Skill-shortage vacancies are a growing challenge for UK employers

The modest growth achieved by the UK economy over the past four years has been met by an unprecedented shortage of skills, leaving thousands of vacancies unfilled, reports the UK Commission for Employment and Skills.

The Commission’s 2015 Employer Skills Survey provides intelligence on the skills challenges 91,200 employers across the UK are facing and their response in terms of investment in skills and training.

In 2015, there were 928,000 reported employment vacancies, an increase of 42% from 2013. Within this buoyant labor market, skill-shortage vacancies presented a growing challenge for employers in filling their vacancies.

There were 209,000 reported skill-shortage vacancies, an increase of 43% from the 146,000 reported in 2013; 6% of all employers had at least one skill-shortage vacancy at the time of the survey.

The report finds that

—the financial services sector has seen the sharpest rise in skills shortages, from 10% in 2013 to 21% in 2015;

—time management is a significant issue, with nearly 60% of establishments who reported a skills gap saying that their staff lacked the ability to manage their own time and prioritize tasks;

—across the UK, two million workers are underutilized—they have skills and experience which are not being used in their current job.

Peter J. Sloane has written for IZA World of Labor about overeducation, skill mismatches, and labor market outcomes for college graduates. He asserts that “[e]mployers need to adopt human resource strategies that maximize the inputs of their employees.” Sloane recommends ensuring that employers are “informed of the potential negative effects of overskilling and the value of improving hiring practices to ensure that there is a good match between workers and the jobs they do.”

Olga Kupets, has investigated the subject in relation to transition economies. She concludes: “Policymakers should be concerned not only with increasing the stock of human capital, but also with enhancing its quality and allocating it efficiently. Innovative firms need assistance in matching job-seekers with employment opportunities, while other firms need help in adopting new technologies, creating skilled jobs, and investing in worker training. Improving overall workforce quality could attract advanced technologies and stimulate local labor markets. It is also crucial to equip older displaced workers with up-do-date skills through adult training so that they are able to stay in productive employment longer.”

Related articles:

Overeducation, skill mismatches, and labor market outcomes for college graduates, by Peter J. Sloane

Skill mismatch and overeducation in transition economies, by Olga Kupets