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The Value of Upskilling for Small Businesses

Published December 1, 2022 (last updated on February 27, 2024) | Adam Wyatt - Content Writer


Car manufacturer Jaguar Land Rover has recently announced its ambitious plan to invest in a training program that involves upskilling 29,000 employees. This upskilling initiative is a significant step towards reaching one of the company’s business goals and achieving electrification by the end of the decade.

Jaguar Land Rover’s ‘Future Skills Program’ is the latest in a long list of examples of businesses responding to the needs of digital transformation, making a significant investment in the technical knowledge of staff, and using employee development as a competitive advantage.

Beyond maximising on a workforce’s capabilities, upskilling offers other valuable benefits. With a job market that’s more competitive than ever, offering upskilling and professional development opportunities is an effective way for businesses to stand out from the crowd.

In this blog, we’ll explain what upskilling is, why it’s important, and how can you use upskilling programs to optimise your current workforce and attract top-level talent.

What is upskilling?

Upskilling is a workplace initiative that provides employees with training programs and development opportunities. Upskilling focuses on expanding an employee’s capabilities, with the aim of closing skill gaps in a business.

Companies upskilling employees tend to focus on two core categories of skills:

  • Technical skills – Also referred to as hard skills, technical skills involve the specialised capabilities needed to perform job-specific tasks. Examples of hard skills include software engineering, graphic design and project management.

  • Soft skills – Soft skills complement technical skills and often revolve around an employee’s personal attributes. These include communication skills, listening skills, critical thinking, presenting their ideas and their ability to collaborate.

How can businesses upskill their employees?

There are many initiatives businesses can implement to help employees develop the new skills they need to thrive in their role. Upskilling opportunities can take the form of:

  • Internal training programs – Most companies will offer some kind of formal internal training. This can be completed in person or online via a learning platform. At the very least, the induction process for new staff should involve basic training addressing the company and role. Ideally, your upskilling strategy should focus on long-term professional growth and responding to your industry’s changing skills needs.

  • Funding for external training – When your company is not able to upskill an employee internally, you have the option to approve funding for them to attend relevant courses at external educational institutions. If time and travel is an issue, online courses are better than ever and offer industry-approved qualifications.

  • Mentorship programs – This is one of the most effective ways to capitalise on the existing skills within your business. By having inexperienced staff learn from employees with advanced skills, you can build your business’s capabilities and the bond between your employees.

The importance of developing new skills

Beyond individual businesses striving to nurture talent and remain competitive, there is a much broader reason why upskilling has become so important in the modern workforce. The global economy is now facing an urgent challenge – how can we equip employees with the skills needed to drive the industries of the digital economy forward? If businesses don’t act immediately, the skills gap will widen considerably.

Here are some key facts:

  • According to the World Economic Forum, half of all employees in the world will need reskilling by 2025.

  • A survey shows that nearly 40% of workers fear their job will become obsolete in the next five years.

  • 77% of workers are ready to learn new skills or are interested in completely reskilling.

  • Younger people are twice as likely as older people to get opportunities to improve skills.

These statistics highlight some of the main issues businesses face – the skill sets of the world’s existing workforce are largely outdate, staff are eager to develop new skills (but the training opportunities aren’t on offer), and older workers in particular seem to be lagging in chances to upskill.

Small businesses and professional development

As a small business owner, you may have limited resources and finances for upskilling efforts. You can’t compete with multinational companies with large budgets for upskilling and reskilling. How can you ensure you don’t lose out on talented employees?

  • Know your strengths – What can you offer employees? If you work in retail, consider letting your employees shadow other team members from different departments. As a small business owner, you can host workshops and training sessions for employees on different topics without too much expense.

  • Support your employees – If your employees want to upskill at their own expense, be supportive. Offer them flexible working arrangements to help them balance completing the course with their work commitments.

  • Be prepared – You need to be prepared for the potential hurdles you may face. How can you handle excess workloads if an employee chooses to enrol in a course or studies alongside completing their job? Is upskilling a necessity or luxury?

  • Stay ahead of skills trends – Follow organisations like the Institute for the Future for the latest forecasts on industry trends. Figure out what existing skills you have in your business and what you need. This will help you to plan your upskilling strategy and allocate your budget for maximum impact.

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The need for digital upskilling

The shift to online living throughout the pandemic led to surging demand for workers with a digital skill set. This trend is unlikely to change, with new technology constantly creating an additional need for up-to-date skills.

Currently, 87% of Australian jobs are now asking for digital skills, with 61% of the nation’s total future training needs assessed as being tech related. With the digital talent gap, the current demand among employers for digital skills heavily outweighs supply.

This means employees are keen to sharpen up their digital competencies and plug the skills gap. In fact, most will consider leaving a company if they don’t receive the professional development needed to thrive in the digital age. A study by UiPath found that 88% of employees would consider finding a new job if their current employer refused to facilitate digital training.

Upskilling programs and improving employee engagement

The same UiPath study reveals that more than four in five workers wish their employers would offer more opportunities for acquiring skills.

Modern employees no longer want to upskill only on a basis of need. Instead, many workers are motivated by the concept of constant development and lifelong learning.

Learning new skills not only enables employees to excel in their current role, but also allows them to remain competitive long-term. Constantly adding to their existing skill set is the most effective way for them to future-proof their career against changes in the industry.

Employees who aren’t offered enough opportunities to develop new competencies may begin to feel stagnant in their role and could eventually seek out a different job that offers more scope for career development.

Offering your staff plenty of upskilling and training opportunities shows your dedication to their career progression, which in turn can improve employee engagement and employee retention rates.


Ultimately, if you want to attract, develop and retain the best talent, you’ll have to offer upskilling and professional development opportunities. If your business doesn’t give employees the chance to develop new skills, they are likely to seek out other job opportunities that offer better prospects for long-term growth.

If you’re unsure about the opportunities you offer, it might be time to talk to your employees and establish if their ambitions are being matched by your professional development programs.

Depending on the feedback, you can review your upskilling strategy and help staff develop the skills they need to grow your business. For you and your employees, it will be a win-win scenario.

Employsure has worked with thousands of businesses across New Zealand in matters of employment relations and work health & safety.  Call our FREE 24/7 Advice line today to get all your questions answered.

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