Preparing a Digital and Future-Ready Workforce

Context

The future of work is unfolding fast. With rapid automation, digitalisation, and re-skilling, organisations are facing an unforeseen workforce challenge. The shelf-life of most skills today has halved, and they are predicted to be rapidly changing in the years to come. The existing organisation structures are no longer optimised to support the changes brought in by the fast-changing skills eco-system. The demographic profile of talent has also been undergoing fundamental changes—with an increasing preference for flexibility and empowerment in their work.

To this heady mix, the complexities of the pandemic were added in 2020. Business continuity was severely challenged which has led to a broad-based stress on jobs and employment. New ways of working like remote and agile were proven to work successfully, leading to more widespread and rapid adoption, while many existing practices around talent attraction, management, and retention are being questioned. All of these changes have super-charged workforce management and engagement into one of the key C-suite priorities today.

The ‘right talent in the right place and at the right time’ was always one of the key mantras to business success. Now, the definition of each of these three parameters has been extended in ways organisations had never thought of before. People are thinking differently about work, and we need to ready ourselves to a ‘brave, new world’.

Future Workforces

The signs had been around for a while – the digital enhancements in different industries, an increasing skills gap in talent globally, rising market volatility, and unique employee demographics. The 2020 pandemic only pushed these triggers and accelerated the need for a future-ready workforce.

According to the World Economic Forum Future of Jobs Study 2020, “85 million jobs may be displaced by a shift in the division of labour between humans and machines” by 2025.¹

A closer look at the nature of skills being replaced reveals that higher-order human attributes like emotional intelligence, influence, empathy, and creativity stand irreplaceable even in the jobs of the future. Furthermore, even the best technology can be harnessed only when the employee using it is skilled enough. The future workforce is turning digital, distributed, and diverse. It is rapidly embracing the changes needed and discarding the old to make room for the new.

Having entered this new normal, it is clear that skills are the new yardstick to measure organisational success against. Organisations can no longer prepare for the workforce of the future using methods of the past. To analyse this in detail, we delineate each aspect of the future workforce and identify its changing trajectory from a skill-based lens in terms of three integrated dimensions: ‘who’ forms the right talent, ‘where’ they work, and ‘why’ they contribute to organisational success.

1. Who:

The right talent is fast becoming available in a variety of forms and shapes – full-time and part-time workers, permanent employees and consultants/freelancers, on-site and fully remote staff, white-collar or blue/ grey collar gig workers, and retirees and independent contractors. This entire ecosystem of new types of workers arising because of digital enablement together form ‘digital employees’. While many of them may possess higher-order digital skills than their non-digital counterparts, it is not just the technology that sets them apart. It is what they can do with that technology and how they can deploy their skills – digital and more – beyond the traditional realm of work.

The changing composition of the workforce also creates increased possibilities and meets critical business challenges at the same time. A recruiter now only needs to focus on whether the talent being interviewed has the right skills needed to deliver the project – irrespective of his/ her preferences in terms of work arrangements, location, or time-zone. In fact, while overall full-time hiring had slowed down in India and globally during 2020, jobs were lost and unemployment averaged at 10%², the parallel digital employment and gig economy grew to absorb a large chunk of this workforce.

Flexing It, an India-based platform for white collar freelancers saw a 20+% growth in flexible talent positions posted in FY20-21 as compared to the previous financial year indicating an increasing demand for non-traditional work structures and a focus on skill.

2. Where:

2020 was also the year of remote work, forcing several organisations to embrace extended work-from-home (WFH) overnight. However, it is now clear that a hybrid approach to ‘where’ employees would like to work is the future. Several leading organisations like Novartis, Slack, and Twitter have announced a permanent option for employees to work from home.³ Many others have opted for a hybrid model, and the latest arrangement to join this trend is ‘work-from-anywhere’ (WFA).

Made possible due to greater confidence in work-from-home productivity during the pandemic-induced lockdown, as well as increased digitalisation of organisations and processes around data security, WFA breaks all barriers when it comes to talent attraction and management. When hiring for in-demand or niche skills, a recruiter no longer needs to be restricted to the local talent market or the full-time talent pool. This trend helps take employability and high-quality jobs to talent outside the metros and into Tier 2/3 cities which was a challenge earlier.

