Skills dearth may fuel interest rise
The Government is becoming increasingly concerned about skills shortages.
There is currently considerable demand for new recruits and increased optimism about future employment prospects.
A Confederation of British Industry survey indicated a surge in pay settlements in both manufacturing and service sectors. The combination of higher pay settlements and skill shortages could put pressure on interest rates.
The Chancellor of the Exchequer Gordon Brown warned recently against workers driving for higher wage settlements. He suggested that “today’s pay rise threatens to become tomorrow’s mortgage rise”.
A recent survey by the British Chambers of Commerce indicates that skill shortages are widespread and are seen in sales and management staff as well as clerical workers.
The data points to a current shortage of computer and information technology skills. A third of the companies surveyed suggested skills shortages eroded their competitiveness.
Small businesses, which employ half the private sector workforce, tend to be hardest hit by skill shortages. The education system appears to be failing to meet the needs of the business community. School leavers and graduates often lack business skills.
Businesses generally are prepared to train and add value to their workforce but they do not expect to have to provide the basics.