The employment picture in the UK is generally improving, with manufacturers across the board reporting an easing of recruitment pressures with more vacancies being filled than at any point in the last two years — 83% of manufacturers attempted to recruit new staff in the second quarter (Q2) – and more manufacturers (67%) were able to fill most of their vacancies compared to any point since the end of 2022.

However, Britain’s manufacturers are still facing the long-term skills challenges which have held businesses back from growing to their full potential for the last few years, according to Make UK’s Q2 HR Bulletin. Just over 65% of companies could not find candidates with the right technical skills needed for the roles advertised, while 31.9% of those questioned told Make UK that they were also struggling to find people with the right qualifications.

The brighter recruitment landscape is down to a combination of reasons — with companies citing better staff retention and older workers coming back into the workforce as a contributory factor. Sickness absence has come down and is combined with lower pressure on pay demands, although 33% of businesses told Make UK that they had increased pay to the new national living wage level. Meanwhile, more companies than ever have reported that they have fully embraced flexible working for their staff which is helping significantly with retention.

Jamie Cater, Make UK’s employment policy lead said: “While manufacturers report an easing of immediate labour shortages, long-term skills challenges remain. The Government has made welcome improvements to the apprenticeship system in recent months – not least additional funding to support high-value manufacturing courses and reduce barriers faced by SMEs.

“However, there remains further to go, and a full review of the apprenticeship system – with the goal of restoring the number of manufacturing apprentices to its pre-levy high and further reducing the number of vacancies in the sector – must be a priority.”