FSB identifies growing skills gap hindering SME growth

The latest Federation of Small Businesses’ (FSB) Small Business Index has identified a growing skills shortage in the workplace which is a barrier for SMEs; almost one third of those surveyed said that it hampered growth.

To address this increasingly significant issue, the FSB wants to see a number of steps taken:

  • The business and education community must work more closely together to ensure young people are ‘work ready‘ and understand the demands of the world of work.
  • Reforms must be completed to create a business-led, high quality apprenticeship system that provides a real choice between vocational and academic routes.
  • Traineeships must be used as a credible alternative to a formal apprenticeship.

John Allan, National Chairman, Federation of Small Businesses, said: “As the labour market continues to tighten alongside the economic recovery, skills shortages will continue to be an increasing concern for more businesses. While this helps to boost the wage bargaining power of workers with the right skills, it poses a risk to the momentum of economic growth and once again underlines a long standing structural weakness in the UK economy.

“Despite the emergence of a skills shortage, these results show small firms are still feeling very confident, with every intention to invest and grow. This will provide further momentum to the recovery, especially in terms of jobs growth.”