80% of UK tech start-ups investing in skills to mitigate gaps

With almost half of small businesses surveyed by the Department for Education citing a lack of skilled staff as a concern, investment in this challenge proves widespread among UK tech start-ups

According to a study from the UK Department for Education, 46 per cent of start-ups across the tech industry say a lack of staff with the right skills, along with hiring difficulties, as their top two concerns for this year.

As a result, 80 per cent of technology start-ups are investing in skills to expand the knowledge of their workforce.

The growth of start-ups, combined with surging digitisation among non-traditional tech firms, has contributed to the ongoing skills gap in the UK tech sector, as well as globally.

To mitigate this, Government research shows a common goal towards investing in skill development, while the Department for Education is presenting its Join the Skills Revolution campaign, which includes a skills and recruitment barometer report on small and medium sized enterprises (SMEs) across England.

Clare Walsh, director of education at the Institute of Analytics, told the Financial Times: “There’s a skills shortage because the technological change came so fast, before education could respond.

“Very few other professions actually expect people to leave school ready to go into that profession. We [need to] retrain them and reskill them to do a specific job.”

As for hiring challenges, brought in part by a reported shallow pool of suitable talent that larger tech companies like Amazon and Google are also keeping tabs on, start-ups are hoping to hire from the swathes of staff recently laid off across big tech.

In addition, some company leaders are opting to offer tech talent with a share of the company as another way to attract staff, such as e-commerce leader David Connor, who told the FT: “Most [freelancers] wanted £1,500 per day [and] the only way that a bootstrapping start-up like ours with zero funding was able to get a developer in was by offering equity in the company.”

Another challenge cited by UK tech start-ups was planned reductions to R&D tax credits for companies that spend less than 40 per cent on innovation — announced in the recent Budget — which are said to potentially leave companies with smaller hiring and recruitment budgets.

This has reportedly been exacerbated by high-calibre tech talent asking for six-figure salaries, despite the average salary of a UK computer programmer being found by Glassdoor analysis to be over £41,000, sources told the FT.

Similarly, Fujitsu research recently revealed a skills shortage among staff to be a growing concern for tech sector C-Suites — 45 per cent of UK companies expressed belief that their teams were not equipped to utilise advanced technology, while 38 per cent said it was a key barrier to unlocking innovation.


How to provide purpose when hiring tech talentProviding purpose is key to recruiting top tech talent in today’s recruitment market. Here’s how you can go beyond salary when hiring candidates.

Three in four UK tech workers dissatisfied with their rolesHackajob research has revealed that most (77 per cent) tech workers in the UK are dissatisfied at work, and are actively seeking new jobs.

Avatar photo

Aaron Hurst

Aaron Hurst is Information Age's senior reporter, providing news and features around the hottest trends across the tech industry.