Increasing automation leading to under-performing workers says new report

BY Fraser Tennant

More than one in four UK workers are “not performing their best at work”, with increasing automation a key concern, according to a report published by Deloitte this week.

In its ‘Voice of the workforce in Europe’ report, Deloitte highlights that 32 percent of UK workers say they are not stimulated by what they do, with 36 percent stating what they do is not meaningful. In comparison, on average, just one in four European workers (24 percent) say they are not stimulated by what they do, and fewer than one in five (18 percent) believe what they do is not meaningful.

“For the UK to remain a globally competitive economy, more must be done to address productivity in our workplaces and the ever widening skills gap,” said Anne-Marie Malley, UK human capital leader at Deloitte. “Businesses are facing an uphill struggle to address these factors which is leading to dissatisfaction, disengagement and despondency among employees. Employers must offer more support to strengthen their worker’s skills and communicate the value their roles are bringing to their company, the economy and ultimately society as a whole.”

The Deloitte report research also highlights that almost half of UK workers are already feeling the impact of automation, with 44 percent of workers stating that some of the tasks they did five years ago have been automated and are now done by robots or software, up from a European average of 38 percent of workers. Additionally, 34 percent in the UK say that entire business processes relevant to their job have been automated over the past five years, up from 30 percent of overall European workers.

Overall, workers across Europe appear relaxed about the future impact of automation. Regarding their own jobs and how they will evolve over the next 10 years, about three-quarters (76 percent) of respondents say they only expect slow, small, or no change at all. In the UK, four in five (83 percent) do not expect any major changes to their job over the next decade.

“The reality is that the future of work is now, and automation is already impacting day-to-day roles,” said Ms Malley. “Awareness will provoke action, so it is important for businesses to educate workers on how their roles will be augmented by technology over the next decade.”

Deloitte’s research was based on the attitudes and views of more than 15,000 people across 10 European countries, including 2043 from the UK.

Report: Voice of the workforce in Europe

UK financial sector wants immigration reform

BY Richard Summerfield

With less than a year to go until the UK’s exit from the European Union becomes official, there is still a great deal of uncertainty surrounding the process. However, the financial services sector, given its importance to the UK’s economy, is making its feelings known. A new report from EY and TheCityUK, ‘The UK’s future immigration system and access to talent’, has suggested that the government must urgently review the country’s immigration system if it hopes to succeed post-Brexit.

Ensuring that the UK’s financial sector is able to access skilled overseas talent is vital to the UK maintaining its pre-eminence as the leading international financial centre, the report claims. The sector raises more than £70bn per year in taxes. However, the cost of bringing skilled European workers into the UK could increase by up to 300 percent if existing immigration rules are applied unchanged to European citizens, and if planned Tier 2 visa fee increases come into effect.

“As we approach Brexit, there is a real need to review and reform the UK’s immigration policy to ensure it supports businesses and skilled overseas talent looking to contribute to the UK economy. The current Tier 2 visa system is out of date – we need a much more flexible and dynamic system, which responds to today’s very real skills shortages, particularly around technology, which will worsen if not addressed,” said Margaret Burton, a partner at EY. “People are the foundation of any company. Without access to the right talent, the UK’s future position as a global business leader will be under threat.”

“Britain’s success is built on openness,” said Miles Celic, chief executive officer of TheCityUK. "Being able to attract and retain the most talented people with the right skills, from both the UK and overseas, is a top priority for business leaders across the industry. The UK’s ability to draw global talent has long been a competitive advantage. Losing this could undermine Britain’s position as the world’s leading financial centre. A basic immigration system that is fit for the UK’s needs, future focused and fair is essential. Simply applying the current immigration system for non-European citizens to European citizens after Brexit will not work. Doing so is likely to worsen existing skills shortages and make it much harder to attract the talent British firms need to compete on the world stage following Brexit.”

The report sets out nine key recommendations which could reform the UK’s immigration system and still allow firms to access global talent while reducing the skills shortages which are holding back UK economic and productivity growth.

However, the financial services space is not the only industry demanding the government take action. The healthcare and agriculture sectors have also demanded unimpeded access to international talent after Brexit. Such demands will place additional, considerable strain on the government which is already struggling to map out a Brexit which will please ‘Leave’ voters, many of whom want tougher immigration controls.

Report: The UK’s future immigration system and access to talent

Mind the gap – still

BY Richard Summerfield

There have been some marked improvements in the workplace for women in the UK in recent years, according to a new report from PwC – ‘Women in Work Index 2017’ – which is based on data from 2015. The report notes that not only have female employment rates improved, there has also been a narrowing of the gender pay gap and a reduction in the gap between male and female labour force participation rates.

However, the progress made of late can only be seen as a qualified success, according to PwC. The report, in which PwC measures levels of female economic empowerment across five key areas – the gender pay gap, female labour force participation, the gap between male and female labour force participation, female unemployment and female full-time employment rate – indicates that in many OCED countries, there is still considerable work to be done.

There has been some significant progress made in a number of jurisdictions, however. The UK, for example, now ranks 13th out of 33 OECD countries, second to Canada in the G7 in terms of female economic empowerment. However, the UK still lags behind on the number of female workers in full-time employment, ranking 30th out of 33 countries, well below the OECD average. Indeed, the UK has only a small proportion of women in full-time work, leaving it in 13th place behind the Nordic countries, Poland and Canada. However, it is ahead of France, Germany, the US, Japan and Italy.

