Action is required to stem a UK-wide skills crisis, warns new research today.

Three quarters of British businesses believe a significant skills crisis will hit the UK within the next three years (73 per cent), while two fifths predict this will happen within the next 12 months (43 per cent). Two thirds fear skills shortages will slam the brakes on the UK’s economic recovery (68 per cent); while one in three fear it would cause their business to fold (35 per cent).

According to The Prince’s Trust and HSBC report, based on interviews with 616 UK business leaders, 72 per cent believe that the recruitment of young people into the workforce is vital to avert a skills crisis.

The research reveals that more than two-fifths are already experiencing skills gaps within their organisations (43 per cent) and over half are currently facing difficulties filling vacancies (53 per cent).

With a third of organisations reporting skills shortages at entry level (32 per cent), youth charity The Prince’s Trust is calling on employers to invest in vocational training for unemployed young people to avoid future skills shortages.

Martina Milburn CBE, Chief Executive of The Prince’s Trust said: “It is deeply concerning that employers are struggling to fill vacancies when we have hundreds of thousands of unemployed young people desperate for work. The current economic recovery is encouraging, but in order to sustain this growth, UK plc needs to invest in the next generation to avoid a skills vacuum in the future, which threatens to hamper economic growth.

“We are urging businesses to take action now to up-skill the workforce of the future to prevent the bubbling skills crisis from boiling over.”

The Prince’s Trust is working with employers like Whitbread to help unemployed young people gain the skills they need to access available jobs.

Sandra Kelly, Education Manager, The Whitbread Investing in Skills and Employment (WISE) Programme, says: “By partnering with the Prince’s Trust we have been able to make a real difference to the work confidence of young people whilst giving our team members the opportunity to develop their mentoring skills.

“The young participants who have gained experience in Premier Inn have gained invaluable work experience, as well as having the opportunity to gain nationally recognised food safety and health & safety qualifications. Our Costa programme has also been a great success with clusters of Costa stores working together to give young people a truly life changing opportunity to experience Costa from behind the counter.

“We are proud of our partnership with The Prince’s Trust, as we work together to provide training and experience to the next generation of baristas, chefs and hoteliers, alongside strengthening our business for the future.”

The economic recovery has seen 71 per cent of businesses reporting increased demand for their services over the past 12 months, with 63 per cent saying that they are growing faster than this time last year. However, more than half pinpoint faster growth as the cause of current UK skills gaps (59 per cent), and 45 per cent cite their ageing workforce as a concern.

Antonio Simoes, CEO, HSBC UK said: “It is essential that we invest in young people now and equip them with the skills that both they and British businesses need to thrive. As a major UK employer, we are committed to supporting the economic recovery and tackling youth unemployment. We are proud that our partnership with The Prince’s Trust is helping the next generation move into the workplace with the skills that they need to make a success of themselves and the UK economy.”

Rob Wall, Head of Education and Employment, CBI said: “The lack of skills in key sectors risks acting as a brake on our economic recovery. Organisations like The Prince’s Trust provide a critical role in helping plug the skills gap, equipping young people with the knowledge and skills they need to get on in work and life. Moving forward, we need structural reform to open up more routes to higher skills.”

The Prince’s Trust aims to help 58,000 unemployed young people this year, providing vocational training in sectors with identified skills shortages such as construction, retail and logistics.

In response to the findings, the youth charity is calling on more employers to help increase the number of young people it can support this year.

A number of employers, including HSBC, Marks & Spencer, DHL, Balfour Beatty, Asda and Accenture have also stepped forward to support The Prince’s Trust in its mission to upskill the workforce of the future. HSBC is one of a group of leading UK employers – Movement to Work – which aims to support thousands of unemployed young people, giving them the skills and confidence to find a job.

The Prince’s Trust has supported more than 750,000 young people since being set up by HRH The Prince of Wales in 1976. Three in four young people supported by The Trust move into work, education or training.