IT skills gap threatens UK competitiveness

2004

The UK faces an IT skills gap in the workforce which will damage its global competitiveness within ten years if not addressed, according to new research.

A report by e-skills UK, the voice of employers on IT, found that a quarter of UK businesses lack everyday IT skills, with more than four out of ten companies reporting their staff were not proficient in using basic word-processing applications.

Three-quarters of companies with hard-to fill IT professional job vacancies have had to delay the development of new products and services and a third of businesses with IT vacancies are finding them hard to fill.

As a result, more than four out of ten suffered an increase in their operating costs, a similar proportion experienced problems meeting customer service objectives and more than a fifth have lost business or orders to competitors.

The findings, based on a survey of over 3,200 employers, also suggest that the UK is lagging behind the USA, Sweden and Germany in terms of e-business uptake because smaller organisations are not recognising and exploiting the benefits of IT.

The problem is compounded because UK’s four million business managers do not fully realise the potential of IT to create new business opportunity and transform productivity. Yet there is no plan for the widespread development of these skills in either the current workforce or the business leaders of the future.

"The UK will not be competitive in the global economy in ten years time if we continue with the level and type of skills being relied on by business today," said Karen Price, e-skills UK CEO.

"There is a tendency to dismiss the subject of skills as a 'soft issue' with no real impact on the economy. To do so in this case would lead to catastrophic damage of the UK economy.

"IT intensive industries generate 45 per cent of the UK’s Gross Value Added – driving new markets and productivity. ‘IT Insights’ tells us that at present we have neither the everyday IT user skills, nor the IT professional skills within our businesses to avoid an economic crisis."

According to the report, up to 189,000 entrants into the IT workforce will be needed every year for the next decade. This demand will be met by new entrants from the education system, people moving from other business areas and those returning to the IT workforce after a career break. Many will need significant skills development.

But a study earlier this year by academics at Cambridge University suggested that the number of under-25s going into IT in Britain had nearly halved since 1995 to just 6.7 per cent, while the number of women working in IT has almost halved in only four years.

Dated recruitment and retention practices, a lack of flexible working opportunities, endemic ageism and latent discrimination against women were all identified by the Cambridge researchers as reasons why IT fails to attract - and actively discriminating against - older workers and women.

Larry Hirst, Chief Executive, IBM UK and Chair of e-skills UK, said that developing competitive IT skills for IT users and of IT professionals alike was a significant challenge to the UK over the next decade.

"No-one can develop IT skills in the UK in isolation, but must work together as employers, and with the government, the education sector and private training sector to ensure that we are developing the right skills throughout the entire UK talent pool."