20 million lost training days risk holding recovery back as employers cut investment in skills

@LearnWorkUK and @NOCNGroup- 20 million lost training days risk holding recovery back as employers cut investment in skills  

Action is needed to reverse falls in employer investment in training so that the UK’s economic recovery from the pandemic can be sustained. 

A new report by Learning and Work Institute shows that the declines in employer training over the past decade mean workers get 20 million fewer training days each year than if training had stayed at 2011 levels. It also shows that UK employers invest less per employee than many other countries.

Matching the EU average for investment per trainee would mean UK workers benefiting from an extra £6.5 billion investment in their skills each year. 

This matters because training and skills are pivotal to economic recovery from the pandemic, helping to improve productivity and linked to people getting pay rises. The evidence shows that more productive firms train more, and so it is worrying that this new report shows training fell most in sectors like retail and hospitality, where productivity is lowest. 

The research, produced with the support of NOCN, also lays bare stark inequalities in who gets training at work. Those with a degree-level qualification are four times more likely to access training than those with no qualifications. That means 1.2 million people who don’t have a GCSE-equivalent qualification are missing out on training each year because employers are less likely to invest in them than those with degrees. 

1.2 million people who don’t have a GCSE-equivalent qualification are missing out on training each year because employers are less likely to invest in them than those with degrees 

The Government invests directly in providing skills training, as well as setting the rules for the apprenticeship system and providing tax relief on businesses investment in training. But increasingly this is reinforcing unequal access to training, rather than tackling inequalities. 

For example, the apprenticeship levy system largely follows employer choices about who to invest in. The principle is that employers will make the most effective choices, but the result is that Government investment is increasingly following employers’ choices to invest in higher skilled employees rather than seeking to tackle systemic underinvestment in those with the fewest qualifications. 

Similarly, the new Lifetime Skills Guarantee, giving adults the chance to learn to A level equivalent, excludes qualifications in relatively low productivity sectors like retail and hospitality. An increase in skills in these sectors could increase productivity. 

The overall result is that Government policy is not doing enough to raise investment in skills in sectors and for people that could particularly benefit. 

These findings make clear the pressing need for greater action to increase employer investment in skills, particularly for those sectors and those employees currently missing out. This will require the Government to look at how to make sure its policy and investment tackle, rather than reinforce, unequal access to training.  

Stephen Evans, chief executive of Learning and Work Institute, said:

“The best employers know that investment in their staff is key to success. But employers’ investment in training has fallen over the last decade and the lowest paid and those with the fewest qualifications are most likely to miss out. This is holding our economy back and limiting people’s life chances and the Government needs to do more to change this. This report should be a clarion call for greater action to increase investment in skills and level up opportunity”.

Graham Hasting-Evans, chief executive of NOCN, said:

“As a progressive educational charity with a social rather than commercial purpose, NOCN is focused on skills investment across all sectors and groups in the UK and internationally. L&W’s new report highlights not only how the pandemic has affected investment in training but also identifies pre-pandemic issues of inequality and declining employer investment for skills. Skills investment from employers and the government is critical to ‘building back better’ from the pandemic and reducing inequalities in access to workplace learning. We look forward to continuing to support the L&W with their research into possible reforms to the Apprenticeship Levy and taxation systems to help boost employer investment in skills and provide sustainable economic growth.”