Guest Column:
Darren Jones
Senior Manager for Partnerships
The Open University in Wales
In my role at the Open University (OU) in Wales, I work to make connections across sectors, helping businesses, public organisations, and charitable groups access learning opportunities.
Whether it’s through free content on OpenLearn, postgraduate courses, or micro-credentials, the OU is committed to helping Wales address some of its most pressing challenges – especially in skills development.
This year’s Business Barometer, which we conduct annually in partnership with the British Chambers of Commerce, offers a clear overview of the skills landscape across the UK. For Wales, the findings are particularly revealing, highlighting both the scale of the skills shortages and the strain they are placing on businesses.
One of the standout findings from this year’s Barometer is that 47% of businesses in Wales are facing skills shortages. That’s nearly half of all businesses, and it’s a worrying figure.
These shortages are particularly focused on green technologies and new technologies, like AI. Many businesses not only struggle to recruit individuals with these skills, but they also face challenges in understanding how to build capacity in these areas.
While skills shortages are nothing new, this year’s data shows that green technologies are becoming a focal point. As the Welsh Government drives forward with net-zero targets and sustainable economic strategies, the need for a workforce skilled in green technologies is more urgent than ever. Yet, 45% of businesses say they lack the confidence to apply green technologies in their operations. This highlights a critical gap between policy goals and workforce readiness.
What makes this situation even more pressing is the knock-on effect it’s having on existing staff. About 60% of businesses report that these skills gaps are putting additional pressure on their current employees. People are being asked to take on extra work, learn new skills on the job, or even juggle roles that should be filled by multiple individuals. This situation is far from ideal and raises serious concerns about employee wellbeing, retention, and the overall sustainability of businesses.
Increased workloads and stress can lead to burnout, and that’s something we’ve been hearing from employers across sectors. It’s a vicious cycle: skills shortages increase pressure on existing staff, leading to decreased morale and productivity, which ultimately impacts the business’s bottom line. For SMEs, in particular, this can be devastating.
The Business Barometer offers valuable insight into the specific skills gaps facing Welsh businesses. The top area facing shortages across Wales is engineering, followed closely by customer service, technical skills, healthcare, and marketing. The high demand for engineering roles aligns with the ongoing growth of sectors like manufacturing and renewable energy – industries that are key to the future of Wales’ economy but are being hamstrung by a lack of skilled workers.
Geographically, the north-east of Wales stands out for its particularly acute need for digital skills and leadership skills. As businesses in the region continue to adopt digital technologies, such as production dashboards and data analytics, the need for a workforce that can navigate these tools is paramount.
The manufacturing sector has highlighted shortages in engineering and construction, as well as technical roles. In consumer-facing industries, like hospitality, there’s a high demand for roles such as chefs, catering staff, and online sales and marketing professionals. Meanwhile, the public health and food sectors report difficulties in filling positions such as nurses, social workers, and administrative roles.
One of the more subtle but significant findings of the report is the lack of capacity within businesses to address these challenges. SMEs, which dominate the Welsh economy, often struggle to find the time or resources to focus on strategic skills development. The result is a vicious circle: without dedicated time and leadership to focus on skills planning, businesses are left to react to problems as they arise, rather than proactively addressing future needs.
Only about 37% of businesses reported using short courses like those offered by the OU and other providers to upskill their staff. However, even fewer have formal skills development plans in place, with only a small number actively targeting initiatives to address these gaps. This lack of long-term planning is concerning, as it hampers a business’s ability to stay competitive and respond to future challenges.
Many businesses are looking for short-term fixes to address their immediate skills needs, but the real solution lies in a long-term strategy. That’s where the OU’s short courses and flexible learning opportunities come into play. By offering bite-sized, accredited courses that allow employees to upskill while continuing to work, we’re helping businesses bridge their skills gaps without the disruption of lengthy training programmes.
However, the onus is not just on the businesses. We as a sector need to work with employers, government, and educational institutions to create more accessible and flexible pathways for skills development. We also need to ensure that businesses, particularly SMEs, are supported in making time for strategic skills planning.
The challenges facing Welsh businesses are significant, but they are not insurmountable. Collaboration between businesses, government, and educational providers is key to closing the skills gap. As the Business Barometer has shown, the need for action is clear, and businesses are eager for solutions. At The Open University, we’re committed to playing our part by offering flexible, accessible learning opportunities that help businesses and employees alike prepare for the future.
By working together, we can turn these challenges into opportunities and ensure that Wales remains competitive in a rapidly changing world.
