As changes to work accelerate, employers are bearing witness to a fundamental shift away from the linear transitions made by workers in previous points of history from school, into specialized training, into work and then along a progressive career ladder, defined by increasing responsibility within an established occupation structure. In today’s labour market, workers pivot between professions with significantly different skill sets, and navigate mid-career job transitions accompanied by substantial reskilling and upskilling. Those pivots are as important to the success of firms as they are to the prosperity of workers. Without such pivots skills shortages will remain endemic and a scarcity of adequately skilled individuals to fill the jobs of tomorrow will lead to a persistent productivity lag.

The route to unlocking the value of human potential in tandem with profitability is to employ a ‘good jobs strategy”—halting the erosion of wages, making work meaningful and purposeful, expanding employees’ sense of growth and achievement, promoting and developing talent on the basis of merit, and proactively designing against racial, gender or other biases.⁴⁹ Fundamental to this strategy are two inter-connected, ambitious priorities which, between them, have the power to pave the way to a better, more productive and more rewarding future of work: 1) increasing company oversight of strategic people metrics; 2) effective job transitions from declining to emerging roles through well-funded reskilling and upskilling mechanisms.

There is an emerging consensus among companies that long-term value is most effectively created by serving the interests of all stakeholders. Companies that hold themselves accountable will be both more viable and valuable in the long-term. To do so, companies need a series of new metrics which can, at the Board and C-suite level, make visible the impact companies have on key desirable outcomes to governance, planet, people and prosperity.⁵⁰

In collaboration with the International Business Council (IBC) the World Economic Forum has defined a set of key metrics which can track how businesses are creating broader, long-term value through an investment in human and social capital. People are at the heart of all organizations as investors, workers, customers, suppliers, distributors and contractors. The well-being, productivity and prosperity of individuals is at the core of all successful economies and firms. Human ingenuity is at the core of companies’ competitive advantage and no firm can prosper for long if it proves damaging to the social fabric around it. In the framework outlined within the paper Measuring Stakeholder Capitalism, the Forum in collaboration with the IBC have identified a set of key measures that track: the representation of employees by age group, gender, ethnic and racial category and other markers of diversity; the pay equity between those different groups; the wage levels paid within the organization as a ratio to local minimum wage and the ratio of CEO pay to median employee pay; hours of training undertaken by employees; and average training investment by company. In addition to these core measures the report outlines basic standards of good work such as ensuring health and safety, as well as eliminating child and forced labor.⁵¹

To complement such key oversight metrics, businesses can benefit from more granular operational metrics which quantify the human capital—the skills and capabilities of employees—within an organization. Currently, business leaders lack the tools to adequately illustrate, diagnose and strategize for talent capacity. While businesses and economies have extensive systems to account for monetary assets at their disposals, there is a lag in establishing the value of human skills and capabilities. The losses incurred by talent attrition as well as the gains of acquiring individuals with exceptional skills or of developing talent pools through strong reskilling and upskilling programmes remain unrecorded and unobserved.

Companies without the tools to account for the value of skills and capabilities lack oversight of the depreciation or appreciation of one of their key intangible assets—the capabilities of their workforce. Without that oversight, setting the right investment strategy for reskilling and upskilling becomes a challenging feat. A recent World Economic Forum report, authored in collaboration with Willis Towers Watson, Human Capital as an Asset: An accounting framework for the new world of work, identifies additional areas of measurement that can start to quantify the value of human capital within an organization.⁵² In the outlined framework are the labor market value of the aggregate talent in an organization, the value added through additional reskilling and upskilling into job-relevant skills and the depreciation of those assets through gradual skills redundancy and a decrease in workforce engagement. The approaches to undertaking this quantification are in their infancy and there is need for further efforts to expand such efforts.

Frameworks to track the value of human capital in company balance sheets, to determine a re-investment strategy for human capital through redeployment, reskilling and upskilling, as well as to account for return on investment remain nascent. It is therefore not surprising that few Future of Jobs Survey respondents expected a return on investment from reskilling and upskilling workers within the first three months after employees complete reskilling, and that 17% of businesses remain unsure about the return on investment from reskilling. Survey responses also indicate that companies continue to struggle to quantify the scale of reskilling and upskilling investment that their companies currently make.

The Future of Jobs Survey signals that companies hope to internally redeploy 50% of workers displaced by technological automation and augmentation, but cross-cutting solutions and efficiencies for funding job transitions remain under-explored. Amidst the accelerated arrival of the automation and augmentation of work, as well as the job destruction brought about by COVID-19, businesses require a fast, agile and coherent workforce investment strategy. In collaboration with the leaders engaged with the New Economy and Society workat the World Economic Forum we have been able to identify a set of key elements of a successful workforce investment strategy. They include identifying workers who are being displaced from their roles; establishing appropriate internal committees to manage the displacement; funding reskilling and upskilling either wholly out of company budgets or by tapping into government funding; motivating employee engagement in this process; and tracking the long-term success of such transitions.

