Six steps for quick progress for the new Government

We have a new government that says it wants to fix the foundations of our economy to deliver change, and has talked about the infrastructure of opportunity. That includes reforming skills and widening employment opportunity. How can it make a start?

There are no quick fixes

There are no quick fixes. Average wages are £12,000 per year lower than on pre-financial crisis trends, many public services are creaking at the seams, 4.3 million children are growing up in poverty, adult skills participation in England has halved since 2010, employers are investing 26% less in training than in 2005, and, while employment is relatively high, economic inactivity due to long-term sickness has risen rapidly.

Changing all of this will take time and a relentless focus on delivery that makes a tangible difference to people’s lives. The Government hopes to do this through a set of joined-up missions to increase growth and widen opportunity.

The changes the Government has proposed for employment and skills will also take time to implement and to make a difference:

• Reforming skills by introducing Skills England to join up support, a coherent vision for post-16 education, and replacing the apprenticeship levy with a more flexible Growth and Skills Levy.
• Increasing employment by reforming Jobcentre Plus, local Work and Health plans, and a Youth Guarantee for 18-21 year olds.

These changes also need to be joined up to be effective

These changes also need to be joined up to be effective. The Government wants to promote housebuilding and other construction plus the transition to net zero; doing this requires workers with the right skills and is a chance to ensure high quality, well paid work.

But the Government can begin to make a practical difference, a step on those long-term plans, quickly.

Here’s six suggestions:

1. Begin work on a full employment plan focused on extending employment support to all who can work, joining up work, health and skills, and working with employers on recruitment and job design. This could include benefit reforms, replacing the previous government’s consultations on disability benefits. As an early start, the Government could extend UK Shared Prosperity Fund projects (due to end in March 2025) for a year and review Universal Support plans.
2. Introduce Skills England in shadow form, drawing on existing resources in the skills sector. Task this new organisation initially with getting the skills support needed to support the Government’s ambitions for housebuilding and green energy, and widening the remit of Local Skills Improvement Plans to include increasing employer investment in training.
3. Agree devolution trailblazers with mayoral combined authorities in England piloting the new Youth Guarantee, a new one-stop shop approach with jobcentres as hubs for local services, plus a new Essential Skills Guarantee so everyone on an employment programme gets the literacy, numeracy and digital skills support they need.
4. Announce Growth and Skills Levy pilots in green energy and construction, giving limited freedom for employers to invest in qualifications outside apprenticeships, ahead of the wider rollout of the new levy.
5. Pause qualification reform which risks leaving young people and adults with fewer choices. This should include the defunding of a range of vocational qualifications (as T levels are not available in all parts of the country for all subjects) as well as work begun on the Advanced British Standard, pending the new overall post-16 strategy.
6. Commit to work openly and in partnership. Policy will be better if it’s developed in partnership with trade unions, employers and those working in the sector. Be open with data, starting by expanding the Employment Data Lab, recognising that complex problems require a strategic state rather than one-size-fits-all policy.

Of course, none of this negates the need for investment too: benefits are below the levels deemed necessary to cover the cost of essentials; more employment support will cost more money; and the adult skills budget in England is £1 billion lower than in 2010.

Kickstart growth

But it’s not just about public spending. We can achieve more from the resources we have and we must get employers investing more too. If we can kickstart growth and show the difference learning, skills and employment services can make, we can strengthen the case for greater investment still further.

Change isn’t easy. Growth and opportunity are not in the gift of the Government alone – they require all of us to work together. But by making a rapid start we can build a fairer and more prosperous country.

Stephen Evans, Chief Executive of Learning and Work Institute