Almost three quarters (71%) of Scottish organisations are currently experiencing skills shortages, which remains one of the top challenges facing employers.
That's according to this year’s Business Barometer published by The Open University and the British Chambers of Commerce, which highlights that despite the ongoing skills shortage, almost two in five (39%) Scottish organisations don’t have any specific initiatives or workplace adjustments in place for specific talent pools, including underrepresented groups such as people with disabilities or those from diverse ethnicities.
The report suggests that employers are missing out on the hidden talent pool and an opportunity to ‘grow your own’ talent during a time when two in five (42%) Scottish organisations say they have been prevented from filling roles due to lack of applicants.
The ongoing skills shortage continues to have a negative knock-on effect on existing staff morale and wellbeing, with 75% of organisations in Scotland reporting increased workload on existing staff.
Many also reported an impact on reduced activity or output (44%) and reduced long-term growth plans (36%), meaning the additional pressure of skills shortages are impacting the future of organisations, which could lead to further challenges for the economy as well as meeting net zero, diversity or inclusion goals.
The threat of an ageing Scottish workforce retiring without employers having the skills to replace experienced employees is another concern, with a third reporting an increase in the number of employees over the age of 50 in the last three years.
Despite the ageing workforce concern, 86% of organisations don’t have a specific initiative in place for workers over 50, while three quarters of organisations don’t have any written annual plans to prepare for people exiting the business.
While there is a collective effort to address the skills shortage as most Scottish organisations (77%) intend to use some form of training for their staff over the next 12 months, the report reveals that organisations, especially small and medium-sized enterprises (SMEs), lack the necessary expertise and resources to strategically address the skills gaps and challenges effectively.
Baroness Martha Lane Fox, chancellor at The Open University and president of the British Chambers of Commerce, commented: “It’s clear from this year’s Business Barometer report that the skills shortage has not improved, despite the existing efforts from organisations across the UK.
“But what is even more concerning is that organisations aren’t investing in specific talent pools, including underrepresented groups - if organisations continue to ignore these workers, they risk missing out on untapped talent and deepening the skills gap even further.
“There could be a big opportunity for employers here if hidden talent is given a boost.”
David Allen, acting depute director for external engagement at The Open University in Scotland, said: "Skills shortages are biting hard; damaging businesses and holding back economic growth.
“Never has it been more important for businesses, governments and training providers to work together to find solutions.“
The survey was conducted online by the British Chambers of Commerce between 11 April and 11 May, with 1,289 organisations from all business sectors, sizes and UK regions and nations completing it.
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