3. Why:

The future workforce has a third dimension that is fast changing – and this is the ‘why’. Professionals entering the workforce today are driven by different and unique motivations. Young professionals are thinking about their careers more sustainably. Enjoying time with family or pursuing their interests, seeking flexi-working options, and participating in meaningful projects are important for them. Millennials and Gen Z workers also embrace organisations that give back to society and follow ethical practices. They want to be able to trust their employer “to treat them fairly in terms of pay, development, and conditions and in return are expected to reflect the culture of the company in their approach and behaviour.”⁴ Likewise, they expect greater empowerment in their work. Virtual working during the pandemic has also encouraged managers to move away from micro-management to outcome-linked performance management. Once again, digital tools like collaboration software, project management platforms, and productivity tools support this welcome trend.

Digitalisation has enabled organisations to look at talent pools cutting across geographies, age, and other traditional barriers. The workforce strategy of the new normal is driven by the CEOs and the business, with a conscious understanding that the right skills can take their business to its goals and help navigate the volatility better. Many talent decisions are now driven from the top – be it diversity and inclusion agendas, employee assistance, and wellness programs, to people analytics. In the next section, we take a closer look at some of the key drivers that are shaping this emerging picture of future workforces.

Drivers of the Changing Workplace

Having seen the workforce of the future from the lens of the new normal and how it is changing, it is important to understand what drivers have influenced and accelerated these changes. We talk about a few of these below:

1. Technology

In a PwC survey of 10,029 members of the general population based in China, Germany, India, the UK, and the US, a third of people worldwide expressed worry about losing their jobs to automation and AI.⁵ However, while Digitisation, Virtual and Augmented Reality, and Robotics are indeed an immediate reality, we find that these technologies are creating newer jobs too. There is an urgent need to re-skill and constantly re-invent ourselves as well as our processes to ensure that more and more employees transition smoothly into sustainable job opportunities.

2. COVID-19 Pandemic

The unprecedented conditions invoked due to the COVID-19 pandemic have accelerated several work trends that were already in the pipeline. According to the World Economic Forum Future of Jobs Survey 2020, the top business response to COVID-19 was acceleration of the digitalisation of work processes.⁶ Acceleration of automation of work tasks and implementation of up-skilling/ re-skilling programmes were other key responses that have influenced the workforce of the future to be more agile.

3. Democratisation of work

The gig economy was already a key workforce trend with a large part of the population opting for it. The unexpected job market outcomes of 2020 drove a significant number of skilled and semi-skilled workers into the open market, who began exploring the benefits of the gig economy. This was further provided impetus by two significant trends:

• Firstly, we see a vastly increased acceptance by organisations to deconstruct roles into skills and hire talent in the form of an independent consultant or freelancer. This was particularly true for highly paid white-collar gig roles. A recent survey by Flexing It reveals a definite increase in the quality and quantity of roles available in the professional gig economy in India. In the next 5 years, 35%+ organisations expect to have a workforce comprising >15% flexible talent and 90% of the projects that freelancers worked on were of strategic priority.⁷
• Secondly, the emergence and scaling-up of effective on-demand talent platforms, that have democratised access to skills and effectively bridged the gap between the employer and the talent. These technology-driven platforms have effectively galvanised demand across white-collar, grey-collar, and blue-collar sectors.

According to the global study by Payoneer, India saw a massive 46% increase in new freelancers between Q1 to Q2, 2020, while emerging as the second-fastest growing economy for freelancers (160% y-o-y revenue growth) last year.⁸ However, this positive trend comes with its share of watch outs and opportunities to strengthen the gig and digital eco-system. We will discuss these in the next section.

