London, 27th January 2022, Reskilling staff can create cost savings of up to £49,100 per employee compared to recruiting or making a role redundant according to a report published today by the Financial Services Skills Commission (FSSC) and PwC UK.
The report, titled Reskilling: A business case for financial services organisations, provides evidence on the cost savings financial services firms can benefit from when they reskill an employee; versus hiring someone new with the relevant skills. Reskilling a financial services employee costs on average £31,800 compared to the redundancy and rehire approach which carries an average cost of £80,900. The research shows over a four-year period a company with 30,000 employees could potentially save between £75 million and £115 million by upskilling current employees into the roles they need filled*.
The need for reskilling across financial services has never been greater as the industry faces a significant shift in the skills requirements for its workforce, increasing skills gaps across the UK and a greater demand for talent. Research by The World Economic Forum (WEF) estimates that by 2025, 85 million existing roles, globally, will be displaced due to factors such as technology and automation (1). However, the report published today shows there is a clear business case in favour of reskilling and strategic workforce planning.
Given demographic trends, including an increase in life expectancy and retirement age, the scale of the change needed in the sector and digitisation elsewhere in the economy mean that the skills gaps in financial services cannot be met through recruitment alone. The report published today is designed to help businesses address the difficult challenge of regularly upskilling existing staff to meet emerging skills gaps, and to equip them for roles that may not yet exist, ultimately encouraging firms to undertake a robust forecasting of future skills needs.
Commenting on the report, Claire Tunley CEO, Financial Services Skills Commission comments:
“Recruitment alone will not address the existing skills challenges across our industry. That is why the FSSC is today calling for firms to prioritise reskilling, so it becomes an essential component of an organisation’s workforce and planning strategy. Our business case clearly demonstrates that reskilling can generate a real return on investment, boosting productivity and competitiveness, mitigating operational and reputational risk, and positively impacting the wider economy and society.”
Christopher Box, financial services HR consulting lead at PwC UK, comments:
“The financial sector has a major presence across the country and employs people at every stage of their career journeys, from school leavers to experienced hires. However, we know regions and nations where business activity is concentrated in relatively smaller or fewer hubs have the greatest challenges recruiting and accessing skills. For these areas especially, reskilling current workers will make a big difference to their business models. To remain competitive, financial services companies need to prioritise building programmes that can deliver skills training to their people at scale across multiple levels of experience, expertise, regions and, crucially, programmes that can be delivered across the virtual and in-person divide.”
Access the Reskilling: A business case for financial services organisations report here (including the full calculations referenced above on page 7 of the report).
The skills picture in UK regions & nations – skills challenges vary across the UK, with some regions facing more challenges than others. Research published in 2021 by the FSSC and the Professional Business Services Council (PBSC) examines this and can be accessed here:
About the FSSC:
The Financial Services Skills Commission is an independent, non-partisan, member led body, representing the UK financial services sector on skills. We work directly with the sector and advocate for innovative collaboration to ensure that businesses have the talent and skills they need for the future. Follow FSSC on Twitter and LinkedIn
About PwC :
At PwC, our purpose is to build trust in society and solve important problems. We’re a network of firms in 156 countries with over 295,000 people who are committed to delivering quality in assurance, advisory and tax services. Find out more and tell us what matters to you by visiting us at PwC.
PwC refers to the PwC network and/or one or more of its member firms, each of which is a separate legal entity. Please see how we are structured for further details.
FSSC Press contact:
Director of Communications: Linsey.White@financialservicesskills.org
Tel: 07801 961186
PwC press contact:
PR Manager: email@example.com
Tel: 07483 421921