May 26, 2025 • 11 mins
Organizations face a paradox: they need skilled talent but deprioritize training. As technology evolves, companies struggle to find specific skills, highlighting the need to develop talent internally. Success stories like Amazon and AT&T show high returns on investment in upskilling programs. Convincing executives requires demonstrating tangible business benefits and pilot program successes.
#skills, #training, #business, #upskilling, #technology, #talentdevelopment, #roi
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
(00:00):
Welcome to Bite-sized L&D, your quick no-nonsense update on the latest in workplace learning.
(00:11):
Today we'll uncover how strategic investment and employee development can solve the talent
paradox and explore how companies like Amazon and AT&T are leading the way with groundbreaking
upskilling initiatives.
Alright, let's get straight into it.
Today we're going to explore one of the most frustrating paradoxes facing HR professionals
(00:34):
and business leaders right now.
Companies everywhere are desperately searching for skilled talent, claiming they can't find
the right people with the right skills.
Yet, at the same time, training and development keeps sliding down the priority list, dropping
from 12% of companies calling it a top priority in 2024 to just 5% in 2025.
(00:57):
We're diving deep into this Catch-22 and examining how organizations can break free
from it by investing strategically in their people's growth and development.
Thanks so much for that introduction, Donna.
This really is one of the most critical challenges I see organizations grappling with today, and
I'm excited to dig into the solutions that are actually working.
(01:20):
Why don't you hit me with your first question?
Let's start with the fundamentals.
Can you help us understand why this Catch-22 exists in the first place?
What we're seeing is organizations getting caught in short-term thinking, especially
smaller companies.
They're struggling to find skilled talent, but they treat training as a compliance checkbox
(01:40):
rather than a strategic investment.
The real issue is that the right talent may not actually exist in the market, because
technology is changing so rapidly.
You can have someone with a computer science degree, but nobody's getting a degree in
generative AI or whatever the next technological shift will be.
(02:02):
Companies are trying to buy skills that simply aren't available in the market yet, instead
of creating them internally through targeted development programs.
That makes sense.
Let's look at some organizations that have figured this out.
What can you tell us about Amazon's massive upskilling initiative?
Amazon is a perfect example of thinking big and long term.
(02:23):
They pledged $1.2 billion to upskill 300,000 employees by 2025 through programs like the
Amazon Technical Academy and Machine Learning University, helping non-technical employees
transition into software engineering and data science roles.
By late 2021, over 70,000 employees had participated, and Amazon's VP of workforce development
(02:49):
noted that this investment significantly boosted retention and internal career mobility.
Their philosophy is simple.
When you help people along their desired career path, they're more likely to join and stay
with your organization.
What about companies in more traditional industries?
How did AT&T approach their transformation?
(03:11):
AT&T launched their future-ready program, investing $1 billion to retrain 100,000 employees
for new technology jobs.
Working with partners like Coursera and Universities, they offered online courses and career roadmaps.
The results were remarkable, retrained employees became twice as likely to be hired into mission
(03:33):
critical roles, and four times more likely to advance in their careers.
By 2020, they had successfully transformed their workforce to be much more nimble and
competitive in the digital era, proving that even established companies can reinvent
their talent at scale.
Those are impressive examples.
What does the data tell us about actual ROI on training investments?
(03:57):
The numbers are compelling.
Every dollar spent on employee training yields an average return of $4.53, which is a 353%
ROI.
Companies that prioritize employee training have 24% higher profit margins than those
that neglect training.
Even more striking, 43% of companies report increased revenue after implementing formal
(04:20):
education programs, and this jumps to 60% for companies with structured initiatives.
One financial firm saw a 250% increase in employee productivity within a year, translating
to an extra $3.5 million in annual revenue.
On the retention side, companies with robust L&D programs experience 34% higher retention
(04:43):
rates, and 94% of employees would stay longer if their company invested in their development.
Let's talk about Gen Z specifically.
How critical is L&D for retaining these younger workers?
Gen Z is absolutely the learning generation.
A 2024 Udemy study found that 65% of Gen Z respondents are most motivated by opportunities
(05:06):
for professional development, making them more focused on learning than even millennials.
The retention link is striking.
Over 37% of Gen Z employees say they would likely look for a new job if their company
isn't providing adequate training opportunities.
This generation views skill development as a long-term career investment, not just a
(05:29):
perk, so if they aren't learning, they're likely planning their exit.
