Consider this. Three in four employers around the world report that they can't find the skills they need, a dramatic increase from just 36% a decade ago. Contributing to this crisis are accelerating technological disruption, demographic changes such as an aging workforce and declining participation rates, and a growing disconnect between education systems and workplace needs. And let's not forget the impact of AI and automation. Demand for new skills is created while many skills become obsolete overnight.
The skills shortage crisis is no longer an immediate threat, but a reality that is reshaping the future of work across industries. For organizations to remain competitive, their strategies must evolve. As a board member, your challenge is not only to monitor management's actions. It's about making sure your organization is in a position to adapt and grow in this new environment.
If this sounds overwhelming, it is. But it is also an opportunity to define the next generation of leadership. Adapting to this new reality requires bold thinking and a willingness to step outside of the way things have always been done. Above all, leaders must commit to human-centered strategies and invest in their people to reap the benefits.
How to overcome skills shortages and close the gaps
1. Drive a skills-first workforce strategy
Too many organizations pursue candidates for narrow roles without focusing on the skills they really need. Stop creating “unicorn jobs” that no one can fill. Instead, embrace a skills-first mindset. Define your most pressing needs and look for candidates who are adaptable and have a high potential to grow and fulfill the role.
Next, expand your horizons. Alternative working styles, such as freelancers and gig workers, offer expertise and flexibility, but are often overlooked. Freelancers contributed $1.27 trillion to the U.S. economy last year alone, and ignoring this talent pool means limited access to needed skills.
2. Make upskilling and reskilling a strategic imperative
Skills don't stay relevant forever, especially in a world where AI and other technologies evolve faster than education systems can keep up. According to a McKinsey report, 87% of companies expect to see a significant skills gap within their organizations over the next five years. Leaders must create a workplace where continuous learning is not only encouraged, but fostered. It is expected and planned.
Take Schneider Electric, for example. They used AI to identify skill gaps within their workforce and provide new growth opportunities for their employees. This not only improves retention rates; We saved millions of dollars in hiring costs and built a future-ready workforce. The message is clear. The way out of the skills crisis is not just by hiring, but by building your own.
3. Oversee responsible technology integration
AI is disrupting every industry, but AI doesn't exist to replace humans; it exists to augment human capabilities. Leaders need to use technology to empower their teams, not replace them. This means understanding the unique strengths of both artificial intelligence and human intelligence and how they work best together.
Take Land O'Lakes, for example. They use AI to help farmers make data-driven decisions, increasing efficiency without neglecting human expertise. This is the model for success. We combine cutting-edge tools and skilled workers to unlock new possibilities.
4. Make sure your workplace is designed for retention.
The skills shortage crisis has exposed cracks in workplace structures that no longer meet the needs of employees. Burnout, inflexibility, and weak development pipelines are draining talent and exacerbating inequality.
Women emphasize urgency. Women experience burnout 32% more than men, losing leadership roles and putting decades of progress at risk. Keeping women employed is an economic imperative, adding $2 trillion to GDP since the 1970s.
Gen Z workers have a different set of challenges. More than half feel unprepared at work, especially when it comes to communication and collaboration, and 37 percent would not stay at an organization with an unsupportive manager. They also bring the energy, digital expertise, and purpose- and values-driven perspective that organizations need to grow.
The lesson is clear. That means the workplace must evolve. Flexible policies, leadership, and a purpose-driven work environment aren't perks, they're strategies for success. Leaders who prioritize these things can retain top talent and close gaps.
5. Redefine expectations for leaders
The skills shortage crisis calls for a new kind of leader – one who sees their role as a coach and enabler rather than a resource manager. Leadership today is about building trust, fostering collaboration, and creating psychological safety.
In fact, Google's Project Aristotle found that the most successful teams are not determined by skills or experience, but by culture. Teams thrive when members feel comfortable taking risks and voicing their ideas. Leaders who demonstrate that their employees are valued by fostering this environment and investing in their growth will unlock their employees' potential and build a pipeline of future-ready talent.
Conclusion of lack of skills
The skills shortage crisis isn't going away, but there's no need to derail your organization. This is a challenge, but also an opportunity to rethink outdated systems and invest in building a future-ready workforce.
With 75% of employers struggling to find the skills they need, the real question is: Are you rising to the challenge and are executives using this crisis as an opportunity for both their businesses and the people who drive them? It's about being able to help change.
This article is based on insights from Christie Smith's book. Key points: How distributed teams, generative AI, and the global shift are creating new human leadership.
Print article
