The Role of Upskilling in Improving Employee Retention
The Great Resignation rocked employers large and small. According to CNBC, 50 million workers quit their jobs in 2022. However, that trend began much earlier. The US Bureau of Labor Statistics notes that the “quit rate” rose from 1.6% in April 2020 to 3.0% in 2021.
That trend is far from over. CFO magazine highlights that 36% of US workers plan to leave their jobs in 2023. That means organizations will see the repercussions of “churn” and increased hiring and onboarding costs while dealing with reduced productivity and performance as new hires get up to speed with company processes and responsibilities. And that’s assuming the business can find new hires in the first place.
Most business owners and decision-makers wonder if there’s a better way. There is. Employee retention strategies help businesses keep their current talent, avoid the costs and challenges of attracting, vetting, hiring, and onboarding new employees, and enjoy stability while their competitors struggle.
The challenge is creating an employee retention plan that addresses key reasons workers seek employment elsewhere. Online learning is one answer.
Why Does Employee Retention Matter?
According to the Society for Human Resource Management (SHRM), “a comprehensive employee retention program can play a vital role in attracting and retaining key employees, as well as in reducing turnover and its related costs.” Those costs are high and include the following:
- Up to 150% of the departing employee’s salary for those in technical positions
- Up to $1,500 for hourly workers
- Up to 213% of their salary for C-suite members
Ultimately, employee turnover costs US businesses $1 trillion every year. Employers that want to plug that hole in their sinking ships should reinvest in employee learning and development, particularly online learning.
How Does Online Learning Improve Employee Retention?
Employee retention is not always about more money. Most employees rank financial compensation below other key factors, including the following:
- Their ability to contribute meaningfully to the organization.
- The organization’s ability to support them throughout their career.
- The organization’s ability to help them learn new skills and grow professionally and personally.
Each factor relates directly to learning and development (L&D). Of course, most organizations today have some sort of L&D initiative, so what sets online learning apart from more conventional options?
Traditional training moves at a predetermined pace, whether talking about lectures and in-class types or video-based content. There’s little opportunity for employees to recap topics they might be struggling with and even less chance to dig deeper into areas that bear on an employee’s specific responsibilities, needs, or career goals.
In contrast, online learning is entirely self-paced, allowing employees to learn at the pace that fits them, dig into topics of particular interest or relevance, and master what they’re learning. Not only does that boost mastery, but it ensures better retention after training and over time.
It Prevents New Employees from Jumping Ship
How much time and money do new employees spend onboarding with your organization? How many make it through the first month or two before looking for another job? Fast Company says 40% of employee turnover occurs in the first 30 days of employment. That’s primarily due to the challenges new employees experience getting up to speed with their responsibilities and learning how things work. It can be incredibly overwhelming.
Online learning helps streamline and simplify the onboarding process. By creating a graduated onboarding process, employees can ease into things at their own pace. They might start with the basics, like compliance training, then move on to position-specific topics, software tutorials, and deeper dives into the work processes they will need for success.
It Empowers Employees
We’ve already discussed the self-paced nature of online learning. However, the benefits go deeper. It enables self-directed learning, which empowers employees to pursue training that matters most to them, suits their career goals, and fits their attention spans and available time for training.
Self-directed learning offers quite a few essential benefits. One of those is a sense of control and autonomy. Employees are free to pursue knowledge that means something to them because they want to, not because they’re required to do so. In addition to empowering employees to make their own choices, it improves metacognition and information retention, incites curiosity to dive even deeper, and even plays a role in their willingness to take initiative outside of L&D activities.
That said, keeping tabs on employee progress is also important. By combining online learning with a minimum of instructor-led classes (either in-person or online), you can keep employees engaged, check in with their progress without being overbearing, and motivate them by breaking the content up.
It Increases Competency and Confidence
When employees lack competence, they also lack confidence. The result is underperformance and decreased engagement. That affects productivity and profitability for the team and even the company. When employees are not supported by training and development initiatives, they have no way to build competence and will continue to suffer from a lack of confidence.
Online training allows employees to build confidence and competence in a self-paced, self-directed way. That improves engagement, satisfaction, and happiness, all of which are important metrics for employee retention and the organization’s overall success.
You Can Create Career Paths
You cannot retain employees if you don’t support their growth and development. No one wants to stay in the same position forever – it gets stale, and no amount of money can compensate for the lack of challenge and self-development. Online learning allows organizations to support and retain employees by creating career paths.
By supporting employees throughout their careers, not just in the position they were hired for, organizations can achieve important goals, including:
- Improved Loyalty – Engaged, supported employees are much more loyal and less likely to jump ship. That also helps build a reputation as an employer of note, helping you attract and retain top-tier talent.
- Enhanced Skills and Knowledge – Employees who grow with the organization can put their enhanced skills and knowledge to work on the company’s behalf with surprising results.
- Reduced Hiring/Onboarding Costs – Engaged employees are more likely to remain with the employer, reducing the need to hire new workers. However, they can also apply their knowledge and expertise to helping to train those who must be hired, reducing the time and costs involved with onboarding.
It Helps Future-Proof Your Talent
It’s no secret that the skills required for today’s workers differ dramatically from those required just a few years ago. That evolution is not slowing. The World Economic Forum indicates that one-third of core job skills will change within five years. Moreover, almost 50% of employers worry that their employees don’t have the right combination of skills.
Online learning provides a way to future-proof your talent and cultivate the skills and knowledge necessary for growth, not just five years from now but 10 or 15. Employers that personalize learning with online training can identify required skills and close gaps by training the right people at the right time.
Online learning is not new. It’s been around in various forms for many years. However, its importance and relevance to employee engagement and retention have never been more evident. In the wake of the Great Resignation and ongoing employee dissatisfaction, employers must take steps to increase engagement, build confidence, instill loyalty, and retain key talent to ensure growth and stability.
Online learning provides the platform for exactly that and to future-proof an organization by identifying critical skills necessary down the road and then mapping those to individuals with the talent and aptitude required.
However, a successful online learning initiative requires more than just realizing that L&D is essential to retention. Achieving success here requires the right platform and buy-in from the C-suite. Ultimately, it depends on a shift from a corporate culture that sees employees as commodities that can be replaced whenever necessary to a business that values lifelong learning and supports workers across their careers.