Skills gap vs pay gap: Are we losing balance?

Written by Richard Bourne from BCS Connect

As we move through 2025, employers across the UK – particularly in manufacturing and construction – are facing significant challenges around pay, recruitment, and retention.

The National Minimum Wage has risen to £12.21 per hour, and Employers’ National Insurance now sits at 15 per cent above a lower threshold of £96 per week.

Combined with ongoing inflationary pressures, these factors are reshaping how businesses approach their workforce strategy.

On one side, employers are absorbing increased employment costs just to meet legal obligations.

On the other, workers are still struggling with the rising cost of living and expect wages that reflect not only their effort but also their expertise.

But as unskilled roles see consistent wage increases, the gap between those positions and skilled trades is narrowing – and that’s a real concern.

In sectors like manufacturing and construction, this creates a fundamental imbalance.

Roles that require technical knowledge, formal qualifications, and years of experience – such as plant operators, CNC machinists, and electricians – are not seeing wage growth that aligns with the increased value of their skills.

Meanwhile, entry-level or low-skill positions are catching up in pay, simply due to mandatory wage increases.

This tightening of salary bands leads to difficult decisions.

For employers, it raises the question of how to reward skill and responsibility when budgets are stretched and the baseline keeps rising.

For workers, it challenges their motivation to train, upskill, or stay in roles where the financial return doesn't justify the effort or pressure.

At the same time, there’s a wider issue at play: the UK is facing a growing skills shortage in both construction and manufacturing.

If skilled workers feel undervalued or see limited progression in earnings, it’s likely we’ll see more leave the industry altogether or move sideways into less demanding roles that pay the same or more.

This weakens the talent pipeline further and leaves employers scrambling to fill gaps.

This is where a recruitment agency can make a real impact.

At BCS Connect, we go beyond simply filling vacancies.

We work closely with employers to provide insight into current pay trends, candidate expectations, and how best to position your business to attract and retain the right talent.

We know what candidates are looking for – not just in terms of salary, but work-life balance, shift patterns, job security, and career progression. That insight helps employers make informed, realistic decisions that support long-term staffing strategies.

We also understand the pressure businesses are under.

Recruitment needs to be efficient, targeted, and cost-effective. That’s why we tailor every solution, whether you're looking to grow your permanent team or need flexible labour support to manage peaks in demand.

The reality is this: if pay structures continue to flatten and skilled roles are no longer rewarded appropriately, the workforce will continue to shift in ways that may not favour long-term productivity or sector growth.

To avoid this, employers need to review how they value skill – not just in words, but in pay and opportunity.

If you're concerned about how your roles compare in today’s market, or you're struggling to attract and retain the right people, let’s have a conversation. The market is changing fast – and we’re here to help you stay ahead of it.

You can reach me directly at richard.bourne@bcs-connect.co.uk, on 01543 629 090

BCS Connect – Connecting Talent, Bespoke Staffing Solutions.