Tech Skills Report

Rocketing growth in UK tech threatened by skills crisis

The seemingly unending growth of the UK’s tech sector is under threat from massive skills shortages according to the Harvey Nash Group Digital Leadership Report. The report, in collaboration with CIONET and Massachusetts Institute of Technology CISR is the world’s largest and longest running survey of senior technology decision makers and has found that shortages have reached an all-time high just as companies signal their intentions to increase technology investment (61 per cent) and headcount (66 per cent) to record levels.

The UK’s skills crisis has reached an all time high with 8 in 10 digital leaders report that, post-pandemic, new life priorities amongst staff are making retention even more difficult. Four in 10 in the UK admit they can’t keep key people as long as they would like, as they’re being lured away by the offer of more money. Only 1 in 3 organisations (38 per cent) have redesigned their employee offer to make it attractive to staff in the new hybrid working world.

The report also found:
• Record tech investment and headcount – The number of digital leaders in the UK planning to boost their technology investment and headcount reached record levels, rising by over a third (36 per cent and 37 per cent respectively) since 2020.
• Impact of skills crisis on business growth – Two-thirds (66 per cent) of digital leaders in the UK are now unable to keep pace with change because of a dearth of the talent they need.
• Where the skills shortages are most acute – Cyber security is the most sought after tech skill in the UK with 43 per cent indicating a shortage, up by over a third in the last 12 months, followed by big data/analysts (36 per cent), and technical architects (33 per cent). There is a huge shortage of cyber security professionals available to companies, with a recent DCMS report finding that the UK’s cyber security recruitment pool has a shortfall of 10,000 people a year.
• The shortage of developers rises the fastest – The shortage of developers (32 per cent), which has been identified amongst the three jobs with the worst skills shortages in the UK behind HGV drivers and nurses, saw the biggest increase compared with previous years. Harvey Nash Group says that this shortage correlates with the report’s finding that companies are focusing on creating new products and services, and therefore need developers to do this work.
• New digital skills needed in UK – Half of organisations in the UK plan to radically transform their products, services and business models in the next three years, requiring a new breed of diverse digital skills. The Harvey Nash Group report found that organisations are struggling to bring in more diversity into the sector, especially women, as the sector remains perceived as male dominated.

The report has found that in response to these unprecedented skills shortages, digital leaders in the UK are aiming to broaden the skillsets of their tech teams, with over half (54 per cent) planning to cross-train people from other parts of their organisation. The number of apprenticeships offered is expected to see a boost this year, as over half 52 per cent of digital leaders in the UK said that they would be offering more apprenticeships over the year ahead.

Outside of training and using niche consultancies to bridge the gap, almost half of digital leaders in the UK have widened their geographical net to source new talent, as hybrid working becomes more commonplace.

“With businesses planning record levels of digital investment, we could be standing on the verge of a ‘second renaissance’ for technology,” comments Bev White, CEO of Harvey Nash Group. “Organisations are looking to push their digital transformations further and faster than ever before, putting technology at the very heart of how they operate. This will take them beyond being merely ‘tech-centric’: technology will literally be dispersed throughout the business, everywhere.

“But these ambitions are coming under threat from the acute skills shortages that are now worse than ever before. In fact, businesses face a triple whammy,” she explains. “They lack the supply of skilled resource they need; they have not yet evolved a new and effective employee proposition for the hybrid working world; and the skills they need are themselves changing as technology develops at pace. Digital leaders need to rapidly assess their needs and find solutions if their plans are not to be derailed by this potent cocktail of challenges.”

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