The future of work:

Reskilling and Remote

working to recover in
the ‘Next Normal’
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June 2020
The future of work:
Reskilling and Remote
working to recover in
the ‘Next Normal’
The COVID-19 crisis has accelerated trends in workplace
dynamics that were already underway – including the
need for reskilling the workforce given the advent of AI
and automation; as well as changing workplace roles
given new ways of working such as remote working.
To keep abreast of these changes and build a business
model fit for the ‘next normal’, organizations need to
invest in effective long-term remote-working foundations,
revamp their upskilling and retraining approaches, and
adopt an agile approach to strategic workforce planning.

By Raphael Bick, Eric Hazan, Hamza Khan, Sébastien Lacroix, Hugo Sarrazin, and Tom Welchman
The COVID-19 crisis has forced many companies to rethink their business
models at breakneck speed. While remote working was already gaining
currency before the crisis, the pandemic and the step-change in use
of videoconferencing globally has shown that remote working, where
possible, is here to stay.
Similarly, even before the current crisis, new technologies and new ways
of working were disrupting jobs and the skills employees need to do
them. In 2017, the McKinsey Global Institute estimated that 60 percent
of occupations had at least 30 percent of constituent work activities that
could be automated by 2030 – meaning that as many as 375 million
workers globally would have to switch occupations or acquire new skills
by 2030. Many industries were already feeling an acute skills mismatch. 1

And with the onslaught of the pandemic, as workers across industries

figure out how to adapt to rapidly changing conditions, companies have to
learn how to match those workers to new roles and activities.
Already, at a time when many companies are having to furlough/lay off
employees, we see many others ramping up recruiting, urgently looking
for workers to meet rising demand for certain products and services. For
example, in the UK, the supermarket chain Tesco recruited more than
35,000 extra people in ten days in March to meet demand for more staff in
store and online. 2

Meanwhile in the US, retail pharmacy chain CVS plans to ramp up

hiring to fill 50,000 positions and is looking to hire employees who
were furloughed or laid off by some of its clients. In other industries, 3

companies are specifically looking for professionals who can work from
home. For example, Transcom, headquartered in Sweden, operates
55 global contact centers but its North American team members all work
entirely from home. 4

1
Jobs lost, jobs gained: workforce transitions in a time of automation, McKinsey Global Institute, December 2017, McKinsey.com.
2
“Coronavirus jobs: The UK companies and sectors urgently looking for workers, from farms to supermarkets,” inews.co.uk,
https://inews.co.uk/news/business/coronavirus-jobs-uk-near-me-covid-19-outbreak-temporary-work-2524031
3
“These companies are hiring thousands of new employees during the coronavirus pandemic,” CNN Business,
https://edition.cnn.com/2020/03/23/business/coronavirus-companies-hiring/index.html
4
Flexjobs website: https://www.flexjobs.com/jobs/telecommuting-jobs-at-transcom

The future of work: Reskilling and Remote working to recover in the ‘Next Normal’ 3
 Businesses have had to quickly embrace
remote working in the crisis context –
Companies that systematically address
the resulting challenges can turn remote
working into a competitive advantage
Advances in technologies such as cloud computing working remotely.5 A survey conducted in China
and online collaboration tools have enabled remote in March 2020 showed that, on average, more
working in many jobs that once required in-person than 60 percent of work communication took
interactions. Until recently, however, only a few place online during the coronavirus pandemic.6
companies—mainly in the technology sector—had In addition, many Chinese companies rapidly
fully embraced remote working. adopted local productivity solutions such as
Alibaba’s DingTalk or WeChat Work. As COVID-19
The tragic context of the COVID-19 pandemic has
spread, monthly active users of DingTalk jumped by
accelerated this shift as many companies around
66 percent to more than 125 million.7
the globe are instructing staff to continue working
from home, and are racing to develop their remote- That said, embracing remote working poses serious
working capabilities. early-stage challenges for organizations, across the
operating-model dimensions of people, structure,
China, which felt the first impact of the pandemic,
process and technology and leaders have an
was an early mover in this space. Working from
essential role to play in developing solutions to
home sky-rocketed and by February 2020,
tackle these challenges in the short term (Exhibit 1).8
around 200 million people across China were

