Skills Shortages and Workplace Safety: When Labour Shortages Become an Operational Risk

Does your organisation have the people and capabilities it needs to manage critical risks even as workloads, turnover and operational pressure increase?

AR19 helps organisations assess the competencies, human factors and organisational conditions that shape safety and performance, designing assessment, development and improvement programmes aligned with their operational context.

Abstract

Workforce and skills shortages are no longer merely recruitment challenges. In highly complex operational sectors, they can affect supervision, decision quality, the ability to recognise anomalies and the effectiveness of safety controls. Understanding the relationship between labour shortages, competencies and operational risk helps organisations move beyond headcount management towards a genuine competence assurance strategy.

Why have skills shortages also become a workplace safety issue?

Skills shortages can increase operational risk when an organisation continues to demand the same levels of activity and performance despite having less experience, reduced supervisory capacity or insufficiently developed competencies.

On 6 October 2026, EU-OSHA highlighted the relationship between labour shortages and job quality. Together with Cedefop, the European Agency pointed out that occupations experiencing staff shortages are concentrated in essential sectors such as construction, manufacturing, transport, healthcare and social care. These sectors often involve demanding working conditions and significant health and safety risks.

The issue therefore extends beyond the traditional remit of human resources.

When a company struggles to recruit qualified people, loses experienced professionals or faces high turnover, the problem goes beyond filling vacancies. It can change how work is organised, supervised and carried out.

As early as April 2026, EU-OSHA had explored this relationship, noting that labour shortages are becoming structural in some European industries. At the same time, good health and safety conditions can improve job quality, employee retention and an organisation’s ability to attract people.

This connection deserves attention: safety, skills availability and the ability to retain employees are increasingly part of the same organisational challenge.

In brief

Staff shortages become a safety risk when they reduce available competencies, supervision, operational experience or the ability to manage unforeseen events. Counting the people on site is not enough. Organisations need to understand which competencies are essential to control critical risks, how much the system depends on individual professionals and whether people can apply their knowledge and procedures under real working conditions.

How can labour shortages change operational risk?

Labour shortages primarily affect risk through their impact on how work is organised.

An understaffed department may rely more heavily on overtime. High turnover can push less experienced people into complex roles too quickly. Difficulty recruiting specialists can concentrate tasks and responsibilities in a few individuals. Production pressure can reduce the time available for supervision, discussion and learning.

The ERM Sustainability Institute's 2026 Annual Trends Report provides a revealing picture. A global survey of EHS professionals cited in the report identifies high turnover, recruitment difficulties and new hires as the leading obstacle to progress in EHS programmes for 55% of respondents. Some 34% report inadequate training, while 31% cite time and staffing shortages that reduce EHS supervision.

These findings illustrate why the number of available employees tells only part of the story.

What matters is the combination of staffing, experience, competence, workload, supervision and task complexity.

The same workload can carry a different risk profile when a team loses a senior colleague, takes on many new employees at once or spreads supervision across an increasing number of activities.

Why does losing an experienced employee mean losing more than one resource?

When a long-serving employee leaves, the organisation may also lose part of its operational knowledge.

Not all the knowledge required to work safely is captured in procedures.

Experience enables people to recognise an unusual noise, interpret a seemingly minor change, notice when an activity is deviating from expectations or recall what happened the last time a similar situation occurred.

This knowledge, often called tacit knowledge, develops through experience and continuous engagement with real work.

The issue becomes particularly apparent in safety-critical activities. The Energy Institute has long emphasised that safe operations require sufficient competent people to be available when and where they are needed. Problem-solving, vigilance, analysis and decision-making all depend on this availability. Excessive workloads and inadequate staffing levels can affect human performance, fatigue and decision quality.

In October 2026, the Energy Institute extended this analysis to managerial and technical assurance roles. Its new work on safe staffing levels highlights how gaps in supervision, competencies and workload management can remain largely invisible until they contribute to significant safety events.

