Abandoned projects and low adoption: U.K. skills shortages stall progress

77% of tech executives in the United Kingdom say their organization has abandoned projects because they didn’t have people with the right tech skills. Cloud, cybersecurity, and AI/ML projects suffer the most.

Moving from pilot to production relies on your organization’s ability to address the U.K. skills shortage. But as tech evolves, traditional upskilling methods are no longer enough.

We surveyed 500 tech executives, L&D leaders, and tech practitioners in the United Kingdom to learn how skills gaps are affecting them and what they can do to build workforce readiness and close gaps for good.

Download the Tech Skills Report for all of the insights.

Since last year, 52% of U.K. organizations say the skills gap has remained the same or gotten worse, compared to just 46% of Australian and 41% of American organizations.

Despite this difference, the top skills gaps in the U.K. are consistent with our global findings: U.K. organizations primarily lack cybersecurity, AI, and cloud skills.

These gaps have a ripple effect that impact almost every organization's ability to deliver tech projects and achieve other business goals. U.K. organizations struggle to adopt new technologies (42%), complete key project tasks without outsourcing, contracting, or hiring (40%), and deliver key projects (39%).

One-third (33%) of U.K. organizations also say skills gaps contribute to budget overruns often or all of the time. And while this number seems high, in general, U.K. organizations are outperforming their American and Australian counterparts here. 41% of American and 40% of Australian organizations have gone over budget due to skills gaps.

Altogether, 62% of U.K. tech executives and 77% of L&D leaders say tech skills gaps have cost their organization £190,000 or more in the past year alone.

When it comes to closing skills gaps, U.K. tech executives, L&D leaders, and tech practitioners agree upskilling provides the most value for the lowest cost. But for 48% of U.K. organizations, knowing how to solve the tech skills gap is still where they get stuck.

In other words, they know they have gaps, and they know the value of upskilling, but they struggle to deliver meaningful results. There are a few reasons for that.

First, organizations struggle to overcome various barriers to upskilling. U.K. tech executives say lack of time and financial resources hold them back. L&D leaders say their biggest barriers are lack of support from leadership, difficulty finding time for training, and low employee engagement with the programs offered. 

With different stakeholders focused on different challenges, organizations may find it difficult to develop targeted upskilling programs that overcome the real challenge for U.K. practitioners: Lack of learning time.

Increased AI use has also introduced new challenges. Even though 94% of U.K. organizations have invested in AI tools for at least some of their employees, less than half (48%) say most or all of their employees are AI literate. In fact, 30% of U.K. organizations have more AI tools than they people who can use them effectively.

This gap between AI investment and readiness is further exacerbated by the fact that AI increases demand for other tech skills. In fact, organizations say increased AI use has created more demand for cybersecurity, cloud, and IT skills in the U.K.

Lastly, U.K. leaders and practitioners are disillusioned with the metrics they use to measure skill proficiency and upskilling success. 86% of tech executives, 87% of practitioners, and 90% of L&D leaders worry tech skill measurement can be easily manipulated to falsify completion.

Their worries aren’t unfounded: 77% of U.K. tech executives and 63% of L&D leaders have seen employees complete training or earn certifications and still not be able to use those skills in day-to-day work.

89% of tech executives and 83% of L&D leaders also say employees require additional training or on-the-job instruction before they’re able to use new skills on the job.

Despite these concerns, organizations continue to rely on participation and completion metrics to measure skill proficiency. In the U.K., the most used methods include:

• Continuous learning and training participation (55%)

• Project and delivery outcomes (54%)

• Formal certifications and qualifications (53%)

It's a similar story when it comes to ROI. To measure the value of upskilling, U.K. organizations rely on: 

• Employee’s ability to immediately use new skills for on-the-job tasks (65%)

• Proof of skill or competency, like certifications or completed assessments (64%)

• Cost savings or financial impact (46%)

These metrics provide a helpful starting point, but organizations that want to show upskilling ROI will need to connect learning to business outcomes.

Tech executives, practitioners, and L&D leaders agree that AI, cybersecurity, and IT are the most needed tech skills in the U.K. today. But most of them don’t have people with these capabilities in their tech talent pool. 

The long-term effects of the skills shortage in the U.K. include diminishing tech talent pools and increased hiring costs. In the U.K., 88% of tech executives, 85% of practitioners, and 94% of L&D leaders worry their organization doesn’t have enough junior tech professionals in the pipeline to cover future skills gaps that AI can’t fill.

To solve the tech talent shortage, most organizations have turned to external hiring. In fact, 58% of U.K. organizations have hired more junior tech professionals this year compared to last year. Despite these efforts, gaps persist, and organizations won’t be able to hire their way out of the skills shortage indefinitely.

The data is just the first step. Turn these insights into action with these tips:

• Prioritize AI, cybersecurity, cloud, and IT. These are the biggest tech skills gaps, and the ones most worth your time right now. Use your current priorities to refine further. 

• Give employees dedicated learning time. While tech executives and L&D leaders are struggling with different challenges, lack of learning time is the common denominator. 

• Invest in junior tech talent. Junior tech professionals are key to closing future skills gaps, and hiring isn’t sustainable long term.

Learn more in the Tech Skills Report. You’ll discover: 

• Why upskilling needs to evolve

• How long tech skills last

• How to develop a workforce readiness strategy 

Download now.