Let’s welcome ourselves to the fast (electric) train called “digital transformation”. During this journey we may have various obstacles, dilemmas, but also many new opportunities. So, if the small and medium enterprises on this journey have a dilemma whether digital or soft skills are more important to them, it is similar to, for example, a parent having a dilemma about which of their two children is more important to them!? It’s simple: both types of skills are important because one without the other is meaningless.
However, someone may relativize this thesis and claim that in times of major crises like today’s, small and medium enterprises should focus first on basic obligations, such as regular payment of salaries, payment of (now already enormous) bills for electricity, and if they have a significant profit, only in that case they can think about a complete digital transformation and implementation of digital and soft skills (!?) It is precisely such an approach that is limiting for their faster growth and development because it ignores the fact that nowadays investing in skills is an investment that is more than necessary. By analogy of the example above, it would be similar to parents giving up investing in the education of their two children because they don’t have enough money in the family budget, so it can’t be a priority. It’s almost unimaginable, isn’t it?
Bearing in mind this starting point, let’s look at nowadays, September 2022, how the world thinks and does on the subject of digital and soft skills, where is the European Union, and to what level are we in the Macedonian society and what recommendations we should apply.
Skills in the World
In order to have an essential insight into the situation in the world, it is most relevant to take into account the materials published by the World Economic Forum as a relevant international organization that just last week in New York, USA, held a series of “Sustainable Development Impact Meetings” whose main topic was “The Skills Revolution”. Due to the fact that I have been actively and closely involved in the activities of this international organization for several years, in this text I will extract some important data about the current and future situations.
- Due to digital transformation, by 2025 about 85 million jobs will no longer exist, and about 97 million completely new jobs will be created.
- By 2025, every second employee will need upgrading of skills, upskilling or reskilling.
- For companies, it will be three times more affordable to invest in upgrading the skills of current employees than firing them and hiring new candidates.
- In 2025, the top 10 skills will be the following:
a) Type – problem solving: (i) analytical and innovative thinking, (ii) solving complex problems, (iii) critical thinking and analysis, (iv) creativity, originality and initiative, (v) reasoning, problem analysis and ideation.
b) Type – self-management: (vi) active learning and learning strategies, (vii) toughness, resilience, stress tolerance and flexibility.
c) Type – working with people: (viii) leadership and social impact.
d) Type – use and development of technologies: (ix) use of technology, monitoring and control, (x) design and software development
- Given the digital transformation, much of the current skills will be replaced by artificial intelligence, which is estimated to double productivity worldwide by 2035. But there are also such soft skills that could never be replaced, such as: non-verbal communication, empathy towards customers, management of team growth, conscious management (empathic understanding of employees), management of team intelligence, recognition and realization of new ideas in the organization.
- The “Global North” faces a large number of vacancies that are difficult to fill even in a few years, so one of the recommendations from the founder of LinkedIn is to clearly state the need for candidates from other occupations that have a similar type of skills as the advertised position. On the other hand, the “Global South” faces a large number of unemployed migrants and expatriates who do not have sufficient access to opportunities for proper reskilling and upskilling.
Hence, in a world of imminent digitalization and other geostrategic movements, we can clearly see the urgency to upgrade digital and soft skills of both managers and employees.
Skills in the EU
Unlike the World Economic Forum, which began to focus on “The Skills Revolution” as early as 2019 and especially in 2020, Ursula von der Leyen, the president of the European Commission, indicated a few days ago in her speech in the European Parliament that the next year 2023 will be the “Year of Skills” in the EU. It is good news in the direction of world needs and trends, but if one analyses her speech on this topic more deeply, three key moments will be noted:
- The EU has a shortage of qualified labour force, with the priority being attracting new working population from third countries and recognizing their qualifications, and upgrading the skills of the existing working population in the EU is somewhat in the background, although there is a focus on that as well.
- The EU has a shortage of raw materials and the focus is on their cheaper production in Europe, instead of in Asia. There is also a shortage of lower-skilled labour force in the hospitality industry (for example: waiters), so the priority is the need for a labour force that will work in this type of jobs, certainly with digital and soft skills.
- 25% of small and medium enterprises in the EU have filed for a bankruptcy proceeding due to untimely payments and therefore a new Directive will have to be adopted to introduce a shorter term for payments.
In addition, if the entire EU strategy 2021-2027 is analysed, distributed in several programs with an adequate budget, it can be noted that until 2027 the greatest focus is on digitalization and for this purpose around 200 billion euros have been allocated for all societies that have access to the different types of EU funds.
In this direction are also the data from several researches of the Universities in the EU member states, from which it is evident that a significant part of the working population prefers to have the opportunity to work from home and the most suitable option is for it to be two days during a working week.
It is clear that the “new” world in Europe will also be a world in digitalization where digital and soft skills will be a mandatory prerequisite for every job.
Skills in the Macedonian society
Let’s now go back to our reality at home. The Employers’ Organization has recently conducted research that is of commercial nature and focuses on competitive wages. In the meantime, since the beginning of the pandemic, a number of small and medium enterprises have filed for bankruptcy or, simply put, have gone out of business. The same is also in full view these months with the new energy crisis and the enormous increase in the price of electricity… The real picture is complemented by the limited state budget on the one hand, and on the other hand by the basic level (or slightly above the basic) of digital skills in our society, evident from the latest research. It is nice to note that trainings, courses and academies have started to be organized to increase digital skills, but the investment in them is by the participants themselves, individuals, employees, and very rarely from companies for their team members.
Regarding soft skills, considering that we spread that term in the Macedonian society from 2019 onwards, I can freely state that their understanding is at a very low level, and their application in practice at an even lower level. However, in startup circles and in IT companies, more and more attention has recently been paid to the application of soft skills during the new way of working (from home, hybrid or in the office).
All in all, the need for digital and soft skills in our country is even greater, and the focus and commitment is still insufficient.
ITU Report – Digital Skills Assessment North Macedonia, December 2021
Recommendations for Our Small and Medium Enterprises
- Practising and supporting your teams with digital and soft skills will provide you with happier and more productive teams that can rarely be “bought” with pure money.
- The more skills you develop and apply, the more painlessly you will survive all current and future crises and find a way for more stable growth and development.
- Invest in software solutions that encourage the daily use and development of both digital and soft skills (for example: HR software).
- Hire consultants, mentors, trainers and/or coaches who will know how to train you with soft skills in the existing and future digital world.
- Apply for and make maximum use of all domestic and foreign funds, grants, credit lines and other types of financial support, which support digitalization, reskilling and upskilling of employees and especially managers who, in this fast (electric) train of digital transformation need to become cross-border team leaders from domestic “bosses”!