According to the study, the skills shortage impacts companies in several ways, including loss of business, increased outsourcing costs, and reduced productivity - however, despite predictions of slow economic growth and inflation impacts, 80% of business leaders expect to hire at least as many people in 2023 as they did last year.

Claire Hopkins, interim CEO of RMIT Online, says "Now is the time for businesses to invest in skills and development capabilities if we are to grow a resilient and competitive workforce. As the demand for digital skills continues to grow, the cost to businesses will also grow if decisive action is not taken to address these gaps.

“While the upfront cost to solve our upskilling and reskilling crisis may seem high, our research shows investing in training is necessary for Australian businesses to reap substantial and long-lasting benefits, and to mitigate the impact of the digital skills gap," concludes Hopkins.

The study also found that to address the skills gap, almost half (48%) of surveyed employers prefer upskilling or reskilling existing employees, over hiring externally, as they believe internal solutions generate additional benefits such as increasing retention, strengthening team culture, and raising cost-effectiveness.

It’s reported that employees who received promotions in the past year, on average, spent 50% more time on training than those who did not receive a promotion - and while a third of employers think employees need to refresh their skills at least every three months, employees cited barriers to training such as lack of time, high cost, and lack of support from their employers.

Additionally, the most valuable types of training for employees were mandatory on-the-job training, formal qualifications, and formal certifications.

John O’Mahony, Partner at Deloitte Access Economics, says “If businesses underinvest in digital skills training it can result in a loss of revenue, additional costs of outsourcing work to external staff or contractors and reduced productivity. That’s why training is an investment, not just a cost.”

The study also revealed;

• 24% of employers consider the frequency of engagement in training, upskilling, or reskilling opportunities when promoting internally
• Companies anticipate a continued demand for soft skills, with employees identifying leadership as the most critical skill in the next five years (27%) and employers identifying communication and collaboration (14%)
• The top reason cited by employees for being attracted to a company is higher pay (16%), followed by flexible working hours (12%)
• Employers report increased pay and remuneration is the most effective tool to attract new staff (21%), followed by offering greater location flexibility (17%) and hours (15%)
• Workplace culture (33%) and not feeling valued by management (33%) are among the top reasons employees intend to leave their job.

For more information, read the report here