Skills shortages hit half of all Scottish employers

Half of employers in Scotland are reporting skills shortages and only 32 per cent have recruitment or training initiatives aimed at those under 25 years old, says a new report by The Open University. 

The research by The Open University also found 42 per cent of employers have hired fewer people over the past year, compared with just 26 per cent who have increased recruitment, highlighting growing pressures across Scotland's labour market.

At the same time, the research points to a significant opportunity for employers seeking to strengthen their workforce, with eight in ten 16 to 24 year-olds not in education, employment or training saying they would remain loyal to an employer that invested in training beyond the requirements of their immediate role.

The Open University in Scotland says the findings demonstrate the need for stronger collaboration between employers and educators to tackle skills shortages while creating more opportunities for young people to enter and progress within the workforce.

Jane Grant, Depute Director of External Engagement and Partnerships at The Open University in Scotland, said: “The Open University's annual Business Barometer has charted the UK's skills landscape since 2017 and we have seen that landscape evolve year after year.

“Despite rising economic pressures and changing labour market demands, skills shortages remain a stubborn challenge for employers across Scotland and the wider UK.

“It is vital that we work together to build the future talent pipelines employers need. Young people are the nurses, teachers, engineers, social workers and digital specialists of tomorrow, and we must ensure they have access to flexible and accessible routes into those careers.

“If we are serious about economic growth, we must be equally serious about creating opportunity and giving young people the knowledge, skills and support they need to convert that opportunity into value for themselves, their communities and Scotland's economy.”

The findings come amid growing concern about the barriers many young people face when trying to enter the workforce. Recent warnings from former Labour health secretary Alan Milburn suggested the UK risks creating a “lost generation” of young people facing shrinking opportunities and increasing barriers to entering work.

Milburn found more than 1,000,000 young people are not in work across the UK, while The Centre for Social Justice earlier in the year found 707,000 graduates are currently unemployed and claiming welfare benefits.

The Open University in Scotland believes flexible learning pathways can play an important role in helping organisations develop talent while supporting individuals to gain qualifications and workplace experience.

This approach allows people to combine learning with existing commitments, making education and skills development more accessible to a wider range of learners.

It can also help employers grow talent from within their own organisations and local communities, reducing reliance on increasingly competitive recruitment markets.

The model has particular relevance for sectors facing persistent workforce pressures, including healthcare, education, engineering, social care and digital industries.

Stronger partnerships between employers and education providers will be vital if Scotland is to address long-term skills shortages and create sustainable opportunities for young people."

Jane Grant, 
The Open University in Scotland

Jane added: “As workforce needs continue to evolve, developing accessible routes into employment and lifelong learning will become increasingly important for employers seeking to remain competitive.

“Therefore stronger partnerships between employers and education providers will be vital if Scotland is to address long-term skills shortages and create sustainable opportunities for young people.”

The OU in Scotland's partnerships with businesses, organisations, schools, colleges, healthcare, social work and third sectors are helping to strengthen Scotland's current and future workforce. 

The Business Barometer research was conducted by Opinium Research between April and May 2026 and surveyed 1,500 senior decision-makers responsible for recruitment across UK organisations - including 113 in Scotland - alongside 1,000 young people aged 16 to 24 who were not in education, employment or training, including 64 in Scotland.

The findings were analysed across all four nations of the UK, providing insight into the specific challenges and opportunities facing employers and young people in Scotland.

22 June 2026