Like many other industries right now, the engineering sector is struggling with a skills shortage in the wake of Covid-19. This is a problem that has been steadily growing for many years, but the pandemic seems to have brought it to a head.
Research from the Institute of Engineering and Technology (IET) found that around nearly half of engineering businesses are finding it difficult to find the skills they need when recruiting. And across the STEM sector as a whole, there’s an estimated shortfall of around 173,000 workers. This is the equivalent of 10 unfilled vacancies per UK business.
Building the next generation of STEM professionals is clearly a crucial mission, but there’s something just as important that the sector needs to do right now. To address the skills shortage, firms need to do more to hang on to the talent they have. And across engineering, retention is a real problem.
The UK engineering sector has the potential to generate an extra £27 billion per year, according to research by Siemens. But this won’t happen if new vacancies aren’t created and filled fast enough, and if resigning employees aren’t replaced at the same pace.
Staff retention goes right alongside talent cultivation and acquisition when it comes to meeting demand.
Why retention is so important
When a talented team member leaves, the loss of their skills and experience isn’t the only blow to an engineering business. There is a whole raft of other negative consequences, including:
- Loss of productive output – for each month that passes before a senior employee is replaced, there’s a 10% reduction in productivity
- The cost of recruitment – a worker earning £25,000 or more a year costs around £30,614 to replace.
- Time-lag – the business will inevitably suffer from lost productive working time while a handover between outgoing and incoming staff takes place.
- Risk – what if you hire the wrong person? A mismatch between company culture and candidate expectations could mean going through the costly process of recruitment once more, losing yet more productive time.
According to research by the Association for Consultancy and Engineering (ACE), these factors could mean a financial hit to the sector of between £5.2 billion and £9.5 billion over the next decade.
Immediate actions to address the retention gap
ACE has developed a three-point plan to address the skills shortage within engineering, offering immediate actions that businesses can take right now. These are:
Nurture promotion-ready staff, who can step up to a senior role if a team member leaves. Carving out a clear career development pathway is also a great way to motivate employees to stick around.
Invest more in the first year of employment, as evidence suggests that staff are more likely to leave in the first year. Get recruitment right to ensure the right fit, then work at successfully embedding new recruits into the business as quickly as possible.
Foster a culture of flexibility. If companies can create a structure where engineers and technicians can move seamlessly between different parts of the business, there’s much less impact when someone leaves. Time lag and a drop in productivity can both be addressed.
If you need fast, effective talent sourcing to address skills shortages within your company, VGC is the perfect choice. Get in touch to find out more about our specialist recruitment solutions.