Scotland business

Manufacturers 'facing skills challenge'

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Boosting workforce skills should be a top priority for manufacturers working to keep their Scottish operations globally competitive, according to a new report.

A survey by KPMG found 60% of firms with operations north of the border felt greater access to skilled talent could help them increase productivity.

More than 40% said there was a lack of talent and skills available.

The findings were contained in KPMG's Rethink Manufacturing report.

It said the industry faced "a number of challenges" driven by technological innovation, evolving customer behaviour, regulatory changes and a turbulent global landscape.

'Key priorities'

James Kergon, from KPMG in Scotland, said: "Our report finds the majority of manufacturing executives with operations in Scotland view boosting workforce skills and quality education as the key priorities for the manufacturing sector's continuing growth.

"If the skills challenge in Scotland is not effectively addressed, manufacturing and associated industries are at risk of decline.

"Manufacturers can take action now by investing in training, education and continuous development to raise Scotland's productivity and prosperity for the future."

The survey also found that, following the UK's decision to leave the EU, more than one in three manufacturers with Scottish operations (38%) would consider relocating some of their operations out of the UK.

About two-thirds had no plans to move.

Karen Briggs, head of Brexit at KPMG, said: "When our survey was carried out in January, two-thirds of respondents with operations in Scotland expected the uncertainty from Brexit to be bad for economic stability.

"However, Britain's manufacturers are an especially resolute group.

"Although some fear increased raw material costs, labour pressures and higher indirect taxation, they are taking a range of practical measures to prepare.

"These include partial relocation, supply chain management, increased business development and new sources of financing."

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