People will lose jobs, and find their skills are no longer in demand, but hope is on the horizon

As we approach the festive period, it is clear that the challenges presented by the COVID-19 pandemic will continue to bring further upheaval to all of our lives in 2021, and beyond.

The scale of the economic challenge cannot be underestimated.

People will lose jobs, and find their skills are no longer in demand.

Whilst no organisation alone can solve the problems we collectively face, by working collaboratively, sharing insights and developing a coordinated response, we can support people into employment and mitigate the potential long-term impact on peoples’ lives and careers.

The government has already taken significant action to prevent job losses.

The overall package of support announced so far is expected to cost £200bn. As of 18 October 2020, spending has totalled £41.4bn on the Coronavirus Job Retention Scheme, or ‘furlough’ as it more commonly known, providing support for 9.6 million jobs.

The scheme has been extended until 31 March 2021, raising the prospect of a winter with heavy restrictions and disruption to business. The effectiveness of the scheme can vary.

Whilst half of those who were previously furloughed had returned to work by September 2020, around 10% have no job to return to. Shockingly, this figure doubles to around 20% for BAME workers and young people.

The widening of inequalities should be a cause of concern for us all.

A McKinsey study found that globally, women were 1.8 times more likely to lose their job due to the pandemic. Analysis from the Covid Recovery Commission, an independent group of business leaders, demonstrates through data that the pandemic is disproportionately affecting deprived communities.

Unemployment benefit claims have risen most in those areas that were already suffering from high rates of claims, and the least well off are more likely to experience depression.

Despite unprecedented levels of public spending to help to avoid redundancies, the Bank of England expects the economy to have shrunk by 11% in 2020 and predicts that unemployment will peak at 7.75% in the second quarter of next year. This would be the highest rate since 2013.

Huge fall in unemployed people finding new jobs

Whilst job losses play a role, the expected rise in the rate of unemployment is largely driven by a huge fall in unemployed people finding new jobs. As the Resolution Foundation point out, job vacancies remained around a third lower than normal in September.

Whilst it will mitigate job losses, furlough alone cannot prevent rising unemployment. This problem will be of particular concern for those either leaving full-time education and looking for their first job, or those who may have lost work in an industry that is heavily impacted by the pandemic.

There are other issues that will have an impact on the economy and labour market. We are perilously close the to the end of the Brexit transition period. There is huge uncertainty about our future trading relationship with the European Union (EU). Indeed, at this late stage, it remains unclear whether we will secure a trade deal at all. The National Audit Office (NAO) has warned of ‘significant disruption’ when the transition period ends, with many traders unlikely to be ready for border checks.

The election result in the United States further compounds this issue. President-elect Joe Biden has publicly stated that there will be no trade deal between the US and the UK if the Good Friday agreement is breached and a hard border is returned in Ireland. This leaves the UK government in a much weaker position to walk away from negotiation with the EU.

Whatever our future trading relationship looks like will have consequences in the labour market. Sectors such as transport and logistics, manufacturing and agriculture could face additional barriers and challenges to their current operations. New migration rules have the potential to exacerbate recruitment challenges in high demand jobs roles, such as social care.

It is clear that the labour market in the UK is changing rapidly. It is therefore vital that the education and skills system can quickly pivot to ensure that we are preparing learners with the right skills that will be needed by employers. Our collective response needs to ensure that we can support adults of any age to train and retrain as needed.

We are not starting from an ideal place.

The Institute for Fiscal Studies 2020 annual report on education spending in England found that spending on adult education is about 50% lower than in 2009–10. The Learning and Work Institute’s most recent adult participation survey found that the number of adults reporting they are learning is at the lowest level in more than two decades, at just 36%.

The National Retraining Scheme has so far supported a modest number of learners, with just over 3,600 people across six pilot areas accessing the first digital service. The scheme is designed to help those already in employment, so is unlikely to be an effective vehicle to support those affected by the pandemic.

The scheme will be integrated into the National Skills Fund, a £600m per year manifesto commitment from the Conservatives. We have yet to see any concrete proposals for what the scheme will look like, but we do know that some of the money will be used to fund the Lifetime Skills Guarantee and free provision for those without an level 3 (A Level equivalent) qualification.

The government have yet to publish details on which qualifications will be funded, so as yet it is difficult to plan. Once we understand the size and subject areas of eligible qualifications, as well as the mode of study, we can work together to signpost learners to take up the offer.

Many people will slip through the net

Whilst this is welcome, there are clearly many people who will slip through the net by not meeting eligibility requirements. For example, this funding will not support those who already hold a level 3 in a subject with poor employment prospects.

There may be other learners looking for full-time study but are finding that without maintenance provision to support them whilst they study, they are unable to afford to access the training they need. There will also be people who need to access training at entry to level 2. These people are typically those furthest away from being able to secure a job, and need intense, targeted support.

Adults can, of course, benefit from apprenticeship opportunities, but unlike other forms of training, these opportunities can only be created by employers. We have already seen a drastic reduction in apprenticeship starts due to the pandemic.

Many employers are unsure whether they will still be available, others face uncertainty over how restrictions will impact their business. It is too early to say whether newly introduced incentives for employers will be enough to mitigate the overall drop in the number of apprenticeships.

Whist the overall picture is bleak, there are reasons to be optimistic. Despite many job losses, there are still opportunities out there. Institute for employment Studies analysis of Adzuna vacancy data shows that there is still high demand from employers in healthcare and digital, whilst some sectors, such as logistics and warehousing, have reported significant additional vacancies due to the pandemic. Other industries have made significant recovery, such as construction, which is also likely to be buoyed by large infrastructure projects, such as HS2.

How organisations have worked together

A further reason for hope can be found in looking at how organisations have worked together during the pandemic. NCFE has worked alongside Foundation for Education Development (FED) to facilitate collaboration across the sector and share expertise.

Our Centre of Excellence Partnership with World Skills UK, launched in September 2020 and will support educational institutions over a three-year pilot to transfer world-class expertise to educators and influence standards across TVET.

NCFE is also a member of the Youth Employment Group; by sharing insights and working collaboratively, group members have been able to form a collective response to challenges around youth employment, as well as put forward recommendations to policy makers.

The key for those of us in education and skills is to understand where the opportunities will be, and how we can equip learners with the tools they need to train, retrain, and ultimately secure a job.

NCFE is an educational charity first and foremost.

Our role in supporting our recovery from the pandemic must recognise that we are much more than simply an awarding organisation. We will continue to work collaboratively with colleagues and policy makers to play our part and take action.

That is why we are launching our Go the Distance offer for adults, supporting adults with training for employment.

Through this, we will:

• Ease adults back into learning and education by providing them with clear pathways into growing sectors – equipping them with the skills and confidence they need to assess their options while studying, and identify a suitable employment or career pathway
• Help employers gain the reassurance they need that adults coming from different sectors have the skills they need to make the transition into a new industry area
• Support adults seeking to start their own business, providing them with the knowledge to make their dreams a reality
• Work with providers to provide regional expertise (gathered through regional engagement activity already undertaken), and help them to build a curriculum which maps to their local priorities
• Highlight a range of fundable qualifications that will give learners the best possible chance of finding employment in growing sectors, by giving them the skills they need to make the transition.