Skills deficit damaging productivity say West Midlands businesses

The firm’s latest Business Outlook Tracker* found that four in five business leaders (80%) believe that a lack of vital skills is affecting productivity levels. Financial skills were identified as the most in need (25%), followed closely by complex capabilities including operational and entrepreneurial skills (both tied at 23%). The survey of mid-sized regional businesses revealed that 94% were planning to invest more or the same in skills development over the next six months. Many have already established their own development programmes to achieve this, with 90% of those noting they were lacking financial skills having in-house coaching to boost this. However, of those that identified operational and entrepreneurial skills as areas in need, only 56% and 67% have implemented in-house training, respectively. The survey finds that productivity issues are currently affecting almost every aspect of mid-sized businesses, including their ability to grow and export. Alongside skills shortages, other important factors impacting the productivity levels of West Midlands businesses include the inability to plan long term due to economic and political uncertainty (36%), increasing levels of stress and burnout amongst staff (30%) and difficulty in attracting and retaining talent (30%). With an election called for 4 July, the majority of West Midlands businesses (87%) claimed to have confidence that the next UK government (of any party) will focus on prioritising long-term solutions to address the nation’s productivity issues. Matt Buckingham, Partner and Practice Leader for Grant Thornton UK LLP in the West Midlands, said: “It’s clear that there’s a strong demand for further investment in skills development in the West Midlands, with business leaders recording a need for better financial, operational and entrepreneurial 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.”