The report found that, as AI and digital demands accelerate, some organisations are being left behind.
Ibec, the group representing Irish businesses, has released the findings of its Skills Survey 2025 report. What was discovered is that, of those who participated, 82pc of organisations reported a skills gap that is undermining productivity, innovation and competitiveness.
Research found that there is a clear “mismatch between available talent and the needs of a modern economy”, which has moved from being of marginal concern to a “major strategic threat”. Especially as, according to Ibec, there is an expectation among employers that there will be increased competition for skilled talent over the course of the next five years.
The report stated that the skills gap represents a “major, systemic challenge for every business attempting to navigate this turbulent landscape”, adding that “the economic viability of both individual enterprises and the broader Irish economy depend on the speed and effectiveness with which these strategic skills deficits are addressed”.
Amid a struggle to attract and retain skilled employees in a tight and competitive labour market, the report also found that businesses are simultaneously feeling the pressure to keep pace with new and emerging technologies, for example artificial intelligence (AI). Ibec noted, there appears to be “varying levels of strategic prioritisation regarding the value of digital and AI skills”.
The report highlighted a deepening “preparedness gap” between large firms and resource-constrained SMEs, whereby larger organisations who participated in the research were found to be twice as likely to facilitate AI training at 30pc, compared to just 13pc of contributing SMEs.
Ibec stated: “SMEs are forced to prioritise immediate operational and compliance training over long-term strategic upskilling. The report affirms that cost and time remain the two most significant barriers employers face when it comes to workforce development.”
Funding lifelong learning
In-house training was found to be among the most popular forms of skill development, driven largely by time and cost, however, the report also indicated that there is a demand for greater collaboration with education and training providers. One-quarter of employers said that they would prioritise stronger collaboration with the formal education and training system in meeting their skills needs.
Ibec said: “To overcome participation barriers and boost lifelong learning, businesses clearly value more flexible training models (29pc), faster development of new skills programmes (22pc) and increased guidance to navigate the complex training landscape (21pc).”
Ibec’s report also stated now is the time for the Irish Government to act on the National Training Fund (NTF), which is a dedicated fund to support the training of people in employment and those seeking employment.
The organisation explained: “The persistent accumulation of a significant surplus, estimated to reach €3bn by 2030 even after planned drawdowns, signals a clear underutilisation of resources dedicated to workforce development.” The report also noted that Ireland’s lifelong learning rate has improved to 16pc but remains less than half of that of European leaders, such as Sweden (42pc) and Denmark (32pc).
“To harness this asset, the Government must permanently unlock the NTF’s full potential by setting a maximum target for the surplus. This would enable its comprehensive use across the economy, decisively boosting industry competitiveness, resilience and productivity,” said the report.
Commenting on the findings and the role of Government support in workplace upskilling, Meadhbh Costello, a senior executive for skills and innovation policy at Ibec and an author of the report, said: “With a €3bn surplus projected for the National Training Fund, there is no excuse for underinvestment.
“Government must now move decisively to unlock these employer-contributed funds and jump-start training and lifelong learning. By investing in proven upskilling programmes such as Skillnet business networks, Springboard+ and micro-qualifications we can empower SMEs to bridge the digital divide and ensure that our workforce is not just prepared for the future of work but is actively leading it.”
She added: “This report serves as a critical wake-up call that the status quo in workforce development is no longer enough to sustain Ireland’s competitive edge. With talent shortages growing and internal resources stretched thin, it is deeply concerning that firms who are actively contributing 1pc of their payroll to the National Training Fund are not able to access the supports they need to prepare their workforce for the future.”
For the purpose of Ibec’s research, data was collected from 281 CEOs and senior HR leaders in small and large companies across five broad industry sectors, which were manufacturing; retail, distribution and hospitality; health and education; professional services; and other, undefined sectors.
Don’t miss out on the knowledge you need to succeed. Sign up for the Daily Brief, Silicon Republic’s digest of need-to-know sci-tech news.
