The Great Big Tech Skills Gap
So much technology, so little talent
It is almost impossible to read anything relating to the technology or staffing industry without being reminded of the UK digital skills gap, a gap which is thought to be costing the UK economy £63bn a year. This is obviously a widespread concern and as a result the UK government has been urged to publish its 2016-2020 Digital Strategy without delay. Combine this digital skills gap with a widening and long standing STEM skills deficit and it looks like the UK is still facing a worsening skills crisis, particularly in the Information Technology space. Moreover it is purported that if this is not quickly addressed then there is a strong possibility that the UK won’t have the pipeline of talent needed to keep pace with the ever-evolving global world of technology - this could impact upon our ability to be globally competitive in the future (and I haven’t even mentioned Brexit yet!)
One potential solution to plugging the digital and tech skills gap in the UK is to increase the number of young people who successfully complete technology related degrees by ensuring that they are bitten by the STEM bug in their younger years. Dissapointingly, however, momentum appears to be declining and the STEM worker shortfall is estimated to be at 40,000 each year in the UK with interest in STEM related subjects still declining as 74% of young girls apparently lose interest in STEM topics during secondary school - a daunting figure that potentially threatens our overall prosperity.
Added to this I think it’s fair to say that it’s been rather tumultuous in the UK economy of late with unrest and uncertainty arguably a natural by-product of the potentially seismic constitutional change to the economy as a result of Brexit. This would go some way to explaining why the UK government has “held back” on issuing its Digital Strategy until after the EU Referendum result, no doubt further delayed by the recent cabinet changes.
Interestingly, however, as the dust is settling around our Referendum result, there appears to be as many signs of positivity and determination as there is talk of doom and gloom – one of the things that makes Britain “Great” after all is our sense of “getting on with it” and our resilience in making the best out of any given situation.
The Great British Reserve
You may recall “Y2K” and the fear of the “unknown” that created hype and hysteria in the 90s around the eve of the millennium. Global media coverage and talk in the tech industry ranged from mass loss of data and computers crashing to planes falling out of the sky and a technical ‘armageddon’. Bugs were identified, fixes were found and multiple strategies were implemented to ward off any Y2K consequences. The result? Y2K was subsequently dubbed “the new years’ disaster that never happened.”
Roll forward to 2008 and the UK was officially in recession, unemployment rose, growth froze and some industries were badly hit. Subsequently after 5 quarters, according to official data, the UK grew more rapidly than any other G7 economy and recovery over the past 2 years was faster than anyone had predicted.
Not only did we recover more quickly than anyone thought that we would, our innovative tech sector recovered substantially with many IT companies rising from the ashes and going on to become even more profitable in subsequent years. During the recession the Fintech sector really started to become an emerging force, with investment in Fintech increasing dramatically and in the 5 year period post 2008 the value of Fintech investment in the UK and Ireland region increased almost eightfold to US$265 million in 2013.
This is further supported by a paper presented to the Royal Economic Society annual conference in March this year, by a senior economist at the Bank of England, stating it was essentially our adaptability to changing conditions around our wages and working hours as a country and workforce that allowed us to get through the recession with little damage.
Arguably, technology is the growth engine of the UK’s economy, some have even gone so far as to claim it is our most recession proof industry, and amidst this time of ‘change’ we undeniably have opportunities to innovate and evolve, factors on which the technology industry seemingly thrives. We only have to look at the current spread of tech communities around the UK; our tech sector received £2.7bn worth of venture capital funding in 2015 with London, Manchester, Leeds, Birmingham and Edinburgh long since hailed as world-leading tech hubs containing a diverse blend of IT skills, cutting edge technologies, start-ups and established technology businesses.
The Great and the "Should"
The fact remains that the UK jobs market is buoyant and unemployment is at a ten year low, the UK has suffered many major impacts to its economy, and endured. And whilst the laws of the land are reviewed and, potentially, re-written, us Brits are a pretty agile bunch in potentially adverse times, so surely now we each have an opportunity to re-think our own business models and services? “The current landscape offers an opportunity for us to encourage a new regulatory framework.” Samantha Hurley, Operations Director at APSCo, referring to changes that could improve the agility and flexibility of our temporary labour economy.
Lorien have delivered tailored recruitment solutions across all industries for decades, including Banking, Pharmaceuticals, Fintech and Consultancy. One of the key reasons that we have continued to grow is because we have constantly evolved and innovated to meet the ever changing needs of our clients. We’re not small, yet we haven’t allowed our size to impair our agility and we have continuously innovated our sourcing strategies to ensure that we are able to source the key talent that they have needed - from growing their start-ups to delivering major transformation programmes and achieving their strategic initiatives. You could argue that regardless of the major external impacts to any of our businesses, growth remains dependent upon sourcing, developing and retaining the right talent.
So if tech really is the spark that could stave off a financial crisis and drive growth, then we really should all take note and work hard to strengthen our pipeline of UK tech talent, starting from grassroots: education.
But it’s not just down to the educators, both employers and the staffing industry must work together to encourage and support opportunities for emerging talent. In my last Pulse I outlined how pleased we were to have participated with some of our clients own creative initiatives, including RBS whose own STEM related programmes include working with organisations like SmartSTEMS whose very ethos is to encourage, involve and inspire more young people from different demographics into STEM.
Even though apprenticeships have been much lauded as one of the best solutions to help plug the digital skills gap, according to recent research, half of UK employers do not yet run apprenticeship schemes, despite the fact that 73% of those surveyed appreciated that apprenticeships could help to fill their digital and tech skills gap!
So perhaps now is the right time for the UK government to outline its 2016-2020 Digital strategy with gusto, time for them to address the increasing tech skills gap and outline with earnest how we can all support and drive technology talent to help maintain our Great British, world-leading, tech communities and ultimately support our nation’s continued growth.