Business leaders everywhere are prioritising transformation and reinventing their business model to deliver on their strategy.
Our recent Global PwC Hopes and Fears Survey (2023) highlighted the central challenge facing CEOs and Executive Leadership Teams: if you have to reinvent your organisation, but without the support and energy of your people, these efforts will fail. In the current economic environment, business leaders can not take anything for granted about their workforce, or organisation’s culture. Against this dynamic background of business reinvention, most leaders view that the disruption of work and skills is also a given.
New Zealand is facing the same workforce challenges as other countries across the globe. Employers have been grappling with talent shortages, wage inflation, increasing financial hardship, the rapid emergence of disruptive technology and shifting workforce needs, with skills inequity on the rise. In the Public Sector, additional challenges come from pay restraint policies, making it difficult to attract talent in a market with a labour shortage.
With large-scale transformation projects underway across Aotearoa, the demand for highly skilled talent continues to increase. However, the World Economic Forum's ‘Future of Jobs’ Report (2023) revealed that although 60% of organisations perceive a skills shortage impacting their business, only 30% are considering introducing flexibility around education requirements to widen their talent pool.
According to the World Economic Forum, globally employers estimate that 44% of workers’ skills will be disrupted in the next five years. When NZ employees were asked in the ‘Hopes and Fears’ Survey a few months ago about their view on workforce skills, they ranked people skills as more important than technical or core business skills. These included being adaptable/flexible (73%), critical thinking (68%), and collaborative skills (65%). Only 42% of them feel confident that their employers will provide them the opportunity to apply the skills that are most important to their career in the next five years.
In preparation for the changing skill needs, financial and technological landscape, NZ leaders must consider these questions:
Do we have the skills necessary to transform?
Do we need to rethink and reconfigure our workforce?
Are we creating an inclusive and inspiring vision to attract and retain our workforce?
Do we understand how the cost-of-living crisis is sapping our people?
PwC Global, in collaboration with experts from the World Economic Forum's Reskilling Revolution Consortium has recently published a report on a 'skills-first' approach. It prioritises individual skills and competencies over qualifications or job history, reimagining how organisations approach recruitment. Adopting this approach can help bridge the growing skills gap seen in Aotearoa.
Applying a 'skills-first' approach, a framework for action can aid in retaining and recruiting skilled talent in three ways:
Promoting diversity, equity, and inclusion by reducing formal education barriers to entry and encouraging candidates from non-traditional backgrounds to apply for skills in demand.
Unlocking a hidden talent pool by evaluating and upskilling individuals based on their potential for the future, rather than solely relying on their past experience.
Creating unique progression pathways by providing opportunities for individual upskilling to meet the changing future needs of organisations.
So, how can your organisation adopt a skills-first approach?
Develop a clear vision for your organisation that defines specific business objectives, which will then inform your strategic workforce plan.
Assess your current workforce capabilities to understand current and future skills needs of your organisation. Identify the gap between the skills available and those needed, and work on bridging that gap.
Build a skills strategy that provides clear skills-based pathways for development in order to address future skill requirements. By providing access to skills-based learning opportunities, you will foster and boost a lifelong learning culture within your organisation.
Enhance your recruitment methods by crafting job descriptions that focus on skills, adopting skill-oriented recruitment systems, and considering candidates who have acquired skills through non-traditional means.
A skills-first approach can create sustainable economic and business outcomes, enabling organisations to prepare for financial uncertainty and address skill shortages in Aotearoa's labour market. By embracing this approach, organisations can address the biggest challenges facing the world today and open doors to suitable candidates who may have otherwise been overlooked, and position themselves to thrive in an ever-changing workforce landscape.
At PwC, we would love to talk to you about advancing your workforce actions to deliver on your organisation’s ambition.
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