60%
of occupations have at least 30 percent of constituent
work activities that could be automated by 2030, globally9

5
“Spring Festival rework day: 200 million people work from home,” China News, chinanews.com.
6
McKinsey & Company analysis, Survey on Centered Leadership and Agile Work in Coronavirus Epidemic in China conducted
on March 12-18, 2020.
7
A blueprint for remote working: Lessons from China, McKinsey & Company, March 2020, McKinsey.com.
8
For more details on how to successfully embrace the shift to remote working, please see: A blueprint for remote working: Lessons from
China, McKinsey & Company, March 2020, McKinsey.com.
9
Jobs lost, jobs gained: workforce transitions in a time of automation, McKinsey Global Institute, December 2017.

4 The future of work: Reskilling and Remote working to recover in the ‘Next Normal’
Exhibit 1
Leaders have an essential role to play in developing solutions to tackle
remote working challenges.

Remote working and

confinement challenges Key solutions

People Feeling of isolation; barriers to Instill an inclusive, caring culture and increase
building rapport and community social interactions within the team
Lack of impromptu interactions, Allow for flexibility, including childcare
decreased team cohesion Use one-on-one catchups to guard against
Pressure to balance personal demoralization
and professional life, e.g., caring Set clear direction; lead rather than micromanage
for home-schooled children
Adopt a ‘test and learn’ mindset with
Demoralization due to less daily mechanisms to share ideas
direction and misunderstandings

Structure Amplification in the lack of clarity Set clear objectives and KPIs
Difficulty in navigating Establish a structure for decision making
organization Define a new routine and new norms
Inefficiencies in decision
making
Disturbed office-based flows and
rhythms

Process Unaligned priorities Use the correct digital channel for each
Inefficient use of digital interaction e.g., video conferencing for discussing
communication tools complicated topics in real-time; chat-based
software for quick catchups
Challenges in ownership of
content and progress Create a widely accessible ‘single source of
truth’, aligning priorities and owners, sharing
regular updates and establishing a shared folder
structure

Technology Limited access to co-creation and Start with the basics of fast, stable and secure
process management tools internet connection
Increased security risks using Expand access to virtual private networks
digital communication channels (VPNs) to enable employees to access systems
Unfamiliar tools employees may remotely
not be trained to use (in terms of Use Software as a Service (SaaS) technology
technology and security tools for effective teams collaboration
requirements) Take security seriously: work with Infosec and
legal teams to make sure using tools that comply
with security requirements
Ensure everyone in the organization is trained in
safe practices

Source: McKinsey analysis, April 2020

The future of work: Reskilling and Remote working to recover in the ‘Next Normal’ 5
 Ping An successfully embraced the shift to In the post-crisis future, many organizations will
remote working in the first phase of the crisis by continue to leverage telecommuting. Recently, IBM
establishing smaller cross-functional teams—with highlighted that 54% of Americans surveyed want
clear objectives and a common purpose to keep to continue to work remotely.10 In a world shaped by
everyone on the same strategic course. The global competition, emerging skill shortages, and
company also took its security seriously and changing demographics, remote working could be
established a confidentiality culture, mandated a key enabler for companies to more effectively
awareness training, and limited data access to a deploy their workforce. Virtual approaches to work
need-to-know basis. can also be a competitive advantage to attract
a wide array of employees, including working
mothers, professionals who want more flexible
lifestyles – as well as broader international talent.

