Training call

Lack of skills damaging companies’ productivity

women female engineeer (Institute of Engineering and Technology)
Companies want more focus on training

Productivity among mid-sized businesses (MSB) in Scotland is being dragged down by a lack of key skills, according to new data. 

It finds that productivity issues are affecting almost every aspect of their operations, including their ability to export, recruit and train employees. 

Grant Thornton’s Business Outlook Tracker found that 88% of mid-sized firms plan to invest more or the same in skills development over the next six months. Many have already established their own development programmes.  

Half said that a lack of vital skills is affecting output, with financial skills the most in need (28%), followed by technical and data skills (24%).   

Almost all firms (90%) said said they will be investing more or the same in technology over the next six months, with the growth of artificial intelligence emerging as a key influence. Only 14% believe that AI will not have a positive impact on their productivity over the next year. 

Alongside skills shortages, productivity is being hit by a lack of funding for further investment (36%), increasing levels of stress and burnout amongst staff, difficulty in attracting and retaining talent, and a lack of staff engagement or low morale (all 26%). 

Greater investment in skills and training is identified as the policy area that business leaders in Scotland would most like to see the government focus on longer term.

The majority (84%) have confidence that the next UK government will focus on prioritising long-term solutions to address productivity issues in the nation’s public and private sectors. 

Stuart Preston, practice leader for Grant Thornton in Scotland, said: “It’s clear that there’s a strong demand for further investment in skills development in Scotland, with business leaders recording a need for better financial, data, and technical skills to help boost productivity.

“This lack of necessary skills development combined with difficulty in attracting and retaining talent is likely creating a snowball effect, stretching current people resources and ultimately contributing to heavy workloads and inefficiency – further exacerbating the productivity challenges facing the market and contributing to the increasing levels of staff burnout being seen in the region. 

“Ahead of the election, the major parties have outlined that they are focusing on enhancing the skills and training opportunities available to the country’s workforce.

“It’s crucial then that the parties listen to what mid-sized businesses, the engine of the UK economy, are saying they need and put forward solutions to address the constraints currently hindering the growth and productivity of a core segment of our economy.”  

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