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UK’s skills crisis laid bare as new CIPD report shows nation is bottom of international class on key measures

In its report – From ‘inadequate’ to ‘outstanding’: making the UK’s skills system world class - the CIPD warns that the UK is sleepwalking into a low-value, low-skills economy

  • England and Northern Ireland together rank in the bottom four OECD countries for literacy and numeracy among 16-24 year olds
  • Employers train less and invest less in skills than most other EU countries
  • UK is sleepwalking into a low-value, low-skills economy post-Brexit
  • CIPD urges Government to make skills funding available to tackle low skills in the workplace

New analysis from the CIPD, the professional body for HR and people development, shows that two decades of under-investment and failed policy on skills in the UK has contributed to the country lagging well behind its competitors in Europe and most of the OECD on at least four key measures, including literacy and numeracy, learning and development, and digital skills.

In its report – From ‘inadequate’ to ‘outstanding’: making the UK’s skills systemworld class - the CIPD warns that the UK is sleepwalking into a low-value, low-skills economy which leaves the nation ill-prepared for its post-Brexit future, particularly if the UK is to face restrictions on accessing talent from outside of the UK.

The analysis, which forms part of the CIPD’s formal response to the Government’s Industrial Strategy Green Paper, highlights multiple failings in the UK’s skills system, including:

  • England and Northern Ireland together rank in the bottom four OECD countries for literacy and numeracy among 16-24 year olds
  • Out of 19 countries, the UK ranks bottom of the class on young peoples’ computer problem-solving skills
  • UK employers spend less on training than other major EU economies and less than the EU average, and the gap has widened since 2005. In 2010, the cost per employee was €266 in the UK, against €511 across the EU
  • The UK lies fourth from the bottom on the EU league table on participation in job-related adult learning, with evidence showing a marked deterioration since 2007

Lizzie Crowley, skills adviser for the CIPD and co-author of the report, comments: “This is a sobering analysis of the state of skills in the UK. Our report should serve as a real wake-up call for the Government to break with the past two decades of failed skills policy and set the UK on a new course that delivers the right results for individuals, organisations and the economy as a whole. While more efforts are being made to reform education, it’s clear that there needs to be a much greater emphasis on learning and development in the workplace. As we move towards Brexit, and possible restrictions on overseas talent, it’s crucial that government works in partnership with education providers and businesses to address these deep-rooted issues that continue to blight individual and business potential.”

To build strength and stability into the UK skills system, the CIPD is calling for the Government to:

  1. Make additional skills funding for the workplace a priority

The CIPD believes that some government funding could be redirected from existing, related programmes of work and put towards training and development in the workplace. The Government could, for example, divert £1bn (5%) of the National Productivity Investment Fund announced in the Autumn Statement and about £2bn of the total funds raised by the Apprenticeship Levy, which the Institute of Fiscal Studies estimates is not currently forecast to go towards apprenticeships.

  1. Put skills at the heart of the Industrial Strategy

What happens inside the workplace has material value and workplace practices - such as training and development, and leadership and line management - have a direct impact on business and economic success. It’s vital that the Government’s Industrial Strategy recognises the value of skills in improving outcomes for individuals, organisations, economy and society.

  1. Reframe the Apprenticeship Levy as a training levy

The Apprenticeship Levy should be reframed as a training levy to make it more flexible to employers and to boost individuals’ skills.

  1. Encourage organisations to raise their ambitions and invest more in workplace learning and ongoing skills development

The majority of the workforce of 2030 is already in work and will be untouched by the current round of education reforms. Rather than expecting the UK’s skills challenges to be solved at the point of supply, government and business must act to build and nurture cultures of lifelong learning within organisations and society.

Crowley comments: “We can either take the high road as a nation, with government, employers, education and business support groups working in partnership to boost investment in skills and create more high-value, high-productivity workplaces. Or, we can keep doing what we’ve always done and get the same mediocre results. The Government should seize this moment to raise the ambitions of the UK. We need to lift the lid on what is happening in UK workplaces and address skills at a much deeper and broader level than ever before. Successive governments have merely tinkered around the edges of skills strategies that have ultimately failed to deliver. Now is the time for real and lasting change and a clear plan of action to address skills at a national, sector and local level.”

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