Growing talent crisis could slow business recovery
A growing talent gap in the UK labour market could severely disrupt British businesses as a result of slow growth and lost opportunities, Hays plc has claimed.
The firm revealed that the UK’s talent mismatch level – the gap between the skills people have and those that employers want – increased again the past year.
It means that the UK is among the most severely affected countries in the world, and is behind only Ireland, Spain and Portugal in the European markets.
The Hays Global Skills Index 2014 was produced in collaboration with Oxford Economics and analysed professional employment markers from 31 major global economies.
The report – entitled The Perfect Talent Storm – suggests that the demands of a recovering economy and the lack of skills in certain industries have combined to disrupt the UK labour market.
This is limiting the prospects of nearly every business as companies face a battle to attract the best talent, especially while the recovery strengthens, which promotes a hiring culture.
As more firms look to hire they are finding that people do not have the relevant skills, especially in the IT and engineering sectors – which is slowing business growth.
It also means that those with the desired skills are requesting greater sums for their services and niche job markets are excelling as a result.
However, this is not good news for smaller businesses that are looking to accelerate their growth patterns by hiring inexperienced individuals as it will cost them more to do so.
It therefore represents a catch-22 situation, as the staff come at a cost that may not be affordable, while going a long period without hiring could result in lost opportunities and lost sales.
In smaller companies this could seriously hinder growth and could potentially have a negative impact on business finances.
Careful management or considering business recovery could therefore be required in order to keep a firm trading.
Hays also suggested that the UK’s long-term economic future could be impacted as major investment projects such as Crossrail and HS2 could be jeopardised by skills shortages.
The threat to the nation’s future prospects is something that needs serious consideration from all quarters, especially if the UK is to be maintained as a business-friendly location.
By Phil Smith