UK manufacturing must bridge skills gap to unlock GBP £6 billion

Industry experts have highlighted critical workforce and technology challenges across the UK manufacturing sector, calling for urgent action to address skills shortages, the growing capability gap, and the need to attract a diverse new generation into the field.

Adapting to workforce change

The UK manufacturing sector continues to experience a significant workforce shift. With older workers retiring and new talent scarce, the risk of knowledge loss and declining productivity is mounting. Claire Hu Weber, Vice President of International Markets at Fluke Corporation, warned of the deepening skills gap.

"It's no longer just 'important' to bring young people into manufacturing, it's mission critical. The skills gap is widening year after year, and the numbers don't lie. In the UK, more than half of manufacturers expect up to a fifth of their workforce to walk out the door into retirement within the next decade."

Hu Weber also pointed to the sector's lack of diversity. "Women make up barely a quarter of the UK manufacturing workforce, we don't only have a lacking workforce pipeline but a lack of diversity too. Unless we move fast to attract new talent and break down the barriers that keep women from entering and staying in the industry, we'll lose not just capability, but the diversity of thinking that fuels real innovation and growth."

Mark Williams, Managing Director EMEA at WorkJam, noted that 75% of manufacturers now identify skills shortages as their biggest barrier to growth. Williams emphasised the importance of attracting young workers and providing continuous, accessible learning, tailored skills development, and flexible conditions, suggesting that integrating these into a single digital app could help boost both engagement and retention.

Knowledge retention and AI

Michael DeMaria, Director of Product Management at Fluke Reliability, emphasised that the challenge extends beyond skills shortages to a broader "capability gap" as experienced workers retire: "Industries risk losing the situational knowledge built through decades of trial, error, and high-stakes decision-making." DeMaria sees the transfer and scaling of this expertise through AI as a clear solution: "AI can help make this possible by embedding veteran expertise into guidance that helps new employees adapt quickly, avoid preventable failures, and focus on continuous improvement."

Similarly, Jesus Hernandez, Senior Vice President EMEA at AVEVA, drew attention to the economic consequences of the skills gap, citing 55,000 unfilled vacancies in UK manufacturing and an estimated GBP £6 billion in lost output each year. Hernandez champions a blend of mentoring and AI-guided training to bridge the knowledge divide: "Forward thinking manufacturers are now also making the most of integrated AI-assistants. These provide guidance and assistance 24/7 to junior team members, imitating the expertise of senior employees with decades of practical know-how."

Hernandez highlighted the importance of not only passing on practical experience but ensuring younger workers understand the reasoning behind decisions in fields like safety and technical processes. He called for active mentoring and greater use of technology to ensure knowledge survives generational change.

Robotics and inclusivity

Volker Spanier, Head of Manufacturing Solutions for Epson EMEA, described a sector in transition, where robotics and automation are making advanced technology more accessible to manufacturers of all sizes. Spanier argued that "cobots" - collaborative robots - now play a role in enabling safer, more inclusive workplaces.

"Far from replacing workers, these intelligent systems take on repetitive or hazardous tasks, freeing people to focus on creative, strategic, and value-adding work. This evolution enhances productivity and helps create safer, more inclusive workplaces that attract a wider talent pool into the sector," Spanier said. He also noted that the simplification and affordability of robotic systems could be a "turning point" in democratising advanced technology across UK manufacturing.

The importance of skills and careers

Williams and other experts pointed to the importance of workforce retention and developing clear career pathways in manufacturing. Williams noted, "Prioritising the retention and engagement of the frontline is key to upholding the industry and allowing it to remain as a key player in the UK economy."

Bowes said that while AI promises increased efficiency, its success relies on investment in skills. "The Supply Chain Compass Report revealed that 24% of leaders see workforce skill gaps as a barrier to AI adoption. This makes investment in skills and career development just as vital as investment in technology."

Building a resilient sector

Simon Bowes, CVP of Manufacturing Industry Strategy EMEA at Blue Yonder, reported that AI and predictive demand planning are gaining traction in the sector. Citing the 2025 Blue Yonder Supply Chain Compass Report, he found that 40% of surveyed senior leaders say AI is now changing how they operate, with 47% already using predictive AI for planning. He cautioned, however, that the transition to greater automation and sustainability depends on overcoming workforce skill deficits and outdated technology.

Bowes highlighted the need for a dual-track approach: "Accelerate innovation, equip people with the tools and skills they need, and build ecosystems where sustainability, resilience, and talent converge." He also noted the risks of outdated technology, with 82% of leaders stating that it could hinder their operations.

Across the industry, the consensus among leaders is clear: integrating new technologies, investing in the workforce, and addressing inclusivity and diversity challenges are central to the sector's future productivity, sustainability, and competitiveness.