A severe shortage of skills in Britain is forcing Rolls-Royce, one of Britain’s leading engineering companies, to recruit half its key staff overseas.

The maker of aircraft engines has had to turn to Germany and other European countries in its search for engineers and procurement executives as the pool of talent shrinks in Britain’s declining manufacturing sector.

Yesterday Rolls-Royce blamed its plight on the erosion of Britain’s manufacturing base,which has left talented engineers with fewer opportunities. It also said that industry was not being promoted by universities and schools as an attractive career opportunity.

Sir John Rose, chief executive of Rolls-Royce, is known to have voiced concern that the shrinking of Britain’s industrial sector has deterred school- leavers and graduates from entering the engineering industry because they fear that it will not support them throughout their working lives.

Sir John is also understood to believe that some parts of the Government are promoting creative industries and the services sector, but failing to promote manufacturing.

A company spokeswoman said: “Rolls-Royce has no difficulty in recruiting the required skills at graduate level, but our biggest challenge is finding the right skill sets at mid-career. This is a reflection of the one million manufacturing jobs lost over the last ten years and the loss of critical mass.”

The disclosure that Rolls-Royce is struggling to meet its recruitment needs comes days after the publication of the Leitch review into skills, which gave warning that the UK’s international competitiveness was being damaged by a lack of skilled workers.

Richard Lambert, Director-General of the CBI, said yesterday that not all UK companies would be able to shop abroad for employees like Rolls-Royce. The skills gap would be crippling for firms unable to do so.

Mr Lambert said: “As globalisation takes hold, science and engineering skills are becoming ever more crucial to the UK economy. Yet the education system is not keeping pace — with a stripped-down curriculum, a lack of specialist teachers and lacklustre careers advice all contributing. Whilst some larger firms can turn to overseas recruits to fill the gap, this is not a sustainable long-term solution for the country as a whole.”

The current skills shortage is an embarrassment for Gordon Brown, the Chancellor, who has emphasised his commitment to a knowledge-based economy.

Germany has proved one of Rolls-Royce’s best recruiting grounds because of its strength in engineering. The country boasts global champions, such as DaimlerChrysler and Siemens, as well as many private engineering and manufacturing firms. Rolls-Royce has, however, also recruited from elsewhere in Europe and from Japan and the United States.

The Leitch review recommended that skills training be tailored to business’s needs and called for greater support for sector skills councils, which direct the scope of training for various industries. Its author, Lord Leitch, a Labour peer and former head of Allied Dunbar, also suggested that companies should give staff opportunities to further their education, on top of vocational training.

Mr Brown has appointed Sir Digby Jones, former Director-General of the CBI, as a skills envoy. Sir Digby’s task is to press companies to boost their training provision.

Growing concern over the skill level in British business comes as emerging industrial nations, such as India and China, rapidly improve their skills bases. Businesses fear that those nations, which have so far attracted only commodity work, will soon have a much greater share of the higher added-value production that the West currently holds.

Rolls-Royce does not feel that its own work is immediately threatened by China and India because of the long periods of research and investment needed in aerospace projects. It also has no intention to shift production to lower-cost bases because it believes that its work is resistent to cost pressure because it is so highly skilled. However, the company has increased the proportion of parts that it buys in.

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