What does the skills landscape look like in Scotland now and for the year ahead? That’s a big question at the best of times, let alone this year, when you factor in the ongoing impact of Covid-19 and lockdown restrictions, digitisation and economic uncertainty.

These pressures make it even more important that employers understand what skills are needed now and tomorrow, how to develop those skills and what resources are out there to help navigate through a growing skills crisis.

The Open University’s Business Barometer Report 2020 shows that 60% of employers in Scotland are struggling to find the skills needed to fill vacant roles. This is despite the fact there is an ever-increasing pool of available talent because of widespread redundancies – one in four (26%) companies reduced headcount in 2020 to cut costs because of Covid-19.

It’s clear that employers are struggling to plug this skills deficit, many even before Covid-19 struck. Some are taking more than 26 months to fill vacancies. More than 26 months!

Managerial skills are in increasingly high demand, with a significant number of employers expecting to hire more managers. This trend is stronger in Scotland than in the rest of the UK.

So, what are Scottish employers doing to meet the skills crisis? To address the need for more managers? Many have opted to recruit temporary staff. This approach is not restricted to Scottish employers, I hasten to add – it’s happening across the UK.

But it is a very costly, short-term approach, with Scottish employers spending almost £100 million on temporary staff in 2020. That’s a 60% increase on the previous year. Yet, over half of them (55%) say they need to cut costs in order to survive.

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This short-term approach is not just costly – it also leaves employers more vulnerable to skills shortages in the future.

At The Open University, we understand the many urgent and complex challenges facing employers currently, but we also urge you to be proactive, not reactive, and to take a long-term approach. Invest in skills and develop your own talent pool whenever you can, rather than buying in skills on a short-term basis. Foster a culture of continuous learning – upskilling and reskilling your workforce is so important in today’s fast moving, ever changing world.

We know it’s a very challenging time for employers (and employees), but there is quite a lot of help available, if you know where to find it. For starters, The Open University in Scotland was awarded a £1 million grant to support small to medium-sized enterprises (SMEs) with training, to enable SMEs to respond to the impact of the COVID-19 pandemic, adapt to new ways of working and maximise the opportunities to restart, recover and renew.

This is part of a new phase of the Flexible Workforce Development Fund, recently announced by the Scottish Government. SMEs across Scotland can now access funded training up to the value of £5,000 provided by The OU to support staff development and address skills needs.

What skills will employers want to invest in? Digital skills are a top priority, for obvious reasons. Even prior to Covid-19, there was a shortage of digital skills, and that shortage intensified in 2020, partly due to the rapid digitisation of services, products and workplaces (i.e. the shift to remote working). All organisations, big or small, in towns and cities or in remote and rural areas, need digital skills and they need them now.

The need for digital skills will keep growing. Another piece of OU research, carried out in June 2020, found that 40% of leaders expect their reliance on employees’ digital capabilities to increase as they adapt to the challenges created by the pandemic.

There are all sorts of ways that employers can boost digital skills, in addition to the Flexible Workforce Development Fund available to SMEs in Scotland. Apprenticeships are an obvious choice and are increasingly popular with employers. The OU offers fully funded digital apprenticeships in cyber security and software development. These have taken off in Scotland, with the digital apprenticeships progressing really well. We expect take-up to keep on growing in 2021 and beyond.

DIGIT’S 2021 #virtualevents calendar:

📅 #MarTech Summit https://t.co/JkViHnOzbF Wed 24 Feb
📅 ScotSecure #CyberSecurity Summit https://t.co/JaD886wGh9 24/ 25 Mar
📅 #DigitalEnergy Summit https://t.co/thGSfrBqlM 22 Apr
📅 DIGIT #Leader Summit https://t.co/alC1xjRvtW 26 May pic.twitter.com/XXGqh5Braw

— DIGIT (@digitfyi) January 18, 2021

It’s important to remember that digital skills are needed throughout the workforce. Employers need to invest in the digital capabilities of managers and the senior leadership team. Digital leadership can be supported in several ways – from the provision of and increased awareness of digital apprenticeships through to helping leaders hone their digital leadership skills.

And what about the need for more management skills, as highlighted earlier? Management qualifications – such as the OU’s undergraduate and postgraduate qualifications and the triple-accredited MBA – help existing and aspiring managers consolidate their skills, develop new skills and grow into their roles.

On top of that, there are all the other learning opportunities, such as open qualifications and short courses. Not all learning has to be formal or cost money. The OpenLearn platform provides a range of popular, free informal learning. It all helps.

Even in the midst of a pandemic, in the midst of uncertainty and change, it is important that employers keep looking forward, investing in the skills of the future, upskilling and reskilling the workforce. Those that don’t risk losing their competitive advantage and falling behind in the war for talent.