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How Labour can solve the skills crisis

Labour has pledged to strengthen skills resources for jobseekers, and training for employees

Following the Labour Party's election win, we asked HR how the new government can solve the UK's skills crisis.

A survey led by management consultancy Aon in March 2024 showed that over a third of employees needed new or better skills, in HR professionals' opinion. 

Moreover, research published on 13 June by the National Foundation for Educational Research found that, by 2035, up to 7 million workers in England could lack the essential skills needed to do their jobs.

David James, chief learning officer at training provider 360Learning, told HR magazine that the new government needs to have a plan to tackle the UK's skills gaps.

“The UK has four significant skills gaps: digital capabilities, STEM – particularly in healthcare, management and leadership – teaching and training,” he explained.

“The government needs to have a plan to tackle these gaps to enable growth, at a business level and a GDP level.”

In its manifesto, Labour pledged to strengthen and localise resources for job seekers, as well as to establish a skills levy and Skills England to unite business, training providers and unions with national and local government.

The party also promised to guarantee access to training, an apprenticeship, or support to find work for all 18-to-21-year-olds.

Read more: Employees need new or better skills, say HR professionals

Andrew Hunter, co-founder of job listings platform Adzuna, welcomed Labour’s pledges to introduce upskilling programmes to the UK.

Speaking to HR magazine, he said: “A new government should help employers feel more confident about hiring, to relieve the tightness in the labour market. Labour’s intention to kickstart hiring in critical sectors such as teaching and healthcare will be welcomed by many.”

Training programmes should be tailored to emerging sectors to help employers with recruitment, according to Tom Cornell, senior industrial/organisational psychologist for HR software firm HireVue.

He told HR magazine: "The planned investments in future industries and public services present an opportunity to create new jobs and address skills gaps.

"The government should work closely with businesses and educational institutions to develop targeted training programmes that align with these emerging sectors. This approach would not only support job creation but also help mitigate potential hiring challenges."

Hunter added that the party should support employers with wider issues causing skills shortages, too, such as long-term sickness.

He continued: “More needs to be done to tackle the challenge of the increasing numbers of people who are economically inactive and not looking for roles. 

“Implementing effective upskilling programmes is crucial, to close local skills gaps and support growth sectors whilst also managing the wider obstacles of long-term sickness and caring responsibilities which are causing withdrawal from the jobs market.”

In August 2023, record numbers of employees were signed off work with long-term sickness in the UK, according to data from the Office for National Statistics.

Read more: HRDs to be paid £49,400 minimum, under new immigration rules

As well as investing in national and local skills, attracting international talent will be crucial to Labour’s skills strategy, Karoli Hindriks, CEO and co-founder of visa and relocation platform Jobbatical said.

Immigration changes have also contributed to the skilled worker shortage, explained immigration lawyer Vanessa Ganguin in an article on changes to immigration legislation in HR magazine. 

The previous Conservative government changed the immigration rules, which raised the salary threshold for employers to sponsor skilled worker visas, meaning fewer skilled workers were eligible to work in the UK.

Hindriks told HR magazine: “We need a bold and clear plan to attract skilled international talent, especially since recent policies aimed at cutting immigration have caused significant harm.

“One major area for improvement is the digitisation of the immigration and visa system. Considering the UK prides itself on being a tech-first nation, our immigration system is both archaic and slow, and creates unnecessary hold-ups for businesses trying to access skilled talent overseas. 

“I’d like to see the introduction of the UK’s version of the digital nomad visa, now adopted by over 60 countries. It would be a game-changer and allow businesses to quickly fill skills gaps to ensure growth isn't stunted by outdated systems.”