Upskilling as the Solution to Retail Staffing Shortages

Retail workers are quitting their jobs at an unprecedented rate, with almost half of all frontline U.S. retail employees contemplating turning in their pink slip in the next few months. Compared to only 38 percent of the U.S. workforce looking to exit their position, retail leaders are exceedingly worried about employee retention and how a staffing shortage will affect sales. In fact, 31 percent of retailers struggling to meet sales goals point to staffing shortages as the main cause.

Learning and development (L&D) plays a critical role in employee retention, with 73 percent of retail workers reporting they would have stayed at their companies longer if they were given more professional development opportunities in their role. By implementing an effective L&D program and offering upskilling opportunities to employees, retail leaders can mitigate employee retention challenges and their impact on sales performance.

Upskilling as a Solution to Hiring and Retention Challenges

A strong L&D strategy is becoming less of a nice-to-have and more of a need-to-have, especially for organizations that want to stand out in today’s job market. Studies have shown that organizations with a well-established L&D program are more likely to attract top talent, with 76 percent of employees saying that a company that offers additional training opportunities to its employees would be more appealing than one that doesn’t.

Increased upskilling and professional development opportunities can lead to several additional benefits for employees and businesses overall, including:

1. Increased Employee Satisfaction: When employees feel supported by their employer, they're more likely to remain engaged and fulfilled in their roles. More than half (52 percent) of workers say they need to learn new skills within the next year to continue their careers. By offering a strong L&D program, employers can meet this demand and ultimately increase job satisfaction levels among their employees.
2. Higher Productivity: Staffing shortages can take a toll on employee engagement and productivity, and 63 percent of workers believe these shortages contribute to employee burnout. An effective L&D program has proven to decrease burnout while increasing company-wide engagement and productivity. For instance, 92 percent of employees with access to an effective L&D program report being more engaged with their work. This heightened engagement translates into increased productivity, which ultimately benefits an organization as a whole.
3. Improved Customer Service: On the same note as higher productivity and engagement, a strong L&D program can improve customer service and satisfaction, especially in the retail industry. Seventy percent of buying experiences are based on customer experience alone, with fast service and personalized experience at the forefront of these expectations. Today, 80 percent of customer service teams lack the essential skills needed to keep up with these evolving customer expectations. With staffing shortages being directly linked to a decline in customer satisfaction, retailers that are looking to win the hearts and minds of more customers need to prioritize customer service training.
4. Increased Cost Savings: There are significant financial implications associated with employee turnover, including costs associated with recruitment, onboarding, and a lapse in productivity. By investing in upskilling initiatives, businesses can retain existing talent and mitigate these expenses. Organizations that choose to upskill save an average of 70 percent to 92 percent on training costs compared to new employee recruitment and training investments. L&D programs, in general, have proven to promote significant return on investment, with companies receiving $4.53 in return for every dollar invested in training, a 353 percent ROI.

How L&D Leaders Can Upskill Retail Workers

There are several areas where retail leaders can upskill their employees to help mitigate risk during a staffing shortage. However, to do so they must first identify the areas where training is most needed. Leaders should regularly connect with managers to identify tasks that require additional training and prioritize those first in their enablement strategies.

Once priority upskilling opportunities are identified, leaders should then decide what forms of training best suit the needs of their organization and employees. For example, just-in-time training, a time-sensitive form of training designed to quickly teach employees what they need to know about a specific topic, is an efficient way for retail leaders to deploy training specific to each employee's individual needs. This method is especially effective in a fast-paced environment like retail — providing quick training exactly when needed and then allowing employees to move on to their next task.

When employees have more time to dedicate to training, microlearning opportunities allow employees to brush up on their skills whenever needed and can even be incentivized or gamified to encourage higher participation and learner engagement.

Ultimately, staffing shortages will almost always negatively impact business performance, regardless of the industry. Beyond the direct impact on sales and revenue, there's an indirect impact on the productivity, satisfaction and retention of employees.

By upskilling employees, retail leaders can address these challenges head-on to not only evade the staffing shortages plaguing the industry, but also establish a culture of support and resilience among their existing workforce. This enables teams to navigate challenging times with ease, minimizing their impact on business performance and profitability.

Jen Jackson is the senior vice president of customer experience at Litmos, an online learning platform.