Skills are central to Londoners’ life chances and to the city’s economic success. Access to education and training enables people to improve their employment prospects and adapt to a changing labour market, while a skilled workforce supports productivity and innovation. This chapter examines skills levels among Londoners and how well the city’s skills system meets the needs of employers.
Skills and learner outcomes
This section examines the skills of London’s population, including the proportion with no qualifications and the proportion with Level 3 and above qualifications. It also looks at progression into employment or further learning among Further and Higher Education learners.
Across the 2015-2025 time series, the proportion of London’s working age population without qualifications shows a moderate downward trend. The latest figures for London show a decrease from 5.6% to 5.2% between 2024 and 2025 which sits well below the 2015 level of 7.4%. This corresponds to around 300,000 individuals in London in 2025 without qualifications. The UK follows the same overall pattern and had a consistently higher share of people without qualifications than London for the whole time period.
Correspondingly, the proportion of working-age Londoners with higher level qualifications has been increasing over time. The 16-64 population with a Level 3 qualification or higher (equivalent to two A level qualifications or higher, including degrees) increased by 12.6 percentage points between 2015 and 2025.
The latest data shows that 77% of Londoners aged 16-64 (around 4.7 million people) hold a Level 3 or above qualification, higher than for the UK average of 69%.
London’s latest labour market outcomes for adult (19+) FE learners cover the 2022/23 academic year and include around 163,000 people who completed education, training, or apprenticeships.1
Overall, 72% achieved a Sustained Positive Destination (SPD), meaning they were in employment, further learning, or both for at least six months in 2023/24. This remains below the England average of 77%, and the gap has widened since the previous year, when London recorded 74% compared with England’s 76%.
Changes in London’s SPD rates over time are driven mainly by shifts in sustained employment, while sustained learning has stayed relatively stable. SPD peaked at 78% in 2020/21, reflecting unusually strong employer demand and high vacancy levels following the pandemic. In the most recent data, sustained employment has fallen back, bringing London’s overall SPD rate closer to pre‑pandemic levels.
The latest available data shows that in 2020/21, 86% of around 43,000 Higher Education Institution graduates in London were in a positive destination (employment or further study) one year after graduating.2
This represents a small decline from the previous year when the figure was 88%. London’s rate is also slightly lower than the England average (by around four percentage points in 2020/21). Together, these patterns suggest that while outcomes remain strong overall, London graduates may face a slightly more competitive transition into the labour market than their peers elsewhere in England, reflecting both the higher concentration of degree-qualified workers and London’s openness to international talent.
Skills in the economy
This section examines skills needs in London’s economy, including: employers’ views on the proficiency of their workforce; skills shortage vacancies; employer provision of training; and data on job postings identifying the skills most in demand.
Between 2015 and 2022, the percentage of employees who were judged as ‘not fully proficient at their job’ by their employer, also called the skills gap density, increased from 5% (223,300 employees) to reach a post-pandemic high of 5.8% (296,700 employees). A similar trend was seen across England.
In 2024, the skills gap density in London declined slightly to 5.6% (309,500 employees), however this was still higher than the pre-pandemic figure of 3.8% (190,400 employees) and only marginally below the 2022 peak. At the England level the skills gap declined to below the pre-pandemic level in 2024.
‘Skills shortage vacancies’ refer to vacancies that employers struggle to fill due to a lack of skills, qualifications or experience amongst applicants. Skills shortage vacancies can have an impact on economic growth, as employers cannot fill critical roles, negatively affecting their productivity if longer-term objectives such as expansion or innovation are constrained.
The share of skills shortage vacancies, amongst all job vacancies in London, increased between 2015 and 2022, from 20% to 32%. The sharp increase between 2020 and 2022 may reflect, at least in part, higher levels of unmet skills demand in the period after the pandemic. In 2022, the share of skills shortage vacancies was 4 percentage points below the share across all of England. Data for 2024 shows some improvement, with the share of skills shortage vacancies in London declining to 24%, but this remains above the 2019 level of 21%. A similar trend was observed at the national level.
Employer provision of training is important to ensure that courses are well tailored to the needs of firms and, in turn, London’s economy. Employers can provide either training that equips employees for the requirements of their current job (defined in the Employer Skills Survey as on-the-job training) or training that goes beyond that (off-the-job training).
Employer investment in training has declined over recent years. Since 2015, training provision by London employers has fallen by 6 percentage points (from 65% to 59%). Evidence suggests that a wide range of factors could be driving these trends, including: rising cost pressures; constraints on employer capacity to plan and deliver training; and a shifting of responsibility for training onto individuals. The overall trend in provision in London is similar to that for the whole of England.
Online job posting numbers are a useful, albeit imperfect, indicator of real-time employer demand for labour. Between the latter half of 2022 and the beginning of 2025, job posting numbers trended steadily downwards and are now aligned with pre-pandemic levels. This trend reflects a gradual cooling and stabilisation of London’s labour market.
While the onset of the pandemic had an adverse impact on recruitment activity in early 2020, this reversed rapidly following widescale societal reopening and resurgent economic activity.
Lightcast job posting data provide insights into the common and specialised skills most sought after by employers in London, and how these are changing over time. The common, or transferable, skills most in demand in Q1 2026 included communication, management and leadership. Since the pandemic, the largest increases in the frequency in which skills are mentioned in job postings have been for communication, leadership, detail-orientated, operations and problem solving.
Similarly, technical or specialised skills, such as core business skills including project management, finance and marketing, have remained consistently in demand since before the pandemic. However, demand for expertise related to governance, continuous improvement processes and AI, has grown strongly in recent years.
The rapid growth in demand for AI-related skills, such as experience using generative AI models, prompt engineering, machine learning, and agentic systems, reflects businesses’ growing recognition of AI’s potentially transformative effects on their operations and, in turn, on London’s labour market. Alongside reported investment in staff upskilling initiatives, the job postings data suggests that employers are actively seeking to build an AI-enabled workforce and increasingly expect workers across the occupational spectrum to have the skills needed to support this transition. For more information on AI’s potential labour market implications for London see the GLA Economics report linked below.