55% of UK Businesses suffering Skills Shortage
Research finds that most companies are suffering a skills shortage.
Around the world, governments are predicting serious employment challenges relating to a pending shortage of key skills. The UK Commission for Education and Skills (UKCES) contributes to policy and research on employment and in its report, Working Futures 2012-2022, predicts that by 2022, two million vacancies requiring higher level skills will arise.
In another recently published report, The Employer Skills Survey, UKCES estimates that 20% of all vacancies arise when employers cannot find people with the skills and qualifications they need yet almost half of all businesses surveyed say they have employees with skills and qualifications that are not being fully used at work. Just as the business context moves on, so do the skills necessary to meet them. And where people have skills but are underutilised, they too move on.
With the national unemployment rate at its lowest level since May 2008, the recruitment industry is seeing a shift in candidate supply and demand with the significant majority (68%) of employers saying it is now more candidate-led than in the last five years, and 55% saying that they are suffering a skills shortage.
The data, released today by Totaljobs, also reveals that 43% of jobseekers say that they have been more selective about the roles that they have taken over the last three years.
Steve Ricketts, Managing Director of Circle Group said: “It is clear, especially in skilled industries such as information technology, that candidates are in high demand and this can lead to challenges for those businesses looking to hire. It is important for businesses to assess the service offered to them by their recruitment suppliers.
Agencies should be assisting their clients by advising them on best methods of candidate attraction, and also staff retention. At Circle, we advertise more per head than any recruitment agency in Britain. We encourage any company struggling to hire, to speak to us about our services, most of which are completely free of charge until a candidate is hired, and make a decision whether they are doing all they can to remain competitive in the hiring market”.
Nearly half (45 per cent) of UK businesses have productivity issues due to an “extensive” shortage of IT talent according to research by IT skills and training body CompTIA.
The International Technology Adoption and Workforce Trends Study surveyed more than 1,500 IT executives and found that 44 per cent of executives worry staff productivity is being negatively affected by digital skills gaps. Almost a third (30 per cent) of respondents said that insufficient skills are impacting on customer services, more than a quarter (27 per cent) said IT skills gaps are slowing speed to market and 26 per cent reported they are impeding innovation and new ideas.
Steve Ricketts confirmed. “It is a candidate driven marketplace at present, and companies should be reviewing their recruitment suppliers to ensure they are positioned well to supply demand. Jobserve have confirmed that Circle spend more per head, than any agency in the UK when it comes to candidate attraction. Considering that all of our Jobserve advertisements are also placed on CWJobs, Reed, Jobsite and umpteen other job boards, we are in an excellent position to assist any company suffering candidate skills shortages”.
In order to fill these skill gaps, 28 per cent of IT executives said that they plan to hire more IT staff this coming year, up from 14 per cent in 2014. If you want to speak to us about our candidate attraction methods, please contact us for a no-obligation chat.
There are predicted consequences and implications of this impending shortage including:
- Heavier workload for other staff required to cover the gap
- Increased operating costs
- Difficulties in meeting quality standards
- Greater difficulty in introducing new working practices
What can be done to address this and how does it impact on HR, L&D departments and the companies and institutions that design and deliver development programmes for them?
Perhaps predictably, over three-quarters of those employers who identified a skills gap are trying to overcome them by increasing their investment in training, greater staff supervision and development on the job and more regular and better connected appraisal activity. Yet a quarter have not yet acknowledged any danger.
Sue Parr, head of executive education at The Open University Business School looks at the business challenges behind the buzzwords.
Many managers are recognising that they have to adapt to new ways of working to meet the expectations of their employers and their employees.
New behaviours and ways of working are being driven by changes all around them, but what changes can be supported through developing capability and skillsets?
Complexity: Today’s managers contend with the complexity created by the many different perspectives of a multi- cultural, cross- functional, often geographically dispersed workforce spanning as many as three generations. In fact, there are more generations in our workforce than at any other time as those previously of retirement age extend their working lives.
For example, in areas of manufacturing companies who are increasingly aware of the benefits of sharing best practice and collaborating to drive innovation, in surprising ways, but ultimately to the benefit of all. Commercial sensitivity is being nuanced and boundaries pushed.
Creativity and innovation: We’re not talking about being good with colour here! We are talking about turning problems around, not going for same old safe solutions because ‘this is the way we’ve always done it ’. Organisations need their people thinking more broadly. For managers who had stages 1, 2 and 3 of their career in a technically specific function, creative practice techniques can start to get them thinking more holistically about their whole organisation, the needs of their current market and exploring opportunities in new markets. Although these tools and techniques can be learnt, but the prospect can be daunting for those who have bought in to a self-image of not ‘being’ creative.
