Solving the skills shortage - local and national strategies

The UK is facing a skills shortage crisis, especially in the fields of science, technology, engineering, and mathematics (STEM). According to a 2024 report by the Open University, 62% of organisations are currently facing skills shortages, and the skills gap is costing the UK economy £6.6 billion each year [1]. The Nash Squared Digital Leadership Report also revealed that 54% of digital leaders believe the skills shortage is hindering their ability to keep up with rapid technological changes [2]. The report highlights that STEM skills are among the most in-demand yet hardest to find. So, how can organisations tackle this issue and ensure they have the skills they need for the future?

How can organisations address the skills shortage?

Addressing the skills shortage requires a strategic and multifaceted approach. It starts with workforce planning – understanding the skills your organisations needs now and will need in the future (find out more about workforce planning article). Then it’s about thinking about the different routes available to you to build these skills. Organisations can implement a range of initiatives to address the skills shortage and build a future-ready workforce. Here are some key strategies:

Bootcamps and training programmes: Short-term, intensive training programmes can quickly upskill employees in high-demand areas. Tailored bootcamps can cover critical skills like coding, cybersecurity, data analytics, and digital marketing. When it comes to tech skills, many individuals use these programmes to develop new skills. One example of this is women returning to the workplace after maternity leave. Bootcamps can cover a broad range of skills and can either be run internally or through external organisations. By considering bootcamps, organisations can ensure they are building their talent pipeline with the skills they need to remain competitive.

Structured development programmes: Establishing formal learning and development programmes is essential for nurturing talent within an organisation. These programmes, ranging from in-house workshops to sponsored online courses, should address specific skill gaps and provide clear growth pathways for employees.

Cross-training initiatives: Encouraging employees to acquire skills beyond their primary roles creates a more adaptable and flexible workforce. Cross-training enhances individual capabilities and fosters collaboration across departments, driving innovation and resilience.

Mentorship and Coaching Programmes: Implementing mentorship schemes where experienced professionals guide less experienced employees can be invaluable. These programmes not only aid in skill transfer but also help build confidence, nurture leadership potential, and foster a culture of continuous learning.

Investment in Learning Technologies: Leveraging digital learning tools can streamline training efforts and make them more accessible. Online platforms enable employees to learn at their own pace and track their progress, while also allowing organisations to deliver training more efficiently and cost-effectively.

Making use of apprenticeship schemes: Apprenticeships provide a structured way to develop skills through a combination of work experience and formal education. By offering apprenticeships, organisations can address skills gaps, cultivate talent from within, and build a skilled workforce aligned with their needs.

This is by no means an exhaustive list, but provides an example of the different ways organisations can are effectively addressing the skills shortage to ensure that their workforce is equipped with the necessary skills to succeed in today’s competitive environment.

Labour’s plans and their impact on organisations

The UK government are planning several initiatives aimed at addressing the skills shortage, with a particular focus on improving the apprenticeship system. The Apprenticeship Levy, a tax on employers with a pay bill exceeding £3 million, was designed to fund apprenticeships and encourage investment in training. However, the current system has faced criticism for its complexity, lack of flexibility, and the quality of apprenticeships offered [3].

Labour has outlined plans to reform the levy with the introduction of a new “Growth and Skills Levy.” Under this proposal, organisations could use up to 50% of their levy contributions for non-apprenticeship training, with the remaining 50% reserved for apprenticeships. This increased flexibility would enable organisations to address specific, in-demand skills more effectively [4].

Labour’s broader skills strategy also includes measures to strengthen STEM education and careers:

Guaranteed training and apprenticeships: The government aims to guarantee training, apprenticeships, or job assistance for all 18 to 21-year-olds, focusing on the most in-demand skills. By equipping young people with the skills that are most needed in the workforce, businesses can benefit from a more prepared and capable entry-level workforce, reducing the time and resources spent on training new employees.

Investing in education: Labour’s plans to invest in schools and teachers, reduce class sizes, and ensure access to a broad and balanced curriculum, including STEM subjects, aims to enhance the quality and equity of STEM education. For organisations, this means a future workforce that is better prepared, more diverse, and equipped with the critical skills needed to excel in their careers. With a stronger foundation in STEM, companies can expect to benefit from a more capable and adaptable talent pool.

Establishing Skills England: This body will unite businesses, training providers, unions, and the government to ensure that training in the UK meets the demand for essential skills. Through the planned initiative organisations More effective and targeted training programmes that directly address skill shortages, supporting the growth of the STEM sector and fostering innovation across industries. By ensuring that training meets current needs, organisations can benefit from a more skilled workforce, ready to drive progress and adapt to evolving challenges.

Labour’s manifesto outlines measures that will establish a strong foundation for STEM education and careers. By prioritising lifelong learning, investing in schools and teachers, and promoting innovation and sustainability, these initiatives aim to tackle the skills shortage and boost the appeal of STEM fields.

If these initiatives are implemented by the Labour government, they could lead to a more skilled and diverse talent pool, as equitable access to quality education and improved working conditions make STEM careers more accessible and appealing. This approach could support the development of a thriving STEM sector, crucial for driving the UK’s economic growth and social progress. Businesses would also stand to benefit from a well-prepared workforce, equipped to meet the evolving demands of industry and contribute to long-term success.

Engaging with local communities and grassroots initiatives

In addition to internal strategies, organisations can address the skills shortage by engaging with local communities and grassroots initiatives. Collaborating with schools, colleges, universities, businesses, and charities allows organisations to educate and inspire the future generations about careers in STEM. These initiatives offer several advantages:

Demonstrating relevance and impact: Community programmes can showcase the real-world applications of STEM skills, making them more relatable and exciting for students. This approach can inspire young people to pursue STEM careers by highlighting how these skills contribute to solving societal challenges.

Fostering collaboration: By working with local schools and organisations, businesses can create a robust support network for STEM education. This collaboration often leads to better resources, programmes, and opportunities for students and communities.

Enhancing career readiness: Community-based STEM programmes provide students with practical experience and insights into STEM careers, helping them understand the available pathways and acquire the skills needed to succeed in the workforce.

Building a skilled future

The skills shortage in the UK, particularly in STEM fields, presents a significant challenge to organisations. However, by implementing internal strategies, engaging with local communities, and preparing for government reforms, businesses can address this critical issue. Combining grassroots initiatives with supportive policies like Labour’s proposed Growth and Skills Levy will help organisations build a skilled workforce ready to thrive in the future.

September 17, 2024

Solving the skills shortage – local and national strategies

How can organisations address the skills shortage?

Labour’s plans and their impact on organisations

Engaging with local communities and grassroots initiatives

Building a skilled future