The current crisis is accelerating

the need to reskill workforces at scale –
Beyond just for the ‘distance economy’

Even before the current crisis, AI, automation and the future of work. For example, Amazon pledged
other technologies were already creating major $700 million to retrain 100,000 employees for
shifts in required workforce skills. In 2017, our higher-skilled jobs in technology; JPMorgan
scenarios suggested that by 2030, up to 375 million Chase made a five-year $350 million commitment
workers (14 percent of the global workforce) would to develop technical skills in high demand; and
have to switch occupational categories.11 Walmart has already invested more than $2 billion
in wages and training programs.14
However, new jobs will be created that could more
than offset displacement of workers by 2030. The coronavirus crisis has made the need to
But these new jobs will require specialized skills. address skills gaps even more urgent. While
Demand is expected to grow for new technological near-term upskilling efforts may need to focus on
skills as well as for social and emotional ones, while enabling effective remote working, longer-term
demand will decline for activities that require mainly reskilling efforts will need to be more holistic – and
physical, manual and basic cognitive skills.12 address issues across strategy, skills, and social
responsibility.
Our recent findings show that although 87 percent
of executives said they were experiencing skill gaps Let’s start with strategy. Leaders must set their
in the workforce or expected them within a few strategic vision and determine if they can use new
years, only 28 percent said their organizations were technologies to gain a competitive advantage. The
making effective decisions on how to close that gap divergence of local economies will affect patterns
(Exhibit 2).13 of consumer purchasing power and labor costs—
companies may need to adjust their offerings and
Before the pandemic crisis, some major
geographic footprint in response.
organizations had started launching ambitious
up-skilling and re-skilling efforts to prepare for

10
IBM press release, May 2020, https://newsroom.ibm.com/2020-05-01-IBM-Study-COVID-19-Is-Significantly-Altering-U-S-
Consumer-Behavior-and-Plans-Post-Crisis
11
Jobs lost, jobs gained: workforce transitions in a time of automation, op. cit.
12
The future of work in America: People and places, today and tomorrow, McKinsey Global Institute, July 2019, McKinsey.com.
13
For full details on the recent McKinsey Global Survey on future workforce needs, please see Beyond hiring: How companies are
reskilling to address talent gaps, McKinsey & Company, February 2020, McKinsey.com.
14
Getting practical about the future of work, McKinsey Quarterly, January 2020, McKinsey.com.

6 The future of work: Reskilling and Remote working to recover in the ‘Next Normal’
Exhibit 2
Respondents expect to see skill gaps as market and technology trends alter
organizations’ talent needs.

When skill gaps are expected to occur within organizations, percent of respondents¹
Currently experiencing In next In next In next None in next
skill gaps 2 years 3–5 years 6–10 years 10 years
Don’t
43 22 22 5 6 2 know

Share of organizations’ current roles at risk of being disrupted by market or technology trends
in next 5 years, percent of respondents¹

>50% 26–50% 11–25% 1–10% No

of roles of roles of roles of roles roles
Don’t
8 22 41 22 4 2 know

1. Figures may not sum to 100%, because of rounding; n = 1,216

Source: Beyond hiring: How companies are reskilling to address talent gaps, McKinsey & Company, February 2020

Turning to skills, our research indicates that Companies also started to leverage digital talent
82 percent of global executives at companies with marketplace platforms to bridge the supply-
more than $100 million in annual revenues expected demand mismatch. For example, in the US and in
that up and reskilling current employees would Canada, in response to COVID-19 crisis, Eightfold.
be at least half of the answer to addressing their ai partnered with the Food Industry Association
skills gap.15 To do this, organizations need to assess FMI to launch the Eightfold Talent Exchange. This
current workforce skills, determine their future platform rapidly matches recently furloughed or laid
needs, and create a road map to bridge the gaps. off employees with open jobs.17
To acquire scarce talent, particularly well-educated Last but not least is the imperative of social
and digitally-fluent professionals, companies responsibility. Organizations will need to consider
also need to develop creative ways of identifying the impact of their decisions on the communities
unconventional candidates. This could include in which they operate. Additionally, companies will
simply opting to make an acquisition to gain have a role to play in collaborating with educational
capabilities overnight, or engage temporary institutions to ensure that new graduates have the
contractors on a project basis. skills required for high-growth occupations.
With the pandemic crisis, many companies had to In the context of the COVID-19 crisis, many
stop part of their activities (e.g., closing factories companies are already responding by announcing
or cinemas) and had a large number of employees measures such as pay cuts for leading executives,
to redeploy into other roles. For instance, Majid or revised dividends, as a gesture of solidarity
Al Futtaim, a major shopping mall and leisure with their employees. Others are contributing to
player, has reskilled and redeployed more than one the global effort to fight the virus either through
thousand employees from its leisure businesses donations or innovative solutions to help where
to temporarily assist the company’s Carrefour they can. For instance, a leading automotive player
business with online order fulfilment, food packing donated its protective equipment, normally used in
and stock replenishment.16 manufacturing, to frontline healthcare workers and
loaned them vehicles to get to work in this difficult
time.18

