusion and Diversity Officer, Carolyn Tandy. Humana is a health care company that offers a wide range of insurance products and health and wellness services that incorporate an integrated approach to lifelong well-being.
Insights for Employers: Building a Framework for the Future of Skills-Based Hiring
The trend toward skills-based hiring or a skills-based labor force was already emerging prior to the pandemic, but in some ways the pandemic caused that shift to accelerate, as workers used enforced time off to re-evaluate where they were headed and explore how to upskill to get better jobs. The so-called “Great Resignation” left employers scrambling for talent (a trend that continues), necessitating a much sharper focus on the skills required for any given job, rather than on traditional or “nice-to-have” credentials. At the same time, employers have begun think about their own reskilling and development initiatives to give themselves a competitive edge in the search for new (and existing) talent.
- There is a lot of talent in the workforce today. To capture it, employers will need to hone in on the skills and competencies the business needs to compete. It will be up to employers to ensure that their hiring managers and recruiters understand the actual value that different degrees, credentials, and certifications bring to the jobs they are hiring for. This takes legwork, and collaboration with other groups. There are many non-traditional routes to gaining new skills and knowledge, whether it is apprenticeship or bootcamp programs, military training, or on-the-job learning. Employers must start digging into these alternative routes to understand them at a deeper level.
- Employers and hiring managers also need to consider how skills can be transferred or applied to roles within their company. This is especially true in fields where skills can be more valuable than a college degree, such as in consulting work, project management, or information technology.
- While employers remain heavily focused on how best to achieve their business goals, putting the infrastructure in place to reskill their existing workforces can help them. Reskilling workers makes their own workplaces more competitive and more attractive to prospective employees, and can be cheaper than only hiring new talent.
“There are so many ways we can think about the benefit of skills-based hiring differently, and this is the future…The future will balance this way of thinking so that we’re able to attract a wide net [of talent].”
- Carolyn Tandy, Chief Inclusion and Diversity Officer, Humana
Deciphering Credentials as Proof of Skills
Skill landscapes are shifting fast; sometimes faster than educational systems can keep up. There is no one-size-fits-all approach to getting the workforce trained in the new skills and roles needed to propel businesses forward. Traditional education systems for the most part have provided discipline-based education, which took years to complete. New education models are emerging which provide skills-based training and take only months (if not weeks) to complete.
Deb Everhart, Chief Strategy Officer at Credential Engine discusses the rapidly changing skills landscape with AARP’s Heather Tinsley-Fix. Credential Engine is a nonprofit whose mission is to map the credential landscape with clear and consistent information.
Insights for Employers: Decoding the Credential Marketplace
The rapidly shifting skills landscape has resulted in an explosion of credentials, certifications, and other trainings across thousands of vendors generally without standards or quality assurance. How do employers evaluate these credentials when they appear on a job candidate’s resume? Additionally, how can employers play a more hands-on role in shaping the curriculum that provides such credentials – either to reskill their existing workforce or develop a pipeline of talent?
- The credential landscape is vast, with over 1 million available credentials in the U.S. alone. The sheer scope of offerings coupled with the lack of recognizable standards or accrediting bodies often leaves employers and workers alike feeling confused about the content and the credibility of many credentials. Some employers have formed partnerships with community colleges, workforce development boards, or other institutions to inform and even shape trainings and curricula to better reflect the skills they are hiring for.
- Establishing clear standards and furthering transparency are key to promoting credentials as an avenue for skill development. Vendors, educational institutions, standards bodies, professional associations and employers need to work together to help bring clarity to the marketplace. Knowing what a credential includes, how long it takes to complete, how the students are evaluated, and whether (or how often) they need to re-certify will go a long way to helping employers include valid credentials in their hiring processes.
- The increase in job task automation and digitization has led to a demand for emerging “hybrid” skills, but it has also increased demand for soft skills such as critical thinking, communication, interpersonal skills, persuasion, resilience and curiosity. These uniquely human skills are generally learned over time and through on-the-job experience, which is why an age-diverse workforce is valuable as it represents a breadth of life experiences. These skills are also difficult to codify and are not well-represented within the credential landscape.
“Almost all jobs are going to require some range of technical skills [such as digital literacy]...but those are going to constantly change, so we actually need multiple types of credentials to address different skills gaps.”
- Deb Everhart, Chief Strategy Officer, Credential Engine
Skills as the New Business Currency
Automation and digitization are contributing to huge shifts in the types of skills businesses need to compete and succeed. These two trends are ushering in an evolution of how we view “the job” as a unit of work in tandem with the other parts of our lives. Evaluating what portions of an organization’s activities can be automated or digitized requires breaking down existing jobs into programmable tasks, which in turn focus our attention on skills at a more atomized level. To further discuss this shifting landscape, AARP’s Heather Tinsley-Fix sat down with Ben Eubanks, Chief Research Officer for Lighthouse Research & Advisory, a human resources research and advisory organization.
Insights for Employers: Cashing in on the New Business Currency
Skills are the new business currency. The ability to understand which ones are needed and then hire for or retrain existing employees in those skills has to be central to how businesses think. The high cost of turnover and the speed with which skills needs are changing mean that reskilling the existing workforce will often be cheaper than continually hiring.
- Many employers are finding that they struggle to fill skills gaps within their organizations. They struggle to both identify this challenge and solve it (i.e., Is it a challenge of filling a role, or reskilling existing talent?). If employers can solve the skills gaps within their workforces, they will be much better equipped for growth and taking care of their business and workers.
- Regardless of age, the number one thing that people want are opportunities and experiences to learn new skills. When it comes to older workers (those aged 50+), they are the most likely to take responsibility for learning new skills compared to different age groups. As we know, the workforce and the skills landscape is rapidly changing, and the demand for new skills is growing. It can be more costly for employers to hire new workers to fill skills gaps than to re-skill their existing workforce, especially in more specialized fields. With that said, employers should learn to leverage their older, more experienced workers who want to learn new skills as opposed to always searching for new hires.
- In a world where automation is increasingly becoming more prevalent, soft skills, or human skills, will become a focal point of what we do. The World Economic Forum recently released its Top Skills for 2025 list. It includes skills critical thinking, creativity, resilience, and reasoning. Each of these skills are inherently human skills that cannot be automated, and the values of these skills will only increase exponentially as more tasks are automated.
“Overall, the number one thing regardless of age that someone wants is an employer that gives them chances to learn new skills and provides experiences to learn…when we look at the age 50+ bracket, we find that this age demographic is much more likely to feel responsible for learning new skills.”
- Ben Eubanks, Chief Research Officer, Lighthouse Research & Advisory
Here’s What You Can Do
To learn more about the Future of Skills and the work that AARP is doing, read through the steps below:
- Stay connected: Bookmark this site as we will be adding additional speakers throughout the year.
- Suggest a speaker or topic: Email AARP@publicprivatestrategies.com
- Learn more: www.aarp.org/employers
This page was proudly developed in collaboration with AARP by the Public Private Strategies Institute team. For more information or questions, please reach out to AARP@publicprivatestrategies.com.
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