Companies report mounting recruitment pressures while Ibec urges urgent release of National Training Fund resources.
Ireland’s largest business lobby has warned that persistent skills shortages are now placing a growing brake on company performance, with pressure intensifying as demand for AI‑related capabilities accelerates across the economy.
According to Ibec’s latest Skills Survey, 82% of firms say they are struggling with talent gaps that are undermining productivity, innovation and long‑term competitiveness.
The findings draw on responses from 281 chief executives and senior HR leaders and capture what many companies describe as a widening disconnect between available expertise and the needs of a rapidly evolving labour market.
Better access to National Training Fund needed
Meadhbh Costello, Ibec’s Senior Executive for Skills and Innovation Policy and the report’s author, said the situation represents a significant strategic risk and requires immediate state intervention. She noted that employers contribute 1% of payroll to the National Training Fund but have limited access to the supports they need.
“With talent shortages growing and internal resources stretched thin, it is deeply concerning that firms who are actively contributing 1% of their payroll to the National Training Fund are not able to access the supports they need to prepare their workforce for the future,” she said.
She also warned that “recent years have seen a stagnation in training places available in much‑needed workforce development programmes.”
Competition for talent is increasing as companies respond to rapid technological change. Businesses report a particular struggle to source workers with AI capabilities. Large organisations are more than twice as likely to be training for AI compared to smaller firms, who are focusing their limited resources on compliance and day‑to‑day operational training.
Ibec argues that without significant expansion of capacity in existing upskilling and reskilling schemes, many smaller employers risk being left behind.
Cost pressures are also playing a role in the persistence of skills shortages. Employers told researchers that the expense of training existing staff and the challenge of attracting qualified candidates are weighing heavily on growth plans.
Respondents across sectors view the problem as increasingly acute, with professional services firms among the most affected.
Across the labour market, the appetite for workers with strong technical and data skills continues to rise. The Irish Independent noted that employers are grappling with talent shortages as the need for AI‑skilled staff accelerates, reinforcing concerns that organisations may struggle to keep pace with technological shifts without more substantial training investment.
Ibec has renewed its call for the Government to unlock the significant surplus within the National Training Fund, which is projected to reach three billion euro by 2030. Costello said programmes such as Skillnet business networks are well regarded internationally but are operating without the funding needed to meet industry demand.
The organisation’s findings point to a labour market caught between rising expectations and limited structural support for workforce development. Many firms are already experiencing delays in project delivery, reduced capacity for innovation and difficulty scaling operations due to shortages in specialist skills. Executives surveyed indicated that these pressures are likely to intensify over the next five years unless training pathways expand and recruitment bottlenecks ease.
While businesses continue to invest in internal training where possible, Ibec’s report signals that voluntary company‑level measures cannot close the gap alone. The group argues that the next phase of Ireland’s economic performance will depend on whether policymakers move swiftly to channel underused resources into strategic workforce development.
For now, employers appear united in their message. The skills challenge is no longer a peripheral concern. It is a central factor shaping the trajectory of Irish competitiveness and the country’s capacity to adapt to the technological transitions underway.
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