Economic slowdown hides increasing skills shortage

A fall in recruitment caused by economic slowdown may be masking the severity of the skills gap within manufacturing industry. The latest annual labour market survey by the Engineering and Marine Training Authority (Emta) shows that 63% of companies recruited new or replacement staff this year, down from 66% in 1998, while vacancies fell from […]

A fall in recruitment caused by economic slowdown may be masking the severity of the skills gap within manufacturing industry.

The latest annual labour market survey by the Engineering and Marine Training Authority (Emta) shows that 63% of companies recruited new or replacement staff this year, down from 66% in 1998, while vacancies fell from 26% last year to 21% this year.

According to Dr Michael Sanderson, chief executive of Emta, these figures confirm the economic woes facing industry. Companies have been cutting back on recruitment this year in response to a decline in business caused by the strength of sterling in 1998, he says.

Companies are expected to begin raising recruitment levels next year as the economy revives – and that is when the lack of trained engineers will become more obvious.

This year, the proportion of companies identifying a gap between the skills of their current workforce and the skills required to achieve their business objectives fell from 32% to 26% of those surveyed. But Sanderson says the situation is likely to have deteriorated by the time Emta conducts the same survey next year.

`The shortage of skills will slow down the rate at which companies can make productivity improvements, and even doing simple things can be affected, as lead times increase for companies getting their products out of the factory gates,’ says Sanderson.

`If companies decide to retrain their existing staff in order to plug the gap, it can be costly, thereby increasing their overheads,’ he adds.

The report shows that gaps in engineering skills are considerably worse than in the rest of the economy, underlining the continuing difficulty in encouraging young people into engineering. The survey found that 34% of engineering organisations reported a skills gap, compared to 19% for the economy as a whole.

Within engineering companies, technical skills are the most scarce, mentioned by 71% of those employers with a shortage of staff. Mechanical engineering, computer-aided engineering, toolmaking, CNC machining and electrical and electronics engineering have the biggest problems finding recruits.

The survey blames the dearth of skilled engineers on a variety of factors, including the poor image of engineering in the UK, and incomplete or even biased careers advice to young people.

Ann Bailey, head of education and training affairs at the Engineering Employers’ Federation, says the situation is showing no sign of improving. `We have to get young people at school engaged in design and technology, she says. `We need to get the best teachers so we can catch their interest, and get more young people going through the system.’

Bailey denounced as `crazy’ a recent Government decision not to make design and technology compulsory subjects for pupils over 14.

Other factors cited by Emta for the insufficient numbers entering the profession were the inadequate output from full-time education in the relevant subjects, the high cost and length of time it takes to train engineers and the lack of a framework of regional and national priorities within which local agencies can plan their strategies.

The report does, however, point to recent efforts to improve the situation, such as the introduction of Regional Development Agencies, which will have a remit to develop action plans for their regions. Plans to form a national Learning and Skills Council, which would take responsibility for identifying policies, strategies and funding frameworks for post-16 education, are also seen as a positive step.

But will these strategies be enough?

`It’s never enough,’ says Sanderson. `I go to bed exhausted at night but I still haven’t done enough. Things have improved a little but there’s still a long way to go.’