The UK's STEM skills shortage

Solutions to the UK's shortage of STEM skills must be based on regional and industry-specific needs rather than a one-size-fits-all national approach

The UK's STEM skills shortage is a well-documented phenomenon, costing employers £1.5billion a year in additional training costs, recruitment, temporary staffing and inflated salaries.1

Further, when comparing the growth of STEM jobs to that of non-STEM jobs from 2003 to 2017, it is clear that the former has outpaced the latter (by 4.5 percentage points), a trend that looks set to continue into the foreseeable future.2

Being vital to economic development and international competitiveness, the relatively low number of graduates entering into STEM occupations is a serious cause for concern among employers, with half warning that 'a lack of talent could put off foreign investment' and over half (56%) expecting the shortage to worsen over the next decade.3

And despite the increase in STEM undergraduates over the past few years, two-fifths of employers cited a shortage of STEM graduates as a key barrier to recruiting appropriate staff.4

Additionally, nine in ten (89%) STEM employers report that the recruitment process is taking much longer than usual, forcing many to resort to expensive solutions. STEM Learning found that slightly over three-quarters (76%) are being forced to inflate salaries to attract appropriately skilled workers, while nearly half (48%) are having to look abroad to adequately fill positions.5

A national problem?

 The issue does not present uniformly across the whole of the UK as different areas often have very different needs. As a result, it is necessary to think of this problem in far more nuanced terms to adequately address the UK's STEM skills shortage.

 There are a few places in the UK that have a very low demand for STEM jobs, hence the demand for such skills in these areas will reflect this.6 On the other hand, places such as Westminster and Islington are among the top ten local authorities in the country for STEM jobs.7 Nevertheless, on closer inspection, the disparity between areas becomes even clearer, as a gap of 47,000 STEM jobs exists even between these two local authorities.8 This illustrates the importance of basing solutions to the UK's STEM skills shortage on knowledge of local demand, rather than broad assumptions.9

Focusing on areas of the country where STEM jobs are crucial to their local economy further demonstrates this. Localities with a regional specialism in STEM related jobs such as Cambridge and South Cambridgeshire should not be targeted with the same solutions as places where no such specialism exists.10 Instead, they should be targeted in a way that specifically addresses the needs of STEM industries in that area, as it is likely that the skills required in one place will not be the same as another based on the composition of STEM jobs in that location.

Shortage or mismatch?

 The National Audit Office asserts that there isn't simply a STEM skills shortage, instead claiming that a mismatch exists where there is 'misalignment between the skills needed and those available in the labour pool'.11 For instance, their research indicates that particular shortages exist at technician level, while an oversupply exists in areas with less demand (i.e. the biological sciences).

Furthermore, at graduate level and above there is sometimes an issue with quality (a lack of employability and practical skills) as opposed to quantity.12 This reinforces the need for focused and informed intervention as opposed to broad, nationwide solutions.

International comparisons

A similar issue exists across OECD countries where, similar to the UK, the amount of students entering the labour market to fill STEM jobs has not been able to keep up with demand - despite the fact that STEM roles offer the best return in terms of earnings.

On average across OECD countries, 5% or less of tertiary-educated 25 to 64-year-olds had studied ICT, natural sciences, mathematics or statistics. Besides this, in 2017, only 14% of tertiary graduates obtained a degree in engineering, construction and manufacturing. To put this in context, a quarter of tertiary-educated 25 to 64-year-olds in OECD countries have qualifications in business administration or law.13

So how does the UK fare in comparison with other OECD countries? The available data shows that the UK's STEM skills shortage is actually less severe than that of most OECD member countries.

Although the amount of tertiary-educated 25 to 64-year-olds in the UK who studied natural sciences, mathematics and statistics (3%) is just below both the OECD and EU23 averages (5%) - with only Chile having a lower percentage - the amount of adults in the UK who studied ICT (4%) is on par with both averages, as only nine countries have a higher percentage.14

Moreover, with regard to tertiary educated 25 to 64-year-olds qualified in engineering, manufacturing and construction, the UK sits three percentage points above the OECD average with 19% having qualifications within these fields. This figure that is identical to that of both Sweden and Finland. In comparison, the United States sits six points below the OECD average at 10%, while only seven countries including Austria (27%) and Germany (26%) have a greater proportion of tertiary educated adults with such qualifications.15

When put in this context, we can see that the shortage of STEM skills in the UK is a reflection of a much wider problem facing developed nations - enticing students to enter STEM fields. Despite the fact that they are associated with the highest graduate earnings, attracting students remains difficult across all OECD countries.

One solution is to reach out to students at a younger age to make them aware of opportunities in STEM careers, something that various organisations are attempting to do.16 Meanwhile the government's 2017 industrial strategy pledged to invest an additional £406million in maths, digital and technical education in an effort to address the shortage of STEM skills.

But in order to avoid the shortfalls of previous attempts to close this gap, whatever solutions are devised must be sure to target regional and industry-specific needs.17

Notes

1. Skills shortage costing STEM sector £1.5bn, STEM Learning, 2018.
2. Focus on the demand for STEM jobs & skills in Britain, Emsi, 2018.
3. Ibid.
4. Industrial strategy: Building a Britain fit for the future, GOV.UK, 2017.
5. Skills shortage costing STEM sector £1.5bn, STEM Learning, 2018.
6. Focus on the demand for STEM jobs & skills in Britain, Emsi, 2018. See dark purple areas of map on page 9.
7. Westminster (74,000) being number one and Islington (27,000) number ten.
8. Focus on the demand for STEM jobs & skills in Britain, Emsi, 2018.
9. Ibid.
10. Ibid.
11. Delivering STEM (science, technology, engineering and mathematics) skills for the economy, National Audit Office, 2018.
12. Ibid.
13. Education at a Glance 2019, OECD.
14. Ibid.
15. Ibid.
16. Closing the STEM skills gap: a response to the House of Commons Science and Technology Committee inquiry into closing the STEM skills gap, Royal Academy of Engineering, 2017.
17. Focus on the demand for STEM jobs & skills in Britain, Emsi, 2018.

Written by

Micha-Shannon Smith

Assistant information analyst

Prospects