21.01.2026

More candidates doesn’t always mean the right skills

Skills shortages continue to hold manufacturing back. The Q4 HR Bulletin shows that even as the wider labour market loosens, manufacturers are still struggling to find people with the right qualifications, technical skills, and experience. There may be more people looking for work, but that has not translated into easier hiring for many roles.

This gap between availability and capability is now one of the most persistent workforce pressures facing the sector. It affects productivity, delivery timelines, and the ability to take on new work.

Recruitment conditions may change, but the skills challenge remains.

Why skills shortages are not easing

Manufacturers report familiar barriers. Too few applicants meet technical requirements. Others lack the practical experience or people skills needed to operate safely and effectively in complex environments.

At the same time, rising employment costs mean businesses are more cautious about hiring someone who is not fully ready for the role. The margin for error is smaller, and the cost of a poor fit feels higher.

This creates a squeeze. Employers need capability but cannot afford prolonged learning curves or high turnover. The result is a growing focus on how skills are developed, supported, and retained inside the business.

This challenge is being felt more acutely as recruitment slows and employers become more cautious about adding headcount. 

If you cannot hire the skills, you need to build them

When external recruitment does not deliver, internal development becomes essential.

Building capability from within is not a short-term fix, but it is one of the most reliable ways to strengthen resilience and reduce dependency on an unpredictable labour market.

This means thinking beyond courses and qualifications, and looking at how skills are used, supported, and reinforced day to day.

What employers should do next

  • Focus on development, not just recruitment: Start with the people you already have. Identify critical skills gaps and target training where it will have the greatest operational impact. Practical, role-based learning is often more effective than broad programmes.
     
  • Strengthen management capability: Line managers play a central role in skill development. Giving them confidence in people management, performance conversations, and employment basics helps retain talent and improve capability across teams.
     
  • Define expectations clearly: Clear role definitions and competency frameworks help employees understand what good looks like. They also make it easier to identify gaps and plan progression realistically.
     
  • Link learning to progression: Skills development works best when it is connected to opportunity. Apprenticeships, mentoring, and structured pathways support both retention and succession planning.
     
  • Review pay and reward in context: Pay still matters, even when increases are modest. Clarity and fairness around reward, progression, and recognition support retention when competition for skills remains high.

Skills shortages are one strand of the wider Workforce Shift affecting manufacturers, alongside pay stability, retention pressure and employment law change. 

How Make UK can help

We support manufacturers to build capability from within and reduce the impact of skills shortages. Our support includes:

  • Learning and development programmes that build technical and leadership capability, including our Leadership Development courses for managers and future leaders  
  • Training in HR and employment practice to strengthen management confidence
  • Competency frameworks that clarify expectations and progression
  • Apprenticeships and early careers programmes linked to workforce planning
  • Pay and reward advice that supports retention without driving unsustainable cost
  • Practical management skills training, such as our Performance Management eLearning course, to help managers set clear goals, give feedback, and support growth  

Skills shortages are unlikely to disappear quickly. Employers who invest in capability now are better placed to adapt, retain talent, and grow when conditions allow.

If you would like support developing the skills your business needs, get in touch. Email [email protected] or call 0808 168 5874.