• Two in five local employers are struggling to recruit skilled staff and 41% have seen increased staff turnover since the EU Referendum
• Businesses report this is impacting their growth and expansion efforts
• To solve the crisis more than half are planning on recruiting more apprentices and many are engaging with education providers

More than a two fifths (44%) of Scottish firms are reporting difficulty recruiting skilled staff, and 41% have seen increased staff turnover since June 2016, according to a new employment and skills study from Lloyds Banking Group and London business membership organisation, London First. The study sought to analyse the impact of Brexit on business recruitment and access to skills across the UK.

The skills shortage is proving to be an issue for businesses in Scotland, with 34% saying it had impacted their activity. Half said it affected their revenue growth and business expansion, and 45% said it had made it harder to respond to customer needs.

The skills gap

The biggest gap reported by respondents was for technical and job-specific skills (50%), reflective of the largest portion of respondents being in the manufacturing sector.

Many thought these gaps would persist over the next 18 months, reflecting the UK’s long-term challenge in tackling its skills shortages.

Addressing the challenges

To help generate a pipeline of future talent, almost half (47%) of Scottish firms said they would be focusing on improving skill-set in the next 18 months as part of their recruitment efforts.

More than half of companies (56%) are already engaged with local schools, colleges and universities and the majority of firms surveyed (53%) want to work with more education providers. Despite this, 21% said that they don’t have enough time or staff resource to engage with more schools.

Apprenticeships are providing to be a popular solution to the skills shortage, with almost a third of Scottish companies surveyed employing apprentices and, of these, 43% plan to hire more over the next couple of years.

Philip Grant, Lloyds Banking Group’s Ambassador for Scotland, said: “Having the right access to skills is vital for any business to grow, and being able to hire and retain talented people should be at the top of the agenda for firms across Scotland.

“We’re committed to nurturing young talent as part of our Helping Britain Prosper plan and, in Scotland we employ apprentices across our business and work in partnership with local schools, colleges and universities

As part of its Helping Britain Prosper plan and as a bank to more than a million UK businesses, Lloyds Banking Group provides financial support and internships to help young people get through university and into the world of work; as well as taking on 1,000 apprentices every year across the country. Lloyds is also helping to train apprentices in other key sectors of the economy, including manufacturing at the Lloyds Advanced Manufacturing Training Centre in Coventry.