Survey highlights skills gap

Nearly two thirds of businesses believe that changes in the UK labour market will contribute to Britain becoming a less attractive place to invest and do business over the next five years – up from 50% last year and 25% in 2015, according to the latest CBI/Pertemps Network Group Employment Trends Survey.

Skills gaps were found to be the single most prominent worry facing firms, with nearly four in five (79%) respondents highlighting this as a worry – up from 64% in 2016. Access to overseas workers is a big contributor to this, with nearly half of respondents (49%) identifying uncertain access to labour supply – up from 35% in 2016 as a concern. It comes as figures obtained by the Labour party show the number of unfilled doctor positions in the NHS has risen beyond 10,000 for the first time, while vacancies for nurses in England have hit 40,000.

The CBI/Pertemps survey of 299 employers also found that 51% of firms plan to grow their workforce in the year ahead, with confidence highest amongst small and mid-sized firms (58%).  Some 93% of respondents reported that a diverse and inclusive workforce is important to the future success of their organisation – up on 76% in 2016. Some 70% have introduced or extended flexible working opportunities and 66% have invested in training for line managers to help boost inclusion. Respondents reported a range of benefits of inclusive workplace practices including increased skills (50%) and attraction and retention of staff (52%).

 

The survey suggests pay restraint is still on the cards:  while 52% of respondents aim to raise pay for their employees in line with (or above) inflation in the coming year that is lower than the 57% who planned to do so in 2016.  The survey also shows how firms are dealing with rises in the National Living Wage, with 63% are needing to take action to cope with the costs so far, up from 59% last year. The most common actions taken range from raising prices (21%) and restructuring their business model (20%), to increasing investment in training (32%).

As the NLW increases in the years ahead, only 28% of affected businesses polled said they will be able to absorb the costs.  A quarter of respondents affected are expecting to restructure their business models, which rises to 33% amongst mid-sized firms.  While 30% intend to increase automation to raise productivity.

The survey also shows that, in the coming year, the top workforce priorities for businesses are achieving and maintaining high levels of employee engagement (46%), retaining talent (35%) and improving leadership skills (44%). Other findings are that among those firms who have had to produce a gender pay gap report, 62% reported that it had changed some aspect of their company’s diversity and inclusion strategy. Moreover, 90% of companies surveyed said the removal of employment tribunal fees will lead to a rise in weak, misguided, or vexatious claims. Firms favour a small and proportionate fee per claim – not the expensive system that was rightly challenged in the courts.



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