By providing strategic education opportunities for employees, companies can improve morale, reskill and upskill their workforce, increase retention, and attract other high performers.
By Brian MacDougall
With the unemployment rate continuing to hover around 7%, according to the U.S. Department of Labor, investments in education and skills development are vital to economic recovery.
Despite the economic and employment uncertainties caused by the pandemic, a recent survey conducted by InStride showed that business decision-makers rank investing in talent development and new technology as their top two business priorities in the current environment.
When aligned with a company’s specific goals, workforce education programs are a critical business strategy to address pandemic recovery. These programs can have a number of positive, high-impact effects on an organization.
1. Address skills gaps. In the same InStride study, 68% of business decision-makers say there are skills gaps within their current workforce that are limiting their organization’s future growth potential. Further, 35% say the skills gaps in their organization’s workforce have widened since the pandemic began due to a shift in business needs.
Conversely, organizations that have chosen to upskill and reskill their employees say the skills gap in their organization has shrunk since the pandemic began (57%). This is one reason it is imperative for leaders across industries to invest strategically in short- and long-term workforce development and skills training opportunities for their employees.
CEOs and HR executives at U.S. companies dealing with the financial fallout from the pandemic are making difficult decisions on employee headcount. Rather than lay off or furlough existing staff to hire employees with desired skill sets, businesses have an opportunity to provide their employees with educational opportunities to benefit them and the company’s bottom line.
As 61% of employees prioritize career growth over pay, according to a survey by Jobvite, it is a smart move for companies to support and reinforce continuous learning. Strategic education programs build employees’ skills to align with the organization’s needs while delivering the added benefit of a more inclusive culture with career-pathing opportunities.
2. Achieve diversity and inclusion goals. In the midst of a global pandemic, higher education funding is taking a significant hit. As institutions navigate funding gaps, college degrees may become even more out of reach for students, especially for minority populations and people of color who typically face more barriers to a high-quality and affordable education. Even before the pandemic, a study by the U.S. Department of Education cited that Black Americans and Hispanic Americans are less likely to complete degree programs, yet are more likely to go into debt while pursuing a higher education.
By investing in quality education programs for employees to earn skills training, credentials, and degrees, U.S. companies can support diversity, equity, and inclusion goals while also delivering tangible benefits across their entire organization. And business leaders agree: 92% of participants in the InStride study recognize that a strategic workforce education program should help an organization achieve its diversity and inclusion goals.
With workforce education programs open to all employees regardless of race, gender, or job role, companies can set a broad representation of employees onto meaningful career advancement tracks and elevate employees into leadership roles. By filling opportunities from within rather than relying on recruiting efforts, companies can show in a tangible way that they are investing in their people and making intentional efforts to increase diversity within their organizations.
One example is Aramark. Despite having a corporate tuition assistance program, the global leader in food services and facilities management was looking to attract top talent and encourage retention, particularly within its largest and most diverse employee population: frontline workers. Believing that the company has both an opportunity and responsibility to provide meaningful career paths for all of its employees, Chief Diversity and Sustainability Officer Ash Hanson developed a program specific to the needs of Aramark’s diverse frontline workers, over 70% of whom identify as women or people of color. Aramark launched its “Frontline Education Program” in October 2019 with 81 learners in its first class. The program has since grown to nearly 200 learners by the end of August 2020.
“Looking outside our organization for talent from diverse communities is one way to drive representation, but the most efficient way is to provide pathways for meaningful career advancement to people already at the company,” Hanson says. “Through our partnership with InStride, we’re giving our high-potential, high-performing talent the opportunity to pursue a quality education from respected institutions so they can develop the skills to grow their career.”
3. Drive business growth and remain competitive. Instead of looking at education programs as a cost center, companies need to see these programs as strategic investments in their people. Education programs give employees the ability and opportunity to build a career, earn higher wages, experience higher levels of success, and nurture stronger communities in which they live.
The InStride study found that 96% of business leaders believe they need to invest in the ongoing education of their employees as a way to drive business growth. Many said that in the current economic environment, investing in talent development is a higher priority than reducing overhead costs or investing in product development/service delivery, sales growth, marketing, or supply chain improvements.
By providing strategic education opportunities for employees, companies can experience many benefits: improved morale, increased retention, and the attention of other high performers. Most importantly, many of these outcomes can have a positive impact on meeting strategic business objectives and positively impacting communities. A Lumina Foundation report found that for every dollar spent on workforce education, the organization recouped it and saved an additional $1.29 in talent management costs -a 129% ROI.
In a time of uncertainty, forward-thinking executives recognize that investing in enterprise education can be a win-win for both employers and employees.
Brian MacDougall is vice president of talent and chief of staff at InStride.