How do we solve the skills shortage crisis?
A lack of people with the right skills and experience is holding back businesses across our region.
In some cases, companies are turning down work because they simply do not have enough staff to fulfil contracts.
This can be seen across all industry sectors, although most notably in the retail, hospitality and tourism sectors. Long queues at airports were one of the defining images of the summer holiday season.
The legacy of the pandemic, Brexit and rapid inflation are making matters worse but this is not a new problem. Skills and training are crucial to firms’ future growth plans, yet levels of workplace training are low by international standards.
The IoD’s exclusive Directors’ Economic Confidence Index, which measures business leader optimism in prospects for the UK economy, has found that skills shortages or employee skills gaps are having a clear negative impact on organisations.
The IoD has called for a range of measures to address the “chronic and systemic” skills shortages that are being experienced in Britain. These include a fully independent Shortage Occupations Agency with a statutory remit to systematically advise on current and future skills shortages areas for the UK economy.
As an organisation, the IoD listens to our members and speaks out on their behalf to policy makers.
There are clearly longer-term issues to be addressed around the relationship between business, education and training providers but there are short term policy changes that could make a difference. We have urged government, for example, to look at tax incentives for retraining.
In the meantime, existing government programmes can be a good way for businesses to ease short-term skills gaps. There are several schemes available, including apprenticeships, traineeships and T Levels. We have set out the costs, benefits, and time requirements of each scheme in this guide to government training and employment schemes.
We want to hear your views on skills shortages. What are the challenges you are facing? What extra support do you require?