4. Changing demographic of the workforce

As discussed in the previous section, the changing mindset of the newer workforce is a key changing force in shaping the new economy. The demographics, career preferences, and courage to make sustainable choices that are displayed by the Millennials and Gen Z workers means that organisations need to adapt themselves to suit the career aspirations of this new type of talent.⁹

These drivers have created a fertile ground for the workplace of the future to emerge from. However, the challenges that had prevented these changes from taking shape over so many years, are still prevalent, especially in an economy like India’s. The Organisation for Economic Co-operation and Development (OECD) forum anticipates that given a very young working population, “the annual demand for new jobs in India is estimated at 12-15 million…with a shortage of between 4-7 million jobs each year.”¹⁰ While on the one hand companies finds it difficult to fill their vacancies with capable talent, on the other hand, multiple candidates are looking for suitable opportunities.

The skilling challenge is accentuated by a scarcity of effective technology and tools to bridge the gap between the job seeker, especially beyond the metros, and the job. Added to this the gender disparity of the job market. Women are paid 19% lower¹¹ than their male counterparts for the same job, and the COVID-19 pandemic has only made it worse with the job losses higher amongst women professionals.

In South Asian economies like India, another roadblock that prevents the future-of-work changes from reaching the last mile is the lack of job formalisation. More than 80% of the South Asian workforce “is engaged directly in the informal economy and many more work as informal workers in the formal economy.”¹² This prevents an equitable reach of any changes taking place in the order of work. Put together, we have a greater challenge at hand.

These and multiple other challenges have prevented the Indian economy from fully leveraging the new digital workforce. “In order to take full advantage of the employment potential of the digital economy, it is essential to improve and secure digital infrastructure to enable equal access to digital technologies and reduce the digital divide.”¹³

In the next section therefore, we look ahead at some of the actions we can take to overcome these challenges.

Enabling Change: How can India leverage the future workforce?

Jack Welch once famously quoted – “change before you have to”. The time is upon us when multiple drivers are pushing businesses from all directions to embrace change and adapt into a more agile, future-ready eco-system. However, to enable that this change is sustainable and effective, it needs to be looked at from a holistic perspective.

We analyse it from seven different lenses and what it implies for each of these stakeholders:

 

1. Corporates

• Large organisations today are in a strategic position from where they can drive the thinking around skills needed in the futureand the right mix of Traditional and Digital Employees to deliver these. We will still need human employees in a fully automated world – whether to use a technology or develop new ones. Organisations need to be able to map their digital strategy such that they are able to identify the skills needed in the future, constantly update this thinking, and ensure the workforce is getting the support needed to build these skills. These aspects are critical for an organisation alongside using the latest technology.
• Another area where corporates can play a catalytic role is investing in technology that enables remote and digital workto take place seamlessly and democratically. Adopting technology and digitalisation for the sake of it, leads to short-term and unbalanced results. The pandemic accelerated the digital transformation and forced several organisations to adopt remote work technologies. However, the uneven reach of these reactive measures has impacted workplace productivity as well as inclusivity of different workforce categories. For example, a contract employee working on financial analysis would struggle to safely access confidential data while working from home if her/ his organisation previously relied on on-site data security measures alone. Proactively analysing which technological solution is critical and relevant to the business and industry is, therefore, a key imperative.
• As we prepare for the future of workforce, the responsibilities of corporates extend beyond just their workplace and industry. They can contribute towards more effective up-skilling of talent entering the workforce. This can be achieved through structured partnerships with academia and skill development initiativesto ensure greater fitment of talent with future jobs and support increased employability in society as a whole. Currently, many corporates look at skill building from a CSR (Corporate Social Responsibility) lens. However, there is a significant business case for corporates in developing meaningful partnerships with higher education institutes. Niche and new-age skills like Big Data, Virtual and Augmented Reality, Quantum Computing, Meta Materials are still in nascent stages. By sharing practical know-how, supporting lab development, and partnering in curriculum design as well as faculty development, corporates that utilise these pioneering technologies can build student interest and capability in parallel and build a talent pipeline for themselves at the same time.

