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The CEO pledge Monday to "deliver value" to all stakeholders includes a call for upskilling employees. Nearly 200 CEOs at some of the largest firms in the U.S. said they are committed to investing in their employees and will help them "develop new skills for a rapidly changing world."
Whether the Business Roundtable statement turns into real results or is merely marketing fluff remains to be seen. But, according to some analysts, it may be a harbinger for HR spending gains -- at least until the next downturn.
The CEO statement doesn't signal a change in business decisions. Firms will still lay off workers as they shift jobs overseas. They will still close plants and move production out of the country. But, the CEOs argued, they will also create jobs.
In June, Caterpillar's Joliet, Ill., plant closed. The work was shifted to Monterrey, Mexico. Caterpillar's CEO signed the statement, as did Ford's, who recently said the company is building its first autonomous vehicles in Michigan. Then there is Amazon, which just announced a plan to spend $700 million on upskilling employees.
Workers today are anxious about losing their job, according to the just released "2019 Layoff Anxiety Study." This was a Harris Poll conducted on behalf of CareerArc, an HR tech firm for social recruiting and outplacement. The survey found that, despite the low unemployment rate, 48% of employed Americans "experience layoff anxiety."
Layoff anxiety is high
The layoff anxiety is not rooted in fears of a massive recession, said Brian Kropp, chief of human resources research at Gartner.
"What they're concerned about is that the world is going to change, and their skill sets are no longer applicable," Kropp said. "Because their skill sets will no longer be applicable, they're going to be laid off."
Employers also feel pressure. In their case, it's to improve the skills of their workforce and quickly, he said.
Kropp believes the CEO commitment to upskilling its workforce may lead to increases in HR spending on learning and development tech. He cited microlearning tech and virtual reality, in particular. Microlearning tech is designed for short, focused learning around specific tasks.
The almost 200 CEOs who signed the Business Roundtable statement are also engaging in some marketing, Kropp said. They are signaling a willingness to develop skills, he said.
Harry OsleGlobal HR advisory practice leader, The Hackett Group Inc.
Harry Osle, global HR advisory practice leader at The Hackett Group Inc., a management consulting firm in Miami, Fla., said spending on learning and development has been rising over the last four years. The trend will continue -- as long as there isn't a recession, he said.
"In order to ensure that you don't have high turnover in critical areas, you have to be developing and training your employees," Osle said.
The uptick in learning and development spending stretches beyond tech platforms. Osle said he is also seeing more firms support employees earning college degrees, as well as helping them pay off student loan debt.
Osle said job decisions today by prospective employees aren't always around compensation alone and can include a firm's willingness to grow an employee's skills.
Taking a job "is not always about the base salary or the total compensation package, but it is around the investment in the employee," Osle said. "I think that organizations are waking up to that."
Training is nonetheless discouraged
A problem is that "most companies haven't carved out time" for upskilling employees, said Sam Stern, an analyst at Forrester Research who studies employee experience.
Employees who take time off for training may feel uncomfortable doing so. "They don't believe that they are allowed to," Stern said. Training is also insufficient to the amount of change -- such as automation -- that firms are introducing, he said.
For HR, making a business case for upskilling employees should include greater employee retention "because they feel like they're being invested in," Stern said.
Also, investment in training "leads to greater internal mobility, which means you can fill harder to fill positions with existing staff, which saves on recruiting," Stern said.