This raises a question that goes beyond workforce planning: what knowledge could we lose when that person is no longer available?

What does ‘competence dilution’ mean within an organisation?

Competence dilution occurs when headcount appears adequate but the concentration of experience and capabilities actually available within the system declines.

An organisation may therefore cover every shift and still become more vulnerable.

This can happen during rapid growth, periods of high turnover or when a company recruits many people at the same time. It can also occur when operations expand faster than internal competencies develop.

A team of ten experienced employees does not necessarily have the same operational capability as a team of ten in which eight are new starters.

The headcount is identical.

The ability to recognise and manage risk is not.

This matters especially when work demands judgement, adaptability, contextual knowledge and the recognition of signals that rarely fit neatly into a checklist.

In its 2026 reflections on the conditions required to maintain an effective system of defences, IOGP identifies the detection and closure of critical competence gaps as a fundamental activity, alongside verifying controls and learning from how work actually happens.

Does completing training really demonstrate competence?

Completing a training course shows that someone has attended a programme; it does not automatically prove that they can apply their knowledge and skills in real operational conditions. The distinction between training and competence lies at the heart of this issue.

Training transfers knowledge and develops skills. Competence becomes evident when someone can use those resources to carry out a task correctly, including when conditions vary, pressure increases or the situation differs from the original training exercise.

For critical activities, competence management should therefore include observation, performance assessments, coaching, simulations, refresher training and opportunities to learn from more experienced colleagues.

The Energy Institute identifies the availability of people with the right capabilities, experience and competencies as an essential component of process safety. Competence management consequently covers selection, onboarding, development, monitoring critical tasks and reviewing work patterns and overtime.

This perspective shifts attention from ‘Has this person completed the course?’ to a far more useful question: can they carry out this activity safely when real conditions change?

When do the most experienced employees become a hidden vulnerability?

Experienced employees are essential assets, but excessive reliance on a handful of individuals can create organisational fragility.

This often happens without the company realising it.

The manager everyone calls when a problem arises. The technician who knows every anomaly in the plant. The supervisor who can always recover a complex situation. The colleague who informally trains every new starter.

These people strengthen the system's ability to adapt.

But when the organisation functions effectively only because they are present, it develops a critical dependency on individual people.

Holidays, illness, resignations, retirement or simply excessive workloads can suddenly expose that weakness.

A mature organisation should therefore identify not just its critical equipment, supplies and processes, but also the competencies for which it has little redundancy.

Succession planning, mentoring, on-the-job shadowing and structured knowledge transfer consequently become risk management activities as well.

How can organisations tell whether staff shortages are already affecting safety?

Early warning signs can appear long before an incident. Organisations should monitor persistently rising overtime, reduced supervisor presence in the field, frequent assignment of inexperienced workers to complex activities, decisions concentrated in a few individuals and difficulty releasing employees for training, coaching or refresher programmes.

Other signals emerge in everyday work: postponed activities, checks carried out too quickly, growing reliance on workarounds, poorer handovers and difficulty covering routine operations and emergencies at the same time.

Not all these factors automatically indicate an unsafe situation.

Together, however, they may reveal that the system is losing its safety margin.

Assessments should therefore combine HR data, HSE information and observations of real work. Turnover, average experience in a role, overtime, coverage of critical competencies, supervisor availability and assessment findings offer management a more complete picture than headcount alone.

Why must workforce planning and safety management work together?

Workforce planning and safety management must work together because staffing decisions can directly change an organisation's ability to control risk. Traditionally, HR examines people, roles, recruitment and succession, while HSE examines hazards, controls and safety performance. This separation becomes less effective when competence itself acts as a risk control barrier.

Where a task demands specific experience, sound judgement or qualified supervision, the availability of those competencies should form part of the risk assessment.

The question is therefore not simply ‘How many people do we need?’

