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Skills shortage threat to business growth

Posted on June 20th, 2017

Employers expect to struggle to recruit over the next two years, new research has shown.

And problems finding suitably skilled staff at all levels will have an impact on growth, the Chamber is warning.

Original research by the Chamber, to be revealed at today’s Skills Summit at Loughborough University, will show consistent levels of recruitment regionally between September 2015 and June 2017.

But of the firms recruiting, up to two-thirds (66%) reported difficulties, particularly when filling skilled technical and professional vacancies.

The importance of addressing this recruitment challenge is brought sharply into focus when considered against the number of firms with growth intentions over the next two years.

Almost nine out of ten firms (86%) said they were hoping to grow, of which 67% said their plans involved taking on more people.

But the number of companies saying they planned to invest in training fell between March 2015 and September 2016 before rallying at the start of 2017.

The fall suggested that firms were less keen on ‘growing their own’ as a primary strategy for addressing the skills shortage to facilitate growth.

Of the businesses planning to grow, 63% say investment in training is an essential ingredient and 51% reported having training investment strategies to reduce reliance on external recruitment.

The research asked firms to identify potential barriers to training. Costs and finding the time to release staff from normal duties were cited as the main obstacles.

Chris Hobson, the Chamber’s Director of Policy, said: “What has become clear from this research is that businesses continue to have an appetite for growth but for that growth to be achieved there needs to be a focus on training.

“It’s also clear that the uncertainty resulting from Brexit, and the potential inability to source workers from non-UK EU countries, will exacerbate the recruitment problem.

“With businesses showing a willingness now to make invest in training, it is essential that Government policy responds by offering support to cover training costs and work must be done to ensure provision has the flexibility to meet the real needs of growing businesses.”

The Employment and Skills Summit 2017: Skills for the Future event takes place in the West Park Teaching Hub, at Loughborough University, from 8.30am to 1pm.