Skills have become the new currency of workforce and talent strategies, as more than half of organisations that responded to the 2021 Mercer Global Talent Trends survey target upskilling and reskilling of critical talent pools to drive workforce transformation, Mercer said recently.
Traditionally, the base unit of managing a workforce has been a job, Mercer pointed out, adding that job descriptions and titles have, until recently, defined how companies viewed work, how they set salaries, and how they made critical decisions around talent and workforce transformation.
Today, the base unit of work has fundamentally evolved from jobs to skills, the company observed.
In Hong Kong, reskilling and upskilling are a clear transformation priority for companies in 2021, on the back of rapid technological advances and the new roles they bring, said Brian Sy, Head of Career Products and Total Rewards, Hong Kong, Mercer.
“However, they may lack clarity on the existing skills in their workforce and future skill requirements,” Sy noted. “This clarity is fundamental for them to decide how best to invest resources their already stretched resources for targeted reskilling and upskilling.”
Companies in Hong Kong struggle to identify the required future skills for different roles and for their organisations, he said.
In the same vein, they face challenges in evaluating the right pay for the right skills in an objective manner, similar to salary benchmarking, Sy added.
What is a skills-based approach?
According to Mercer, a skills-based approach to workforce strategy assesses talent based on their holistic skill set — including adjacent skills across industries — rather than industry experience or qualifications.
A well-designed skills-based workforce strategy will enable organisations to proactively identify future skills needs and develop an actionable plan to retain, build, buy and deploy talent, as needed, the firm advised.
- To better adapt to evolving business needs, 41% of survey respondents in Hong Kong stated they have already made it easier to loan and/or share talent internally, with 39% to do so in the future, Mercer said.
- Companies in Hong Kong are lagging when it comes to meeting the inter-generational needs of their workforce, such as offering older, more experienced workers flexible career pathways.
- None of the Hong Kong companies currently use or plan to look into investing in analytics to predict when older workers with critical skills are likely to retire.
- Organisations also struggle to understand the skill gaps in their current workforce. Two in five HR professionals responding to the survey admitted that they do not know what skills they have in their own organisations.
“While Skills-based talent practices, particularly pay-for-skills, are a relatively new concept to firms in Hong Kong, the future of work will see skills become core — increasing in importance over traditional measures such as years of experience or titles — in determining compensation and career opportunities for employees.” Vicki Fan, CEO, Hong Kong, Mercer said.