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Is your business caught in the Digital Skills Gap? If not, it might be soon!

Businesses of all shapes and sizes will be affected by a digital skills shortage. Hard to believe, but according to the World Economic Forum, at least 133 million new roles will be created as a result of the new division between humans, machines and algorithms by 2022.

Bleak forecasts

Surprisingly, the Learning & Work Institute says the number of young people taking IT subjects at GCSE has dropped 40% since 2015.

Plus, the European Commission believes there could be as many as 756,000 unfilled jobs in the European ICT sector by 2020.

Demand and supply

There are several issues at play here that will affect businesses in different ways, some negative and some positive.

Firstly, there aren’t enough skilled people to do the jobs that are currently on offer. This drives the cost of talent up and results in people moving roles more regularly. Movement creates multiple issues for businesses, including cost, continuity, and customer experience.


Secondly, fragmentation. The more experienced talent moves out of mainstream corporates into consultancies, where they can balance their time and income more effectively. This exacerbates the problem for clients wanting to hire and drives up costs through the value chain.

Long-term positive?

However, I believe there is a positive outcome because it forces organisations to think longer term. It leads to more investment in the acquisition and development of new talent over longer periods of time. This creates clearer career paths for early-stage talent and formalises the skills, experience and competencies required to fulfil future skills requirements. It also stimulates public and private sector investment.

Overall, there is a knock-on effect, and the skills shortage means some businesses cannot compete.

Change causes gaps

This isn’t a new problem; it occurs every time significant changes come about in business and technology. We saw the same challenges when PC’s first came to the market and when desktop software, networking and the internet emerged.

What’s important about this is to learn from the past, to expect things to evolve but anticipate and be ready to adapt continually.

Skilled labour shortages

The more worrying aspect of the current skills crisis is that this situation is likely to worsen before it gets better.

According to Korn Ferry International’s ‘Future of Work‘ survey, the world is facing an imminent skilled labour shortage, affecting both developed and developing economies, with the potential to alter the balance of global economic power drastically. They estimate a talent deficit of 85.2m workers by 2030 globally.

So, add this as a backdrop to the digital skills gap, and there is a bigger cloud gathering that could have a much further-reaching impact on our geopolitical standing.

We really need to think more about putting actions in place to mitigate the increasing risks that we see on the horizon.

Digital transformation megatrend

Digital transformation is impacting every area of our lives and the way we work. It’s a global megatrend that will affect, change and challenge every sector at an increasing pace.

Technology has democratised the world too. Populations with very little industry or resources can now compete on similar terms to these in developed countries.

Consumer behaviour has changed almost overnight, and this situation will continue to evolve as innovative ideas and new ways of collaborating and working come to light. All of this has fueled the insatiable demand for digital talent.

UK business & Brexit

The situation is particularly challenging for businesses in the UK due to the uncertainty created by Brexit. The majority of UK businesses will be forced to tackle a widening skills gap because of the shrinking talent pool caused by a reduction of free movement of workers.

The skills gap can make it difficult for UK organisations to embark on their digital transformation journey, let alone make it a successful one. Covid, Brexit and other global, social and environmental pressures have accelerated the need to transform.

Closing the gap

To plug the gap, some companies take experienced people from organisations that have achieved success. Others develop their own capabilities or leverage third parties.

Some participate in government incentive schemes, take on apprentices, sponsor graduates, working with universities to attract talent early. Unfortunately, this may not be enough to secure talent in the future.

However, I think we are in the very early stages of the digital revolution. We need to think hard about how to actually close the gap instead of just trying to plug it temporarily.

Plan ahead now

Companies need to commit to the importance of training and skills development. They should think about “learning cultures” that support and incentivise skills and capability development.

The skills gap is so wide that it is just not possible to hire your way out of it now. Leaders need to rethink and need to plan much further ahead. They must identify how to continuously shape and develop internal resources to respond to the changing landscape.

Next, read Will’s advice and tips on How to Survive the Digital Skills Gap.

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Andrew Salmon