The UK is at risk of having a shortage of skilled workers in industries such as technology and banking, according to research released on Wednesday.
A report by recruitment firm Hays said Britain is among the top five countries facing a shortage of talent, alongside New Zealand, Portugal, Canada, and Switzerland.
The firm said it collected data using job adverts and candidate profiles from 31 countries then examined five sectors: technology, engineering, manufacturing, life sciences, and financial services.
Hays analysis found the UK has a “pressing need” to address its skills shortages or it risks falling behind.
By contrast, the United States, China, India, Germany, and Brazil rank in the top five talent networks across all the sectors it analysed.
“To ensure the UK can continue to compete on the global stage, it needs a steady supply of talent with the right skills,” said Nigel Kirkham, the chief executive of enterprise solutions at Hays.
Hays and other recruiters have noticed a drop off in hiring rates over the past year, saying many employers have been cautious to take on new staff as a result of economic and political uncertainty, and wider cost pressures squeezing their finances.
Previously Chancellor Rachel Reeves has said that the financial services sector is “at the heart” of Labour’s “growth agenda.”
The study comes as Home Secretary Yvette Cooper announced a “new approach” to legal migration aimed at “boosting the UK workforce’s skills before recruiting abroad.”
Cooper claimed rising levels of legal migration in recent years demonstrated a “failure over many years to tackle skills shortages and other problems in the UK labour market.”
In a ministerial statement, she pointed to a rise in non-EU long-term migration from 277,000 in the year to December 2022 to 423,000 in the year to December 2023.
The number of work visas in the 12 months to March 2024 meanwhile, was 605,264, or “over three times that of 2019,” she said.
The home secretary added, “This is why we are setting out a different approach—one that links migration policy and visa controls to skills and labour market policies—so immigration is not used as an alternative to training or tackling workforce problems here at home.”
Under the new approach, the Migration Advisory Council—which provides advice to the Government on migration—will work alongside Skills England and other bodies as part of a “coherent approach to skills, migration and labour market policy.”
The agencies will also work with the devolved governments in Scotland, Northern Ireland and Wales.
Cooper further said Labour would keep the Tories’ minimum income requirement for a partner or spouse to be granted a visa, but didn’t commit to raise it as Rishi Sunak’s administration had.
The lower limit was raised from £18,600 to a £29,000 income per year by Sunak’s government, with plans to increase it eventually to £38,700 by sometime in 2025.
