UK Manufacturers Risk Falling Behind Europe as Digital Skills Gap Stalls AI and Cloud Ambitions
Half of firms say lack of digital skills has hindered growth as AI ambitions outpace readiness
New research from European software provider Forterro has found that skills shortages and sluggish digital transformation are putting the UK’s industrial midmarket at risk of falling behind its European peers.
The findings, from a new Forterro report – The Digital Future of the European Industrial Midmarket – reveal that almost half (49%) of UK manufacturers and wholesalers say the digital skills gap has directly impacted business growth or projects. More than one-third (34%) admit they lack confidence in finding recruits with the right digital expertise.
The most significant gaps are in AI literacy (42%), cybersecurity (41%), and data analysis (40%) – precisely the capabilities needed to deliver on the industry’s digital transformation goals.
“The digital skills gap is becoming the single biggest barrier to digital transformation in the UK’s industrial midmarket,” said Thomas Knorr, Vice President Cloud Transformation, Forterro. “Most firms recognise the potential of AI and automation for efficiency gains and growth, but many don’t have the people or infrastructure to make it work. The risk is a growing divide between businesses that modernise and those left behind.”
According to the research, 57% of UK respondents have a digital transformation roadmap, and 56% say they have a fit-for-purpose cloud and data strategy, slightly ahead of the European average. Yet progress remains uneven: 30% rated their digital transformation performance as poor over the past three years, with a further 34% calling it merely adequate.
AI, however, is seen as a crucial part of the solution. UK firms cited predictive maintenance, predictive logistics and document management as their most popular ERP add-ons, while AI-driven analytics and risk detection are expected to deliver the greatest future value.
“AI isn’t about replacing people and taking jobs, it’s about empowering those people to do their jobs better and allowing them to shape their role in a way that brings greater rewards,” added Thomas Knorr, Forterro. “When the right digital skills and technology are harnessed together, AI becomes a practical tool for improving operations, predicting issues, strengthening competitiveness and powering growth. That’s what we’re helping our customers achieve, offering tools that offer tangible and practical benefits.”
The report also reveals that one-third of respondents say that keeping pace with competitors and future-proofing the business are the main drivers for digital transformation. More than half (57%) believe resisting cloud adoption will damage market share, further evidence that the UK industrial midmarket understands the stakes but struggles to act decisively and even hire the people to help them.
“Digitalisation is no longer a project for tomorrow; it’s the price of staying relevant,” concluded Thomas Knorr, Forterro. “AI, cloud and ERP modernisation go hand-in-hand, but without retraining or upskilling in the business, digital transformation will continue to stall.”
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