Transcript Slide 1

WHAT DO WE MEAN BY SKILLS?
When we refer to skills we consider five broad areas:
Employability skills – the foundation skills and behaviours necessary for
people to find and succeed in work. An important issue for the “NEET”- Not in
Employment, Education or Training - agenda. A big issue for employers
General work skills – skills that people need to do their jobs. A big issue when
considering productivity
Up-skilling – important for an individual’s increased competency in current and
future jobs, adaptability, personal motivation, commitment and responding to
technology changes or regulation
Re-skilling – training part of the workforce to either help individuals get a job
post redundancy, or a choice by employers to respond to new business
opportunities or challenges eg the Green Agenda or to deal with economic shocks
Leadership and Management skills – skills needed to manage people and
resources in the workplace. Evidence shows that this is a big issue for business
improvement and capability
1
WHY IMPROVE SKILLS?
Skills contribute to a wide range of desirable outcomes:
Economic objectives
Social objectives
Skills
Personal and family
well-being
Stronger communities
Productivity
Employment
Greater social mobility
Sustainable
Growth
Greater social
inclusion
2
WHY IMPROVE SKILLS? (2)
They enable people to attain and progress in work
• People with higher level skills are more likely to be employed… and
less likely to be unemployed1
% Employed
% Unemployed
No Qualifications
44%
15%
Level 2
75%
8%
Level 4
85%
4%
• Low skilled adults who improve their numeracy skills between
ages 21 and 34 are more likely to have their own home, savings
and less likely to be on benefits than those who do not improve
their skills2
1
Labour Force Survey, 2009 Q4 - Q4 2010 data will be released in a new Supplementary Table to the Post-16 Education and
Skills Statistical First Release on 31 January and Q4 2011 data will be released at the end of March
2 Bynner & Parsons (2006) ‘New Light on Literacy and Numeracy; Results of the Literacy and Numeracy Assessment in the
Age 34 Follow-up of the 1970 Cohort Study’. National Research and Development Centre for adult literacy and numeracy.
3
Human side of these problems
 Those with poor skills are [1]: More likely to be in prison
 More likely to be in debt
 More likely to be unemployed
 More likely to be unwell and have mental health
problems
 More likely to have a child who can’t read at 9
 More likely to be involved with or have to be
supported by the State
 Are less likely to vote
 Are less likely to own their own homes
 Are less likely to take up a community role such
as school governor
 Are less likely to hear their child read
No quals
1993
2008
Other quals
1993
2008
GCSE
1993
2008
A Level or Eq.
1993
2008
HE
1993
2008
Degree or Eq.
1993
2008
0%
20%
40%
Employment
60%
Unemployment
80%
100%
Inactivity
Will never normally earn more £14,000
Those with no qualifications
are on average 37ppt less
likely to be in employment
than those with HE
[1] Centre for Research on the Wider Benefits of Learning, Research Brief, October 2006
4
WHY IMPROVE SKILLS? (3)
We fall behind our key competitors at Level 2 and above
Proportion of 25-64 year-olds qualified to Level 2 and above
100%
Source: "OECD Education at a Glance" 2011 (Table 1.2a)
Data refer to 2009
Next data release: September 2012
80%
60%
40%
OECD Average
Portugal
Turkey
Mexico
Spain
Italy
Greece
Iceland
Chile
France
Belgium
Australia
Ireland
New Zealand
Netherlands
United Kingdom
Denmark
Luxembourg
Korea
Hungary
Norway
Israel
Austria
Finland
Slovenia
Germany
Sweden
Switzerland
Canada
Poland
United States
Estonia
Slovak Republic
0%
Czech Republic
20%
With 74% of the working age population qualified to Level 2 and above, the UK is close to the OECD average (of 73
per cent). This has remained stable over time - in 2011 we are ranked 19th out of 33 OECD countries and in 1998
we were ranked 19th out of 29 OECD countries, although only 60% of our working age population was qualified to
that level.
