UK Budget must address critical skills shortages

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​Seventy-two per cent of firms responding to a British Chambers of Commerce (BCC) survey said they experienced recruitment difficulties in the last quarter of 2019

A ‘critical skills shortage’ has been attributed to the challenges in employment which the BCC recommended should be taken to account in the upcoming Budget next month.

As part of this address, the BCC asked that the government consider reforming the Apprenticeship Levy.

It stated: “Greater flexibility for employers on how funds can be used towards vital non-apprenticeship or accredited training could help to make better use of this budget and upskill the UK workforce.”

Conducted in collaboration with Totaljobs, the QRO is the UK’s largest independent survey of labour market conditions.

Data for the report is collected from more than 6,200 people in businesses across the UK, 93% of which work at SMEs with fewer than 250 employees.

Over half (55%) of the businesses surveyed said they attempted to recruit staff in Q4 2019.

Of those that reported difficulties (72%), skilled manual or technical roles and professional or managerial roles proved the hardest to recruit with 49% and 46% respondents respectively reporting challenges.

Adam Marshall, director general of the BCC, said: “Although it is encouraging that businesses are looking to take on people, the prolonged skills shortages they’re facing are not sustainable as they try to shake off years of political uncertainty and pursue growth.

“Training has got to be at the heart of the upcoming Budget if the government wishes to demonstrate that it is serious about ‘levelling up’ opportunity all across the UK. Funding boosts are needed for vocational and technical education, for apprenticeships, and for incentives to help more employers provide high-quality job-related training.”

One of the sectors hit hardest by skill shortages was hospitality, with 77% of recruiting businesses saying they struggled to fill roles.

Speaking to HR magazine, Eugenio Pirri, chief people and culture officer of the Dorchester Collection, confirmed that the company had experienced recruitment challenges in 2019.

He said: “The movement of people, the political situation, high cost of living and other such factors have all added to this challenge.

“The skills shortage is real and we continue to look at new markets to attract talent. [We] have also had to review how we develop and grow existing talent as well as on-board new talent who do not know our industry.”

Pirri said that he expected recruitment challenges to continue in 2020 though “more certainty” regarding the UK’s relationship with Europe would likely bring stability.

Looking to 2020, the Q4 2019 QRO found that one in four businesses (26%) expected to recruit in the first quarter of the year.

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