UK organisations are experiencing the knock-on effect of ongoing skills shortages and recruitment challenges, as employees are report an increased workload.

Also, more than three quarters (78%) report seeing reduced output, profitability or growth, according to Data from The Open University and British Chambers of Commerce.

The report also highlighted the effect the skills shortage is having on staff morale and wellbeing, as almost three-quarters (72%) of organisations say the impact increases workload on other staff.

This statistic has crept up dramatically year on year, when only 56 percent of respondents from 2021’s report claimed their staff were experiencing additional pressure.

“Skills shortages are worsening, and the country can ill afford this drag on the economy as we recover from the pandemic and grapple with the impact of geopolitical events,” warns Head of People Policy at the British Chamber of Commerce, Jane Gratton.

 

Increased workload and skills shortages

The report also revealed more than two-thirds (68%) of SMEs are currently facing skills shortages.

This rises to 86 percent of large organisations, in stark comparison to last year’s report where almost a quarter (24 per cent) believed that finding staff with the right skillset was the single biggest challenge facing businesses.

Organisations reported they were feeling the full impact of complex socio-economic issues such as Covid-19, Brexit, the war in Ukraine and rising business costs – all feeding into the skills shortage.

But while nine in ten large organisations are looking at a long-term strategic approach to skills gaps and have a written plan to address this, only 43 percent of micro organisations (with fewer than 10 employees) said they have some form of plan to address workforce issues.

Similarly, more than half (52%) of large organisations will increase investment in staff training over the next year, compared to 39 percent of micros, showing that large organisations are currently better equipped to tackle recruitment challenges, despite reporting larger skills gaps.

 

 

Staff training: can it help with the increased workload?

To address the problem, more than half (52%) of large organisations will increase investment in staff training over the next year, compared to 47 percent of SMEs.

The knock-on effect of these shortages is also impacting company growth as 28 percent of businesses say they have had to turn down work or are not able to bid for work due to their staff shortage.

“We need an agile skills system that can respond quickly to the evolving needs of businesses, supporting the transition to a more digital, automated, and net zero workplace and giving firms the confidence to boost investment in training and development.  Planning for skills has never been more important and it’s time for employers, training providers and policy makers to work together to ensure the skills system delivers for individuals, businesses, and the economy,” suggests Ms Gratton.

Viren Patel, Director of the Business Development Unit at The Open University commented: “Our Business Barometer report highlights the need for employers to take a long-term strategic approach to addressing the skills gaps and that it’s more important than ever to take a proactive view on employees’ skills.

“The report also shows that recruitment is tougher than ever and that places a focus on growing talent from within and opening up opportunities for hidden talent both inside and outside the organisation. Critically, staff seem to be under more pressure than ever, looking at last year’s report, an increased amount of employers admit that the skills shortage is increasing their teams’ workload and wellbeing.

“Through The Open University’s work with employers, we’ve seen how education can make a huge difference to workforce impact and diversity. Education is a huge enabler and has a vital role to easing and solving the skills shortage. If we can harness the ambitions of our people who deliver products and services, then it’s a win-win for all.”

 

 

 

 

Editor at HRreview

Amelia Brand is the Editor for HRreview. With a master’s degree in Legal and Political Theory, her particular interests within HR include employment law, DE&I, wellbeing within the workplace. Prior to working with HRreview, Amelia was Sub-Editor of a magazine, and Editor of the Environmental Justice Project at the University College London, writing and overseeing articles into UCL’s weekly newsletter. Her previous academic work has focused on philosophy, politics and law, with a special focus on how artificial intelligence will feature in the future.