Three essential ways to address skills shortages with integrated upskilling and reskilling

In 2025, the labor market continues to face a widespread skills shortage across industries. In Europe, for example, this challenge is reflected in rising job vacancy rates since the beginning of the 2020s, especially in countries like Germany, where 82 percent of employers reported recruitment difficulties in 2024. “For many companies, the challenge isn’t just finding skilled workers – it’s doing so within tight budget constraints,” Brittany Lothe, Head of Solution Enablement at SAP, says while adding that “hiring externally is often costly and limited by geography or talent availability”.

Providing tailored upskilling and reskilling opportunities to existing employees has emerged as a more cost-effective and strategic solution. By investing in the development of internal talent, companies can address skill gaps while building a workforce that is more loyal, adaptable, and engaged. “Reskilling improves employee performance, enhances retention, and equips workers to navigate change more effectively,” Lothe says. For this reason she outlines three essential ways to upskill and reskill effectively in your workforce:

#1: Leverage a platform-based approach

A platform-based approach to learning has proven to be particularly effective. The SAP Learning platform is a powerful tool in this effort, designed to provide “just-in-time” digital self-paced learning. Beyond acquiring product knowledge, learners can achieve certifications and earn digital badges – a recognition that motivates learners.

#2: Consider how reskilling and upskilling can develop the workforce of the future 

By prioritizing upskilling and reskilling, companies can not only overcome the skills shortage but also cultivate a workforce equipped for the future. This includes developing talent that is well-rounded with a varied skillset. The scale of this need is emphasized by data from the World Economic Forum’s Reskilling Revolution initiative, which projects a $2.93 trillion economic impact from upskilling and reskilling efforts by 2030, with 1.1 billion jobs being transformed by technology in the next decade.

“At SAP, we’ve seen firsthand how reskilling enables employees to explore diverse roles and topics while maintaining their core expertise, creating more agile professionals ready to meet today’s challenges head-on,” Lothe explains.

Advancements in AI are also transforming the learning experience by offering immediate opportunities for skill verification and support through innovative tools like avatars and bots. These technologies make learning more dynamic and personalized, enhancing the overall experience.

#3: Make learning an integral part of work

Learning shouldn’t feel like a separate or disconnected task. It should be seamlessly integrated into the flow of work, enabling employees to develop a strong understanding of their job requirements and the skills needed to succeed.

A targeted, well-designed program can help employees refine their abilities and stay prepared for the challenges and opportunities ahead. It’s important for hiring managers and companies to look at candidates and their ability to grow in their role and provide a training plan on day one. If someone has a skills gap, there should be a plan in place for how they can close that as quickly as possible.

“In the rapidly changing labor market, upskilling and reskilling are no longer optional – they are essential for both professionals and businesses to stay competitive,” Lothe says while adding: “By leveraging platform-based learning, focusing on workforce agility, and integrating development into daily work, companies can build and retain a more future-ready workforce.” As technologies like AI continue to transform learning experiences, businesses that prioritize learning for their employees will not only bridge current skills gaps but also foster a culture of innovation and resilience for the years ahead.

What it means for SAP insiders

How upskilling can transform your workday: As an ERP end-user, whether a Finance Manager navigating complex integrations, an HR Specialist streamlining employee workflows or an Operations Leader optimizing supply chains, upskilling and reskilling are no longer just industry buzzwords – they’re the tools that can revolutionize your daily responsibilities. With integrated learning platforms like SAP Learning, you’ll have access to personalized, just-in-time training that seamlessly fits into your workflow. Imagine effortlessly acquiring new certifications to master ERP functionalities, while AI tools provide immediate assistance tailored to your unique role. This approach simplifies adopting new features and ensures you remain at the forefront of ERP innovation, boosting both efficiency and job satisfaction.

The upskilling market trends and competitive landscape: Globally, the corporate learning market is projected to surpass $450 billion by 2030, driven by the rapid pace of technological innovation and a pressing need to bridge skills gaps. ERP giants like SAP, Oracle and Microsoft are increasingly embedding upskilling tools into their ecosystems to stay competitive, capitalizing on AI-driven personalization and workforce analytics. These advancements align with macro trends such as digital transformation, where agility and adaptability define success. At the same time, emerging players like Workday and Cornerstone are challenging incumbents with learner-centric models. This competitive landscape underscores the urgency for businesses to invest in platforms that not only enhance productivity but also future-proof their workforce.

Key criteria for evaluating upskilling solutions: When evaluating technology providers for upskilling and reskilling, ERP end-users should focus on three core criteria: integration, personalization and scalability. First, ensure the solution seamlessly integrates with your existing ERP systems, minimizing disruption and enhancing usability. Second, prioritize platforms offering AI-driven, personalized learning paths that address individual skill gaps in real time. Lastly, scalability is vital – choose a provider capable of evolving alongside your organization’s growth and future needs. By emphasizing these factors, you’ll secure a solution that not only addresses today’s skills shortages but also equips your workforce to thrive amid tomorrow’s challenges.