Tackling the UK digital skills shortage

By Katie Green
22/07/2021


The availability of workers to fill vacancies is declining at the fastest pace in almost a quarter of a century, meaning that businesses are struggling to find the necessary staff to cope with growing demand as Covid-19 restrictions lift.  However, within this recent Brexit and pandemic fuelled labour drought lies a more concerning and long-term issue: the digital skills gap. The lack of digital skills among the workforce combined with the proliferation of new jobs in technology and an increasingly digital workplace is creating a dearth of suitable applicants and an underproductive labour force. For businesses, this means unfilled vacancies, slow adaptation to advances in technology and missed growth opportunities.

Currently, less than 50% of employers think people are leaving education with sufficient digital skills with the Workplace Training and Development Commission finding that 75% of businesses are facing a shortage of digital skills amongst their workforces. It is estimated that the existing digital skills gap causes the UK to miss out on £63bn of GDP each year - experts warn that we are headed for a digital skills shortage disaster. There are issues across the entire spectrum of ‘skills’ with far too many lacking basic digital literacy but also too few highly-trained specialists in industries such as engineering and AI. Research carried out by LinkedIn predicts that 150 million new technology jobs will be created in the next five years which will further expand the digital skills gap, thus creating even more problems for businesses and the wider economy.

The government is starting to wake up to this issue and beginning to take steps towards tackling the problem. As part of Boris Johnson’s Lifetime Skills Guarantee announced in September 2020, there are plans for free digital skills bootcamps for claimants funded by the National Skills Fund. Currently in the House of Lords, the Skills and Post 16 Education Bill will introduce the Lifelong Loan Entitlement which will give individuals access to the equivalent of up to four years’ worth of student loans for level 4–6 qualifications that can be used flexibly across one’s lifetime.

Institutes of Technology are central to the government’s plans to tackle the skills shortage. At the recent opening of the Digital and Data Centre at Exeter College, Gillian Keegan the Minister for Apprenticeships and Skills stated that “by bringing together Further Education colleges, universities and businesses, Institutes of Technology are unique partnerships which will help to tackle skills shortages in vital sectors, from marine engineering to software development.”

To encourage children to develop the high-level digital skills required for industries such as software design and robotics, greater education technology is needed at a younger age. Therefore, it is also important to tackle the digital divide as is the aim of the Digital Inclusion Network. Better information needs to be given about career paths in technology. As Dr Niel Bentley- Gockman OBE, Chief Executive, WorldSkills UK has said “we need to plug shortages by inspiring more young women as well as young men to understand that digital careers are for them.”

It is clear that much has to be done by the public sector, and recently the Work and Pensions Select Committee has called for the Department of Work and Pensions to create a comprehensive strategy for how it plans to deal with changes to the labour market brought about by technology. However, the private sector also has a significant role in combatting the digital skills shortage, especially as it ultimately stands to bear many of its costs.

Firms need to take part in upskilling the workforce as well as coordinating with the public sector on educational needs.  Only 17% of UK employees say they have been part of re-skilling efforts which is less than half of the global average. Underuse of capital is likely to emerge because more managers are focusing on the AI they implement rather than on the people who will work with it.

With the importance of education, training and workplace focused skills, a collaborative approach between the public and private sectors will allow solutions to focus on the needs of both students and employers. Joining large organisations, working with educational facilities such as Institutes of Technology, and encouraging Government can help tailor outcomes to business needs. For example, the All-Party Parliamentary Group on digital skills recently issued a call for evidence on skills for employment offering firms an opportunity to provide their insights.

Elsewhere, the Skills and Education Bill is set to create a legal requirement for employers and colleges to “collaborate to develop skills plans” so that training opportunities meet the needs of local areas. Already, the Staffordshire Partnership for Employment and Skills brings together 40 training delivery partners including further education colleges, universities, private providers, the voluntary sector, and councils to help tailor training to local needs. The Greater Manchester Combined Authority has joined FutureDotNow to work together to close the UK’s workplace digital skills gap, another example of coalition organisations tackling the issue.

Skills are not for life and constant upskilling is needed throughout careers. The current lack of provisions at school education means tackling the digital skills gap is a difficult task. A collaborative approach between the public and private sectors will best help tackle the digital skills gap and propel growth as we seek to recover from the pandemic.