Businesses struggle with recruitment and retention

 

London First, a membership organisation with a mission to make London the best place in the world for businesses, has paired up with Lloyds Banking Group to survey 1,000 senior leaders or HR decision-makers from UK companies with over 50+ employees.

And what it found, post the EU Referendum, is that four in ten companies are finding it more difficult to hold onto staff; six in ten employees are struggling to recruit the right people and 30% are flagging that the skills gap is hampering growth. Now whilst this might look all a bit doom and gloom, it’s not all damning. 42% of respondents said their experience of recruitment hasn’t changed over the past 18 months, whereas 33% said it was easier (with just 24% saying it was more difficult).

When it comes to the skills gap, it’s not really a great surprise. After all, it’s been much-talked about. What we’re now beginning to see is what it looks like. And it’s reportedly worse for London with 76% of London firms saying that they face challenges in hiring the people they need. What’s also coming to the fore is the impact on businesses’ employees, with 46% saying that skills shortages meant increased workload and stress for existing staff.

The biggest skills gap appears to be technical and job-specific skills, with 38% of respondents saying these were the most difficult skills to source, closely followed by management (30%) and data analysis skills (28%). Many thought these gaps would persist over the next 18 months, reflecting the UK’s long-term challenge in tackling its skills shortages.

The report also investigated the effect of automation and skills. Most businesses expect job automation to impact within the next seven years, and three quarters are planning for an impact on their staff numbers or a change in their need for skills. Of those planning for automation, 22% are expected to be replaced. And the roles most likely to be affected were cited as being manufacturing (25%), administrative (24%), sales and customer services (23%), managerial (19%), professional (19%) and skilled trade (22%). No real shocks there either.

But for all that, 44% still expect to increase their headcount over the next 18 months, with a notable focus on long-term planning. 46% are looking to hire to improve their skill-set and 39% are thinking about succession planning. Companies are also hoping to fill 24% of the roles by re-training staff, through on-the-job or full-time training, whilst 21% think they will have to look for new hires to fill any skills gaps.

To help create a pipeline for future talent, the topic of apprenticeships was explored. 66% of the companies’ surveyed said they are already engaged with local schools, colleges and universities and many want to do more (60%). What we found positive was how popular apprenticeships were, with 63% of the companies surveyed already employing apprentices. And of that 63%, eight out of 10 were planning to either hire more or maintain current levels over the next couple of years. Only one in 10 were planning to reduce the number of apprentices they take on.

When it came to the apprenticeship levy, however, they were less positive with only 30% saying they thought it was working well. Many wanted more flexibility in how the levy is spent to allow investment in further training or a contribution towards the cost of recruiting, training and employing apprentices.

Jasmine Whitbread, chief executive of London First, said: “The most important thing to business is being able to hire, retain and train the talented people we need. The UK’s employment landscape is changing, with signs people are thinking about their long-term plans as Brexit approaches and the oncoming impact of automation. Companies are stepping up to re-train and re-skill the people we have but, as we prepare to leave the EU, business, government and the education sector need to work together to fill the massive skills gaps currently holding UK businesses back.”

Edward Thurman, Ambassador for London, Lloyds Banking Group, said: “The skills gap in the UK is one of the most pressing economic issues of the moment. It risks hindering businesses growth, competitiveness, and productivity and needs urgent attention.”

“The next few years are critical. As our survey shows, businesses are facing unprecedented changes in the nature of roles and the skills they require; and firms across all sectors have a part to play in addressing the problem.”

John Allan CBE, Chairman of London First and the Employment and Skills Commission, said: “Too many Londoners are missing out on the skills they need and not sharing in our capital’s success. Business is ready to step up and tackle the skills gaps head on, making the most of the talent we have. But government will need to make changes to policy, helping us challenge weaknesses and secure the step-change we need on skills. With Brexit rapidly approaching, London First’s Employment and Skills Commission could not come at a better, or more needed, time.”

Wednesday, 14 March 2018

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Businesses struggle with recruitment and retention
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