IMI 2023 Baseline Report: Automotive sector on a roller coaster

Despite a decline in automotive businesses and job roles, the sector still sees record high in vacancies and continued lack of diversity.

The annual Institute of the Motor Industry (IMI) Baseline Report underlines the challenging conditions faced by the UK automotive sector. The 2023 data shows that the number of automotive businesses has fallen, as has the number of job roles, while job vacancies have risen to a 21 year record high.

Key data:

• 758,000 jobs in the automotive sector – 742,600 in 2022
• Sector contributed £37 billion gross value added (GVA) to the UK economy in 2022
• 78% of jobs are within the automotive retail sectors, the remaining 22% are in automotive manufacturing
• 98,500 establishments (businesses) in the sector - 97% of these are in automotive retail (100,000 in 2022)
• 19% of the sector are female (20% in 2022)
• 39% are aged under 35 – 1% increase on 2022 when it was 38%

The detailed report, ‘Driving Forces: Unveiling the Landscape of the UK Automotive Labour Market’, shows that job opportunities in the sector are growing even while the number of businesses operating in automotive has seen a small decline.

“Our sector has been facing a number of challenges for some time and the high number of vacancies follows the steady trend we have seen in recent years,” commented Steve Nash, CEO of the IMI. “Vacancies are now at the highest we have seen in more than two decades, and that is a real concern for the ever-growing skills gap. Added to that, we have seen the number of businesses in the industry fall, meaning it is harder for motorists to find a local dealer or garage. This means upskilling is more important than ever so that the businesses that remain can provide the services customers need as automotive technology evolves.”

The shrinkage in automotive businesses in the UK in the past 12 months, coupled with the contraction in number of industry occupations – now 213, down from 218 in 2022 – are likely to be reflections of the modernisation of the industry. Businesses are retiring roles that are becoming obsolete due to new technology, while others opt to close their doors instead of investing in updating tech and carrying out the additional training needed to fill skills gaps.

Another area in which the automotive industry has historically faced challenges is diversity. Unfortunately, these challenges continue.  The 2023 figures reveal that 19% of the automotive sector comprises female employees, down from 20% in 2022. However, there is a small encouraging sign that the sector is appealing to younger people with 39% of the workforce aged younger than 35 compared to 38% in 2022.

“To ensure the automotive sector continues to serve customers and their vehicles as technology evolves and we move closer to the end of petrol and diesel engines, we must urgently fill the growing skills gap”, concluded Steve Nash. “More support and training is essential and overdue to better equip our existing and future workforce. And, to attract the best future employees across all roles, we need to work together to increase diversity. It is great to see a larger number of young people joining automotive, but the fall in the proportion of women is a real concern – we need the opposite.

“A more diverse sector will be stronger, more successful and more resilient, better able to serve every motorist in the UK.”

To download a copy of the report click here