Skills shortage undermines UK export growth

Created: 14 August 2015

Two thirds of exporters are struggling to recruit the skilled staff they require for their operations, warn DHL and the British Chambers of Commerce, as they release their Quarterly International Trade Outlook.

While UK exports remain relatively high, and confidence among both services firms and manufacturers is increasing, more than two thirds of exporters (68%) reported difficulties hiring staff during Q2 2015 – the highest level since Q4 2013.

The greatest area of recruitment difficulty reported was finding skilled and professional staff.

Although the overall amount of trade documents issued by Chambers of Commerce declined in Q2 by 0.3% on the previous quarter, this was still 1.5% higher than for the same quarter in 2014, and was the second highest on record.

Export documents are required for goods exported outside the EU, and this figure demonstrates that UK business are continuing to expand non-EU exports and break into new markets overseas.

Firms are becoming increasingly confident that turnover and profitability will rise in the coming months, leading to a third of firms (36%) expecting to take on additional staff in the next three months as a result.

However, this confidence is rising much more quickly among service firms than among those who manufacture.

John Longworth, Director General of the British Chambers of Commerce, said: "This week we celebrated the achievements of those taking their A levels, but we have to remember that academic results are not the only thing employers look for. We need to make sure that the skills young people develop in schools equip them for the world of work. In the 21st century the countries with the most skilled workforces will be the ultimate winners globally. Our research shows that while confidence among exporters is rising, businesses are struggling to get access to the skilled staff that they need.

"Businesses and schools need to work together to ensure students have a better understanding of the business world, the opportunities it presents to them and the skills that will help them to get ahead, including foreign languages.

"If we are going to reverse the UK's trade deficit then businesses need a workforce with the appropriate skills and knowledge to trade and compete on the global stage. Businesses must be able to attract and, crucially, retain the talent they need to stay ahead."

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The UK will miss £1tn export target

Created: 04 August 2015

The UK government is likely to miss its target of hitting £1 trillion worth of exports by the end of the decade, business leaders warned earlier this week.

In 2012, the Prime Minister announced a target for British companies to double the value of goods and services sold overseas by 2020, to help reverse the country’s historic trade deficit.

However, publishing its latest international trade survey, the British Chambers of Commerce (BCC) said that at current growth rates, the large £1 trillion export goal was unlikely to be reached until 2034.

While the overall UK trade deficit last year stood at £34 billion, the services sector saw its highest ever surplus at £86bn – equivalent to 5 percent of gross domestic product (GDP).

Despite that, the sector has much more untapped potential, according to the BCC, which gathered its findings from some 2,500 businesses.

It found that just 23% of services firms currently export, and a further 17% have either previously traded internationally or are looking to do so in the next two years. By comparison, 53% of manufacturers – a much smaller sector – surveyed currently export their goods, and an additional 13% have done so previously or plan to do so again.

The UK currently ranks as the second largest exporter of services in the world, just behind the US, but the BCC said its survey highlighted the needs for government action to increase the skills range of their workforces.

It noted that the greatest barrier to exporting among services firm were differences in regulation and standard – cited by 27% of those polled – and language or cultural difference (26%).

Meanwhile, Santander said yesterday that its analysis of official UK export data for 2014 found that exports to China grew 12% to £13.9bn, resulting in the Asian powerhouse displacing Belgium & Luxembourg as the sixth most-significant export market for the UK.

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Our a range of products and services is design help exporters and importers operate effectively within the complex world of International Trade. We assist companies by providing essential skills and knowledge in trade procedures, enabling employees to handle export orders and international product procurement successfully. Our workshops, trade reference, documentation and software applications form a unique suite of 'tried and tested' services. We are associate members of the Institute of Export and British International Freight Association.