Contractors can expect demand for their services to increase further and be sustained over the long term as businesses struggle to find enough candidates with the skills they need.
This is according to the Confederation of British Industry (CBI)/Pearson Education and Skills Survey 2015, which also highlights that skills shortages in many of the core contracting disciplines such as construction, engineering, IT and manufacturing will take years of investment in education to resolve.
With constant technological and social advancements, the report highlights that the UK requires increased amounts of higher level skills that can only be met by the UK’s expert and flexible workforce of contractors and freelancers.
“The danger is very real: as this survey shows, over half of all businesses fear that there will not be enough people available with the skills needed to fill their high-skilled jobs – particularly in the key sectors which underpin growth, such as manufacturing and construction,” highlights Katja Hall, deputy director-general of CBI.
Why is there a skills shortage in the UK?
With the report identifying education as the root cause of the skills shortage, contractors will be in demand for almost a generation as the survey suggests improvements in higher education are needed to ensure that future candidates are better equipped when starting their careers.
“With the CBI proposing changes be made from the ground up, it could be a while until the UK begins to enjoy the effects of suggested higher educational reforms, should they even occur. This leaves a skill deficiency for the foreseeable future, which hard-working contractors will be eager to take advantage of,” notes ContractorCalculator CEO Dave Chaplin.
The CBI has expressed concerns over Government plans to levy large businesses in order to fund new apprenticeships. The scheme, announced in Chancellor George Osborne’s Summer Budget last week, ultimately plans to deliver 3m apprenticeships, but the CBI claims these efforts are misguided, with higher apprenticeships only accounting for 2% of the apprenticeships currently available in the UK.
“Quality must not be sacrificed for quantity – and we need a laser-like focus on driving up the number of higher apprenticeships,” highlights Hall.
How contractors will benefit from skills shortages over the long-term
Contractors may potentially be looking at a contract-rich environment that could be sustained over the long-term. Of the more than 300 companies surveyed, 55% admitted they are not confident that they are currently able to source suitable recruits. When asked about future recruitment prospects, two thirds of businesses said they are expecting to need more higher skilled staff over the next few years.
The evident shortage of sufficient staff, coupled with predicted increased need for skilled workers, doesn’t bode well for the UK economy as a whole. However, contractors with key strategic skills will be well placed to take advantage of the current climate, as Chaplin highlights:
“Skills shortages will inevitably always be with us, as technology continues to steal a march on the workforce. However, contractors can respond quicker than the mainstream employment market, so will always be ahead of the curve.”
Core contracting sectors suffering most from skills shortages
Positively for contractors, core disciplines account for the sectors in most desperate need of skilled workers. Top of the list is the construction industry, where a balance of +73% respondents reported that they are short of sufficiently skilled workers.
Manufacturing is in second with a balance of +69% and the engineering industry is also in urgent need of staff with a balance of +52%. However, the CBI note that these industries are pivotal to economic growth, so whilst contractors may benefit, the economy looks to suffer.
"Worryingly, it's those high-growth, high-value sectors with the most potential which are the ones under most pressure. That includes construction, manufacturing, science, engineering and technology,” highlights Hall.
Chaplin concludes: “Whilst major clients focus on bridging the gap caused by skills shortages, contractors simply need to stay at the cutting edge. Continue to learn new skills, stay close to your market and its direction and needs, and keep doing what you do well and the contracts will keep flowing.”