Skills gaps still widening in UK and worldwide
Skills gaps are getting wider and wider in important sectors as employment rises, according to a new report.
Employment is rising quickly in the UK, and graduate employment in particular is performing well. However, many of the industries that are crucial to a balanced and high-performing economy are still struggling to find candidates with skills that they need – and are likely to reward those who can fill the void.
The latest Hays Global Skills Index is based on data from 31 countries and gives each nation a score out of ten according to criteria such as education, wage pressures and the flexibility of each nation’s workforce. This year, the UK scores just 5.1, down from 5.2 in the previous year.
Developed economies that have returned to growth are the most likely to feel the pinch, too – with employment rising and consumer demand on the rise, a number of industries are having difficulties finding the talent that will meet their needs.
But it isn’t a question of a shortage of workers; after all, most countries still have fairly high numbers of unemployed people. Instead, the issue is that the labour available does not have the mix of skills that is needed to fill the jobs on offer.
“This is the first year since we launched the Hays Global Skills Index that we are seeing evidence of economic good news across the board. The flip side, however, is that labour market pressures are building. Demand for skilled workers is outpacing supply,” says Alistair Cox, chief executive at Hays.
“If this is not addressed, we will see opportunities slip away from individuals, businesses and entire nations as jobs go unfilled and business growth stalls.
Short-term unemployment is declining in the UK, but long-term unemployment remains “stubbornly high”, Hays finds, putting pressure on the skills balance across the country. Labour market participation is a little low as a result. But wage pressures in highly skilled industries have also taken their toll.
On the other hand, wage pressures are less of a concern specifically in high-skill occupations, where the people who can meet these key business needs are rewarded in line with their capabilities but wages are rising at a fairly stable rate. Perhaps the higher salaries already afforded to these individuals means they are less likely to ask for a pay rise.
Where skills are not necessarily being found within the UK, Hays says that the solution lies in a rethink of the UK’s approach to immigration, to make sure that businesses can harness the skills of the best talent from around the world. Yet it is down to employers to make sure that they manage their talent effectively and equip them with the skills and abilities to make that contribution to the firm’s success.
In the long run, education policies need to be adapted to fit in more closely with the needs of employers, Hays says. But in the short term, it looks as though acquiring the right skills is likely to be a route into a world of career opportunities.