With employers now routinely saying they’re short on skills, a new report from the Open University has found that Gen Z are ready to step up, and could be the key to closing Scotland’s burgeoning skills gap.

The study, Business Barometer: Skills for Today and Tomorrow: How Employers Can Plan for Future Skills, found that more than half (56%) of Scottish organisations are currently experiencing a skills shortage, but that only a third (35%) have specific initiatives in place to recruit, retain or train under-25s.

At the same time, the majority of Gen Z are aware of Scotland’s skills challenges, and are factoring that into their career thinking, but lack the guidance and support they need to become work-ready.

According to the Open University, 66% have never been told they lack specific skills, despite 34% of employers perceiving a lack of “work readiness” as one of the top barriers to filling roles. 

Pointing to a disconnect between Scottish employers and Gen Z candidates, the research found evidence of a persistent and growing digital skills gap among Scotland’s workforce at a time when AI is increasingly essential to success.

The study found that while nearly half of Gen Z based in Scotland (47%) are currently working in or interested in AI, 20% of Scottish employers say they’re not confident they can deliver their AI strategies due to talent constraints, while 23% lack confidence in delivering their AI plans over the next five years.

Training Gen Z candidates in the right skills could not only help firms meet the immediate challenge, but future future-proof their workforce, too.

Almost three-quarters (71%) of young workers said they would stay longer with an employer that offers training and development pathways, a striking contrast to the 23% of organisations that said a major barrier to training staff is the fear they’ll leave. 

“Employers have an incredible opportunity – and responsibility – to shape the future workforce,” said Baroness Martha Lane Fox CBE, chancellor at the Open University.

“Young people are motivated, they’re digitally savvy, and they want to contribute. But they need clear training pathways, practical support, and employers willing to invest.”

The skills gap remains one of the most pressing issues for organisations, with nearly two in five (39%) already suffering a skills shortage expecting it to worsen over the next five years, with recruitment and training in Scotland becoming more difficult thanks to the increase in national insurance (58%), increases to the minimum wage (51%) and economic uncertainty (70%).  

Meanwhile, with global headlines amplifying political division over ED&I policies, the report reveals continued support for inclusion in Scotland. 

The Open University’s data shows that 87% of employers say ED&I is important to their organisation, while 56% believe it will become even more important over the next five years.

However, 24% have no initiatives in place for underrepresented or disadvantaged groups, including returners, career changers, and workers with disabilities or neurodiversities. 

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Calling this a missed opportunity to widen the talent pipeline and reduce economic inactivity, particularly in sectors and areas facing acute workforce shortages, the report highlights that more needs to be done to break down barriers for those wanting to enter, or re-enter, the workforce.

“Scotland’s skills gap is one of the biggest long-term challenges facing our economy – but it’s also one of our greatest opportunities,” said David Allen, senior partnerships manager at The Open University in Scotland.

“However, with a third of employers citing funding as a barrier and many still without a formal skills plan, action is urgently needed. 

“We need to meet learners where they are, equip them for the future, and make development a shared priority. The organisations that do, will be the ones shaping Scotland’s growth and resilience for years to come.”