Shortage of language skills and its economic cost

Foreign curreny notes

A shortage of language skills has been identified as a barrier to trade. According to a recent British Chamber of Commerce survey, 70% of businesses have no foreign language abilities in the markets they serve. With the second-biggest UK export market being Germany, insufficient German language skills would hold back any company trying to conduct business in that country. The same goes for other German-speaking countries in Europe.

Addressing gaps in business skills, including language skills, should be the priority of many businesses. It is said that the economic costs of language ignorance, in terms of communication and awareness of cultural barriers, were up to £48bn or 3.5% of national income.

A better understanding of language and culture enables businesses to identify and exploit sales opportunities in overseas markets.

A British Council report identified languages of crucial importance for the UK’s future prosperity. The report pointed out how leaving the EU had given importance to developing language skills. The UK has reached a critical juncture where investment in language skills is vital. 

Recent Aston Business School research found that SMEs making use of languages had 30% better success in exporting and that languages helped the internationalisation of UK SMEs, which employ 61% of the total UK workforce.

Language skills also help increase employment opportunities and social mobility. A recent Confederation of British Industry (CBI) survey noted that learning foreign languages expands the horizon of young people. The survey endorsed the inclusion of a foreign language in the English Baccalaureate. 

Languages are strategically vital for the future of the UK. But there is overwhelming evidence of an inadequate, longstanding, and worsening supply of the language skills needed by the UK to meet future needs. Both in education and the workplace, the UK has depended heavily on the skills of EU nationals. They continue to play a vital role, but this is an opportunity to refocus on the language skills of UK citizens.

Where does the business stand that you work for? Does it have adequate foreign language skills?

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