There is a tendency in some quarters to regard skill deficiencies simply as a consequence of the business cycle. The evidence does not support such a conclusion and points to more complex underlying causes and more serious consequences. It is clear that skill deficiencies are widespread across organisations. Many employers reported that they experienced recruitment problems related to the availability of skills, and/or that their existing workforce was not proficient enough to meet the needs of the business. Moreover, it is demonstrated that, where they exist, such problems have had a significant impact on organisations’ economic performance, both with regard to employers’ immediate perceptions and their effect on the longer-term performance of business. In aggregate, this has important implications for the overall performance of the economy and national wealth. In this sense there is a very real skills problem: skills matter.