2. Human Resources professionals and community

HR’s role is undergoing the biggest revolution in decades and the traits that will hold HR in good stead are bringing the outside in and a keen sense of business. The HR community can do this by developing new frames of thinking about core HR processes like Learning, Performance Management, Compensation – for new segments of the workforce. HR today needs to be open to new ways of working and managing a different type of talent – from full-time to part-time, from permanent to gig workers, and even expert advisors. Some of the key imperatives where HR can add immense value in years to come are:

• How they access non-traditional talent in time to meet business demands?
• How do they define fair pay for different workgroups?
• How to ensure people practices meet a hygiene standard across all talent categories?
• How is talent engaged and aligned to the larger organisational vision across boundaries of generation, age, and geographies?

Fortunately, digitalisation of HR processes has helped a great extent in making this new thinking a reality. Digital transformation is not about technology, it is about what people can do with that technology. For example, advanced HR management systems today can not only help HR and line managers plot what skills are available in the organisation but also identify which talent can be moved or quickly developed to occupy upcoming critical roles. Tools to fairly peg compensation of skills are now available for all segments of talent like full-time, contractual, and specialist advisors. Similarly, learning and development professionals believe that online learning portals have put self-development at the centre of employee engagement.

Considering that a “one size fits all” approach is no longer viable, HR also must learn to listen to people, their needs, and motivations in a more segmented manner. Defining a holistic Employee Value Proposition (EVP) that delivers an enriching experience to all segments of the workforce is the next important role for HR to play as we get future-ready. Every existing and potential employee should resonate with the EVP that HR creates. For example, some organisations have now adapted their Code of Conduct and employee policies to allow for employees to pick up part-time paid gigs in their free time, so that they can follow their passion like music or teaching. These forward-looking HR functions have identified the need for greater flexibility if they have to position themselves as employers of choice in this new world order.

Another role for HR professionals to play as we move rapidly into a new era of digital and distributed work is creating an inclusive culture that supports all groups of talent to perform, wherever they are. All people practices like hiring, learning, and development, performance management, succession planning, compensation, and talent management must accordingly adjust to enable a diverse workforce to operate in tandem with each other, together with achieving the larger vision of the organisation. As per research, diversity and inclusion brings greater innovation and superior business results. According to the 2020 McKinsey research, “Companies whose leaders welcome diverse talents and include multiple perspectives are likely to emerge from the crisis stronger.”¹⁴ Inclusion of these varied ideas means HR must build a safe environment for everyone to express their thoughts and bring their whole selves to work.

3. Higher Education Institutes

Higher education institutes are the primary source of our intellectual capital. As the new normal hits, the students entering the workforce from our institutions, preparing them for the new ways of working becomes crucial. The half-life of skills is only 2 – 5.5 years¹⁵ and so by the time a student graduates and enters a workplace, some of the skills she/ he studied at university will become obsolete! The focus of these institutes therefore should be on enabling students to prepare for a different future of work & how they can navigate it. Thankfully, digitalisation has also democratised the learning and re-skilling landscape. Mass Open Online Courses (MOOCs) platforms like Coursera, EdX, and others have enabled learners across the globe to access best-in-class education from the comfort of their homes and at a fraction of the cost of a traditional university degree.

At the same time, a meaningful partnership between higher education institutes and corporates will lead to a win-win understanding of which skills are required for the corporates and developing the talent from the institutes. Structuring programs for corporates on how their leaders and HR can better manage blended and hybrid workforces is also a critical input that academia can provide.

Workers of all categories across India are finding that jobs increasingly require new and adapting digital skills and competencies. However, skill development is still catching up, creating barriers to gainful employment. Higher education institutes can address these challenges by designing out-of-the-box solutions like innovative apprenticeship-based skilling models. These could include fully digital programs in conjunction with industry, which help define how this could scale and map the skills of the future, ensuring higher employability of youth.

4. Workforce partners & staffing agencies

Some of the largest private sector employers in India are staffing agencies like Quess, Teamlease amongst others. These organisations provide talent on contract to their clients and have a critical role to play in solving for India’s employment challenge. Workforce management and staffing agencies need to go beyond traditional manpower solutions and think about how they offer longevity in careers and skill building for the professionals they staff. They can also explore synergies with flexible talent portals to offer more opportunities for the community. Innovations like these in the industry can help advance the future readiness of the larger talent ecosystem.

Additionally, workforce service providers can consider designing equitable yet unique solutions for specific groups of talent. This can help create an optimised workforce.

