Using data to target recruitment and address skills shortages in the rail industry

In the UK, it is NSAR’s role to analyse the current rail workforce and forecast future skills needs. Since 2016, NSAR has been conducting an annual comprehensive survey of industry professionals – collecting data from the majority of rail organisations on demographics, job roles and work locations. The survey helps NSAR build the most complete and accurate representation of the UK Rail workforce, enabling the industry to set direction.

There is widespread awareness of the skills shortages the UK rail industry faces – NSAR data from the annual workforce survey illustrates their location and extent. Armed with this knowledge, strategic workforce planning and targeted recruitment can be undertaken to build talent. This extends to increasing equality, diversity and inclusion in the rail industry. The importance of data in addressing skills shortages cannot be underestimated.

This article lays out the data and illustrates where the skills shortages are. It then suggests how the data can be used, at a high level, to undertake strategic workforce planning and develop strategies to address shortages – as well as, at an organisational level, create targeted recruitment and training plans.

Age

The age profile of the workforce illustrates a concerning trend. The proportion of employees under 30 (13.5%) is at its lowest since data collection began – a reduction of nearly 50% in seven years. At the other end of the scale, the proportion of over 50-year-olds continues to rise, to 33% in 2023.

The proportion of older employees in the industry is important. As the number of retirees increases there is a real risk of further gaps and shortages – at a time when investment (and, therefore, demand for workers) is increasing. Using a projected retirement age of 65 years, by the end of 2030, it is expected that over 35,000 rail industry employees will have reached this age and would therefore be considered retirement risks.

Location

It is useful to understand the regional variations that exist. The profile of investment in rail between 2024-2028 shows almost 40% of investment will take place in London and the South East, and 32% of investment will take place in the North West, West Midlands and Yorkshire & the Humber. Demand for skills is particularly acute in the North West, West Midlands and Yorkshire & the Humber – areas that have typically experienced lower levels of investment in projects and have had fewer resources to invest in skills than London and the South East.

Considering each of these five regions has over one-third of the workforce aged 50 and over, planning for the replacement of those who retire ought to be well underway and evidenced through increased levels of training. There is no evidence yet that this is happening.

Job types

There are clear and key job types where consistent workforce deficits exist – including Signalling & Telecoms, Systems Engineering and Electrification & Plant – where the gaps typically range between 1,000 and 2,000 people per annum. These deficits are creating premiums for skills – for Electrification 12% and for Signalling 10%, evidenced by increased salary demands.

As the sector develops and new technologies are deployed, there will be an increased demand for digital skills. In addition, sustainability is increasing in importance as the sector strives to meet the Government’s decarbonisation targets. This means there will be an increased demand for roles and skills that are ‘greener’ in nature, specifically, Electrical Engineers, High-Voltage Engineers and Systems Engineers.

Gender

The proportion of women in the workforce is 16.3%. This figure has increased steadily since NSAR started collecting data in 2016 and, despite a dip in 2022, the numbers are showing a positive upward trend.

Looking at gender and job type, the data shows that women have the highest profile in the job type of Business Management, which includes corporate support functions such as HR, finance and administrative roles. Operations and Property, Stations & Depots have the next highest proportions. These job types have a higher number of customer-facing roles.

Ethnicity

Ethnicity data has only been collected since 2019 and remains a challenge to obtain. This is either because employees choose not to disclose, or employers do not collect this data. In NSAR’s 2023 workforce survey, ethnicity data was provided for just under 30% of the total workforce population. Of these employees, 12.4% are from ethnic minority backgrounds. This compares to a UK national average of 18.3%.

Apprentices

Apprentices make up approximately 1.65% of the total rail workforce. It includes new entrants, multi-year apprentices and those who are being upskilled – meaning the number of new entrants is just a proportion of the 1.65%.

However, more apprentices are required to meet the skills demand. Rail now needs about 5,000 apprentices per annum, or 2.5% of the workforce.

