UK businesses are concerned about a skills shortage that is challenging growth, according to new research from the Grant Thornton International Business Report (IBR)*. Around four in ten (38%) UK companies are struggling to recruit the right people, with nearly three quarters (72%) citing a lack of technical skills as the primary problem. The concern is that a lack of talent will dampen business productivity, potentially threatening future growth and profitability. Nearly one in five businesses (18%) is concerned that skills shortages will impact 2013 expansion plans..
Commenting on the findings, Scott Barnes, CEO of Grant Thornton UK LLP, said: “While the number of people employed in the UK hit a record level in 2012, businesses are still finding it hard to recruit for roles requiring technical skills. Investment in internal training programmes, aligned closely to business need, is needed to broaden these talent pools. By developing their people, companies will be able to deliver on strategy, innovation and, ultimately, growth.”
The reported shortage of technical skills is an EU-wide issue with 68% of businesses surveyed citing this as a significant challenge for recruiting talent, compared to the global average of 64%. In the UK, 40% of businesses reported a low number of applicants compared to 51% in the EU. In the UK, a lack of both work experience (55%) and qualifications (40%) were also contributing factors.
Staff retention is also presenting an increasing problem to UK businesses. According to the Q1 2013 results of the ICAEW and Grant Thornton Business Confidence Monitor, staff turnover is on the rise again after a period of stagnation in 2011, having increased from seven to ten percent. The IBR report found that almost one fifth (19%) of organisations believe that staff retention issues have contributed to a loss of business or orders to competitors, increased operating costs (28%) and an inflated workload for remaining staff (40%).
Scott Barnes added: “We have seen some evidence of improved dialogue between educational institutions, governments and business leaders but this research should give fresh impetus to their discussions. There is clearly a disconnect when, on the one hand, UK business leaders are crying out for more skilled labour, and on the other, there are still lots of people out of work. Efforts to boost skills should be high on the public policy agenda.”