There’s a spectre haunting the human resources profession, set to give HR teams nationwide one big headache.

And it’s not COVID-19. It’s the 2030 skills gap.

By 2030, it’s predicted that the UK economy could be facing severe and debilitating skills shortages. COVID-19, and the economic devastation it has caused, has highlighted the structural weaknesses of the economy and brought the upcoming skills gap crisis into focus. 

So, how have we got here and what can we do to resolve the situation? We took a closer look at the issue.

The 2030 Skills Gap Explained

A skills gap happens when there is a mismatch between the skills that employers need and the skills that employees have. This makes it harder for employers to find employees with the skills they need. It also makes it harder for employees to get jobs.

Put simply, research has shown that by 2030 there will be a shortage of highly skilled employees in sectors that are in need of them and an oversupply of medium/low-skilled employees in sectors that don’t need them.

Driven, at least in part, by a growth in automation technology and an ageing workforce, the 2030 skills gap looks set to compound the unprecedented economic problems that the COVID-19 pandemic has created. The Industrial Strategy Council’s ‘UK Skills Mismatch in 2030’ report found that by 2030, over 7 million workers could be considered underskilled – around 20% of the current UK labour market. 

And that’s a significant problem for the long-term productivity of businesses.

What could employment in 2030 look like?

In its ‘The Future of Work: Jobs and Skills in 2030’ research paper (conducted before COVID hit), the UK government envisioned four possible scenarios for how the skills gap could affect the economy:

1. Forced Flexibility

This scenario sees increased business flexibility and limited innovation leading to a small growth in the economy but creating fewer opportunities and less job security for low-skilled employees.

2. The Great Divide

High-tech industries drive growth but create a two-tiered society, where there is a huge divide between the high-skilled and low-skilled. 

3. Skills Activism

Technological innovation leads to the widespread automation of professional work, creating large-scale job losses. This leads to a national, government-led skills programme to retrain the workforce.

4. Innovation Adaptation

Digital innovation, and a boom in digital and STEM-focused skills, drives productivity.

These scenarios are quite different but they all agree on one thing – future employment is likely to be based around flexibility and the ability to adapt to changes quickly. And that has a direct effect on the skills that many roles will need.

What skills will be in demand in 2030?

So, what are the skills organisations will need?

Basic digital skills

By 2030, the Industrial Strategy Council estimates that up to 5 million workers in the UK could lack the basic digital skills and knowledge to be able to do their jobs competently. With digital technology growth accelerating, it’s extremely likely that digital skills will be in high demand in the future economy.

Leadership and management skills

The UK already has a concerning leadership and management skills gap and by 2030, the situation will have significantly worsened if nothing is done. Core management skills like leadership, critical thinking and decision-making are predicted to be some of the most in demand by that time.

Communication skills

As automation grows and artificial intelligence takes over a huge number of roles, there’s likely to be an increased demand for so-called ‘soft’ skills, like communication, creativity and problem-solving amongst workers.

STEM skills

Unsurprisingly, skills associated with STEM subjects are predicted to become very sought-after by 2030, reflecting ongoing technological development and an increasingly competitive global economy.

What can we do about it?

Both the government and employers are responsible for finding a solution to this crisis.

One solution to the skills gap for employers is surprisingly simple in theory – we need to retrain and reskill employees to meet the demands of the future. By investing today, we can face the challenges of tomorrow with confidence.

Here are some measures you can take to get ahead of the curve when it comes to combating the skills gap:

Recognise the value of lifelong learning

Short-termism has blighted the UK economy for the last decade and a failure to invest in the skills of employees now will store up problems for later.

One of the most powerful things employers can do to combat the skills gap is to recognise the value that learning and professional development provides to employees. As well as improving the confidence and motivation of employees, professional development can also improve business efficiency, productivity and employee retention, saving you money in the long-term.

Identify employees with potential and nurture them

By taking a long-term view and identifying employees who show great potential, we can start to significantly skill-up our workforce and get a headstart on remedying the skills gap. Ask management teams to pay attention to which skills employees show an aptitude in, and encourage them to develop them.

Build a culture of learning in your workplace

All of these measures are useless unless you develop a clear culture of learning in your workplace that values knowledge and encourages continuous training. Develop a company learning strategy, try to get buy-in from senior management and nurture the skills of your employees.

We hope you’ve found this article thought-provoking. If you’re interested in learning more about how L&D might look in a post-COVID world, make sure you tune into Dr. Stephen Littler’s CIPD ACE presentation on ‘The Future of L&D in a Post-Pandemic World’.

Ready to upskill your team? ICS Learn’s award-winning professional qualifications can help you develop your staff – or your own career – 100% online.