MORE than one-third of Scottish companies have seen activity hit by skills shortages, a Brexit impact study reveals, and 41 per cent have experienced increased staff turnover since the June 2016 Leave vote.

The study shows 44% of Scottish firms are having difficulty recruiting skilled staff.

Of the 34% of companies north of the Border reporting that skills shortages have impacted upon their activity, half said this issue had affected their revenue growth and business expansion, and 45 per cent declared it had made it harder to respond to customer needs.

The study was conducted by Bank of Scotland owner Lloyds Banking Group and the London First business membership organisation to analyse the impact of Brexit on business recruitment and access to skills across the UK.

The study found that, for businesses across the UK facing challenges in recruiting, fewer applications by citizens of other European Union countries “is the number one cause”.

On the staff turnover front, the study highlights uncertainty for workers from other EU countries in the wake of the Brexit vote.

Figures published by the Office for National Statistics have shown a sharp decline in net immigration of citizens of other EU countries to the UK since the Brexit vote.

Lloyds Banking Group said the biggest skills gap reported by respondents in Scotland related to “technical and job-specific skills”.

It added that this was “reflective of the largest portion of respondents being in the manufacturing sector”.

Lloyds Banking Group noted that many respondents thought the skills gaps would persist over the next 18 months, “reflecting the UK’s long-term challenge in tackling its skills shortages”.

About 47 per cent of Scottish firms said they would be focusing on improving skill-sets in the next 18 months as part of their recruitment efforts.

Around 56 per cent are already engaged with local schools, colleges and universities. And 53 per cent of firms north of the Border want to work with more education providers, according to the survey However, 21 per cent declared they did not have enough time or staff resource to engage with more schools.

Nearly one-third of Scottish companies surveyed employ apprentices. Of these firms, 43 per cent plan to hire more apprentices over the next couple of years.

Lloyds Banking Group said: “Having the right access to skills is vital for any business to grow, and being able to hire and retain talented people should be at the top of the agenda for firms across Scotland.”

The study was conducted in January and February, and 59 Scottish firms were surveyed.

Of these companies, 11 had an annual turnover of more than £750 million. Meanwhile, 15 were in the £25m to £749m annual turnover bracket.

British Chambers of Commerce warned in January that skills shortages were “reaching critical levels”. It flagged Brexit as one key factor in recruitment difficulties for companies, in terms of some people from other EU countries consequently being less inclined to choose to work in the UK.

Scottish Chambers of Commerce warned in January that recruitment difficulties had continued to worsen for a number of sectors north of the Border, particularly manufacturing, tourism, and financial and business services.

Outgoing Scottish Engineering chief executive Bryan Buchan highlighted continuing skills shortages when the industry body published its December 2017 report on sector conditions.

Mr Buchan warned the pound’s weakness was causing companies to lose staff from other EU countries, who were choosing to move elsewhere.

He said then: “The issue there is craftspeople who have come across from Eastern Europe who are looking at what they can earn in euros in Germany [compared with] what they can earn here - it suddenly becomes a less attractive proposition to work in the UK.”