5
WHY IMPROVE SKILLS? (4)
At Level 4+ and above the UK’s relative position is strong,
but we are still below the top quartile, which may impact on
our future competiveness with emerging economies
Proportion of 25-64 year-olds qualified to Level 4 and above
50%
Source: "OECD Education at a Glance" 2011 (Table 1.3a)
Data refer to 2009
Next data release: September 2012
40%
30%
20%
OECD Average
Turkey
Italy
Portugal
Czech Republic
Slovak Republic
Mexico
Austria
Hungary
Poland
Slovenia
Greece
Chile
Germany
France
Spain
Iceland
Netherlands
Sweden
Belgium
Denmark
Luxembourg
Switzerland
Ireland
Estonia
Norway
United Kingdom
Australia
Finland
Korea
United States
Japan
Israel
Canada
0%
New Zealand
10%
With 37% of the working age population qualified to Level 4 or above, the UK lies above the OECD average (of
30%) and is ranked 9th out of 34 countries. In 1998 we were ranked 12th out of 29 with only 24% qualified to that
level (although this is an improvement due to a change in the methodology we use in the UK to calculate L4+
qualifications, we cannot assume that this is a genuine improvement).
6
WHY IMPROVE SKILLS? (5)
Skills deliver benefits to individuals, employers and the wider economy
Evidence suggests that skills deliver benefits to:
• Individuals: In the form of higher wages and improved employment prospects
• Average hourly wages are £17.53 for those qualified to L4+, £10.68 for those qualified to
L2 and £8.88 for those with no qualifications
• Employment rates are 84% for those qualified to L4+, 68% for those qualified to L2 and
47% for those with no qualifications
• Employers: In the form of increased profits and competitiveness. For example:
• NIESR matched-plant studies show how lower levels of skills in the UK workforce led to
lower output per employee
• 77% of employers believe apprenticeships make them more competitive; 76% say that
they provide higher overall productivityii
• The Wider Economy: For example, firms operating in high skill areas tend to have higher
productivity than firms with a similar skill profile, but operating in a low skill areaiii
• Skills accounted for around one fifth of UK Gross Value Added (GVA) growth from
1997-2007iv
i Labour Force Survey 2011 Q2;
ii Findings summarised at http://www.apprenticeships.org.uk/Employers/The-benefits.aspx
iii Galindo-Rueda & Haskel (2005) ‘Skills, workforce characteristics and firm-level productivity: Evidence from the matched ABI/Employer Skills Survey’
iv Groningen Growth and Development Centre, EU KLEMS
7
THE SKILLS “OFFER”
• Full funding for literacy and numeracy courses for all adults aged 19+,
•
•
•
•
and first Level 2 and 3 qualifications for those aged 19 to 24 and the
unemployed.
Full funding for 16-18 Apprenticeships; co-funding for 19+
Apprenticeships.
From 2013, adults aged 24+ will be able to access loans to fund L3 and
above skills.
Additional support for leadership and management skills.
But the Skills Strategy “Skills for Sustainable Growth” set out a model
designed to give business more power and responsibility, not just to
define the vocational skills needs of different sectors, but also to
develop new ways to meet them, e.g. supported by:
- Growth and Innovation Fund
- Employer Ownership Pilots, up to £250m over 2 years of public
investment for training and Apprenticeships channelled directly to
business to give employers real purchasing power in the skills market.
8
Freedoms and flexibility – moving to a demand led system
Policy rationale
• To move to a more demand-led system, we need to free up the system to be more responsive to what
individuals and employers want.
• Within this system the relationship between further education and its direct customers (individuals and
employers) takes primacy and is the key to securing high quality and relevant training
New policy
• No top down targets with colleges and providers free to determine the learning offer they provide
• An Innovation Code which enables colleges and providers to develop new programmes which meet the
needs of their communities
• Local Enterprise Partnerships will play an important role in linking to local businesses, understanding
their needs and liaising with providers to ensure training is available. More detailed advice on vocational
training and qualifications is available from Sector Skills Councils and National Skills Academies
• A City Skills Fund to support effective working between colleges, providers and cities
• A simplified FE and Skills System:
• Simplifying landscape – closing, merging and scaling back number of intermediary organisations
• Reducing bureaucracy – simpler systems and processes
• Removing regulation
• First class advice delivered by the National Careers Service is free to all adults to help them in their work
and life
9
Apprenticeships
Apprenticeships:
Government funding for Apprenticeships
in 2011-12 is £1.4bn, and this has been
increased in 2012-13 to over £1.bn,
which is sufficient to train 444,000 new
apprentices*
100,000 employers offer
Apprenticeships in more than
160,00 locations and there
are over 1,200 job roles
available to apprentices*
• Apprenticeships help employers improve productivity and give them a competitive edge, enabling them to
compete globally. Employers recoup their investment within two to three years in most cases.
