Addressing the skills shortage: Why HE and FE must work more closely with business

The UK is experiencing a major skills shortage. The Open University’s Business Barometer for 2021 found that two thirds (63%) of businesses are struggling to recruit candidates with the right skills, and a quarter (24%) consider finding the right employees the single biggest challenge their organisation faces. This deficit in skills is proving a huge detriment to the economy, with a report by the Learning & Work Institute estimating it could risk economic output of £120 billion by 2030.

There are a number of reasons why the UK is facing this skills gap; covid and Brexit are key contributors but it’s also driven by the acceleration of tech. The speed at which technology is advancing is having a knock-on impact across nearly all industries and the necessary workplace experience and skills employers seek is changing and developing at an unprecedented rate. Gartner research found that more than half (58%) of the workforce will need new skills to enable them to continue to do their job successfully, and identified that the skills listed in the average 2017 job posting for IT, finance and sales, are already obsolete.

“More than half (58%) of the workforce will need new skills to enable them to continue to do their job successfully”

Higher and further education options are struggling to keep up with the pace of change. What’s relevant in a course one year may be antiquated by the next, and increasing numbers of students are leaving universities, adult education colleges and courses run by Independent Training Providers (ITPs) ill-equipped for the world of work.

The situation as it stands is harming both business and a generation of potential employees. Too few candidates entering the jobs market with the correct skills means businesses face lengthy and more costly hiring processes. It’s estimated to cost companies an average of £3,000 for each new hire, with the time to find the ‘right’ candidate taking 42 days. This is a big chunk of money and time eating into businesses’ bottom line and that’s before you include money and time spent on onboarding new recruits.

We need to create a system where potential employees leave HE, FE and ITP courses with the necessary competencies employers are looking for. Thereby boosting individuals’ employability and drastically reducing the cost to businesses of hiring and training staff. 

So, how can HE and FE providers better respond to what businesses need to solve this issue?   

Involving business from the outset

As Managing Director of iconoClass UK, I can see one of the aspects that sets our business bootcamp apart from many other HE and FE providers is that we partner directly with brands and fast-growing tech start-ups that are looking to hire new talent. Our partner companies run practical training sessions with students, so candidates gain the exact skills those organisations are looking for, while the organisations have the opportunity to identify new talent and make job offers to those students.

Simon Proust, Head of Sales at SumUP, one of iconoClass’s partner companies said:

“The practical nature of the iconoClass programme trains students perfectly for customer facing sales roles. Our collaboration has become an integral part of our recruitment process. So much so that 50% of our workforce now comes from this bootcamp.”

Training directly with businesses also provides students with the opportunity to get a real taste of what it would be like to work for certain organisations, thus enabling them to make fully informed decisions about the companies and industries they would like to work in the future. This in turn boosts businesses’ staff retention rates, as individuals are less likely to quit a new role if it’s a job they already know they want.

To meet the needs of students and businesses, there needs to be a greater focus on collaborations between HE and FE institutes and the private sector. Professionals in senior positions need to be consulted on course syllabuses to ensure what students are learning will directly prepare them for the workplace, and HE and FE providers need to do more to connect students with organisations that are looking to hire. 

Bootcamps offer a quick solution

The urgent need to address the skills deficit means businesses need employees with the right experience now, not in three years time once they’ve completed a degree. Even highly desirable sectors such as tech are struggling with a skills shortage that has reached an ‘all-time high’. Demand is outstripping supply in many industries; in 2021, there were more IT jobs advertised online than all of British business in the previous year.

“Demand is outstripping supply in many industries; in 2021, there were more IT jobs advertised online than all of British business in the previous year.”

To help address this issue, HE and FE need to be offering courses that swiftly train individuals in the skills businesses are looking for. In my last article for FE News, I discussed the benefits of short courses that condense an intensive learning programme into a matter of months rather than years. Not only are shorter courses more beneficial for students, who can upskill and enter the workplace more quickly, but also for businesses that can take on recruits armed with fresh knowledge and experience for the role.

The need for recruits with up-to-the-minute experience is one of the reasons we’ve seen a surge in bootcamps over recent years. Bootcamps enable students to rapidly gain practical know-how in a specific field through fully immersing themselves in an intensive course run by experts. These are particularly popular in the tech sphere in areas such as coding and data science, but their success has expanded to other industries such as marketing and beauty.

Many tech companies hire directly from bootcamps with analysis of the top 24 coding bootcamps finding that 71.4% of students found a job in the industry within 180 days. What’s more, 2021 research shows that 6.03% of the Big Five’s employees came from bootcamps. And so confident are many bootcamp providers – iconoClass included – in the quality of their training that they offer a job guarantee or your money back.

“Many tech companies hire directly from bootcamps with analysis of the top 24 coding bootcamps finding that 71.4% of students found a job in the industry within 180 days.”

Bespoke business training

Bootcamps are great for those out of employment or looking to change careers but the intensive nature of the courses means they’re not always suitable for candidates already in employment. Upskilling individuals already in the workplace is crucial to closing the skills gap, especially given that 1 in 4 employees feel they haven’t received adequate training to properly do their job.

“Upskilling individuals already in the workplace is crucial to closing the skills gap, especially given that 1 in 4 employees feel they haven’t received adequate training to properly do their job.”

The responsibility to ensure staff are properly trained of course falls to individual organisations, but FE providers can support businesses in developing their staff by offering bespoke training packages for companies in the skills employees most need. One of the blocks to staff training is that it typically requires employees to spend time away from the workplace but there are training options that can upskill staff in practical skills on-the-job. This type of training should be a no-brainer for businesses, as it gives employees a chance to really put experience into practice and deliver results for their organisation while they train.

A further way training providers can improve their business offering is through custom courses that enable a whole team to be trained in specific skills at the same time. For teams that are struggling or failing to deliver against KPIs, training everyone at once can help identify and hone individual strengths and weaknesses and better ways of working together, to take the whole teams’ performance to the next level. 

The UK’s skills gap is a major threat to the economy. UK businesses are struggling, as well as individuals who want to find employment but don’t possess the relevant skills to get the job they want. It’s important that education providers play their part in helping to solve this crisis. Where education and enterprise once operated almost entirely separately, we must work more closely than ever and involve business professionals in the creation and administration of courses to ensure that students come out work-ready and on the radar of companies looking to recruit. What’s more, with the skills deficit extending to those already in the workplace, we need to see more training providers offering tailor-made courses that fit the specific needs of an organisation and upskill staff on-the-job.