Rebuilding The Skills Ecosystem: Colleges That Collaborate Are Making The Biggest Gains

In further education policy, “closing skills gaps” is often framed as a technical challenge with straightforward solutions: expand provision, add courses, increase qualification levels. It’s a simple and appealing narrative – but as many FE colleges know from experience, one that doesn’t hold up in practice.

Consider places like Grimsby

To understand why, consider places like Grimsby, as I do in the newly released The Local and Regional Economic Development Handbook. Once home to one of the world’s largest fishing fleets, the town’s industry created not just jobs but an entire ecosystem of skills, knowledge and identity. When that industry collapsed in the 1970s, the loss extended far beyond employment. The mechanisms through which skills were passed down and reinforced across generations also disappeared.

Britain’s ‘worklessness capital’

Today, the situation is paradoxical. There are well-paid opportunities in sectors such as offshore wind, and local training provision exists to support them. Colleges are delivering relevant, industry-aligned courses. Yet the town was called Britain’s ‘worklessness capital’ by BBC News in December 2024, and vacancies remain unfilled while unemployment persists. This is not a failure of FE, but a failure to recognise what skills systems actually are.

A key misunderstanding in policy is the tendency to equate qualifications with skills. Qualifications provide structure and signals to employers, but they are not the same as workplace competence. Skills are developed through a combination of knowledge, practice, experience and context. They reflect what people can do, not just what they have studied.

While FE plays a central role in skills development, as an FE college Principal will tell you, it operates within a much broader system. Skills are shaped as much by family expectations, peer groups and local labour markets as by formal education. When these elements align, skills development becomes embedded in everyday life. When they do not, even strong provision struggles to deliver outcomes.

Invisible Infrastructure

This highlights the importance of what might be called “invisible infrastructure.” In places where skills systems function well, networks and norms support progression. Parents understand career pathways, young people see examples of skilled work, and employers are meaningfully connected to education providers. There is a shared belief in the value of training and development.

Where this infrastructure has broken down, the challenge becomes far more complex than simply adding courses. Individuals may not see the relevance of training, may lack confidence, or may be disconnected from the networks that link education to employment. In such contexts, FE colleges are being asked to address issues that extend beyond their traditional remit.

The local nature of labour markets further complicates the picture

The local nature of labour markets further complicates the picture. Most people work close to where they live, meaning that skills supply and demand are shaped by local conditions rather than national trends. A shortage in one region cannot easily be offset by a surplus in another. National strategies often miss these nuances, reinforcing the need for FE leaders to engage deeply with local employers and communities.

At the same time, mismatches persist across the system. Employers report difficulties finding the skills they need, while individuals struggle to access good-quality jobs. Training provision exists, but it does not always translate into employment outcomes. This points to a coordination problem rather than simply a supply issue.

Employers, particularly smaller firms, often struggle to articulate their skills needs. Individuals have imperfect information about which pathways lead to sustainable careers. The system can feel fragmented and difficult to navigate. In this environment, qualifications become proxies for skills – useful, but imperfect indicators of actual capability.

Policy discussions tend to focus on sectors rather than skills

Policy discussions also tend to focus on sectors rather than skills. While emphasis is placed on areas such as digital or green industries, sectors are made up of diverse occupations requiring varied skill sets. A single firm may need engineers, administrators, technicians and managers. Narrow sector-based approaches risk overlooking this complexity.

For FE, this creates a balancing act. Colleges must deliver specialist technical skills aligned to growth areas while also developing broader capabilities that enable individuals to adapt and progress. Skills such as communication, problem-solving and resilience – often labelled “soft skills” – are central to workplace effectiveness.

These capabilities are harder to teach and assess than technical knowledge. They develop through experience, feedback and real-world application, raising important questions about how FE programmes are designed and delivered.

Alongside these, life skills such as digital literacy, financial awareness and time management play a crucial role in enabling labour market participation. Though often overlooked, they can determine whether individuals are able to access and sustain employment.

All of this is unfolding in a context of rapid change. Technological advances, demographic shifts and the transition to a low-carbon economy are reshaping skills demand. Roles are evolving and new ones are emerging, making adaptability the most important capability of all.

FE has a vital role in supporting lifelong learning, but barriers remain. Costs, time constraints and limited support make retraining difficult, particularly for those on lower incomes. If a resilient workforce is the goal, greater attention must be given to enabling continuous skills development through flexible provision, improved financial support and stronger incentives for employer investment.

The economic case for skills is clear: a skilled workforce drives productivity, innovation and investment. Regions with strong skills bases are better positioned to compete in high-value sectors. However, the relationship between skills and prosperity is not automatic. It depends on alignment between skills supply and the availability of quality jobs.

The importance of integration

This underlines the importance of integration. Skills policy cannot be developed in isolation from economic development, industrial strategy or local growth plans. It requires collaboration across institutions and a willingness to engage with the complexity of real-world labour markets.

Ultimately, skills systems are ecosystems made up of interconnected elements: education providers, employers, individuals, communities and institutions. Strengthening one part without addressing the others will have limited impact.

The story of Grimsby illustrates this point. The challenge is not just to provide training, but to rebuild the networks, expectations and cultural foundations that make skills development meaningful. This includes careers guidance aligned to local opportunities, deeper employer engagement, and clear, visible pathways that show where training can lead.

FE is central to this effort, but it cannot do it alone. Colleges are increasingly being asked to act as anchors within local economies, connecting people, institutions and opportunities. This presents both a challenge and an opportunity.

There is no single solution to the UK’s skills challenges. Expanding provision, reforming qualifications and launching new initiatives all have a role to play, but none are sufficient in isolation. What is needed is a more holistic, place-based approach that recognises the complexity of skills systems and works to strengthen them as a whole.

In the end, skills are not just about what people know – they are about what people can do, and whether their environment enables them to do it.

By Dr Glenn Athey, author of The Local and Regional Economic Development Handbook