Tax, Skills and Investment Report

The research reveals a clear appetite for a skills tax credit. Not only do a majority support a subsidy but two in five respondents indicating that tax relief could increase their skills investment by as much as 29%. 

While a skills tax credit is not a silver bullet for every workforce challenge facing the sector, the findings demonstrate its potential to unlock greater employer investment in skills.

SMEs are the backbone of UK engineering and manufacturing, yet in an increasingly challenging economic and fiscal environment many businesses struggle to invest in the skills development they need to grow, innovate and remain competitive. 

Drawing on evidence from Enginuity’s SME network, the report provides new insights into the barriers businesses face when investing in training and skills, and examines how a targeted skills tax credit could help overcome them. 

This research marks the beginning of a wider conversation about how best to support skills investment in engineering and manufacturing SMEs.

Building on these findings, Enginuity will continue to look into this research and explore the feasibility of a skills tax credit to strengthen the evidence of its potential impact with other partners and Government.

The Policy Centre for Supply Chain and SMEs, powered by Enginuity, unifies and amplifies the voice of the UK’s engineering and manufacturing SMEs and the supply chain.