New research* has revealed that demand for digitally skilled workers in UK vertical industries including technology, finance, ecommerce and retail, is outgrowing the level of digital skills available.
Yet, only half (51%) of British companies within these vertical industries are willing to spend more than £25,000 on recruitment and learning and development (L&D) combined, to boost skills such as cybersecurity, software architecture and data analysis.
Recruitment and L&D spend not aligned with skills most lacking
The new research, conducted by Censuswide in September 2022, surveyed 300 HR decision-makers within the technology, finance, ecommerce and retail industries (100 per industry) to identify the digital skills most in demand and potential barriers to upskilling staff.
More than a quarter (27%) of the HR decision makers surveyed say their organisation faces the biggest lack of skilled workers in cybersecurity, followed by software architecture (15%) and data analysis (14%). Despite this, only a third (33%) are willing to spend more than £10,000 on recruitment and L&D to hire cybersecurity talent. Meanwhile, the majority of organisations plan to spend no more than £10,000 on recruitment and L&D for data analysis (71%) and software architecture (68%) skills.
Instead, almost a third of organisations plan to spend up to or more than £20,000 on recruitment for AI and ML (32%) and cloud (31%). Additionally, more than a quarter of organisations will spend up to or more than £20,000 on AI and ML (29%) and cloud (28%) L&D to upskill employees. Organisations will spend the most on L&D for Gen Z (average £13,962), followed by £13,608 for Millennials and £13,495 for Gen X over the next twelve months.
Disparity in recruitment vs L&D spend
Encouragingly, the majority (83%) of vertical industries plan to spend between £25,000 – £50,000 on overall recruitment for skilled tech vacancies over the next twelve months. Yet, only 78% will spend the same amount on tech-related L&D.
The technology sector is planning to spend the most on overall recruitment (average of £33,676), compared to £31,651 on L&D. Additionally, the finance sector will spend an average of £33,075 on recruitment compared to £31,400 on L&D, while the retail and ecommerce sector will spend an average of £29,275 on recruitment versus £28,801 on L&D.
The biggest barrier to upskilling current employees for more than two fifths (21%) of organisations is insufficient resources, followed by a lack of internal personnel (19%) and a lack of internal buy-in (17%). In the tech sector specifically, 21% of organisations say lack of leadership support is a key barrier to upskilling current employees. However, across all industries combined, 58% of HR decision makers feel ‘significantly’ supported by leadership when it comes to investment in tech-related L&D.
“It’s encouraging that 80% of companies within the UK’s tech, finance and retail sectors have increased investment for tech-related learning and development over the past three years. However, our data suggests that further investment is needed to recession-proof the UK’s vertical industries,” said Alexia Pedersen, VP of EMEA at O’Reilly.
“With the pound currently at a 37-year low against the dollar, now is the time for companies to deploy upskilling programmes alongside ongoing recruitment efforts. Likewise, employees should prioritise L&D to safeguard their role and make themselves an invaluable asset to their organisation. This will be key to creating a highly skilled workforce that keeps British businesses at the forefront of their industries globally.”