Can you give us a concrete example of a company successfully retaining Gen Z through learning
programs?
McDonald's Archways to Opportunity program is a standout example.
They provide crew members with English classes, high school diploma support, and college tuition
assistance.
(05:51):
Employees enrolled in Archways have a 2.5 times higher retention rate and are twice
as likely to be promoted.
Students with higher participation even saw slight sales increases, directly linking employee
growth to business performance.
T-Mobile took a different approach by offering fully funded tuition from day one for any field
(06:13):
of study, achieving massive uptake among frontline teams, and improved retention in communities
where these programs were heavily utilized.
Technology seems to be driving major changes in skill requirements.
How is AI specifically impacting what employees need to know?
AI is creating massive disruption.
The World Economic Forum estimates that 25% of jobs will be disrupted in the next five
(06:37):
years, with 44% of workers' core skills needing to change in that time frame.
A Deloitte survey found that 95% of business leaders expect AI to disrupt jobs by 2026,
yet only 22% feel prepared to address the talent implications.
Companies must now train workers on AI tools, develop digital literacy, and build uniquely
(07:01):
human skills like creative thinking and emotional intelligence that become even more important
in an AI-enabled workplace.
Many organizations are launching AI academies internally, recognizing that without deliberate
training their workforce won't keep pace.
What other technology trends are creating new training needs?
(07:23):
Training technology represents a huge emerging area.
The global push for carbon reduction is spurring growth in renewable energy, electric vehicles,
and ESG reporting jobs.
LinkedIn's Global Green Skills Report shows green job postings increased by over 15% in
2023, with new roles like sustainability analysts and carbon credit traders emerging faster
(07:48):
than workers can upskill.
Beyond that, the broader digital transformation across cloud computing, cybersecurity, and
data analytics means over 75% of companies plan major tech adoption by 2027.
The half-life of technical skills has shortened to just four to over five years in some fields,
(08:10):
requiring constant refresh.
This all sounds expensive.
How can HR professionals convince skeptical executives to invest in L&D?
The key is speaking the language of the C-suite by tying training directly to business problems
rather than pitching training for training's sake, identify specific issues hurting the
business like declining customer satisfaction or leadership shortages, then show how targeted
(08:35):
training addresses them.
Use quantified business cases including turnover costs, productivity metrics, and industry
research showing that every dollar in training yields four or five vololors in ROI.
Present scenarios like, if we reduce turnover by 10% through this program, we save X million
(08:55):
in recruiting costs.
Also highlight the cost of doing nothing by showing lost revenue if skills stagnate.
For risk-averse organizations, what's the best way to get started?
Start with pilot programs and quick wins.
Use a small initiative targeting a specific skill gap with defined outcomes and modest
budget.
(09:17):
When the pilot concludes, collect success metrics like sales increases or internal placements
that saved recruiting costs.
Use these stories to build credibility.
It's a proof-of-concept approach.
Reduce the initial ask.
Deliver success on a small scale, then leverage that momentum for larger buy-in.
(09:39):
Saving an executive sponsor is also critical.
Companies with L&D executive sponsors are twice as likely to exceed business goals.
What's the final piece for securing executive buy-in?
Present a clear implementation plan with metrics for accountability.
Outline timeline, target audience, and crucially the metrics you'll track like performance
(10:01):
improvements and KPI impacts.
Commit to reporting back on outcomes.
This is both qualitative feedback and quantitative indicators.
If the goal is better customer service, track satisfaction scores before versus after training.
This data-driven approach shows we will know if this works and sets you up to sustain funding
(10:24):
by proving impact over time.
Any final thoughts on breaking free from this training catch 22?
The fundamental shift needed is reframing L&D from a cost center to a vital investment
in human capital.
In today's knowledge economy, an always learning company will consistently outperform
a stagnant one.
The most admired companies treat talent development as core to their competitiveness and reap
(10:49):
the rewards.
By demonstrating successes, grounding proposals in data, and aligning with executive priorities,
HR professionals can convert L&D from a low priority budget line to a strategic driver
of growth.
In a world where skills are the new currency, those who invest in their people's development
will have the strongest competitive advantage.
(11:17):
That wraps up today's podcast where we explored how companies like Amazon and AT&T are successfully
investing in employee development to tackle the skills gap and highlighted the importance
of aligning training with business needs for executive support.