15
Retraining and reskilling workers in the age of automation, McKinsey Global Institute, January 2018, McKinsey.com;
Beyond hiring: How companies are reskilling to address talent gaps, op.cit.
16
Majid Al Futtaim press release, March 2020, https://www.majidalfuttaim.com/en/media-centre/press-releases/2020/03/majid-al-
futtaim-staff-redeployment-photo-release
17
FMI press release, April 2020, https://www.fmi.org/newsroom/latest-news/view/2020/04/06/eightfold.ai-creates-talent-exchange-
with-fmi-to-immediately-match-recently-furloughed-or-laid-off-employees-with-critical-open-jobs
18
Press searches, April 2020.

The future of work: Reskilling and Remote working to recover in the ‘Next Normal’ 7
 Companies that build the muscle
to continously and rapidly adapt their
models and workforces to changes will be
able to compete better in the ‘next normal’

As operating models evolve quickly to Our recent research showed that smaller
accommodate a rapidly changing environment, organizations are often more successful at reskilling
the key is adopting an agile, iterative approach to their workforces – partially driven by the fact that
strategic workforce planning. For example, when they can and do follow agile principles. In addition,
an international bank realized that its regular face- most companies that had launched reskilling
to-face sales model faced disruption, it concluded programs felt more ready to address skills gaps
that virtual selling could become a competitive caused by future disruptions. Interestingly, even
advantage if done well. The bank immediately organizations that viewed their reskilling programs
began a tailored upskilling journey for its sales reps as unsuccessful felt better prepared to take on
to deepen their core sales skills while improving future skills gaps. The act of testing and iterating
their virtual ways of working. in itself builds resilience – and is thus preferable to
waiting.19

With the accelerating adoption of AI and automation, and the rise in new
ways of working, reskilling was already a priority for many organizations.
The crisis has accelerated the trend as businesses have to quickly embrace
remote working. It is more important than ever before to undertake
reskilling at scale. And to maintain resilience for the future, organizations
would also benefit from adopting an agile approach to strategic workforce
planning.

Raphael Bick is a McKinsey partner in Shanghai, China, McKinsey & Company, March 2020; Jobs
Eric Hazan is a McKinsey senior partner in Paris, lost, jobs gained: workforce transitions in a time of
Hamza Khan is a McKinsey partner in London, automation, McKinsey Global Institute, December
Sébastien Lacroix is a McKinsey senior partner in 2017; The future of work in America: People and
Paris, Hugo Sarrazin is a McKinsey senior partner places, today and tomorrow, McKinsey Global
in Silicon Valley, and Tom Welchman is a McKinsey Institute, July 2019; Beyond hiring: How companies
partner in London. are reskilling to address talent gaps, McKinsey &
Company, February 2020; Getting practical about
The authors wish to thank the authors of the
the future of work, McKinsey Quarterly, January
following publications, upon which this work is
2020.
based: To emerge stronger from the COVID-19
crisis, companies should start reskilling their The authors also wish to thank Amine Aït-Si-Selmi,
workforces now, McKinsey & Company, May 2020; Marion Castel, Mathilde Castet, Michael Chang, and
A blueprint for remote working: Lessons from Tianwen Yu for their contributions to this article.

19
To emerge stronger from the COVID-19 crisis, companies should start reskilling their workforces now, McKinsey & Company, May 2020,
McKinsey.com.

8 The future of work: Reskilling and Remote working to recover in the ‘Next Normal’
June 2020
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