Scotland's Workforce Better Prepared But Skills Challenges Still Lie Ahead According to New Reports 

It is an improving picture, but while overall the level of skills gaps in Scotland's workforce are falling, key sectors of the Scottish economy still experience significant skills gaps, with a fifth of employers in some areas reporting a skills gap in their workforce.

These are the findings according to a report launched today by the Alliance of Sector Skills Councils in Scotland (Alliance Scotland), the body responsible for acting as the voice of employers in the skills system. A skills gap occurs when employers find that an employee lacks the necessary skills to carry out their role with full proficiency.

Planning, organisation and problem solving emerged as the most common skills gaps amongst Scotland's workforce, according to the survey contained in the report.

The Scottish Sector Profile 2011 report is part of a series of industry sector profiles (Labour Market Intelligence reports) produced by the Alliance Scotland which looks at the profile of, and the impact of the economic downturn, on employment and skills in 24 sectors ranging from banking to mining and engineering to healthcare* **.

Overall, the report shows an improving skills picture within the Scottish workforce, with the percentage of workplaces reporting at least one employee with a skills gap now standing at 15%, down from 20% in 2008, when the last similar employer survey was undertaken.

The number of Scottish workers experiencing a skills gap has also dropped, with skills gaps now affecting 139,100 employees or 6% of the Scottish workforce, compared to 179,000 employees, or 8% of all employees identified as having a skills gap in the 2008 Scottish Employers Skills Survey (SESS).

The Scottish Government has identified seven economic priority areas which it has identified as having the strongest potential to deliver sustainable economic growth: creative industries, energy, financial and business services, food and drink, life sciences, tourism and universities.

The new report shows some of these industries are rising to the skills challenge, with relatively low numbers of employees suffering from skills gaps. In the creative industries, a sector which is anticipated to generate a substantial number of new jobs over future years, only 6% - 8% of employers reported having identified staff with specific skills gaps. Meanwhile, employers in the energy sector, another area anticipating huge employment growth in the years ahead, a relatively modest 13% of employers reported employees with a skills gap.

However, the proportion of employers complaining of skills gaps in their workforce rose to 21% in the food and drink sector; in finance, accounting and financial services, the percentage was 19%. Meanwhile, 18% of employers in hospitality, leisure, tourism and travel, and in lifelong learning, including the economically significant university sector, reported skills gaps amongst employees.

Skills gaps are also particularly acute in areas such as retail (20%), social services and science, engineering and manufacturing (both 18%).

The survey also looks at skills shortages in the Scottish labour market, where employers have been unable to fill a vacancy due to a shortage of relevant skills to fulfil that role. 3% of Scottish employers said they had been unable to recruit for a specific post for that reason.

Land-based and environmental industries were found to be particularly affected by skills shortages. Including sectors such as agriculture, aquaculture and forestry, the report found that the percentage of employers in these industries unable to fill vacant posts due to a shortage of suitably skilled candidates was as high as 5%.

The Alliance Scotland argues that the report findings lend further weight to the Scottish Government's focus, as part of its refreshed Skills Strategy, on ensuring that Careers Advisers are aware of the opportunities on offer in key sectors, that relevant college / university and training courses are provided and that there are an appropriate number of Modern Apprenticeships (MAs) available for these sectors.

Evidence from employers who recognised skills gaps in their own workforce suggests planning and organisation, problem solving and customer handling are the most widespread skills gaps within the Scottish workforce. 59% placed planning and organising at the top of their list of skills needing improvement, with 57% highlighting problem solving as a common skills gap and 51% pointing to the need for improvement in customer handling skills.

The survey highlights the main impacts of skills gaps on employers as being a difficulty in meeting customer service objectives (identified by 63% of respondents), difficulties meeting required quality standards (mentioned by 53%) and increased operating/running costs (indicated by 49%).

Workplace preparedness
Employers were also asked about their perceptions of the preparedness of new recruits from secondary school, college and university for work. The response seemed to depend on the length of time individuals had stayed in education. 78% of employers having recruited from university found such employees to be well or very well prepared for work. By comparison, only 59% of employers recruiting straight from secondary school found their new recruits were either well or very well prepared to start work.

The report also found that public sector establishments were more likely than those in the private sector to regard education leavers as well prepared for work, particularly those recruited straight from secondary school or college.

Modern Apprenticeships
52% of employers indicated they were aware of the existence of MAs, which allow those aged 16 and over to work in a paid job while undertaking vocational training. The level of employer awareness ranged from 56% in the public and voluntary sector to 51% in the private sector. Awareness of MAs was also generally higher amongst larger employers. 76% of employers with 50 or more employees had heard of MAs compared with just under half of employers with fewer than 10 employees (48%), suggesting an important opportunity for a focused information campaign to make smaller employers aware of the opportunities on offer through MA programmes.

The report identified just under one in ten (9%) of all employers that offer MAs and 5% that have staff undertaking MAs at their site. However, 30% of employers with over 50 staff offer MAs, compared with just 6% of employers with fewer than 10 employees.

The main factors cited by employers for not offering MAs was that all staff were fully trained (mentioned by 18%), that the job in question didn't require highly trained staff (identified by 17%) and that MAs were not considered relevant to their company or industry (mentioned by 12%).

Recruitment of young people
In the last 2-3 years just over a quarter of employers have recruited from secondary school (26%), compared with approximately a fifth from university (20%) and college (19%).

Private sector employers are more likely to recruit secondary school leavers (29% as compared with 19% from university), while public sector employers are more likely to recruit university leavers (31% as compared with 15% from secondary school).

Commenting on the report, Jacqui Hepburn, Director of the Alliance Scotland, said:

"The fact that the number of Scottish workers experiencing skills gaps continues to fall is to be welcomed - and suggests the Scottish Government's Skills Strategy is making continued progress in effectively addressing the skills needs of our workforce. As an organisation, we are working hard to ensure that, despite the economic recession, we are delivering a skilled workforce which is able not only to fulfil the opportunities of today, but also those forecast for the future.

"However, there remain challenges ahead, especially given the current economic climate, with some sectors experiencing relatively large skills gaps which need to be addressed. We also need to ensure our young people are prepared for the world of work, which we are assisting in doing through ensuring they are being made aware of the opportunities on offer and equipping them with the skills required.

"This report also emphasises the need for continuing investment to upskill the existing workforce, particularly with softer skills such as organisation, problem-solving and dealing with customers, where skills gaps seem to be most commonly identified."

On the subject of Modern Apprenticeships, she added:

"We also need to ensure that there is an increased level of awareness, especially among smaller businesses, of the Modern Apprenticeships programmes on offer, and with the Scottish Government pledged to deliver 25,000 a year there are clearly opportunities for businesses, both large and small, to get involved."

 

* All data contained in the report is from the Scottish Employers Skills Survey
**The full range of industry sector profiles can be accessed via the link below