5. Government and Policymakers

As the future of work evolves and businesses go through a VUCA (Volatile, Uncertain, Complex, and Ambiguous) environment, the world will not be simple for workers either who must constantly struggle with job mobility and re-skilling to ensure their relevance in the ever-changing talent market. In a society like India, less than half the active working population have the digital skills required today.¹⁶ Even fewer will have awareness of re-skilling parameters and platforms, let alone the ability to pay for it themselves. As a result, the continued state support to encourage skill development and mobility through allocation of funds and/or offering financial incentives to corporates investing in skilling their workforce for the future will be a huge impetus.

There is also a need for government bodies and policymakers to develop guidelines in consultation with industry around the employment of non-traditional workforce like baseline benefits (insurance, medical, retirals), overtime, minimum pay, leave working conditions, etc. Governments across the work are “responding to the dynamic changes in the nature of employment. An example of recent policy intervention is the Freelancer isn’t Free Act in the United States.”¹⁷ This enhances protections for freelance workers, including the right to receive a written contract, the right to be paid timely and in full, and the right to be free from retaliation. “Another example is the European Commission’s Late Payments Directive of 2011.”¹⁸ India has also taken positive steps in this direction, through the three draft labour codes intended to benefit platform-based gig workers¹⁹. When enforced, it will provide the right to the Central Government and State Governments to notify schemes for such workers related to life and disability cover, health and maternity, provident fund, employment injury benefit, housing etc. Such legislation can go a long way in providing the necessary support structures and an equitable work environment for them to perform optimally.

Policymakers can further structural support and incentives for WorkTech platforms and other workforce partners which enable the digital employment ecosystem. Such platforms are helping bridge the gap that has traditionally prevented transparency between organisations and gig and remote talent – whether white collar or blue/ grey collar. Policy measures aimed at incentivising such platforms will democratise access to the digital workforce to a variety of opportunities.

6. WorkTech and Gig Platforms

The Gig and Digital Employment economy is a rapidly growing and yet relatively new career choice for professionals in India. One of the biggest priorities for WorkTech platforms is to invest in enabling trust in this new model of employment and enhancing adoption. Strengthening the process of verification of candidates, a clear delivery process, and transparent compensation structures can help boost the Digital Employment ecosystem.

As independent workers, gig talent depends on their own initiative to build their skills and keep abreast with technical advances in their domain. WorkTech platforms are strategically placed to create optimised up-skilling initiatives for the gig workforce. By investing in the skilling and financial health of their community members, WorkTech platforms can contribute to ensuring a sustainable career for them.

Finally, WorkTech platforms can also play a significant role in this new normal by creating targeted support models for women professionals to enable them to get back to work. “Female job loss rates due to COVID-19 are about 1.8 times higher than male job loss rates globally”²⁰ The pressures of working from home and managing childcare or virtual schooling fall greater on women.

However, with the increased digitalisation of the workforce and acceptance of remote working, this inequality can be reversed if more women are absorbed into the gig and remote talent framework. WorkTech platforms have a significant role to play here by increasing the diversity of gig projects and creating a larger pool of women talent. Their role in democratising access to suitable projects will remove barriers faced by women today and can help increase India’s Labour Force Participation Rate (LFPR) for women.

7. Industry bodies

Associations and think tanks like CII, Assocham, and India Foundation have helped navigate the socio-economic thinking around key workforce trends over the years by asking the right questions to corporates, leaders, policymakers, and other stakeholders. Their continued efforts in this direction can enable broader change by sharing best practices and toolkits with the extended corporate community. By generating high-quality research and thought leadership on the future of the workforce, they can create the necessary awareness and pave the way for discussion and subsequent changes.

Industry forums can also play a unique role by facilitating partnerships between members to deliver solutions for Digital and Gig Employees. For example, Insurance companies can support the new gig sector by custom designing solutions with the support of flexible talent platforms. Such cross-pollination in a start-up culture like India can open up opportunities for new intermediaries/ ancillary services like “private insurance cover, training services, licensing help, credit providers and business support.”²¹

Other critical areas where industry forums can make a difference is enabling suitable corporate-academia or corporate-government partnerships towards skill-building and policy definition. They can decisively lead the thinking on core enabling mechanisms in partnership with members as we steer through the pandemic to take proactive measures towards skilling, job creation, and digitalisation. These measures will require sustained public-private collaboration at scale, which can be led by industry bodies.  

