Recruitment challenges a threat to business growth Latest report published as part of Hertfordshire’s Local Skills Improvement Plan

Economic growth in Hertfordshire is looking positive with an increasing number of businesses planning to recruit over the next 12 months.

But finding the right candidates with the relevant skills continues to be a challenge that threatens company strategies.

When surveyed a year ago, only 40 per cent of companies were hoping to take on new staff; that has now risen to 56 per cent.

In 2023, the most cited recruitment problems were poor employability skills (45.5 per cent) and a lack of the relevant technical skills (43.2 per cent). Although those figures have fallen to 27.3 per cent and 40.6 per cent respectively, the most common issue now is they simply can’t get enough suitable applicants (43.4 per cent).

The figures are revealed in the county’s Local Skills Improvement Plan (LSIP) report that has just been published by the Chamber of Commerce.

Donna Schultz, Chamber CEO, said: “It is encouraging to see so many businesses hoping to add to their workforce, but equally disappointing that the ongoing skills gap is a barrier to recruitment.”

LSIP project lead Professor Michael Brookes shared Donna’s concerns. “The biggest disappointment in the report was the issue of employability. This has been front and centre for all education and training providers for the past 15 years, and yet many employers are still saying that it has a significant and negative effect upon recruitment and retention.

“Hertfordshire has been on a trend for some time with productivity and average earnings declining in real terms, and without positive interventions this is likely to continue.”

This year’s report, the second stage in the Governmentfunded LSIP, shows the progress that has been made over the past year in bringing businesses and education and training providers together.

Although there have been steps forward, fewer businesses said they were engaging with training providers than a year ago.

Donna commented: “Over the past year, we have worked hard to engage with businesses and training providers to bring the two together. Companies know the skills that are needed now and in the future and the hope is that by encouraging conversations with training providers, relevant courses can be made available.

“We are supporting a more collaborative approach to align available courses with industry needs. We have identified 10 priority sectors, including property and construction, creative industries and engineering and manufacturing, and have held summits across the year to bring people together to help us gain a better understanding of the challenges.

“We are also working closely with local authorities and trade associations to help us identify projects that will support our goal of closing the skills gap.”

Michael added: “One of the key challenges we are facing is around recognition of the mutual benefits from these potential collaborations.”

LSIPS are an initiative funded by the Department for Education, introduced following the Skills for Jobs white paper published in 2021. Their aim is to reshape the technical skills system to better align with the needs of employers and the wider economy, by focusing on adaptability, industry collaboration and continuous learning.

Read the report here: www.hertschamber.com/lsip