- Half (49%) of engineering companies experience difficulties with a lack of skills available in the external labour market and 45% skills gaps or limitations within their internal workforce.
- 71% experiencing an internal skills gap report it being from engineering or technical skills.
- Only 1/3 have taken action to improve the diversity of their engineering/technical workforce across gender (33%) or ethnicity (30%).
- The impact of the pandemic on staff recruitment and skills has seen over half (55%) of engineering companies in the UK having to deal with staff being ill or self-isolating as a result of Covid-19.
The impact of missing skills means 45% of companies who see a skills shortage within young people provide additional training for apprentices/graduates who are new to the industry, whereas a quarter simply recruits fewer apprentices and graduates as a result (25%).
Two-thirds (71%) of the UK engineering workforce who are experiencing internal skills gaps say it is down to missing engineering or technical skills.
Almost all (96%) engineering employers who had identified a skills shortage within general applicants say that this skills deficit impacts their business in some way.
The most common impacts of a skills shortage amongst applicants are around the recruitment pathway – either causing difficulty recruiting (50%) or making recruitment timelines longer (47%).
A lack of recruitment from a diverse talent pool may also be fuelling the problem, with only a third of businesses taking action to improve the diversity of their workforce across gender (33%) or ethnicity (30%).
When asked what support businesses need from government to improve skills nationally, more funding for apprenticeships came out on top (54%), with more support to train or reskill in priority areas (51%) and better careers advice and guidance in schools and colleges (49%) next in line.
Simon Edwards, Director of Governance and External Engagement at the IET, said: “Over the last 12 months the UK has continued to go through economic uncertainty, underpinned by Brexit and the Covid-19 pandemic.
This coupled with a drive to deliver on the UK’s net-zero targets and the emergence in engineering companies of new roles with a change to the skill-set required has meant we are seeing a sustained skills gap that will continue to grow unless government and industry take action.
“Workers are in high demand but we don’t have them readily available recruits with the right skills to fill the labour market – something we have been reporting via the skills survey for the last 15 years.
Frustratingly nothing has changed. Additionally, this year, engineering employers are reporting a general lack of applicants for roles causing more difficulty in recruitment (34%) – a marked increase in 2020 (22%). Engineering companies across the UK now have to look to improve profitability and productivity with fewer staff than before.
“We are urging more businesses to provide work experience opportunities for young people to help with the rollout of T Levels and more apprenticeships.
To solve this skills crisis there needs to be deeper engagement between government, employers, and the education system to produce a talent pipeline that can sustain a thriving UK economy.
The IET has already started engaging with government by calling for the embedding of engineering in the existing science, technology and mathematics learning at primary school.”
The impact of the pandemic on staff recruitment and skills has been immediate, with over half (55%) having to deal with staff being ill or self-isolating as a result of Covid-19.
Nevertheless, firms remain positive about the future, being confident about the economic prospects for their firm (79%) and sector (77%).
As the economic situation evolves, so do the priorities of businesses. While 12 months ago, the top priority was cutting costs (44%), currently, the top priorities focus on improvements in profitability (67%) and productivity (62%).
However, one of the long-term impacts of the pandemic is skills-related. Three-in-ten have experienced a decreased headcount over the last 12 months (31%) and half attribute this directly to Covid-19 (52%).
Looking to the next five years, engineering employers do recognise particular areas of skills as important for their organisation’s growth.
However, whether or not they currently have these skills within the workforce varies considerably. Design and manufacturing is recognised as a key area by 36% of respondents and most (64%) have the skills they think they need.
However, energy and environmental sustainability is the second most cited area for growth (35%) and only half (51%) have the skills they need.
In light of this lack of skills, it is unsurprising that only half (50%) think it is achievable for their organisation to be net zero by 2050, in line with the UK target.
This is the fifteenth year that the IET has published its skills report. The fieldwork was conducted online with 1039 engineering and technology employers across the UK between 6 August and 2 September 2021 by market research agency YouGov.
The last skills survey with comparative data was carried out in 2020.
Download the IET’s Skills and Demand in Industry Report 2021