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Employers missing out on hidden talent pool as a large skills gap remains

  • Data from The Open University and British Chambers of Commerce shows the vast majority of organisations (73%) continue to report skills gaps
  • More than half (54%) of organisations don’t have specific skills initiatives in place for specific talent pools, including those from underrepresented groups
  • Business expert and Chancellor of The Open University, Martha Lane Fox, warns organisations are missing out on an untapped talent by ignoring underrepresented groups in their workforce

29th June 2023: According to this year’s Business Barometer report published by The Open University and the British Chambers of Commerce, three-quarters (73%) of UK organisations are currently experiencing skills shortages, which remain one of the top challenges facing employers.

The annual report, which provides a temperature check on the UK skills landscape, highlights that despite the ongoing skills shortage, over a half (54%) of organisations don’t have any specific initiatives, skills programmes or workplace adjustments in place for specific talent pools including underrepresented groups such as people with disabilities or workers from diverse ethnicities.

The report suggests that employers are missing out on the hidden talent pool and an opportunity to ‘grow your own’ talent during a time where 42% of organisations say they have been prevented from filling roles due to lack of applicants.

The ongoing skills shortage continues to have a negative knock-on effect on existing staff morale and wellbeing, with three in four (72%) of organisations reporting increased workload on existing staff.

Organisations also reported an impact on reduced activity or output (42%) and reduced long-term growth plans (40%), meaning the additional pressure of skills shortages are impacting the future of organisations, which could lead to further challenges for the economy as well as meeting Net Zero and equality, diversity and inclusion goals.

The threat of an ageing workforce retiring, without employers having the skills to replace experienced employees is another concern, with a third (31%) reporting an increase in the number of employees over the age of 50 in the last three years.

Despite the ageing workforce, 85% of organisations don’t have a specific initiative in place for workers over 50, while 77% of organisations don’t have any written annual plans to prepare for people exiting the business.

While there is a collective effort to address the skills shortage as most organisations (79%) intend to use some form of training for their staff over the next twelve months, the report reveals that businesses, especially SMEs, lack the necessary expertise and resources to strategically address the skills gaps and challenges effectively. As a result, many firms are trapped in a cycle of continual recruitment and retention challenges.

It’s clear from this year’s Business Barometer report that the skills shortage has not improved, despite the existing efforts from organisations across the UK. We haven’t solved it yet. 

But what is even more concerning is that organisations aren’t investing in specific talent pools, including underrepresented groups. If organisations continue to ignore these workers, they risk missing out on untapped talent and deepening the skills gap even further. 

There could be a big opportunity for employers here if hidden talent is given a boost.”

Baroness Martha Lane Fox CBE
Chancellor at The Open University and President of the British Chambers of Commerce

Skills shortages are biting hard; damaging businesses and holding back our economic growth. Never has it been more important for businesses, governments and training providers to work together to find solutions.

There’s no doubt that more investment in training and reskilling is essential – together with a laser-like focus on boosting technical skills at all levels – and, crucially, creating a much more agile and flexible skills system to help employers who are struggling with hard-to-fill job vacancies.”

Jane Gratton
Head of People Policy at the British Chambers of Commerce

This article was originally published on The OU news website; click to read the original article.

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