The manufacturing skills gap - and how organisations should tackle it

Written by Matt Parry – Manufacturing Account Executive.

A shortage of critical skills - and the related high costs of employment - is one of the manufacturing industry’s biggest headaches right now. It's putting pressure on businesses to raise prices, hampering business growth and causing small and medium-sized manufacturing and engineering firms in particular to hold back on investment. 

In a recent survey, the former manufacturing sector skills council Enginuity found that eight in ten UK manufacturing businesses had struggled to find suitable staff in the last six months, with almost nine in ten saying that labour costs had forced them to raise prices. Just over four in ten said that skills shortages meant that they'd been unable to grow and respond to new business opportunities, despite having plenty of demand.
 

The problem is particularly acute when it comes to implementing digital technologies - and this matters, given the UK's competitive position. When it comes to the use of industrial robots, for example, the UK has just 112 per 10,000 industrial workers, according to MakeUK - less than half the EU average and well behind other leading industrial economies. 

Recent research from Insight Enterprises found that when it comes to cybersecurity skills, for example, the manufacturing industry is experiencing the worst shortage of any sector, with nine out of ten EMEA firms saying it has a sizeable impact on their business today. Nearly half of manufacturers identify a lack of technical skills as the main thing holding them back.

Enginuity is calling for more government support in closing the skills gap in small manufacturing and engineering firms.  SMEs, it says, need strong institutional arrangements, greater cultural esteem for vocational learning and more continuity in long-term policy.  

“Whilst the government wants to see increases to employer investment in skills, barriers keep SMEs locked out of the skills system that would enable them to do so," says the firm's policy manager Poppy Bramford. "For SMEs to realise the ambitions of the UK government on economic growth, the skills landscape must move beyond policy chop and change by injecting longevity and SME engagement into policy creation.” 

When it comes to training and upskilling existing staff, there is help available. Automate UK, for example, offers training for manufacturing workers in everything from leadership and management skills and marketing to CE marking and electrical machinery safety. It also provides a variety of bursaries and apprenticeship grants for employers. And training is also available from government skills bootcamps, HVM Catapult, Make UK and other organisations.

Meanwhile, according to recruitment firm Michael Page, manufacturing employers need to be a bit more flexible when it comes to recruiting new staff. It recommends introducing hybrid working arrangements and re-evaluating non-negotiable specifications, for example by widening the range of required years of experience or removing the need for an industry-specific background.

And, says Jazz Little, business development manager at The Recruitment Co, companies should modernise their apprenticeship schemes and market them more effectively to appeal to today’s younger people. 

"Flexibility, innovation, and clear progression pathways within apprenticeship frameworks can make them more attractive," she says. "Additionally, integrating digital skills and advanced technologies into training programmes will align with the interests of younger generations, who are often more tech-savvy and eager to work with cutting-edge tools."

It's also worth investing in outreach programmes, she says, as well as attending careers fairs, offering school visits and creating partnerships with educational institutions.
Meanwhile, automation and the use of AI can make a big difference in tacking the skills shortage, according to EIT Manufacturing, a public-private partnership co-funded by the European Union. For SMEs, it says, staying on the sidelines of digitalisation means losing competitiveness. 

EIT has developed a course aimed particularly at SMEs in the manufacturing sector. Designed to offer flexible, targeted and applied training rooted in real use cases, it's designed for managers, engineers or technicians with a basic understanding of digital tools and an interest in applying AI to improve operations. 

And according to the Manufacturing Technology Centre (MTC), many organizations aren't making the most of the talent they've already got. Older manufacturing workers say their skills are going unused, while young staff say they are willing to learn from older colleagues if given the chance.

"We all know there is a wealth of knowledge already embedded in the UK’s manufacturing workforce, but too often it goes untapped," says David Grailey, managing director of MTC Training. 

"At a time when the sector is facing a significant skills gap, we need to realise the benefits of many different ways of skilling, upskilling and reskilling workers, not just on bringing in new talent." 

If your business is feeling the pressure of the manufacturing skills gap, our specialist manufacturing team at Howden can help you build resilience. Speak to us today to ensure your people, operations and growth plans are fully protected.