According to the report from the Institution of Engineering and Technology (IET), over two thirds (71 per cent) of the engineering workforce experiencing internal skills gaps say it is down to missing engineering or technical skills.
Nearly all (96 per cent) employers who had identified a skills shortage said that it impacts their business in some way, the most common of those being around recruitment.
Difficulties recruiting (50 per cent) or making recruitment timelines longer (47 per cent) were identified as common results. Less than half (45 per cent) of companies who see a skills shortage within young people provide additional training for apprentices and graduates, while 25 per cent simply recruit fewer apprentices and graduates as a result.
Lack of recruitment from a diverse talent pool may also be fuelling the problem, the report found — only a third of businesses were shown to be taking action to improve workforce diversity across gender (33 per cent) or ethnicity (30 per cent).
When asked what support businesses need from government to improve skills nationally, more funding for apprenticeships came out on top (54 per cent) with more support to train or re-skill in priority areas (51 per cent) and better careers advice in schools and colleges (49 per cent) next in line.
Simon Edwards, director of governance and external engagement at the IET, said that economic uncertainty caused by Brexit and Covid-19 has been a factor in the skills shortage coupled with the drive to deliver on net zero targets, resulting in an emergence of new engineering roles with new required skill sets.
“Workers are in high demand but we don’t have the 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,” Edwards said. “Frustratingly, nothing has changed.”
He explained that this year, engineering employers are seeing a general lack of applicants for roles causing more difficulty in recruitment — 34 per cent reported this, a marked increase on 2020 (22 per cent).
“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.”
Edwards added the IET has already called for the embedding of engineering into the existing science, technology and mathematics learning at primary school.
Despite the impact of the pandemic on recruitment and skills, firms remain positive about the future, the report said, with 79 per cent confident about the economic prospects for their firm and 77 per cent for the sector. However, three in ten companies have experienced decreased headcount over the last year and half of these attribute this directly to Covid-19.
Whilst 12 months ago the top priority was cutting costs (44 per cent), current top priorities for firms focus on improving profitability (67 per cent) and productivity (62 per cent).
Engineering employers recognised particular areas of skills as important for economic growth over the next five years, with design and manufacturing recognised as a key area by 36 per cent of respondents.
Most (64 per cent) have the skills they think they need, however energy and environmental sustainability was the second most cited area for growth (35 per cent) and only half (51 per cent) have the required skills. In light of this, only 50 per cent think it is achievable for their organisation to be net zero by 2050.
The full report is available to read here.