Harnessing the Channel Islands’ untapped talent

From tech disruption to geopolitical instability, a range of forces are reconfiguring both local and global economies. Yet for business leaders here in the Channel Islands, one challenge stands out above all others – pressure on the availability of talent and skills.

In PwC’s Channel Islands CEO Survey, 66% of Channel Islands’ CEOs pointed to the shortage of key skills as the most pressing threat to their growth prospects.

Looking ahead, the talent gaps could be exacerbated by the impact of an aging population and low birth rates. Without action, our workforce will shrink and the impact on the economy will be severe. Projections set out in our Boosting the Channel Islands workforce report reveal that by 2040 there will be four older islanders (over 65) for every ten people of working age. The results could not only hold back the economies of Jersey and Guernsey, but also put pressure on tax receipts and the incomes needed to fund public services.

While these demographic shifts might pose significant challenges, they also highlight the opportunity to unlock the full but often underutilised potential of existing talent within Jersey and Guernsey. The key lies in fostering environments that encourage everyone who wants to work to participate actively in the workforce. If Jersey matched New Zealand's employment rates today, the workforce could be boosted by an additional 3,100 employees and GVA could increase by £280 million a year. The corresponding tax increase could be around £65 million a year. If Guernsey matched New Zealand's employment rates today, the workforce could be boosted by an additional 4,500 employees and GVA could increase by £410 million a year. The corresponding tax increase could be around £89 million a year.

Improving employment participation could have benefits for multiple sectors, for example in the digital sector in Guernsey. The Guernsey: Embracing the digital economy report indicates that the digital sector is already a vibrant part of the island's economy, but with significant potential to grow further if talent can be attracted and upskilled into the sector.

The path to maximising workforce participation in the Channel Islands calls for a concerted series of strategic actions by policymakers, employers and islanders:

1. Embrace diversity and inclusion: Promoting greater age diversity in the workforce and developing opportunities for older workers in areas such as skills training would bring a wealth of experience, insight and leadership.
2. Capitalise on experience: Harnessing the capabilities of women returning from career breaks, as well as older islanders not currently employed or volunteering, presents a significant opportunity. Promoting policies that support these groups can alleviate talent gaps and drive GDP growth.
3. Encourage civic and community engagement: Participation doesn't solely revolve around paid employment. As highlighted in our Value of the Third Sector report, volunteering plays an instrumental role in bolstering our communities and economies. Greater civic and community engagement can yield substantial benefits for islanders and those they serve, enhancing the vibrancy and dynamism of our local economies.
4. Learn from the leaders: New Zealand, Singapore and Iceland are the economies that are leading the way on workforce participation. Achieving employment rates similar to New Zealand could increase the Channel Islands' workforce by an additional 7,500 employees. These economies have also seen the positive impact on the health and wellbeing of the population, as well as the boost to the economy and public finances.

As we embark on this journey, collaboration remains key. We at PwC want to encourage open discussions with all stakeholders – policymakers, employers, educators, industry groups and community members – seeking inclusive solutions to bolster our workforce prospects. As part of the key recommendations in our report, PwC urges the Channel Islands governments to consider appointing a 'Lifelong Employment Commissioner' to drive participation. Together, we can forge a path that ensures our economies remain dynamic, vibrant and inclusive for years to come.

To find out more about how to harness the potential, see our Boosting the Channel Islands workforce report. If you would like to discuss any of the issues raised in the report, please get in touch.