POLITICS


Business growth is dependent on skills


Employers expect to continue to struggle to recruit over the next two years, new research has shown. And problems finding suitably skilled staff


Theresa May (pictured) remains Prime Minister, but a hung Parliament created uncertainty


at all levels will have an impact on growth, the Chamber is warning. About half of the Chamber’s members


of respondents expected their investment in training to increase in the coming quarter, a fall from the 29% figure recorded in Q1 2017. Q2 responses revealed a small increase in the


likelihood of companies to invest in equipment but a drop in the readiness of business to invest in training is a concern. Generally speaking, the survey showed


workforce stability over the three months. The data supports figures from the Office for


National Statistics, which recorded an unemployment rate of 4.1% in the East Midlands, which was lower than the national rate of 4.6%. While respondents were generally positive


about intentions for short-term labour force changes, 34% said they anticipated recruiting in the next three months but that is nine points down on the Q1 result. Almost two-thirds of companies (64%) said


they expected their labour force to remain constant over the coming quarter, up from 52% in Q1 2017. This figure might, however, suggest a dry


talent pool stemming from exceptionally low levels of unemployment in the region.


employ non-UK EU nationals, leading many to say they anticipate complications retaining those workers as Brexit progresses. Original research by the Chamber, carried


out as part of its Quarterly Economic Surveys between September 2015 and June 2017, showed consistent levels of recruitment from businesses in the region. Quarter-on-quarter, the number of firms


saying they were recruiting was between 52% and 63%. But of those saying they were recruiting,


between 55% and 66% reported difficulties, particularly, but not exclusively, when looking to fill skilled technical and professional vacancies. The importance of addressing this


recruitment challenge is brought sharply into focus when considered against the number of firms planning to grow over the next two years. Almost nine out of ten firms (86%) said


they were planning for growth, of which 67% said their plans involved taking on more people. Contrary to expectation, the number of


companies saying they planned to invest in training fell between March 2015 and September 2016 before rallying at the start of 2017. The fall suggested that firms were less keen


on ‘growing their own’ as a primary strategy for addressing the skills shortage. It’s possible that the reality of Brexit might


have prompted a greater interest in training existing staff. Of the businesses planning to grow, 63% now say investment in training is essential to


‘Work must be done to ensure provision has the flexibility to meet the real needs of growing businesses’


helping them achieve their plans and 51% reported having training investment strategies to reduce reliance on external recruitment. Staff training was seen by 84% of firms as


playing a key role in retention. The research also asked firms to identify


potential barriers to training. Costs and finding the time to release staff from normal duties to undertake training were cited as the main obstacles. Just under ten per cent of firms ranked a lack of flexibility among training providers as one of their top three obstacles. Chris Hobson, the Chamber’s Director of


Policy, said: “What has become clear from this research is that businesses continue to have an appetite for growth but for that growth to be achieved there does need to be a focus on training. This has to start with closing the skills gap between education and the workplace while encouraging firms to invest in training, both in terms of cost and making sure workers have the time to undertake training, so that they don’t miss out on opportunities for business growth. “With businesses showing a willingness now


to make this investment, it is essential that Government policy responds by offering support to cover training costs and work must be done to ensure provision has the flexibility to meet the real needs of growing businesses. “The Chamber will continue to work with members, Government and wider stakeholders to support progress in this area.”


business network July/August 2017


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