The moment of peak talent shortage might already be behind us, with new figures from ManpowerGroup showing that the UK’s skills gap has fallen for the first time in ten years.

In its latest Talent Shortage report, the recruiter found that the number of UK employers struggling to fill roles due to a lack of talent had eased to 76%, down from 80% the year before. 

Though that figure is far above the roughly 15% of 2015, the five-point drop is the most movement seen in the survey in the last five years, and brings the UK closer to the global average, where 74% of employers are reporting talent scarcity.    

Following the socio-economic upheaval of recent years, ManpowerGroup said that this marginal decline is evidence that employers are finally finding their feet in a less predictable post-pandemic market.

Scotland, however, bucks the general trend, with more employers reporting skills shortages this year (79%) than last (76%), a problem shared only by the East Midlands. 

Overall, while the skills shortage may have softened, some sectors remain deep in a talent drought. Financial services face the toughest conditions, with 79% of firms reporting skills shortages, but government and public services are close behind at 78%, and IT not far off at 75%.

These sectors are bearing the brunt of the skills gap largely because they’ve undergone the fastest, most profound change over recent years, particularly since the introduction of commercial AI systems – a trend underscored by the specific capabilities employers report as missing.

IT and data expertise, as well as operations and logistics skills, are now in hot demand, a stark reversal from ten years ago, when skilled trades dominated hiring needs – talents which have fallen from the top ten in favour of new entrants like front office and customer-facing skills, or sustainability and ESG experience.

Likewise, the demand for sales and marketing skills has risen, while requirements for admin and office support skills have declined, a trend ManpowerGroup said is reflective of businesses’ efforts to recuperate costs and improve ROI as AI and other tools take on key administrative functions. 

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In an effort to future-proof their businesses, employers are ramping up upskilling and reskilling initiatives for current staff (28%), a strategy that will help cut back on spiralling recruitment costs, an issue that is now routinely dampening hiring optimism.

“Organisations have worked hard during this time to drive positive change amidst major challenges; by upskilling, reskilling, seeking out new talent pools and through smarter use of technology,” said Michael Stull, MD at ManpowerGroup UK.

“Any closing of the skills gap should be seen as a sign of green shoots for improving productivity. But we can’t rest where we are and must continue to invest in training and development, preparing thoroughly for further changes in workplace legislation, and adapting recruitment practices without compromising on longer-term goals.”