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Pressure grows on industry to invest in training to solve its own skills shortage

Growth Through People report

More pressure was this week put on employers including those in construction and infrastructure to resolve their own skills crises rather than waiting for  Government to do it for them.

A new report from the UK Commission on Employment and Skills, co-signed by both CBI and the TUC, states clearly that employers "hold the key" to solving the growing skills crisis which threatens to hinder the UK's growth aspirations.

“Businesses, and the people who work in them, must be in the driving seat.," says the report. "They are the engines of growth and hold the key to improving productivity and providing good jobs.”

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The UKCES report “Growth through people: A statement on skills in the UK” follows a call by Sir John Armitt last week for the construction industry to take the lead and take charge of the skills crisis. ““We can’t rely on government to fill our needs. That is the responsibility of the industry. It is our responsibility to pick people up and give them training,” he said.

And two weeks ago the London Chambers of Commerce and Industry with KPMG called, in their ‘Skills to Build’ research, for “industry to wake up and take responsibility to increase levels of training dramatically”.

The skills gap facing construction and infrastructure in the next five years is variously reported as between 600,000 and 750,000 individuals.

Government has provided a pipeline of work via its commitment to use infrastructure to develop the economy.

In effect what UKCES, Armitt and LCC all say is that now Government has created the opportunity for construction and infrastructure businesses to grow, business has a responsibility to step forward to build skills needed for the UK economy to develop . That means filling the jobs that are created in a way that will benefit the UK long term through employing local people and training them.

Quick fix solutions such as recruiting vast numbers of temporary workers from overseas, as is already being suggested, would not be politically acceptable, particularly at the moment, certainly unless obvious efforts are being made to create home grown recruits.

However, industry is responding – the Tunnelling and Underground Construction Academy, the National Skills Academy for Rail Engineering plus the new National High Speed Rail College are examples of what can be achieved.

“To meet the skills and employment challenges we face, businesses, and the people who work in them, must be in the driving seat". UK Commission on Employment and Skills

Meanwhile organisations such as the Construction Youth Trust and Building Lives are working hard to create openings for young people.

There is also a significant push to encourage more women to join the industry. But women, particularly the university standard who are being enthusiastically pursued by engineering, are also being chased by other sectors and as a strategy, while good for diversity, is likely to struggle on its own, to significantly dent the skills gap in construction.

Bigger, more ambitious, more concerted industry-wide plans are needed to create a more diverse workforce.  

"I welcome the UKCES report," said Construction Youth Trust executive director Christine Townley. "It says all the right things in terms of employers taking the lead. But I wonder if we need more than that to make a difference in construction. Everyone is committed to tackling the issues but we don't come together collectively enough. We go into schools individually, but we don't have enough of a joined up approach. And we need our key figures including clients to be championing the skills issue to set the standard of what is expected."  

The UKCES report says that 80% of 25-49 year olds are currently in work compared to just over 50% of 16 to 24 year olds; 74.4% of white people are working compared to 60.8% of black (British/Carribean/Other) people and 85.9% of those with degrees are in work compared to just 41.1% without. The gap between men and women working is smaller, at 77.6% to 67.8%.

A conclusion to draw from the report is that along with all industries, construction and infrastructure – traditionally a home for the disadvantaged – should be working to close all those gaps through its own workforce planning and training, from entry level to helping people progress throughout their careers.

“In the UK the ratio of youth unemployment to adult unemployment is significantly higher than other leading economies," UKCES said. "This is a structural problem, reflecting a long-term decline in entry level jobs in industries that young people traditionally go into, and fewer opportunities to combine earning, learning and to progress.”

It added: “Private investment in training has been steadily declining and in England, part-time learning has fallen significantly. At the same time, changes in the nature and structure of work will require businesses and the people within them to adapt and innovate. With the public purse likely to be even more constrained in the future, employers and employees will need to invest more time and resources in their development and in new ways of working.

“To meet the skills and employment challenges we face, businesses, and the people who work in them, must be in the driving seat. They are the engines of growth and hold the key to improving productivity and providing good jobs.

“This is not about big business calling the shots – it’s about businesses of all sizes taking responsibility, with their employees and in their supply chains, for building a skilled workforce now and into the future, not leaving it to government or the education sector.”

 

 

Growth through people: the recommendations

 

Employers should lead on skills and government should enable them

• We need a new level of leadership from employers to take responsibility for competitiveness and growth.

• Employers, working with each other and with their employees and trade unions, should raise the bar on skills in sectors, regions and supply chains. Collaboration is vital to building the skills we need for competitiveness.

• Governments should commit to supporting employer leadership on skills, individually and in partnerships, as a central part of long-term growth plans and a way of aligning public and private resources.

 

Improving workplace productivity should be recognised as the key route to increasing pay and prosperity

• Up to 90% of the current workforce will still be in work in the next decade. To tackle the productivity deficit for the economy as a whole, there must be a much greater focus on job design, technology and progression for those in work.

• Equipping people with the right skills and giving them the best opportunities to use them will lead to better paid jobs.

• This means better leadership and management of people and organisations, increased employee engagement and more transparency about the value of people to business success.

 

‘Earning and learning’ should be the gold standard in vocational education

• We need a step change in attitude and uptake of quality vocational routes into good jobs. High quality apprenticeships should be a normal career pathway for many more young people, and a normal way for businesses to recruit and develop their talent pipeline.

• Employers, working collaboratively, should have the lead role in designing apprenticeships to ensure they have value in the labour market. The public contribution should be channelled via employers to stimulate greater employer uptake.

• In England, long-term stability in vocational education and training is essential for employers to have the confidence to engage.

 

Education and employers should be better connected to prepare people for work

• To create new pathways into work we need to start much earlier. All schools should have links with local businesses and use those links to inform and inspire young people about the breadth of career opportunities available.

• Further education colleges should be supported to work with employers to deliver higher level technical and professional education to meet the UK’s technical skills gaps.

• Closer collaboration between employers, colleges and universities is essential to ensure there are seamless opportunities to work and learn over the course of longer working careers.

 

Success should be measured by a wider set of outcomes not just educational attainment

• The success of our skills system should be based on more than just qualifications. The publicly funded skills system should reward outcomes such as employmentand progression as well as educational attainment.

• Colleges need to work strategically with businesses, and be accountable to local businesses, communities and learners - not upwards to central government funding agencies.

• Reliable labour market intelligence should be used widely to support better decision making by individuals, employers, and skills and employment providers.