82% of businesses grappling with critical skills gaps as AI and Digital demands accelerate

• New Ibec report cites cost of training and organisational capacity as key constraints in skills development
• Strategically unlocking the National Training Fund, Springboard+, and micro-qualifications should spearhead a fundamental shift in workforce development
• Life long learning figures still less than half of European leaders

Ibec, the group representing Irish businesses, has published a new skills report which reveals that 82% of firms are reporting significant skills gaps that are actively undermining productivity, innovation, and competitiveness. According to Ibec’s 2025 Skills Survey, the mismatch between available talent and the needs of a modern economy has moved from a marginal concern to a major strategic threat. Employers are expecting the competition for talent to increase in the next five years, further impacting the productivity of businesses in Ireland.

According to the report, most firms are facing significant challenges both in recruiting talent and in addressing skills gaps within their business. The survey confirms that businesses are simultaneously managing intense competition for talent in a tight labour market and escalating pressure to keep pace with emerging technologies, including AI.

Meanwhile, the report also highlights a deepening "preparedness gap" between large firms and resource-constrained SMEs. Large organisations more than twice as likely to be training for AI (30%) compared to their smaller counterparts (13%), as 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.

Ibec believes it is now urgent for the Government to strategically unlock the National Training Fund (NTF). The persistent accumulation of a significant surplus- estimated to reach €3 billion by 2030 even after planned drawdowns- signals a clear underutilisation of resources dedicated to workforce development. While Ireland’s lifelong learning rate has improved to 16%, it remains less than half of that of European leaders like Sweden (42%) and Denmark (32%). 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.

Meadhbh Costello, Senior Executive for Skills and Innovation Policy and report author, said:

"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 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. Recent years has seen a stagnation in training places available in much-needed workforce development programmes. Programmes such as Skillnet business networks are internationally recognised as best in class when it comes to workforce development, yet are underfunded with not enough capacity to meet industry demand.

Without additional supports, these firms risk being left behind in the digital and green transition.

With a €3 billion 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 jumpstart 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."