Skills gaps cost a third of UK firms at least £380,000

More than a third of UK organisations say technology skills gaps have cost them at least £380,000 over the past year, according to Pluralsight's annual Tech Skills Report, published today and based on a survey of 500 UK tech executives, IT professionals and learning and development leaders.

The 35 per cent headline figure climbs sharply with company size. Among businesses with revenue of £73 million or more, 57 per cent reported costs of at least £380,000, and 15 per cent put the damage at £760,000 or more.

Cybersecurity respondents gave the highest estimates: 41 per cent said skills gaps had cost their organisations at least £380,000 over the same period. The government's own research, published yesterday, found 57 per cent of UK businesses now have a basic technical cybersecurity skills gap, up from 49 per cent a year earlier.

Why does cybersecurity carry the biggest cost?

Matthew Lloyd Davies, principal security author at Pluralsight, explained the mechanics behind the losses. "Cybersecurity skills gaps are particularly costly because they lengthen the window attackers stay undetected, and cost scales with that window," he said. "The longer the window is open, the greater the financial impact as costs quickly spread from business interruption to recruiting external specialists."

He warned that employers ignoring early warning signs — backlogs, staff burnout, rising remediation costs — "will suffer greater financial pain."

What does the gap mean for delivery and budgets?

• 40 per cent of organisations unexpectedly outsourced or hired externally for key project work because of skills shortages.
• 39 per cent failed to deliver key projects.
• 30 per cent reported budget overruns.
• 27 per cent lost a client or contract.

The AI picture shows a similar mismatch. Although 94 per cent of organisations have invested in AI tools for at least some employees, only 48 per cent said most or all of their staff are AI literate, and just 6 per cent reported AI literacy across the entire workforce. Some 57 per cent said demand for AI, machine learning and data science skills had risen because of AI adoption, and 26 per cent said new tech skills can become obsolete within a year.

Is junior tech hiring holding up?

Yes, for now. Eighty-five per cent of organisations said they hired the same number of or more junior tech professionals this year, with 10 per cent reporting a significant increase. Yet 88 per cent worry they do not have enough junior talent coming through to fill future gaps that AI cannot solve.

The pipeline concern is grounded in labour-market data. The Office for National Statistics estimates 981,000 people aged 16 to 24 — 13.0 per cent of that age group — were not in education, employment or training between April and June 2026.

Faye Ellis, author fellow at Pluralsight, said: "Businesses cannot rely on recruitment alone, but must invest in clear development pathways that prepare new talent and help existing employees continually build relevant skills."

Who is responsible for closing the gap?

Pluralsight found 53 per cent of senior leaders are unsure how to solve their skills gaps. On the employee side, 46 per cent of technology workers struggle to find time for training, while 28 per cent of L&D leaders cite a lack of leadership support as a barrier to upskilling.

For individual tech workers, the report points to a clear market signal: AI literacy and cybersecurity expertise command a premium precisely where employers report the largest losses and the least internal capacity — and where skills can expire within twelve months without continuous investment.