Conclusion

Today we stand at a defining moment in history. Amidst an unprecedented pandemic and an array of opportunities in new digital skills, we have the opportunity to look at the future from a new lens – one of change and renewal. As we look ahead, there is hope yet a need for caution. Our choices and decisions today will impact an entire generation, their livelihoods, and outlook. Herein lies the possibility to make a difference to tomorrow.

Fortunately, we have the right tools and the right mindset as a country. The Industrial Revolution 4.0 has led us to this exciting era where we can leverage humans and machines alongside. We have the ability to up-skill and re-skill our people in the latest technology, manage the best people practices, partner meaningfully with each other and create a society that uplifts every worker and supports their constant renewal in this ever-changing economy. Looking in the right direction, we can lead the narrative on the digital-ready future workforce.

Authors Brief Bio: Ms. Chandrika Pasricha is the Founder and CEO of Flexing It, India’s largest Tech-driven platform enabling the Professional Gig Economy and Ms. Vidhi Kumar is a Senior Consultant in Human Resources Management.

References :

1. https://www.weforum.org/agenda/2020/10/top-10-work-skills-of-tomorrow-how-long-it-takes-to-learn-them/
2. https://unemploymentinindia.cmie.com/
3. https://www.forbes.com/sites/kristinstoller/2021/01/31/never-want-to-go-back-to-the-office-heres-where-you-should-work/?sh=41a4eb5a6712
4. https://www.pwc.com/gx/en/services/people-organisation/workforce-of-the-future/workforce-of-the-future-the-competing-forces-shaping-2030-pwc.pdf
5. Ibid
6. Future of Jobs Survey 2020, World Economic Forum (http://www3.weforum.org/docs/WEF_Future_of_Jobs_2020.pdf)
7. https://www.flexingit.com/think-factory-report/crafting-a-strong-freelancer-proposition-are-organizations-ready/13/
8. Payoneer study on Freelancing in 2020: An Abundance of Opportunities (https://explore.payoneer.com/en/report/2020-gig-economy-index/)
9. https://www.hbs.edu/managing-the-future-of-work/Documents/Building_The_On-Demand_Workforce.pdf
10. https://www.oecd-forum.org/posts/29977-india-inclusive-growth-and-the-employment-challenge
11. https://www.livemint.com/money/personal-finance/what-is-gender-pay-gap-and-why-is-it-so-wide-in-india-11575356633900.html
12. https://www.oecd-forum.org/posts/29977-india-inclusive-growth-and-the-employment-challenge
13. https://www.ilo.org/wcmsp5/groups/public/—asia/—ro-bangkok/—sro-new_delhi/documents/publication/wcms_344607.pdf
14. How Diversity & Inclusion Matter | McKinsey
15. https://www2.deloitte.com/content/dam/Deloitte/global/Documents/HumanCapital/dttl-hc-english-opentalenteconomy.pdf
16. Future of Jobs Survey 2020, World Economic Forum

http://www3.weforum.org/docs/WEF_Future_of_Jobs_2020.pdf

17. https://www.flexingit.com/think-factory-report/flexing-it-presents-some-key-trends-on-how-the-freelance-economy-has-been-shaping-in-india/4/
18. Ibid
19. https://www.mckinsey.com/featured-insights/future-of-work/covid-19-and-gender-equality-countering-the-regressive-effects
20. (i) The Occupational Safety, Health and Working Conditions Code, 2020, (ii) The Code on Wages, 2019 (“Wage Code”), and (iii) The Social Security Code, 2020 (“SS Code”) (collectively referred to as (“Labour Codes”))
21. https://www.flexingit.com/think-factory-report/flexing-it-presents-some-key-trends-on-how-the-freelance-economy-has-been-shaping-in-india/4/by 2025