At least three more questions matter: which competencies must always be available? Which activities cannot depend on one individual? How long does a new employee need to become truly autonomous?

From this perspective, workforce planning becomes part of the organisation's operational capability.

What practical steps can companies take?

As we often explain in our courses, the first step is to distinguish important roles from the roles and competencies that are genuinely critical to risk control. The organisation can then map available competencies, experience levels, authorisations to perform specific tasks, the time needed to develop new specialists and the degree of dependency on individuals.

A useful competence matrix should therefore do more than record training courses and expiry dates. It should show how capable the system really is of managing critical activities under different operational conditions.

Field assessments, mentoring, coaching, realistic simulations and technical and non-technical skills development can support this analysis. Decision-making, communication, situational awareness and the ability to recognise weak signals are especially important in roles where a poor decision could have serious consequences.

One principle remains central: competence assurance is not about proving that people have received training. It is about establishing reasonable evidence that they possess and retain the capabilities required to perform their roles safely.

From headcount management to safety capability: AR19's perspective

At AR19, we see competence as part of the system through which an organisation manages risk. An effective assessment should therefore look beyond staffing numbers and certificates. It must also examine how knowledge, experience, leadership, work organisation and human factors interact in real operating conditions.

Skills shortages become particularly critical when they weaken the system's ability to recognise weak signals, maintain effective controls, manage unforeseen situations or make sound decisions under pressure.

The answer is not to deliver more training indiscriminately.

Organisations need to understand which competencies genuinely protect them, where gaps and dependencies exist and how to transfer knowledge before turnover, growth or organisational change exposes those weaknesses.

This approach brings workforce, human factors, leadership and safety management together around one question: does the organisation have today, and will it have tomorrow, the capabilities required to operate reliably?

For companies, this is an increasingly strategic question. A vacant position may be an HR issue. A missing critical competence, however, is a risk to the entire organisation.

FAQ

What does skills shortage mean?

A skills shortage occurs when employers cannot find sufficient people with the competencies they need, either in the labour market or within their own organisation. It does not necessarily mean that workers are unavailable overall: candidates may exist but lack the experience or capabilities required for specific roles.

Can staff shortages increase the risk of workplace accidents?

They can contribute to higher risk when they lead to excessive workloads, fatigue, reduced supervision, less experience on hand or greater pressure on operations. The impact depends on the sector, the tasks involved and how the organisation manages the shortage.

What is the difference between training and competence?

Training builds knowledge and skills. Competence is the demonstrated ability to apply them correctly in a particular role. Completing a course alone does not always prove that someone can manage a real-world situation.

What is competence assurance?

Competence assurance comprises the processes through which an organisation defines required competencies, develops its people, evaluates their ability to carry out specific tasks and checks that those competencies remain effective over time.

Which competencies become most critical during labour shortages?

It depends on the operational context. Particular attention should go to competencies involving safety-critical activities, supervision, maintenance, emergency response, verification of critical controls and decision-making in unusual or high-pressure situations.

Sources

European Agency for Safety and Health at Work, Safer and healthier workplaces can help tackle labour shortages, 6 October 2026. EU-OSHA – Labour shortages and OSH

EU-OSHA, Increasing labour shortages in Europe – key considerations for occupational safety and health policy and practices, 23 April 2026. EU-OSHA – Discussion paper

ERM Sustainability Institute, 2026 Annual Trends Report: Competing Pressures, New Approaches. ERM – Annual Trends Report 2026

Energy Institute, Research report: Safe staffing levels in relation to managerial roles and assurance roles, October 2026. Energy Institute – Safe staffing levels

IOGP, Safety Directorate Reflections – June 2026. IOGP – Human performance and competence

Abu Dhabi Public Health Centre, Qudorat – Competency-Based Regulatory Framework, 2026. ADPHC – Qudorat

Ministry of Higher Education and Scientific Research / MOHRE, UAE Skills Platform, 2026. UAE Skills Platform