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This research focused on investigating perceptions of the socio economic impact of skills shortage on the community of Khayelitsha, Western Cape. The objectives of this study were to critically investigate the causes of skills shortage in the community of Khayelitsha; to assess the perceived social impacts that it has on the community; and to critically investigate whether skills shortage is one of the causes of unemployment. The research also went as far as examining measures, which were taken by government and other stakeholders to address skills shortage. this material provides information related to a background of the research under study. It briefly considers skills shortage, globally, prior to looking thoroughly at the causes for skills shortage in Khayelitsha. It further presents evidence of skills shortage in South Africa by considering different sectors. Furthermore, the research also details the social and the economic impact of skills shortage, the state of poverty and inequality, as well as the state of unemployment. additionally, it also details the role of government and other stakeholders to address skill shortage.