The portion of UK women in full time work is not the only issue, however. It is important for women to be employed in a greater variety of industries, including those that offer better career opportunities. "It's not just about getting more women working, but also about getting more of them into high quality jobs that offer career progression and flexibility," said Yong Jing Teow, an economist at PwC.

While the gender gap does appear to be closing, it will take time to achieve gender parity. According to PwC’s estimates, in the UK at least, the gap will finally close in 2041. Across Europe, however, progress could be quicker. PwC’s data suggests that Poland, Luxembourg and Belgium could close their respective gaps within the next 20 years. The US will not see its gap closed for at least another 50 years. Germany will not see its gap closed for another century, if current historical trends continue, and Spain’s  may not close for over 200 years.

Closing the gender pay gap would be lucrative in the long term. Achieving pay parity in the OECD, for example, could increase total female earnings by $2 trillion.

Report: PwC Women in Work Index 2017

Millennials key to worldwide cyber security workforce shortage, says new study

BY Fraser Tennant

A severe shortage of talent in the information security workforce is looming, with employers needing to look to millennials to fill the gap, according to new research from the Center for Cyber Safety and Education, published this week.

The research, part of the Centre’s eighth Global Information Security Workforce Study (GISWS), which includes feedback from over 19,000 information security professionals worldwide, indicates that employers must look to millennials to fill the projected 1.8 million information security workforce gap that is estimated to exist by 2022. This is a 20 percent rise from the 1.5 million worker shortfall forecast by the GISWS in 2015.

The publication of the GISWS coincides with a major initiative to tackle the UK skills deficit due to a lack of millennials recruited into the field: the National Cyber Security Centre, which was officially opened this week in London.

"Supporting and developing the next generation of cyber security talent is essential to the future of the industry,” said Richard Horne, cyber security partner at PwC. “We are on track to recruit more than 1000 technology specialists over the next four years at both graduate and experienced levels. It is important to help graduates experience the many different paths a career in this field could follow by offering a rotation programme around our teams, ranging from threat intelligence and incident detection and response to security transformation programmes and legal and regulatory compliance.”

The 2017 GISWS features a series of reports and analyses focusing on millennial respondents, with key takeaways for employers and hiring managers as to how they should go about attracting and retaining the millennial workforce. These include: (i) millennials value career development opportunities and are more likely to pay for them, if not offered by their employers; (ii) they are more likely to aspire to become security consultants than move into managerial roles within an organisation; and (iii) salaries were not the highest priority for millennials, but they do receive higher salary increases than other generations.

Mr Horne continued: “Cyber security roles can often be seen as purely technical but today's well-rounded cyber security expert has a diverse skillset, with not only technical knowledge but also wider business skills like creativity, organisation, relationship-building and communication."

With addressing the impending information security workforce shortage clearly a major concern, David Shearer, chief executive of the Center for Cyber Safety and Education, is confident that millennials “are the future of cyber security and hold the key to filling the information security workforce gap".

Report: Meet the Millennials – the Next Generation of your Information Security Workforce

Executive pay crackdown announced by May

BY Fraser Tennant

Tighter controls on executive pay designed to curb the excesses of the “privileged few” have been proposed by UK prime minister Theresa May this week as part of an anti-elitism drive to regulate company behaviour and create a more equal country.

The proposals contained in the ‘Corporate Governance Reform’ Green paper are part of Ms May’s attempt to restore public trust in business practices and close the gap between those at either end of the corporate ladder (an increase in inequality being one of the main reasons for Brexit).  

In a statement outlining its intent, the UK government stated that it would bring to an end the behaviour of "an irresponsible minority of privately-held companies acting carelessly – which left employees, customers and pension fund beneficiaries to suffer when things go wrong".

Ms May’s drive to tackle unsavoury corporate behaviour focuses on five specific areas: shareholder voting and other rights; shareholder engagement on pay; the role of remuneration committees; pay disclosure; and long-term pay incentives. One of the main components of the prime minister’s plans is the question of whether a new pay ratio requirement should be introduced.

However, a proposal to have workers represented on company boards has already been sidelined. Business minister Greg Clark indicating that the government was unlikely to change the unitary boards system currently in place.

Providing a stark illustration of the disparity between pay in the boardroom as opposed to the shop floor, is a TUC study (September 2016) which found that, in 2015, the average FTSE 100 boss earned 123 times the average full-time salary. Furthermore, the median total pay (excluding pensions) of top FTSE 100 directors increased by 47 percent between 2010 and 2015, to £3.4m. In contrast, the average wages for workers were found to have risen by only 7 percent over the same period.

The TUC research also found that those companies with high pay inequality between bosses and workers tended to perform less well overall.

“Two thirds of people think executive pay is too high, so we support the Government’s intent to help rebuild trust and strengthen accountability in this area,” said Fiona Camenzuli, a partner in PwC’s Reward & Employment team. “Enhanced shareholder powers and engagement, greater focus by boards on pay fairness, appropriate employee and stakeholder voice in the boardroom, and making pay plans simpler and longer term can all contribute to making pay work better to support the long-term performance of UK companies. The Green Paper presents a wide range of sensible options and we encourage a robust debate, based on evidence, to determine the right policy proposals.”

Following consultations on the Green Paper, a White paper is expected in early 2017. “It will be a consultation that will deliver results,” said Ms May.

News: ‘Corporate Governance Reform’ Green paper

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