Why we need to think smaller on skilling

 |   Tim Allen, Skills for Employability Lead, Microsoft ANZ

Employees working together on a Surface Device

The main themes of NZ Tech’s new report on skills are familiar – a struggle to fill advanced digital roles, barriers for early-career tech workers and a need to inspire more young people to choose a tech career. By 2026, IDC calculated public cloud adoption will generate 586,750 new jobs in Australia and 134,000 in New Zealand, around 20 per cent of which are going to require specific digital skills. 

One of the major challenges when it comes to skilling digital workers is scale. As the NZ Tech report points out, a lot of tech businesses are already running their own skills programmes to attract diverse talent. Microsoft itself runs initiatives such as #10KWomen, which has nearly reached its goal of skilling 10,000 Kiwi women, and the First Nations Digital Careers Program alongside the government of Queensland.  

It’s heartwarming to hear people like Vanessa Santos, who recently participated in #10KWomen, talking about how the programme had helped overcome her impostor syndrome, saying: 

“When I’m having doubts about starting a career in technology, I remember I am welcome, I can, and I will.” 

However, 72 per cent of organisations said they simply didn’t have the bandwidth or resources to train interns or upskill their existing workers to fill senior roles, in SMBs especially. When you consider that more than 95 per cent of businesses in the tech sector are SMBs, that’s a huge barrier. 

Across our industry and governments, we need to think more collaboratively and get more ambitious about helping smaller tech employers take on apprentices or participate in skilling programmes. 

Changing the narrative on skilling 

Setting targets like a million more people in tech can make the solution seem too far out of reach for the average small business. Instead, let’s break it down into actionable, relevant steps for every employer by saying 20% of early career hires should come from alternative pathways. 

Internationally, many organisations are starting to recognise the importance of transferable skills, attitude and microcredentials over degrees. Yet in this part of the world, the majority of STEM roles still require a bachelor’s degree or higher – our own study with Accenture showed that nine in 10 Australian job ads specified a degree. There’s no doubt degrees are a great option, but this “grads only” approach narrows the talent pipeline still further, and reduces our chances of creating a diverse workforce. Linear learning isn’t suitable for many people for various reasons, whether it’s financial barriers or family and other commitments. 

Many employers believe that apprentices or others who come through alternative pathways such as microcredentialling programmes will require more hands-on training than graduates. Our experience has shown that’s not the case. Consider that career-changers who come through these pathways often have work experience and other transferable skills that those fresh out of university typically don’t have.  

On the other hand, microcredentials can quickly provide targeted skills, while offering the flexibility many people require to study while they work. Earlier this year, Microsoft partnered with vocational training provider Te Pūkenga and TupuToa to create a programme aimed specifically at cybersecurity, which is now seeing cohorts receive on-the-job training at public sector health organisation, Te Whatu Ora Health New Zealand. If more public and private sector employers embraced such alternative pathways to employment, it would be a massive boost for our talent pipeline. 

Support for career development 

A centralised external agency to support with additional pastoral support, mentorship and HR functions for tech apprentices could also be a game-changer. We’ve seen the tremendous benefits that leadership organisations such as TupuToa provide in supporting Māori and Pacific Island interns in their first jobs.  

Career development and concern that their skills aren’t being utilised were two of the top five reasons tech employees cited for changing jobs. Factoring in savings from improved retention rates, and the greater diversity and innovation enabled by support for workers from all walks of life, this would also hugely benefit businesses’ bottom line – and that of the broader economy.  

Businesses should also be looking within at how they’re creating career pathways for diverse workforces. Spark and Accenture are two businesses doing an incredible job of this, with Spark’s internship-style “accelerators” that upskill its own people providing opportunities to try out different parts of the business. A combination of external and internal innovation is what’s needed to get us to those million-plus skilled workers within the next few years.   

The role of AI 

Of course, that also means larger, better-resourced businesses need to take the lead on that kind of innovation. Microsoft has gone all-in on AI development, seeing the potential for this technology to act as a co-pilot for workers. Those in early stages of their career can now use in-built AI tools in Microsoft products to get to the “good stuff” faster, while prompting them on what they should be acting on next. That means they’re more empowered to take action themselves, making their whole experience of the job much richer and helping them learn more quickly.  

To build on Spark’s example, wouldn’t it be great to have whole development houses in-country to upskill more workers using AI? There are more than 20,000 businesses in New Zealand’s tech sector – more than 60,000 in Australia’s. Working collectively alongside government, that’s a lot of power to create change. 

Let’s commit to concrete recruitment targets that enable more people to give tech jobs a go via alternative pathways, and look harder at what will help new tech workers get ahead in the industry. Many of our global competitors are already doing it at scale to fuel their tech economies. We can’t afford not to join them.