News & Analysis

Why Aren’t Managers Shifting from Hiring to Training?

The ever-widening skill gap in the IT and IT-enabled enterprises could cascade into a global crisis if managers do not take this call soon

Experts have repeatedly reiterated the broadening skills gap and how it could result in the top-1000 enterprises in the world cornering the best and those immediately after, leaving the rest of the field gasping for the talent required to spur operational efficiencies and growth. 

It is an open secret that MSMEs in India are the worst hit when it comes to talent acquisition, both at the campus recruitment stage as well as through an employee’s lifecycle. The best talent gets sucked out directly from campuses and those in queue immediately thereafter get pulled out post a couple of years in their first jobs. 

And, if this isn’t enough, the SMBs have a grouse against their larger counterparts, who seldom think twice before poaching good and trained hands from these small enterprises by offering a better pay package. All of this brings us to the question of how and where can managers begin to fix this issue? 


The traditional approach

The traditional approach at filling gaps is losing effectiveness. A McKinsey study conducted prior to the pandemic-led lockdowns said nine out of ten executives and managers said their organizations either face skill gaps already or expect them to develop over the next five years. But, the catch is that respondents felt their companies do consider it a priority but most have little understanding on how to equip themselves with workforce skills they will need most. 

The modus operandi in vogue among enterprises to build that super tech team is to hire developers, cloud specialists and cybersecurity experts through the direct hiring route. While this may work in tenured and large enterprises with big pockets, the process hasn’t succeeded at all with others. In fact, TCS added over 35,000 employees in a single quarter to counter the high rate of attrition they witnessed in 2022. The same was the case with Infosys. 


Hitting the wrong buttons

A recent report said 40% of tech employees claimed that lack of growth room caused them to quit their jobs and most claimed that acquisition of skills were also curtailed. In fact, 87% of the 7000 respondents contacted for the Pluralsight State of Upskilling 2022 said they actually wanted to improve their technical skills. 

If this isn’t an opportunity for employers to secure their teams and keep salary costs in check, what is? The report highlighted that skills not only help people stay, but also aids them in thriving in their roles while ensuring that organizational objectives continue to be delivered seamlessly. 

However, there is a fly in the ointment. The same survey also claimed that over 60% of the respondents felt that they were too busy with their daily chores to be able to dedicate time for any upskilling. And this is where managers and executives perhaps could play a more important role than to just send out job descriptions to the HR when a team member wants to sign out. 


There are tangible benefits 

The upskilling and training programs for existing staff brings clear benefits to the organization. The first of them is that it helps employers bridge the shortages in their teams. And on the other hand it also ensures that team members with the additional skills feel confident of career progression, a crucial factor that they consider while weighing external opportunities. 

The lack of time for skilling that employees speak about also indicates a shortage of staff or of the right skills. Which is probably why employees find themselves stretching to cover for their daily operations. Of course, the continuously declining L&D budgets is what managers refer to when asked why they rather hire afresh than retrain or upskill existing staff. 

This appears a facetious argument at best, given that companies often throw extra dollars to get fresh hires, apart from the cost that gets added for onboarding new staff in terms of induction and training on the job. 

In fact, the Pluralsight survey claims a fifth of the respondents felt their company went for fresh hiring over upskilling, with the same number suggesting that employers seldom supported those who were inclined to upskill. What’s more, the managers (27%) blamed their bosses for this state of affairs. 


In conclusion

A continuous churn in the resources does carry a heavy cost for the enterprise in terms of fulfilling its customer objectives and also skews up the entire employment and skill ecosystem where those who can afford new hires face attrition and those who cannot seldom get any talent coming their way. 

If continuous upskilling becomes the norm rather than an exception, employees will feel more comfortable staying put in an environment they know and keep adding skills. And in doing so, the larger enterprises leave at least a decent chunk of good resources for their comparatively poorer cousins in the industry.

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