Change: The themes of leadership and change have always been high on the management agenda but the focus of these has changed. As organisations recognise increasingly that what is needed to stay competitive is to be more responsive, agile and comfortable with increasing ambiguity, they are investing in their middle managers. As a result there has been a democratisation of management and responsibility. Where once the focus of executive education was on the most senior of senior teams, today’s companies recognise the need for developing leadership excellence at every level.
Connection not Control: The traditional workplace had a top down structure, hierarchies where orders were given and carried out. As more organisations use project teams spread across locations, remotely connected, the skills of influencing become much more important. Managers need to learn how to influence people to achieve outcomes where they don’t have direct authority or control.
Career Development: As the economy gets back on track the scales are tipping and businesses need to make the effort to retain good people. L&D has a proven track record as a powerful retention tool. Generation Y workers are much more likely to move onto new jobs quickly. Restless for new experiences, employees need to see a development pathway within their organisation or they will be tempted to move on. A structured, embedded talent management programme can help employees visualise their personal growth plan.
But on top of this, the managers on-the-ground, are expected to satisfy this quest for knowledge, development and progression. Coaching is a skill that can meet many of these needs, but how much should, or can, individual managers be ‘expected’ to fulfil this role?
L&D Centricity: Increasingly HR departments are embedding elements of leadership in learning and development right from the start of employees’ careers. Advanced organisations are incorporating leadership development and L&D at the centre of their organisational strategy. The leaders of these organisations act as ambassadors for this approach, realising that when L&D becomes a part of the DNA of a company it is much more successful.
We worked with a large UK-based retailer who wanted to change the whole way people accessed L&D and highlighting at every career stage, why it’s important. This cultural shift led to a company-wide holistic approach that supported the company’s strategy and goals.
(bite size) Content There is a definite shift towards a blended learning approach to executive development. Rather than taking people out of their workplace for long periods of time, face-to-face delivery is being supported by shorter chunks of online learning and interaction.
In the past executive education frequently included an online facility – a library of content. However this approach often wasn’t successful. People simply didn’t use the library. Now online is used to prepare for, and follow-on from, face-to-face learning.It’s all about making people more responsible for their own development, learning at their own pace and accessing information when they need it.
The virtual academy, or online campus, gives people the opportunity to access the content they need. This can be particularly helpful for senior managers who are often expected to have achieved “sage status” or business “omniscience”. The virtual academy provides a safe environment for them to fill in the gaps in their knowledge.
Overall, managers are expected to have a much broader repertoire of skills, often earlier in their careers: effective management will require highly developed communication and interpersonal skills, capability building though coaching and mentoring, problem solving through creativity, networking through social media savvy. The pace of change is heady and the combination of developing hard and soft skills at all levels to enable individuals and organisations to adapt and thrive requires a commitment to professional development for a career-lifetime; both from the employee and the employer.
What Needs to Change?
The increasing alignment in many organisations between strategic business priorities and investment in L&D will, among other things, help to avert a major skills shortage.
Increasingly L&D professionals are more closely aligned to business strategy generally and more so with HR systems and processes. This enables them to identify and make a more powerful case for investing in the skills and knowledge to sustain their organisations through turbulent times.
Many other changes are also taking place reflecting a more strategic approach to L&D:
1. Greater emphasis is being placed on the measurement and analysis of the inputs and outcomes of development interventions
2. L&D departments are working more closely with line managers to upskill them in how to identify their training needs, create L&D plans and follow up programmes to embed learning
3. Investment in management training is supporting talent development and retention, while upskilling and encouraging more facilitative approaches amongst more experienced managers
4. This stronger dialogue with managers helps to align future programmes with anticipated skills gaps
5. More robust and objective evaluation of existing programmes is being undertaken to establish which offer value for money and added value to the business. Those that don’t may need rework; those that do may need to be carefully protected even when budgets need to be cut
6. Clearer longer term succession planning and better identification of those employees that could fill vacancies with some training and support. Good induction and follow-up programmes that help to ensure that new employees have training plans in place to get up and running as soon as possible and development plans for the future
7. Seek ways to enhance the efficiency of programmes. For example could a more blended learning approach with a significant work based element make learning more accessible and readily applicable. Linking programmes to live priorities not only provides a rich seam of data about the impact on the business but is often seen as win-win by participants and managers and a more efficient use of precious time