Is the Engineering Skills Shortage Going to Hinder Projects?
The engineering sector is in a constant state of disruption. Rishi Sunak has released a statement saying that a £20 billion cash injection is going to be invested in carbon capture and CCUS, which is going to fund a project in Scotland.
Vulcan Engineering have plans to expand in Rotherham, which is going to bring an influx of new jobs to the market. Projects that include the East West Rail are undergoing continual developmental progress, which is providing engineers with exciting opportunities. Even with all of this growth, the underlying skills shortage is still evident. STEM Learning have suggested that in technology, science, math and engineering alone, there is a shortage of 173,000 workers. Reports by IET indicate that 49% of UK engineering businesses are not able to recruit the skills they need to operate efficiently. In the construction business, there are 34,478 open positions for construction workers, roofers, and site managers. Only 2,870 people are currently searching for positions, however. There’s a risk that only one out of ten roles are being filled, which highlights the dire situation currently being faced by the sector.
The Current Shortage of Skills within the Construction Sector
The shortage of construction workers became evident when retrofit skills shortages stalled the process of plans to upgrade 19 million homes across the UK. The planned upgrade of cold and draughty homes required over 400,000 builders, however out of the 250,000 people who work in home maintenance, only 3,000 of them are retrofit coordinators. It’s estimated that 50,000 coordinators will be needed by the year 2030.
Delving into APSCo’s Report on Engineering
APSCo’s report also touches on the current skills shortage. Broadbean Technology provided the report and revealed that 36% fewer people are applying for jobs, which marks the biggest drop in the last two years. Even though numbers are falling, demand is high. Jobs are up 5% when compared to 2022.
Why is there a Skills Shortage?
There are many reasons why there is a current shortfall in UK talent. Emerging talent pools have exacerbated the issue. The OECD have indicated that less than 10% of UK graduates are engineers. This is far too low when compared to current demand. As the skills gap grows, the consequences of this shortfall become more apparent. While the government are focusing on improving STEM skillsets at an educational level, the action taken now will take years to become impactful.
The Importance of Immediate Solutions
Immediate solutions are needed as an interim option if current projects are to remain on track. This includes aiding contract professionals in filling current resourcing gaps. Off Payroll and Brexit have had a monumental impact on businesses and their ability to engage with temporary resources. This is unfortunately, the case on a global scale.
Off-payroll has had a lasting impact on the people who decide to work as contractors, as well as the number of employees who want to meet the compliance regulations for engagement. While in the near future, there aren’t going to be any changes to Off-Payroll regulation outside of the consultation sector, APSCo are striving to make sure that recruiters are heard. Regulation hasn’t been supportive of creating a flexible labour market, which given the scarcity of talent, is of great importance. What can be implemented on an immediate basis, are tweaks to the current immigration policy. The UK is lagging behind its European counterparts in terms of immigration options. This is especially the case for independent contractors and the self-employed.
Working Closely with Policy Decision-Makers
The public policy team is working closely with decision-makers to identify flexible options similar to those of Denmark, Germany, Australia and the Netherlands. Visas that are straightforward to obtain have to be available and accessible. They also need to mirror the general flexibility that Germany currently offers, as they are a leader on this issue.
Permitted businesses need to fall within the Standard Visitor visa. This could allow a short-term fast-track visa route for self-employed workers, as well as foreign employees. The Home Office did utilise fast-track visa applications last year, but this should be expanded upon, allowing for the leasing of visa holders in terms of registered sponsors.
If the new engineering projects in the UK are going to be successful, the underlying skills shortage has to be solved. The UK simply doesn’t have enough workers to support demand, but this could turn around quickly if new skill pipelines are opened.