Don't forget to like, subscribe and share this episode with your friends and colleagues
(11:39):
so they can also stay updated on the latest news and gain powerful insights.
Stay tuned for more updates.
Welcome to Bite-sized L&D, your quick no-nonsense update on the latest in workplace learning.
(00:11):
Today we'll uncover how strategic investment and employee development can solve the talent
paradox and explore how companies like Amazon and AT&T are leading the way with groundbreaking
upskilling initiatives.
Alright, let's get straight into it.
Today we're going to explore one of the most frustrating paradoxes facing HR professionals
(00:34):
and business leaders right now.
Companies everywhere are desperately searching for skilled talent, claiming they can't find
the right people with the right skills.
Yet, at the same time, training and development keeps sliding down the priority list, dropping
from 12% of companies calling it a top priority in 2024 to just 5% in 2025.
(00:57):
We're diving deep into this Catch-22 and examining how organizations can break free
from it by investing strategically in their people's growth and development.
Thanks so much for that introduction, Donna.
This really is one of the most critical challenges I see organizations grappling with today, and
I'm excited to dig into the solutions that are actually working.
(01:20):
Why don't you hit me with your first question?
Let's start with the fundamentals.
Can you help us understand why this Catch-22 exists in the first place?
What we're seeing is organizations getting caught in short-term thinking, especially
smaller companies.
They're struggling to find skilled talent, but they treat training as a compliance checkbox
(01:40):
rather than a strategic investment.
The real issue is that the right talent may not actually exist in the market, because
technology is changing so rapidly.
You can have someone with a computer science degree, but nobody's getting a degree in
generative AI or whatever the next technological shift will be.
(02:02):
Companies are trying to buy skills that simply aren't available in the market yet, instead
of creating them internally through targeted development programs.
That makes sense.
Let's look at some organizations that have figured this out.
What can you tell us about Amazon's massive upskilling initiative?
Amazon is a perfect example of thinking big and long term.
(02:23):
They pledged $1.2 billion to upskill 300,000 employees by 2025 through programs like the
Amazon Technical Academy and Machine Learning University, helping non-technical employees
transition into software engineering and data science roles.
By late 2021, over 70,000 employees had participated, and Amazon's VP of workforce development
(02:49):
noted that this investment significantly boosted retention and internal career mobility.
Their philosophy is simple.
When you help people along their desired career path, they're more likely to join and stay
with your organization.
What about companies in more traditional industries?
How did AT&T approach their transformation?
(03:11):
AT&T launched their future-ready program, investing $1 billion to retrain 100,000 employees
for new technology jobs.
Working with partners like Coursera and Universities, they offered online courses and career roadmaps.
The results were remarkable, retrained employees became twice as likely to be hired into mission
(03:33):
critical roles, and four times more likely to advance in their careers.
By 2020, they had successfully transformed their workforce to be much more nimble and
competitive in the digital era, proving that even established companies can reinvent
their talent at scale.
Those are impressive examples.
What does the data tell us about actual ROI on training investments?
(03:57):
The numbers are compelling.
Every dollar spent on employee training yields an average return of $4.53, which is a 353%
ROI.
Companies that prioritize employee training have 24% higher profit margins than those
that neglect training.
Even more striking, 43% of companies report increased revenue after implementing formal
(04:20):
education programs, and this jumps to 60% for companies with structured initiatives.
One financial firm saw a 250% increase in employee productivity within a year, translating
to an extra $3.5 million in annual revenue.
On the retention side, companies with robust L&D programs experience 34% higher retention
(04:43):
rates, and 94% of employees would stay longer if their company invested in their development.
Let's talk about Gen Z specifically.
How critical is L&D for retaining these younger workers?
Gen Z is absolutely the learning generation.
A 2024 Udemy study found that 65% of Gen Z respondents are most motivated by opportunities
(05:06):
for professional development, making them more focused on learning than even millennials.
The retention link is striking.
Over 37% of Gen Z employees say they would likely look for a new job if their company
isn't providing adequate training opportunities.
This generation views skill development as a long-term career investment, not just a
(05:29):
perk, so if they aren't learning, they're likely planning their exit.
Can you give us a concrete example of a company successfully retaining Gen Z through learning
programs?
McDonald's Archways to Opportunity program is a standout example.
