Investing in higher skills

To those of you who have read my previous columns, it will come as no surprise that I think there is a worrying mismatch between the skills employers need to sustain and grow their businesses and the skills young people are being taught in the UK today. Research has shown that I am not alone in my concerns, with many employers worried about the basic skills levels of school and college leavers today, as highlighted by the Work Foundation’s report, Lost in Transition, which I discussed earlier this year in my article Addressing the skills shortage to get Britain working again. This makes young people a risky employment prospect at a time when many businesses are cautious about taking on new staff.

It’s no coincidence then that record numbers of young people currently find themselves unable to get a job. Meanwhile graduates – traditionally considered highly employable – are faring little better as businesses put greater emphasis on the practical skills they need from their workforce to deliver commercial success. Therefore, it is now critical that young people are given the means to gain the right level of skills, which will make them employable.

This was recently reaffirmed by the Department for Work and Pensions’ (DWP) Select Committee recent review of the Youth Contract – the Government’s initiative to help get young people into work.  It further underlined the need for better understanding and provision of the skills employers are looking for to help get young people into work and requested a clear statement from the Government about how it will ensure schools are giving their pupils the right advice and guidance on the jobs markets and the skills and qualifications required to pursue their chosen careers. This is a clear signal that more needs to be done to match employer needs with the skills being taught to young people.

Nevertheless there have been some very positive steps toward tackling youth employment – most notably the investment given by the Government to apprenticeships, including at higher levels.  If you look abroad to countries such as the Netherlands and Germany, apprenticeship schemes and university degrees are viewed with parity of esteem. In fact, in Germany, apprenticeships form compulsory training for young people in many sectors up to the highest levels, leading to highly skilled jobs such as engineering. Not surprisingly perhaps, when compared with the UK, youth unemployment in Germany remains low.

As our European neighbour therefore shows, it’s important that we provide learners with the opportunity to study apprenticeships to a higher level in the UK too. That is why City & Guilds is expanding its portfolio beyond levels 3 and 4; because we believe it is vital to invest in the provision of longer progression routes for young people. Over the coming months, we are launching Higher Level Apprenticeships across a number of key sectors. City & Guilds’ IT and Business Higher Apprenticeships have already launched and these will be followed by Social Care Management and Hospitality and Catering later this month, and Engineering in November.

Progression opportunities such as these are of the upmost importance if we are to avoid the skills shortage businesses in the UK are facing; in the next five to ten years, our aging workforce must be replaced by an upcoming generation able to meet the demands of skilled work. Add to this the as yet unknown social and economic impacts that rising youth unemployment could lead to if something is not done to address some of the root causes soon.

Our research (The Economic Value of Apprenticeships) has shown the tremendous potential value of apprenticeships to the UK economy, with businesses set to benefit from a £4.37 billion boost by 2020 if one million extra apprenticeship places are created by 2013. This is largely down to the value apprentices can add to business, providing employers with the skills workforce they need to boost productivity and future growth. And it’s not just businesses that benefit, but the economy more broadly – the same report found that the cumulative tax impact would be £1.2m between 2012 and 2020.

Apprenticeships work for both businesses and individuals by providing companies with a skilled workforce to help them grow, whilst giving learners the hands-on experience, guidance and qualifications they need to help them develop real skills and progress in their chosen career. There’s never been a better time to invest in skills of all levels. Not only are they central to tackling youth employment and giving people the skills they need to support them into their first jobs, but they are vital to the future success of our economy.

Chris Jones is chief executive and director general of City and Guilds, the awarding body