Company leaders can ensure the success of workforce strategies by directing the transition of employees with empathy, within the rule of law, in line with company values and culture, by ensuring outcomes are equitable, and by directing learning to effective resources and meaningful curricula. A range of motivating factors can fuel reskilling and upskilling uptake—connected broadly to employees’ sense of purpose, meaning, growth and achievement. Employers can signal the market value of new online-first credentials by opening up role opportunities to new cohorts of workers who have completed mid-career reskilling and upskilling. Employers can make broader use of hiring on the basis of potential rather than current skill sets and match potential-based hiring with relevant training. The data featured in this report has shown that a number of emerging roles are already staffed by individuals who first transition into those positions and then ‘grow into’ the full skill set required. As an overarching principle, business leaders need to place equity and diversity at the heart of their talent ecosystem, ensuring that employees believe in their capacity to prosper based on merit.

Expanding effective workforce strategies requires strong capabilities in real time, as well as dynamic mapping of the types of opportunities that remain available to workers displaced by the COVID-19 pandemic and the fast pace of automation. A set of technology companies which are broadly classed as EdTech and reskilling services companies can support the process of redeploying workers into the jobs of tomorrow.⁵³ Such companies utilize advanced data and AI capabilities matched with user interfaces that guide workers and managers through to discovering possible pathways into new job roles. The data featured in sections 2.2 and 2.3 already indicates the types of insights that can be accessed through such services—dynamically matching opportunities to workers, identifying possible job destinations and singling out bridging skill sets. Companies with such capabilities can become part of a new infrastructure for the future of work which powers worker transitions from displaced to emerging roles. The efforts of matching workers to possible opportunities can be complemented by the delivery of reskilling and upskilling at scale through educational technology services.

Finally, the necessary reskilling and upskilling demands substantial attention and broad-base systemic solutions to funding the job transitions which the current labour market context requires at an unprecedented pace and scale. As shown in Figure 37, the Future of Jobs survey shows that 66% of businesses believe they can see return on investment within a year of funding reskilling for the average employee. It remains concerning, however, that the survey also reveals that only 21% of businesses report being able to make use of public funds, and merely 12% and 8% collaborate across companies and within industries, respectively. Previous estimates have shown that businesses can independently reskill some employees with positive return on investment; however, the employees who are most disrupted and with the largest need of reskilling are likely to need a larger investment.⁵⁴

This report calls for renewed efforts to understand the division of spend on reskilling and upskilling workers between business and the public sector. A typical return on investment framework considers the costs on the side of both businesses and governments under various scenarios—such as the extent of training costs, the cost of employees taking time out of work, and the need to pay unemployment benefits. On the benefits of reskilling and upskilling workers, a calculation takes into account avoided severance and hiring costs borne by business, the avoided lag in productivity when onboarding new employees and the additional productivity of employees who feel supported and are thriving. Additional benefits to governments include the income tax dividends of citizens who are employed as opposed to out of work.

A number of companies have in recent years experimented with a range of approaches to reskilling and upskilling. The role of business in such a programme can be to directly drive such efforts and define the approach to reskilling and upskilling. In other cases, businesses can be in a supporting role, agreeing to redefine their approach to hiring and accept candidates who have been reskilled through new types of credentials. In one example, Telecommunication company AT&T has worked with Udacity to create 50 training programmes designed to prepare individuals for the technical careers of the future which are distinctively relevant to AT&Ts future workforce and digital strategies.⁵⁵ In particular, these strategies include courses focused on skills in web and mobile development, data science and machine learning. To date AT&T has spent over $200 million per year to design this internal training curriculum, known as T University, and has already achieved over 4,200 career pivots with 70% of jobs filled internally by those that were reskilled. In a similar effort, Shell launched an online education effort titled the Shell.ai Development Program, which focuses on teaching artificial intelligence skills to its employees.⁵⁶ Both programmes have created customized versions of Udacity’s Nanodegree programs to reskill and upskill employees with hard-to-source, in-demand skill sets.

An additional example is provided by Coursera for Government.⁵⁷ At the start of the COVID-19 pandemic, a number of countries experienced a surge in unemployment. Governments in over 100 countries provided access to the platform to citizens looking to gain new skills and credentials to re-enter the workforce. The programmes connected graduates directly with local companies who agreed to accept those credentials as the basis of hiring decisions. Since April, this programme has reached 650,000 unemployed workers who enrolled in over 2.5 million courses that provide the skills needed for fast-growing jobs in IT, healthcare and business. In one example, Costa Rica’s government has worked with local employers across the country to identify current job openings and skill demand and tailored the programme offering to that local demand. Similar structures of collaboration have been established across local government in the United States, specifically across a network of job centres.