Skills shortages are showing no sign of dissipating, particularly across STEM specialisms. There has been a wealth of conversation around how to address the issue, from better collaboration between education institutions, policy leaders and employers, to reskilling workers, particularly as AI continues to automate elements of some roles.

While there will be no easy solution to this challenge, there are tactics that HR leaders should prioritise. If we take a look at the defence sector – where the dearth of available talent has prompted the Ministry of Defence (MOD) to publish a refreshed Defence Command Paper prioritising recruitment and retention – there are immediate steps to take.

Indeed, we conducted an in-depth study with Defence Online to ascertain not only the extent of the skills shortages, but also how employers in the sector are addressing the issue. The report – Delivering the Defence Workforce of the Future* – shows two crucial areas pools of talent that are going underutilised; temporary workforces and diverse groups.

Contingent will be crucial

The temporary workforce is a natural source to tap into when skills are scarce. In fact, our study showed that in the defence sector, more than half (58%) of employers rely on contingent workers in some form. And as these businesses continue to feel the impact of limited resources, the proportion turning to these workers looks set to increase. In fact, of the 27% of businesses yet to engage the temporary workforce, 10% are planning to do so in the future.

There’s a clear correlation between those utilising contingent resources and firms that are struggling to fill resourcing needs. When asked what the core benefits of these workers are, 63% of employers stated the ability to rapidly respond to emerging skills shortages, while a further 61% said contingent workforces are being utilised to fill permanent resource gaps.

While there may be a wide recognition of the benefits that flexible workers offer in terms of tackling skills gaps, there remains a persistent challenge for HR and hiring teams; namely attracting and retaining contingent talent (cited as a core issue for 53% of employers). When we consider that many of the skills the flexible workforce is being utilised for are narrow specialisms within STEM, the fact that 42% of defence firms still find it difficult to source niche skills is a concern.

While engaging contingent staff allows for greater flexibility and movement of talent, peak competition is not only draining pools, but also leading to greater competition for these resources. Workers are also aware that they are in high demand and are leveraging this, often for financial gains that prices some employers – particularly those in the defence sector – out of the market.

What was interesting to note, though, is that far too few employers are utilising contingent worker employment solutions through the likes of Managed Service Providers (MSP) or any other outsourced means. Only 18% tap into external support, while just over a third (34%) manage this in house. Given the cost savings, efficiencies and access to wider talent pools that come with using external providers, there are clearly avenues being missed in contingent engagement.

Diversity can’t be forgotten

Engaging diverse groups is another obvious route to increase access to talent when skills are scarce. However, while there is certainly a commitment from many employers to drive diverse recruitment practices, our research suggests that, in reality these tactics aren’t being implemented.

If we look at the data, a commendable 80% of defence businesses are committed to unbiased hiring. While we would, of course, like to see this hit 100%, that is still a significant proportion of employers actively committed to diversity, equality and inclusion (DEI) in recruitment. However, when we look at the proactive steps that we’d expect to see taken in light of this, though, the figures fall significantly.

Less than half (38%) are currently offering mentorship opportunities to support those from underrepresented groups, while only 33% indicated that they are benchmarking the progress of their DEI initiatives. Training and educational events are also in limited supply, with just 29% of defence employers offering them to workers.

Beyond these tactics, there also appears to be a diversity gap in the recruitment process itself. If we look at how many employers are promoting opportunities to underrepresented groups, there are some laudable figures. Over two thirds (68%) are pushing opportunities to women, while 55% are proactively engaging veterans, which does demonstrate positive momentum for diversity in defence.

However, other underrepresented demographics are being overlooked. Perhaps most notable is the fact that less than half (41%) are engaging with people with disabilities. When we consider that a large proportion of veterans will leave the Armed Forces with life-changing injuries, this figure certainly needs addressing.

When we also consider how important the contingent workforce is for skills-short sectors, the fact that just 13% of employers indicated that DEI is a significant benefit of engaging temporary resources, suggests that diversity initiatives aren’t being transferred to this segment of the labour market.

Future-proofing skills

While these examples may be centred on our experience and insight into the inner workings of the defence sector, many of the trends – and subsequently the guidance – rings true for other skill-short sectors. For defence, the impact that a dearth of talent can have on the nation’s security is one of the core reasons why the issue is so widely reported in the media.

However, even in those sectors that aren’t responsible for the security of the country, limited access to critical STEM skills will have an on-going impact on business stability and growth. If employers are to future-proof their talent attraction and retention strategies, they need an honest look at where they may be inadvertently falling behind the curve.

A more robust means of engaging contingent workers and the implementation of impactful diversity tactics are just two elements of the puzzle that are missing. But the reality is, there’s always more that can be done, if there’s the commitment, resources and budgets to support it.

For the UK defence sector in particular, stakeholders need to diversify their talent pools and prioritise inclusion over costs. Action is needed now to ensure the UK’s legacy of defence innovation remains, and that’s where contingent workforce solutions will be critical.

*Guidant Global