• Apprenticeships are:
•
•
•
•
paid jobs incorporating on & off the job training and leading to nationally recognised qualifications;
open to all suitably qualified people over the age of 16;
at 3 levels: Intermediate - Level 2, Advanced (for Supervisors) - L3, and Higher (for Managers) - L4 & 5;
available in over 200 occupations.
• HMG subsidies are full funding of the off-the-job training at 16-18; 50% at 19+; 40% at 25+ (... with 25% less
for large employers).
• Apprenticeship Frameworks, developed by Sector Skills Councils and employers, describe the content of
different apprenticeships
• Employers can go to the National Apprenticeship Service (NAS) for further information about recruiting an
Apprentice on 08000 150 600 or www.apprenticeships.org.uk
* Source: Skills Investment Statement.
10
Apprenticeships have grown strongly despite economic
challenges and significant programme changes
500,000
450,000
400,000
350,000
300,000
25+
19-24
16-18
250,000
200,000
150,000
100,000
50,000
0
2002/03
2003/04
2004/05
2005/06
2006/07
2007/08
2008/09
2009/10
2010/11
(Provisional)
11
Apprenticeships
The programme could support up to 2.4 million 19+ Apprenticeships over the spending review
Our main priorities are to:
Focus the programme more sharply where Apprenticeships bring the greatest returns and wider benefits, including targeting
younger adults, new employees, higher level qualifications and particular sectors where investment will make the
greatest impact.
Increase the number of 16-24 year old apprentices, including by encouraging small employers not yet engaged with the
programme to take on new young apprentices. Partly through the Youth Contract, we will provide up to 40,000
incentive payments.
Significantly extend Higher Apprenticeships provision, including with the launch of a further opportunity for organisations to
bid for funding.
Take strong action to drive up standards and quality, including withdrawing funding from providers that do not meet the high
standards that learners and employers demand and ensuring that providers support apprentices to achieve Level 2 in
English and Maths wherever possible. A major employer-led review of apprenticeships standards will consider how the
programme should adapt to meet evolving employer and learner needs.
Make it easier for employers to take on an apprentice, by reducing bureaucracy, streamlining and speeding up processes
and removing all additional health and safety requirements on employers. We will ensure the National Apprenticeship
Service better supports the needs of small employers through more targeted advice and guidance.
12
ACCESSING THE “OFFER”
Business Link
FE Colleges
FE Choices
SSCs/other routes
Employers can access enhanced support and improved
integrated information on skills from the Business Link website http://www.businesslink.gov.uk
Employers may wish to access help with how to invest in skills
and training, by contacting their local FE college or training
provider direct.
Employers can find details of training providers and compare
qualification success rates, learner destinations and learner
and employer satisfaction ratings, through the Skills Funding
Agency’s FE Choices site http://FEChoices.skillsfundingagency.bis.gov.uk
Employers may be able to access skills support through projects
run by their Sector Skills Council under the Growth & Innovation
Fund or the Employer Investment Fund. UKCES works with
SSCs to provide leadership to drive up employer investment in
and better use of skills. Groups of employers may also be able
to bid for funding to deliver skills training through the Employer
Ownership Pilots.
13
ISSUES FOR SMEs
Pathfinder idea emerged from a workshop in December to look at the skills issues facing SMEs the environment they operate in; key drivers & factors that influence investment decisions &
how this applies to Skills.
Issues:Skills training not always offered by FE sector in a way that meets SMEs needs or
they can access (we don’t fund company training)
Many SMEs favour on the job training rather than formalised education /
qualifications
SMEs not always able to understand/articulate their needs
They lack knowledge about what support they can access or have difficulties
navigating the skills system
Lack of volume / purchasing power means they are not always an attractive customer
for training providers.
SMEs get information from a range of sources – local level messaging/case studies
work best
Good examples of SMEs in niche sectors collectively influencing design of
qualifications at local level
Leadership and Management capability in SMEs a key factor in determining ability to
overcome business hurdles and capacity for growth – but less likely than larger companies to
invest in leadership and management training.
14