Lack of focus on further education could cripple the UK labour market if we don’t act now

#UntappedPotential 

The UK’s labour market is amidst a transformational and unpredictable period driven by a changing political landscape and rapidly advancing technologies.

Meanwhile, we are working for longer and our workplace skills are forecast to change at a faster and faster pace. According to the OECD, 38-42% of the UK population will need to completely retrain within the next ten years due to the fourth industrial revolution and rise of Artificial Intelligence.

And even with the UK’s unemployment levels at just 3.8%, employers continue to struggle with a skills and productivity crisis.

Without enough skilled workers to fill the jobs the country needs, a focus on further education to tap into the potential of the millions of underutilised working age people is crucial.

After a decade of brutal cuts to the adult education system, the UK is underequipped when it comes to funding upskilling for the current workforce, making it critical for government, employers and education providers alike to be looking ahead to find a solution sooner rather than later.

The current state of affairs

In times of political and economic uncertainty, funding cuts to ‘non-essential’ areas are often a consequence. We have been witnessing this since the 2008 recession with employers cutting investment in training and technology, and the Government drastically reducing adult education by 25% across its apprenticeships and vocational courses (according to the IFS).

The problem is that, in the longer term, these cuts are unsustainable and mean that businesses become inefficient and out of date.

The underinvestment that we have seen in further education and work-based learning by employers and government has wreaked havoc on our workforces and it’s set for further decline.

Over the past ten years, participation in adult learning has fallen by 10% – with an estimated 3.8 million fewer adult learners having access to education at the close of the decade than at its start.

We already know that, as Britain separates itself from the European Union, immigration rules will change to restrict the free movement that has enabled employers to bolster their workforces in the past. As such we will need to shift our focus towards upskilling our own labour pool with a far more robust system than what is currently in place.

The scale of underutilised and undertrained talent

At City & Guilds Group, we recently undertook an extensive research project to understand the impact of Britain’s low levels of investment in training and development and its subsequent effect on our country’s talent.

Missing Millions: UK is overlooking the #UntappedPotential of millions of workers: Undertrained, underemployed and unprepared: the UK is squandering the potential of millions of workers A new report Missing Millions published today (25 Feb) by leading… https://t.co/UoFx8TuWf1pic.twitter.com/IjbDrk8BSu

— FE News – The #FutureofEducation News Channel (@FENews) February 25, 2020

In our Missing Millions report we found that only half (53%) of the UK’s working age population has received workplace training in the last three years. What’s more, one in three Brits (34%) have either not received workplace training in the last five years or have never had any such training. When benchmarked against the population, this equates to 17.8 million people with outdated skills.

In addition to this, 60% of respondents stated that they felt the skills they did have were underutilised at least 50% of the time, suggesting that employers are not fully capitalising on the skills they already have within their businesses.

We also found that those from lower socio-economic groups have effectively been ‘left behind’ due to the continued cuts to adult education funding.

People living outside of London and the South East; people from lower socio-economic groups; older workers; and part-time workers are the least likely to have had training recently and to be satisfied with their opportunities for career progression.

Call for government, policy makers, employers and individuals to take action to meet the UK’s growing further education needs

Considering the untapped potential of millions of working age people in the UK we are faced with many challenges but also huge opportunity – should we take significant action and investments to seize it.

In today’s budget announcement, we’re calling on the Government to urgently review adult education and increase the funds required to support lifelong learning, retraining and reskilling.

Particularly, we would like to see new ‘lifelong learning hubs’ created in areas of economic need and those areas most likely to be impacted by the displacement of jobs thanks to the rise of AI.

These hubs should provide careers advice and guidance, help to diagnose people’s skills issues and direct them to training to help them get into meaningful work – bringing together the current skills development structure in these areas in a ‘hub and spoke’ approach, helping to direct people into work.

The FE sector has a huge contribution to make in helping to address the skills challenges that the UK is facing – as long as we are willing to be open to change and new ways of doing things.

The benefit we could gain from rethinking what we do and shaking up the current training and development system could be huge. We can be a key player in addressing our skills crisis, improving social mobility, and driving up productivity within the UK.

Kirstie Donnelly MBE is CEO at City & Guilds Group