Trainers

Skills shortages in rail extend to trainers. The average age of trainers is 52 years and 40% of all active trainers will reach retirement age by 2030. 80% of the rail industry will need upskilling over the next two decades. To maintain current service levels and meet future demand, appropriate training opportunities must be in place. The ageing profile of trainers will make this a challenge.

Addressing skills shortages in rail through targeted training and recruitment

There is the opportunity to generate between £128 and £181 million cumulatively for the UK economy by filling the gaps in the rail sector between now and 2028. The realisation of this value will require improving promotion, attraction and retention of employees as well as making a commitment to training and upskilling existing employees.

Data can drive decision-making focussed on skills development to meet the requirements of the sector. NSAR recommends following the scientific approach to the talent pipeline by using data more effectively and creating a methodology to recruit and train the skills the industry needs. This type of role and skills profiling forms a baseline for recruitment needs, informing the sector where to direct its energies, depending on the scale of the demand and when specific skill sets will be required.

Take the age of rail employees as an example. There are a number of key roles where the average age is higher than 50. Planning for the succession of suitably skilled and qualified people in these roles is essential to ensure the railway continues to operate efficiently. There is also a need to consider how the sector can harness the skills of these individuals and ensure there is a good knowledge transfer process in place for those retiring. Using some of this knowledge to support apprentices will enable skills information to be passed on. This is particularly important considering the general lack of trainers and assessors.

The data also shows us that rail must create a more diverse and inclusive workforce to better reflect the communities it serves. Broadening the range of diverse skill sets is crucial if the rail sector is to be attractive to different types of people and competitive with other industries. Diversity has been proven to improve productivity.

The industry should persist in providing opportunities to increase the number of women in the workforce. While numbers are trending in the right direction, there is more to do. Continued implementation of strategies such as job-shares, increased opportunities for part-time working and increased role flexibility are evidence that the sector is attempting to adapt and attract from a different resource pool.

Other opportunities to increase diversity include using open and fair recruitment policies to attract candidates from the widest pool, such as blind CV screening and diverse interview panels. Building a culture of inclusion and respect by developing policies on equality, diversity and inclusion (EDI) is also important.

Organisations need to understand their current workforces before they begin efforts to diversify and plan for the future. Competency management and tracking is an important aspect of this. NSAR’s Skills ID competency management system (CMS) allows organisations to understand competencies and training across their workforce. With a clear idea of how the profile and composition of the workforce fits with operational and project requirements, skills and competency gaps can be identified and options developed to address them – such as recruitment plans, HR strategies and training programmes.

Training will be a vital component of resourcing the demand. NSAR evidence shows that £1 spent on training on rail skills in the UK results in a £3 return on that investment. Offering high-quality training to new employees and upskilling existing employees will help the industry attract and retain workers. Getting the training supply side fit for purpose is critical and will require investment across the industry.

The broader use of apprenticeships must be a core component of any training plan. Apprenticeship take-up, completions and apprenticeship levy underspend all suggest that rail has yet to fully embrace apprenticeships as a method of workforce planning and a way to increase diversity within rail. Apprenticeship programmes supply the industry with an ongoing cohort of qualified talent and are a useful way of teaching the practical, hands-on skills the modern railway needs.

The industry has made much effort to increase apprenticeship numbers in the last few years. However, apprenticeship places in supply chain SMEs have remained low. We know this is because SMEs face challenges that prevent them from taking on apprentices – like concerns over having enough work or the breadth of work for the apprentice to complete their apprenticeship standard.

NSAR’s Apprenticeship Agency supports SMEs with apprenticeships. We work with businesses to identify which apprenticeships best suit their needs and then recruit and employ the apprentice on their behalf, matching the apprentice with a training provider. NSAR will also provide HR support to the apprentice while they are hosted and can place them with another host agency if needed. NSAR can also provide lighter-touch apprenticeship support to organisations that might need help with levy optimisation, navigating apprenticeship standards or buying quality training.

A concerted and collaborative effort can enact real change across the sector as it aims to attract and retain a more diverse set of skills. The rail industry needs to embed a consistent approach to competency management and strategic workforce planning to inform recruitment and training strategies and ensure it has the skills it needs to operate efficiently.