More than a third of UK organisations say technology skills gaps have cost them at least £380,000 over the past year, according to research published today by skills development company Pluralsight.

The company’s annual Tech Skills Report, based on a survey of 500 UK tech executives, IT professionals and learning and development (L&D) leaders, found that 35 per cent of respondents put the cost at that level or higher.

Among businesses with revenue of £73m or more, 57 per cent said skills gaps had cost them at least £380,000, and 15 per cent reported costs of £760,000 or more.

Respondents working in cybersecurity gave higher estimates. Pluralsight said 41 per cent of cybersecurity professionals estimated skills gaps had cost their organisations at least £380,000 over the past year.

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

He added: “Building cybersecurity expertise across the workforce is therefore imperative to managing business risk. Those that ignore early warning signs of backlogs, staff burnout and rising remediation costs will suffer greater financial pain.”

The findings follow government research published yesterday, which found that 57 per cent of businesses had a basic technical cyber security skills gap, up from 49 per cent the previous year. In February, the government announced an £80m investment to expand student places in areas including cyber security.

Projects, budgets and contracts

Pluralsight said skills shortages had left many organisations relying unexpectedly on external talent. Forty per cent said they had unexpectedly had to outsource or hire for key project work because of skills shortages, and 39 per cent said they had failed to deliver key projects.

Almost a third (30 per cent) reported budget overruns, and 27 per cent said they had lost a client or contract.

The report identified a similar gap in AI. While 94 per cent of organisations have invested in AI tools for at least some of their employees, 48 per cent said most or all of their staff are AI literate, and 6 per cent reported AI literacy across their entire workforce.

More than half (57 per cent) said demand for AI, machine learning and data science skills had increased because of AI adoption, and 26 per cent said new tech skills can become obsolete within a year.

Junior hiring continues

The survey found that UK organisations are still recruiting junior technology staff despite concerns that AI could erode entry-level roles. Eighty-five per cent said they had hired the same number or more junior tech professionals this year, with 10 per cent reporting a significant increase.

However, 88 per cent said they were worried they do not have enough junior talent coming through to address future skills gaps that AI cannot solve.

Faye Ellis, author fellow at Pluralsight, said: “With a significant amount of youth in the UK not in education, employment or training (otherwise known as NEET), organizations may see gaps in their entry-level tech talent pool. This means that 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.”

The Office for National Statistics estimates that 981,000 people aged 16 to 24 were not in education, employment or training in April to June 2026, or 13.0 per cent of that age group.

Separate Department for Education research, reported by Business Matters in February 2025, found that nine in ten English businesses were struggling to fill skills gaps, with entry-level vacancies hardest hit.

Pluralsight’s report found that 53 per cent of senior leaders are unsure how to solve their skills gaps.

Among employees, 46 per cent of technology workers said they struggle to find time for training, while 28 per cent of L&D leaders cited a lack of support from leadership as a barrier to upskilling.

Pluralsight said the findings pointed to a cycle in which leaders recognise the need for new capabilities, but employees lack the time and organisational support to develop them.

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