Mike Thompson, Chief Executive, Sustain HR Limited

Time to reverse the decline

As I talk to clients from across different sectors of our economy about their future skills needs a common theme emerges which is that, to survive and flourish, businesses must reverse the decades long decline in investment in workforce training that we have seen in the UK.

It is clear that businesses large and small see themselves in the midst of a skills revolution driven by the ever growing pace of technological change that has revolutionised traditional business models and changed consumer behaviours and preferences for how they consume goods and services.

Many businesses have recognised that they need to invest significantly in new technologies and new skills within their workforce to meet this challenge head on but this re-skilling effort is often hampered by a lack of available learning and development budget which has been repeatedly scaled back year on year.

It is made even more challenging in larger more established businesses by the sheer scale of the re-skilling efforts required and an ageing demographic with the workforce.

Delivery models challenged by emerging technologies in all sectors

No industry I talk to appears untouched, with even the more traditional sectors such as Insurance or Law seeing their delivery models challenged by emerging technologies such as Artificial Intelligence and digitisation.

At a recent visit to the Barclays Law Eagle lab I saw how start up tech firms are partnering with major law firms to look at how to create new ways of meeting client needs through technology.

These type of incubator hubs will become common place and will fuel the success of our businesses in the modern world but moving from old models to new will be painful.

Historically, to meet their current and future skills needs businesses have looked to recruit either experienced skilled labour or develop early in career graduate talent.

Increasingly this avenue is becoming more problematic with graduate talent often difficult to attract and subsequently hold on to and skilled labour only available at a premium if available at all. Brexit can only exacerbate this.

Business Barometer 2019

The latest research  from the Open University drives home this point with some incredibly stark figures and costs to business of the current skills shortage

The research reveals that organisations spent £4.4 billion on temporary staff, recruitment fees and increased salaries in the past 12 months due to difficulties finding employees with the right qualifications and experience.

Key Findings: 

  • Over two-thirds (68%) of employers have struggled to find the right skilled workers over the last 12 months 
  • Organisations report a 33 per cent increase in spending on recruitment fees in the last 12 months as they try to attract talent
  • But more than half (53%) of organisations report increasing training budgets, in an attempt to develop a more sustainable solution to skills gaps
  • The skills shortage comes as the UK employment rate stands at the highest level since 1971. The dearth of skills in the labour market means that recruitment is taking one month and 27 days longer than anticipated, forcing many to seek external help. 
  • Three in five (59%) senior business leaders agree that the skills shortage will worsen after the UK officially leaves the European Union, which may explain the shift to focus on home-grown talent. 
  • While seven in 10 (71%) employers agree that developing the skills of the existing workforce is a more sustainable approach, it is crucial that any training helps to support business objectives, while offering as much as value as possible.

Decades of underinvestment in skills

The skills gap has come about due to years, if not decades, of employers underinvesting in skills and a consequent stagnation in productivity.

The greatest area of under investment that I experienced in my corporate career was in leadership development where an army of accidental managers was created as strong “technicians” were promoted into leadership positions without sufficient training and development.

The knock -on effect of this has been poor employee engagement, productivity and wellbeing.

The advent of the Apprenticeship Levy and degree apprenticeships has handed businesses the key to unlock this issue with access to the highest levels of leadership development now an affordable reality.

Many businesses are grasping this opportunity with both hands and will reap the benefits but, incredibly, many still have little or no awareness or understanding of how they can take advantage of both the funding and access to learning that is available.

Advertisement

This is leaving vast sums of levy unspent which at best is a missed opportunity for L&D professionals and at worst a true dereliction of their duty of develop the skills their businesses desperately need.

Higher level technical skills

It isn’t just Leadership skills where businesses aren’t taking full advantage of the Levy it is also higher level technical skills such as IT, Data Analytics and Engineering where there are desperate shortages of skill but where numbers of starts on degree or degree level apprenticeships is growing but still well below what you would hope to see.

There are a number of factors contributing to this but probably the most concerning is the simple lack of understanding of the levy and the opportunities it presents.

There is no doubt that awareness of apprenticeships is higher than it has been for a long time but understanding of how to reap the benefits of apprenticeships remains low.

The DfE must think long and hard about how to stimulate the supply side of the apprenticeship equation and turbo charge the growth of higher level anddegree level skills in the UK.

It needs to focus on three things:

  1. Stop only funding the lowest cost route: It needs to take a long hard look at its policy of only funding the lowest cost route to competence which has driven down funding bands to the point where Universities do not feel it is worth entering the market and there is often a lack of meaningful provision available to employers. We saw this very starkly in Financial Services where on a handful of HE organisations stepped in to deliver the Level 6 and 7 standards which are very much needed for our Financial Services companies to continue to compete on a global stage.
  2. Stop preaching to the converted: Holding bi-annual conferences for companies already utilising apprenticeships adds little or no value. This effort would be better focused on selling the benefits of apprenticeships to the thousands of companies who are yet to make any meaningful investment of their levy. The Apprenticeship Ambassador Network needs to be supported by a high profile national campaign working alongside Universities that focuses on educating employers. High profile schools education/marketing campaigns are only any good if there is a strong pipeline of opportunities for young people to move into.
  3. Close the gap between FE and HE provision: A more joined up and consistent offering to employers is needed to allow simple and easy progression from the lower rungs of the skills ladder to the higher and degree level skills businesses need.

The skills gap is a stark reality we all face but we can take encouragement from the fact that the foundations to address this gap are in place.

We now need to press on and build on them.

