Manufacturing skills shortage costs UK £6bn in lost output

UK manufacturers face pressure to develop new recruits as persistent skills shortages leave 55,000 long-term vacancies unfilled and constrain the sector's workforce capacity.

Portakabin has highlighted workforce development alongside recruitment as manufacturers contend with shortages of skilled workers and the loss of experienced employees.

The scale of the problem was set out by manufacturing trade body Make UK in its 2025 Industrial Strategy Skills Commission report, which estimated that long-term vacancies were costing the UK economy £6bn a year in lost output. It also reported a 42% fall in apprenticeship starts since the Apprenticeship Levy was introduced.

Skills shortages remain particularly acute in manufacturing. The Department for Education's 2024 Employer Skills Survey found that 34% of vacancies in the sector were skills-shortage vacancies.

Make UK found half of manufacturers could not source the talent they needed locally, with 62% expecting the problem to persist until at least 2030.

The shortage leaves manufacturers managing recruitment alongside the development of new entrants and the transfer of expertise from experienced workers.

'Manufacturers put a lot of energy into attracting people, but the environment those people walk into on day one matters just as much,' said Greg Wood, head of manufacturing at Portakabin.

The skills challenge also intersects with manufacturers' adoption of automation. The UK has 112 industrial robots per 10,000 manufacturing workers, compared with an EU average of 231 and a global average of 132, according to figures cited by Make UK from the International Federation of Robotics.

Manufacturers therefore face a workforce capability problem extending beyond the number of people entering the sector. Employers need to develop recruits, retain existing expertise and build the skills required to introduce and operate new technology.