They provide crew members with English classes, high school diploma support, and college tuition
assistance.
(05:51):
Employees enrolled in Archways have a 2.5 times higher retention rate and are twice
as likely to be promoted.
Students with higher participation even saw slight sales increases, directly linking employee
growth to business performance.
T-Mobile took a different approach by offering fully funded tuition from day one for any field
(06:13):
of study, achieving massive uptake among frontline teams, and improved retention in communities
where these programs were heavily utilized.
Technology seems to be driving major changes in skill requirements.
How is AI specifically impacting what employees need to know?
AI is creating massive disruption.
The World Economic Forum estimates that 25% of jobs will be disrupted in the next five
(06:37):
years, with 44% of workers' core skills needing to change in that time frame.
A Deloitte survey found that 95% of business leaders expect AI to disrupt jobs by 2026,
yet only 22% feel prepared to address the talent implications.
Companies must now train workers on AI tools, develop digital literacy, and build uniquely
(07:01):
human skills like creative thinking and emotional intelligence that become even more important
in an AI-enabled workplace.
Many organizations are launching AI academies internally, recognizing that without deliberate
training their workforce won't keep pace.
What other technology trends are creating new training needs?
(07:23):
Training technology represents a huge emerging area.
The global push for carbon reduction is spurring growth in renewable energy, electric vehicles,
and ESG reporting jobs.
LinkedIn's Global Green Skills Report shows green job postings increased by over 15% in
2023, with new roles like sustainability analysts and carbon credit traders emerging faster
(07:48):
than workers can upskill.
Beyond that, the broader digital transformation across cloud computing, cybersecurity, and
data analytics means over 75% of companies plan major tech adoption by 2027.
The half-life of technical skills has shortened to just four to over five years in some fields,
(08:10):
requiring constant refresh.
This all sounds expensive.
How can HR professionals convince skeptical executives to invest in L&D?
The key is speaking the language of the C-suite by tying training directly to business problems
rather than pitching training for training's sake, identify specific issues hurting the
business like declining customer satisfaction or leadership shortages, then show how targeted
(08:35):
training addresses them.
Use quantified business cases including turnover costs, productivity metrics, and industry
research showing that every dollar in training yields four or five vololors in ROI.
Present scenarios like, if we reduce turnover by 10% through this program, we save X million
(08:55):
in recruiting costs.
Also highlight the cost of doing nothing by showing lost revenue if skills stagnate.
For risk-averse organizations, what's the best way to get started?
Start with pilot programs and quick wins.
Use a small initiative targeting a specific skill gap with defined outcomes and modest
budget.
(09:17):
When the pilot concludes, collect success metrics like sales increases or internal placements
that saved recruiting costs.
Use these stories to build credibility.
It's a proof-of-concept approach.
Reduce the initial ask.
Deliver success on a small scale, then leverage that momentum for larger buy-in.
(09:39):
Saving an executive sponsor is also critical.
Companies with L&D executive sponsors are twice as likely to exceed business goals.
What's the final piece for securing executive buy-in?
Present a clear implementation plan with metrics for accountability.
Outline timeline, target audience, and crucially the metrics you'll track like performance
(10:01):
improvements and KPI impacts.
Commit to reporting back on outcomes.
This is both qualitative feedback and quantitative indicators.
If the goal is better customer service, track satisfaction scores before versus after training.
This data-driven approach shows we will know if this works and sets you up to sustain funding
(10:24):
by proving impact over time.
Any final thoughts on breaking free from this training catch 22?
The fundamental shift needed is reframing L&D from a cost center to a vital investment
in human capital.
In today's knowledge economy, an always learning company will consistently outperform
a stagnant one.
The most admired companies treat talent development as core to their competitiveness and reap
(10:49):
the rewards.
By demonstrating successes, grounding proposals in data, and aligning with executive priorities,
HR professionals can convert L&D from a low priority budget line to a strategic driver
of growth.
In a world where skills are the new currency, those who invest in their people's development
will have the strongest competitive advantage.
(11:17):
That wraps up today's podcast where we explored how companies like Amazon and AT&T are successfully
investing in employee development to tackle the skills gap and highlighted the importance
of aligning training with business needs for executive support.
Don't forget to like, subscribe and share this episode with your friends and colleagues
(11:39):
so they can also stay updated on the latest news and gain powerful insights.
Stay tuned for more updates.
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