Skills shortage, what skills shortage?

It has become fashionable recently to bemoan a current skills gap in the UK life sciences sector that is said to be frustrating future growth.

Prime Minister, Rishi Sunak, lit the touchpaper earlier this year when he suggested the country could become a science and technology ‘superpower’, with life sciences at the vanguard of this bold new ambition.

Few players in the industry appeared to disagree but, in their very British way, some are already citing potential reasons why this may not be possible, and chief among them is firms’ inability to find the personnel they will need to meet this goal.

The skills gap, they argue, exists not only at the lower end of the employment scale – with too few properly skilled graduates and modern apprentices – but also at the top, where there is apparently a critical lack of experienced scientists, chemists, engineers, and senior executives with a science background.

As a specialist recruiter of senior executives in the industry for more than 20 years, I don’t buy it.

Those promoting the existence of a skills gap point to employer surveys, recruitment statistics and geo-political forces and events to bolster their claim.

But, if you scratch the surface, it is evident that the current market is not significantly different from what has gone before and you can always cherry pick statistics and overplay the significance of external factors to support an argument.

For me, the most compelling evidence is my own experience. It may be true that firms are unable to recruit specialists in very niche areas from within the UK, but most are operating in a global market.

With the most sympathetic and favourable immigration regime in living memory, it has never been easier to recruit skilled and experienced talent from abroad.

The only plausible reason for a UK life sciences company being unable to fill a senior role is its inability – or unwillingness – to pay candidates what they would expect to earn in the United States, the Far East, or elsewhere in Europe.

If they did pay more, doubtless they would find that the ‘skills shortage’ suddenly disappears. It’s easier to say ‘there is a skills gap’ than to admit that you don’t have enough money to hire the people you need.

Principal among the reasons given for the existence of an apparent ‘shortage’ is Brexit. The ending of free movement when the UK departed the EU makes it more of a bureaucratic headache for firms to recruit from Europe, so the argument goes.

Even if that were true – and my sense is that Brexit’s impact on UK life sciences is overblown – companies in this country were never heavily reliant on senior executives or specialist scientists from Europe, prior to Brexit.

If anything, highly skilled, qualified, and experienced Britons were more likely to be recruited to work for companies in Germany, France, and Sweden than the other way round.

My feeling is that, with post-Brexit immigration patterns now bedding in, the penny has dropped with employers that they can bring anybody in from any country globally – with the possible exceptions of Iran, Russia, and Libya – provided they are qualified and they pay them enough. And while there might be a premium for doing so, it is not an outrageous one.

In many ways, it would be easier for a London-based life sciences company to relocate someone from Shanghai than from Cambridge, given the difference in salaries they could command.

Another reason cited by skills gap proponents, is an apparent rise in the number of foreign scientists leaving the UK to return home or to work elsewhere.

Last October, it was reported that 22 senior scientists had decided to leave, due to delays in negotiations with the EU to retain £84million of research funding for the Horizon Europe programme.

Brussels refused to continue discussions with the UK Government until Brexit-related issues, including the Northern Ireland protocol, were resolved. But with Rishi Sunak’s Windsor framework deal signed off earlier this year, that problem should soon disappear.

Other contributory factors have included the war in Ukraine, a shortage of lab space in Oxford and Cambridge and a series of ongoing ‘fiscal fixes’ – including a rise in the rate of Corporation Tax from 19% to 25% – which have supposedly had the effect of discouraging investors and scientists from coming to the UK.

The latter argument would be more convincing in diagnostics, for example, if it wasn’t for the fact that only around 20% of companies in the sector are profitable, with the remaining 80% not paying Corporation Tax.

Inevitably the argument always circles back to economic firepower, and the painful truth for many UK companies is that they can’t compete on an equal footing with equivalent US firms doing the same type of work.

Even within the UK, there can be huge disparities, with a managing director of one company earning £500,000 compared with their counterpart at a similar sized firm who is earing half of that.

As well as having to meet market leading salaries, UK employers are also often shocked to learn that potential executive recruits from the US will also expect to receive the same amount as their annual salary in share options.

The reality is that there are disappearingly few early-stage MedTech and diagnostics companies in the UK with the financial power to be able to do that.

Highly qualified and experienced people tend to stay in the US because, there, they will be paid four times more and pay half the tax than they would by doing roughly the same job in the UK.

My experience tells me there isn’t a life sciences skills shortage in the UK – or anywhere else for that matter – only a relative reluctance to meet the financial demands of the sector’s top talent. As with most things in life, show them the money and they will come.