Why Upskilling Matters More Than Ever
The Key to Thriving in a Rapidly Changing World
This post is the first of three in a series: Transform Today, Thrive Tomorrow – the Power of Upskilling
The workplace of today doesn’t just demand adaptability—it rewards it. Companies across industries are doubling down on upskilling, recognizing it as the secret weapon for staying competitive. But what does it mean and why has it become a cornerstone of organizational strategy?
Upskilling is more than learning new tricks—it’s about building on the clay already molded, enhancing existing employee strengths to meet evolving challenges. While the term has gained traction over the last decade, especially during and after the pandemic, the essence isn’t new. Organizations have always needed skilled workers, but now the stakes are higher, and the changes are faster.
The urgency is clear: skill gaps are the biggest barrier to business transformation globally, according to the World Economic Forum. Similarly, a report by the Future Skills Centre and the Conference Board of Canada predicts that in the next decade, digital skills will be required for nine out of every 10 jobs in Canada.
These skill shortages aren’t confined to tech or specialized fields—they span industries, from healthcare to manufacturing, and affect roles at every level. As roles evolve due to digital transformation and demographic shifts, the need to bridge these gaps through upskilling is more important than ever.
Why Are Companies Embracing Upskilling?
1. Demographic and Workforce Shifts. Retiring employees and a younger workforce drives the need to bridge knowledge and skills gaps. In 2025, Gen Z (under 28) will represent 30% of Canada’s Workforce (Stats Can), making the case for mentorship combined with upskilling to ensure that knowledge and wisdom transfer seamlessly across generations. Even though they lack practical experience of more seasoned workers, maximizing the capabilities of the youngest workers will capitalize on their fresh ideas for the benefit of all and fuel their success long term.
Leadership gaps in small to mid-size enterprises must also be addressed. With 75% of SME business owners retiring in the next decade, succession planning is critical for sustainability (Stats Canada). Upskilling initiatives are essential to prepare their successors. Training in leadership, operational continuity, and strategic decision-making can bridge gaps during succession planning and knowledge transfer.
Additionally is the concern all must have around the work efforts of SME business owners. In their report on The 8-Day Workweek, the CFIB (Canadian Federation of independent Business) estimates that the average small business owner works 54 hours a week, the equivalent of an eight-day work week for most salaried workers. Those who say they work more than that cite talent shortages as the reason. Estimates are that 20 of those hours or 34% of their time is work being done to make up for a lack of employees, or a lack of the skills to accomplish the work that needs to be done. The impacts on both the business owner’s mental health and their organizations is significant, limiting their ability to plan forward, to consider investments in productivity improvements, including training and automation.
2. Adapting to Market Forces Global competition and digital transformation are reshaping roles at breakneck speed. In response, many organizations are reimagining traditional roles and introducing entirely new ones. Digital transformation in particular, accelerates this need, as emerging technologies like AI, automation, and data analytics disrupt established workflows and create demand for specialized skills. There's a need for a roadmap that ensures individuals can adapt quickly, enabling organizations to maintain resilience and capitalize on market opportunities.
3. Talent Development as a Retention Strategy. Beyond boosting productivity, actively developing talent signals that companies value their employees’ growth. A key reason employees search for new opportunities is that they don’t see a future with their current employer, that their growth and development is either lagging or not being attended to. Employees are more likely to stay when they see investment in their professional development and have opportunities to apply what they are learning. Tied to their career growth plans, talent development with upskilling is a force multiplier for high morale, productivity, and retention.
4. Aligning with Industry 4.0 and 5.0. We’re clearly experiencing major shifts in how and what work gets done, also known as the next industrial revolutions. The Fourth and Fifth —known as Industry 4.0 and 5.0—are reshaping how organizations operate and deliver value. Upskilling is at the heart of these shifts, ensuring businesses can keep pace with rapid innovation while prioritizing human and societal needs. Here’s what this means:
Industry 4.0: Embracing Technology and Automation
Industry 4.0 centers on leveraging advanced technologies like automation, artificial intelligence (AI), the Internet of Things (IoT), and big data analytics to streamline processes and improve efficiency.
• Why Upskilling Matters: Workers must adapt to new tools and workflows, such as operating AI-powered systems or interpreting data insights. Roles that once required repetitive tasks are evolving into ones demanding analytical thinking and technological literacy.
• Real-World Example: A logistics company automates its supply chain using IoT sensors and predictive analytics. Employees need training to interpret the data and troubleshoot the system when anomalies arise.
Industry 5.0: Focusing on Societal Value and Human-Centric Design
While Industry 4.0 emphasizes efficiency and technology, Industry 5.0 balances this with a focus on human needs and societal impact. It calls for collaboration between humans and machines, aiming for sustainable innovation and solutions that address broader challenges like climate change and inclusivity.
• Why Upskilling Matters: Employees must develop skills in creativity, critical thinking, and collaboration. They also need the ability to integrate human insights with technology to create meaningful solutions.
• Real-World Example: A manufacturing company adopts cobots (collaborative robots) on its assembly line. Employees are trained to work alongside these machines, focusing on tasks requiring judgment and adaptability.
Upskilling is no longer optional. As organizations face accelerating change, the ability to pivot quickly relies on a skilled, adaptable workforce. But success requires more than just good intentions—it demands a thoughtful, strategic approach.
Take a close look at how these trends are impacting your business, organization and individuals, and how you can build talent planning around the key needs of your team members. A clear understanding of the drivers affecting your industry and specific teams will lay the foundation for building your upskilling strategy.
Stay tuned for the next two posts in the series:
Post 2: Building a Smarter Upskilling Strategy
Post 3: After the Skill Upgrade: Managing Expectations in the Upskilling Journey
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Consider upskilling yourself and your fellow people leaders in navigating today’s workplace challenges. Take your capabilities as a talent leader to the next level with the Align. Grow. Prosper. course, a hybrid learning experience designed to help you shape success today and prepare to seize tomorrow’s opportunities. You can learn more about it here.
