Reading the Signs on Upskilling

American companies today employ 24 million workers whose literacy skills are inadequate to meet emerging talent challenges. Experts discuss ways HR can help in educational efforts to ensure future workforce needs are met.

Tuesday, April 7, 2015
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America's employers should always be looking to build skills, at every level.

That being the case, a recent U.S. Department of Education report revealing that 24 million American workers have low literacy skills should set off alarms for HR leaders, according to education and talent management experts.

In 2013, the Organisation for Economic Co-operation and Development conducted a worldwide survey of adult skills. Soon thereafter, the Department of Education requested an additional analysis of the specific U.S. data, asking OECD for a more detailed understanding of the low-skilled population. The resulting report, Time for the U.S. to Reskill?, found that 36 million adults in the United States have low basic skills, scoring below Level 2 on the literacy assessment.

The initial OECD global survey rankings also revealed that, when it comes to "literacy, numeracy and problem solving" in a technology-rich environment, the U.S. has a relatively high percentage (17.5) of low performers. It found skill levels of U.S. adults have remained stagnant over two decades, and two-thirds of the low-skilled population currently is in the U.S. workforce, accounting for the nearly 24 million workers who need attention.

"That figure already has significant negative impacts on individuals, families and their communities," says Steve Perry, an education expert and founder and principal of Capital Preparatory Magnet School in Hartford, Conn. "It's important for employers to understand that whatever they can do to improve skill sets of that group of workers and give them the opportunity to grow and move upward improves the organization."

Employers must do more to support the "up-skilling" of more frontline workers, Perry says. Unfortunately, Perry believes there are people on their own career paths in leadership positions who don't always feel comfortable doing the right thing for those they see as subordinates. That's just one reason why the literacy gap exists, he says.

"In some workplaces, people with low self-esteem see others as competition, and that is poison," Perry says. "When you think about it, the real way to improve or extend standing is to build the team around you. Employers need to provide opportunities to grow, and that would include some basic programs focused on improving literacy."

Chicago-based Ravin Jesuthasan, talent management practice leader at Towers Watson, said that a study called Global Talent 2021, done by Oxford Economics and co-sponsored by Mercer and several other American companies such as Coca-Cola and American Express, had similar findings about today's global workforce. The study reported that, to cope with today's changing business environment, employers are demanding new skills from their employees, yet often find they are in short supply.

At the same time, the report says global regions including the United States and much of Europe will need to "undertake a critical 'reskilling' of labor to meet the new demands of a highly digitized and interconnected world, where higher skill sets will be required."

"The Department of Education report underpins one of the most eye-opening findings from Global Talent 2021," Jesuthasan says. "And that would be a significant talent deficit relative to demand for skills."

Jesuthasan notes there has been much discussion about the decline of education levels in the U.S. In fact, even among high school graduates, large gaps in numeracy and literacy are common.

"Schools are churning out people [who are] ill-prepared for the demands of tomorrow's organizations," he says.

Jesuthasan's advice to HR leaders is to be prepared to invest more in retraining and reskilling. Along those lines, employers need to engage in "open dialogue and partnerships" with educational institutions and government employment development agencies that can help firms ensure a healthy talent pipeline, particularly in fast-growth markets.

"Developing programs that train and educate workers not only helps with recruiting but improves employee loyalty," he adds, noting that recent tough economic times brought about a slowdown in corporate training initiatives. The problem, he says, is literacy reskilling programs are not easy to implement because they take a long time to develop and bear fruit.

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"The only way we get to that is if we have collaboration between government, education and the private sector," Jesuthasan says.

Along those lines, in July 2014, the White House released "Ready to Work: Job-Driven Training and American Opportunity," which discussed both public- and private-sector commitments. One of the three main calls for action in the government report focused on helping the 24 million "low-wage, low-skilled, hard-working Americans upskill themselves into better jobs."

Matt Stevenson, a principal within the workforce analytics and planning practice at Mercer, in Washington, says HR leaders whose workforces includes those types of workers must figure out ways to create incentives for more education-not an easy task.

"The DOE report is clear on the benefits of raising literacy skills among employees, but we don't see a lot of HR leaders going out and helping those workers get more education," Stevenson says. "HR needs to figure out how to create incentives so those folks can at the very least start to help themselves."

Stevenson agrees that raising literacy and numeracy skill levels for 24 million employees is going to require those public-private efforts. That partnership needs to clearly and effectively communicate the value of sharper literacy skills for employees in those vulnerable populations, he adds.

"Within the company, HR must offer ways to demonstrate [the] value of higher literacy," Stevenson says. "If employers are desperate for upskilling certain segments of their workforces, they might consider building their own internal training programs to reach that objective."

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