Skills are essential to productivity and profitability. For UK businesses to compete in an increasingly global marketplace, the workforce must be equipped with the skills to produce high quality goods and services. Countries such as China and India currently compete on the basis of lower labour costs, but with over 20 million graduates in China each year alone, these countries are increasingly competing on expertise too1;. The UK has real skills shortages. Over 85% of respondents to a recent CIPD survey reported difficulties recruiting, with over two-thirds of these citing a lack of specialist skills as the cause2;.
The Department for Educations and Skills' Skills Task Force projections3 show the need for an additional 500,000 jobs in the care sector, 252,000 science and technology professionals, 257,000 teachers and researchers, and 95,000 health professionals by 2010. Skills shortages in skilled construction and metal trade occupations were highlighted in another DFES report4;.
The Work Permit system is designed to enable employers to fill medium and high-skilled jobs where UK and EU citizens are not available: the system is entirely demand-led, and a labour market test applies. Looking at new EU citizens who registered to work in May and June 2004, 34% were employed in hospitality and catering, 17% in agriculture, 17% in administration, business and management5;.
The Work Permit system facilitates recruitment for recognised shortage occupations, for which the labour market test is waived. The Home Office's Highly Skilled Migrant Programme selects skilled, adaptable individuals likely to make a substantial contribution to the UK economy. There are a small number of low skill schemes, targeted at sectors with clear evidence of labour shortages such as agriculture and hospitality.
Facts and figures
2 Recruitment, Retention and Turnover (2004) Chartered Institute of Personnel & Development
3 Labour Market Trends Vol. 110 No. 1 (2002)
4 Labour Market Trends Vol. 112 No. 3 pp 10 (2004)
5 Home Office statistics
6 Manpower Employment Outlook Survey UK: 3rd quarter 2004
7 Employers Skill Survey (2003) Department for Education and Skills
8 Manpower press release 15 June 2004
9 Home Office statistics
10 CITB Annual Skill Survey 2003
11 Migrants in the UK: their characteristics and labour market outcomes and impacts (2002) Home Office Occasional Paper 82
12 Migrants in the UK: their characteristics and labour market outcomes and impacts (2002) Home Office Occasional Paper 82
13 Set for Success (2002) Report of Sir Gareth Roberts' Review