Mike Thompson, Chief Executive, Sustain HR Limited

You may also be interested in these articles:

Register, Login or Login with your Social Media account:


Advertisers

Newsroom Activity

FE News: The Future of Education News Channel commented on this video 13 hours 3 minutes ago

www.accenture.com/gb-en/insights/future-workforce/…

How To Bridge The Skills Gap In The Future...

It's learning. Just not as we know it. The race is on... It’s a race between education and technology. As intelligent systems and machines reshape...

FE News: The Future of Education News Channel shared a video in channel. 13 hours 6 minutes ago

How To Bridge The Skills Gap In The Future...

It's learning. Just not as we know it. The race is on... It’s a race between education and technology. As intelligent systems and machines reshape...

Latest Education News

Further Education News

The FE News Channel gives you the latest education news and updates on emerging education strategies and the #FutureofEducation and the #FutureofWork.

Providing trustworthy and positive Further Education news and views since 2003, we are a digital news channel with a mixture of written word articles, podcasts and videos. Our specialisation is providing you with a mixture of the latest education news, our stance is always positive, sector building and sharing different perspectives and views from thought leaders, to provide you with a think tank of new ideas and solutions to bring the education sector together and come up with new innovative solutions and ideas.

FE News publish exclusive peer to peer thought leadership articles from our feature writers, as well as user generated content across our network of over 3000 Newsrooms, offering multiple sources of the latest education news across the Education and Employability sectors.

FE News also broadcast live events, podcasts with leading experts and thought leaders, webinars, video interviews and Further Education news bulletins so you receive the latest developments in Skills News and across the Apprenticeship, Further Education and Employability sectors.

Every week FE News has over 200 articles and new pieces of content per week. We are a news channel providing the latest Further Education News, giving insight from multiple sources on the latest education policy developments, latest strategies, through to our thought leaders who provide blue sky thinking strategy, best practice and innovation to help look into the future developments for education and the future of work.

In May 2020, FE News had over 120,000 unique visitors according to Google Analytics and over 200 new pieces of news content every week, from thought leadership articles, to the latest education news via written word, podcasts, video to press releases from across the sector.

We thought it would be helpful to explain how we tier our latest education news content and how you can get involved and understand how you can read the latest daily Further Education news and how we structure our FE Week of content:

Main Features

Our main features are exclusive and are thought leadership articles and blue sky thinking with experts writing peer to peer news articles about the future of education and the future of work. The focus is solution led thought leadership, sharing best practice, innovation and emerging strategy. These are often articles about the future of education and the future of work, they often then create future education news articles. We limit our main features to a maximum of 20 per week, as they are often about new concepts and new thought processes. Our main features are also exclusive articles responding to the latest education news, maybe an insight from an expert into a policy announcement or response to an education think tank report or a white paper.

FE Voices

FE Voices was originally set up as a section on FE News to give a voice back to the sector. As we now have over 3,000 newsrooms and contributors, FE Voices are usually thought leadership articles, they don’t necessarily have to be exclusive, but usually are, they are slightly shorter than Main Features. FE Voices can include more mixed media with the Further Education News articles, such as embedded podcasts and videos. Our sector response articles asking for different comments and opinions to education policy announcements or responding to a report of white paper are usually held in the FE Voices section. If we have a live podcast in an evening or a radio show such as SkillsWorldLive radio show, the next morning we place the FE podcast recording in the FE Voices section.

Sector News

In sector news we have a blend of content from Press Releases, education resources, reports, education research, white papers from a range of contributors. We have a lot of positive education news articles from colleges, awarding organisations and Apprenticeship Training Providers, press releases from DfE to Think Tanks giving the overview of a report, through to helpful resources to help you with delivering education strategies to your learners and students.

Podcasts

We have a range of education podcasts on FE News, from hour long full production FE podcasts such as SkillsWorldLive in conjunction with the Federation of Awarding Bodies, to weekly podcasts from experts and thought leaders, providing advice and guidance to leaders. FE News also record podcasts at conferences and events, giving you one on one podcasts with education and skills experts on the latest strategies and developments.

We have over 150 education podcasts on FE News, ranging from EdTech podcasts with experts discussing Education 4.0 and how technology is complimenting and transforming education, to podcasts with experts discussing education research, the future of work, how to develop skills systems for jobs of the future to interviews with the Apprenticeship and Skills Minister.

We record our own exclusive FE News podcasts, work in conjunction with sector partners such as FAB to create weekly podcasts and daily education podcasts, through to working with sector leaders creating exclusive education news podcasts.

Education Video Interviews

FE News have over 700 FE Video interviews and have been recording education video interviews with experts for over 12 years. These are usually vox pop video interviews with experts across education and work, discussing blue sky thinking ideas and views about the future of education and work.

Events

FE News has a free events calendar to check out the latest conferences, webinars and events to keep up to date with the latest education news and strategies.

FE Newsrooms

The FE Newsroom is home to your content if you are a FE News contributor. It also help the audience develop relationship with either you as an individual or your organisation as they can click through and ‘box set’ consume all of your previous thought leadership articles, latest education news press releases, videos and education podcasts.

Do you want to contribute, share your ideas or vision or share a press release?

If you want to write a thought leadership article, share your ideas and vision for the future of education or the future of work, write a press release sharing the latest education news or contribute to a podcast, first of all you need to set up a FE Newsroom login (which is free): once the team have approved your newsroom (all content, newsrooms are all approved by a member of the FE News team- no robots are used in this process!), you can then start adding content (again all articles, videos and podcasts are all approved by the FE News editorial team before they go live on FE News). As all newsrooms and content are approved by the FE News team, there will be a slight delay on the team being able to review and approve content.

 RSS IconRSS Feed Selection Page