Scots employers suffer increase in skills shortages - a 'dangerous drag on economic recovery and growth'

Scottish employers are feeling the impact of skills shortages, which are acting as a “dangerous drag on economic recovery and growth”, and show the need to further tackle the issue, according to a new survey.

The Open University’s 2022 Business Barometer report, which was carried out by the British Chambers of Commerce, surveyed 1,300 employers, and found that 70 per cent of respondents in Scotland agreed that their organisation is currently facing skills shortages, up from 62 per cent a year ago.

The study – the first time the two organisations have teamed up on the report, and is billed as an annual temperature check on the UK’s business landscape – also discovered that 84 per cent of Scottish organisations say the impact of skills shortages is causing increased workload on other staff, while just over three quarters are seeing reduced output, profitability, or growth.

However, more than six in ten have implemented some form of written plan around recruitment and training to address skills shortages, and more than half expect to increase their investment in staff training over the next year, “showing that Scottish organisations are currently motivated to tackle recruitment challenges”.

David Allen, senior partnerships manager at The Open University in Scotland, said the need for employers to take a “long-term, strategic” approach to addressing skills gaps is more crucial than ever.

He added: "Critically, staff in Scotland seem to be under more pressure than staff elsewhere in the UK. More employers say this year that the skills shortage is increasing their teams’ workload and wellbeing. Through The Open University’s work… we’re seeing how targeted skills training can make a huge difference providing new opportunities for individuals and supporting growth for businesses.”

Russell Borthwick, chief executive of Aberdeen & Grampian Chamber of Commerce, stated that by 2050, a quarter of Scots will be of retirement age, while overall population growth since 1970 is only 5 per cent, “well behind peer nations”.

Around six in ten Scots organisations have implemented a plan around issues such as recruitment, training, and addressing skills shortages (file image). Picture: Getty Images/iStockphoto.

He continued: "These worrying statistics, together with the results of this survey, confirm that labour and skills shortages are worsening, acting as a dangerous drag on economic recovery and growth.

“It’s vital that policy-makers, employers, our education system and training providers work meaningfully together to ensure our businesses have access to the people and skills needed to achieve our economic potential.”