JOBS

Does the skills shortage exist?

By Oliver Smith 29 September 2015
Summary

There are two opposing views on how many, or how few, skilled digital workers Britain has, but which is correct?

There’s a fierce debate going on.

You can spot it nearly every day, on the pages of newspapers and in the tech press.

Depending on what you read there’s either “chronic shortage of technical skills” going on, centered in London but affecting the whole of the UK, which threatens to topple Britain’s position as a European tech leader, or there’s no talent problem at all.

The message from London Mayor Boris Johnson and City Hall this morning is that there is no skills shortage.

“The capital houses more IT programmers than New York, San Francisco and any other European City,” reads the headline of a press release from London’s promotional organisation London & Partners this morning.

It claims that London is home to 71,000 professional developers, and a separate report from Oxford Economics (commissioned by London & Partners) found that the wider tech workforce in London will grow by 22% over the next decade taking the total number of people employed the sector to 239,700 by 2025.

Boris Johnson in the same release describes London as “a hotbed for tech talent” with “an unparalleled talent pool”.

Clearly there are two opposing views on the skills situation in London, but which is correct and why is this debate so crucial?

Supply and demand

Lets look at the two views in the debate.

On the one hand the idea that London is in the midst of a tech talent shortage will deter businesses and entrepreneurs from coming to the capital.

The fear a business won’t be able to find the right tech-savvy staff or the best workers is enough to persuade many to instead choose less-competitive European tech hubs like Stockholm or Berlin, rather than the hyper-competitive London.

At the same time, the skills shortage narrative will encourage the Government, schools and universities to raise their investment in increasing the level of technical skills in the capital.

On the other hand, the idea that we’re seeing a talent surplus in London is bad news also: it undermines the narrative that London is undergoing booming growth as one of the defining qualities of growth is a strain on the supply of talent that feeds it.

However, a talent surplus narrative is useful to attract prospective businesses and entrepreneurs to come to the capital.

So what does this all mean for London?

The reality

“I agree that where we are today is far better than where we were five years ago, I agree that the talent pool in London is the best in Europe,” CEO and Founder at digital recruiter Propel London, Melina Jacovou, told The Memo.

“But equally I believe the capital’s vast digital sector which now spans nearly every business, is experiencing soaring demand that’s really difficult to supply,” Jacovou explained, adding that finding talent is one of the top problems affecting digital business in London.

The truth is that London’s talent situation probably lies somewhere in the middle.

It’s not quite the “chronic” challenge as advocated by some commentators but, at the same time, we don’t have quite the abundance of talented digital workers that City Hall would like us to believe.

Regardless of who is correct, increasing the technical skills of the capital’s workforce should be a top priority for both central and local Governments.

That’s not because of any specific tech boom in the capital, whether its FinTech or Fashion Tech, but because of the wider shift taking place in Britain’s workforce from lower-skilled, manual jobs towards higher-skilled technical and service sectors which means we’ll always need more digitally skilled workers.