Sharper focus needed on skills crucial to UK productivity

Public Accounts Committee warns of potential Brexit impact and calls for action on gender imbalances in their latest PAC Report “Delivering STEM skills for the economy” published today (22 Jun).

STEM skills (science, technology, engineering and maths) are crucial for the UK’s productivity, and a shortage of STEM skills in the workforce is one of our key economic problems.

The future workforce relies on many more children and young people being encouraged to take STEM subjects and enter STEM careers.

Government is not well placed to understand the extent of the challenge and ensure the supply of STEM skills, especially in the context of withdrawal from the European Union.

In particular, there remains a need to address marked gender imbalances in several areas of STEM learning and work – demonstrated, for example, by the fact that only 8% of STEM apprenticeship starts are undertaken by women.

The quality of careers advice in schools is patchy at best, perpetuating misconceptions about STEM careers. In addition, the way that schools are funded will restrict the likelihood of pupils moving to other, more STEM-focused learning providers, such as the new institutes of technology.

To make better informed decisions, departments also need to tackle the apparent lack of industry and commercial experience on their STEM boards and working groups.

COMMENT FROM PAC CHAIR MEG HILLIER MP:

“Warm words about the economic benefits of STEM skills are worth little if they are not supported by a coherent plan to deliver them.

“Government must take a strategic view, properly informed by the requirements of industry and the anticipated impact of Brexit on the UK’s skills mix.

“But Government also needs to sharpen its focus on the details, from providing sound advice to pupils through to ensuring schools have the right skills in the classroom and STEM-focused institutions are properly supported.

“Poor-quality apprenticeships must be weeded out and there is still much work required to address the striking gender imbalance in STEM apprenticeships.

“This is a challenging and long-term project but there are practical steps the Government can and should be taking now.”

Andy Durman, Managing Director, Emsi UK, said:

“As the report rightly states, a major part of any solution to the shortage of STEM skills is a better understanding of employer skills needs at the local and regional level, since demand for such occupations is by no means uniform across the country.

“By gaining insight into the demand for STEM skills within local and regional economies, we are not only better placed to align education and training in those areas with the needs of employers, but we are also better placed to give young people a STEM career vision, by showing them how training in these skills can lead them to in-demand, well paid and sustainable employment.”

CONCLUSIONS AND RECOMMENDATIONS

BEIS and DfE do not currently have sufficient understanding of what specific skills businesses really need or how Brexit will affect the already difficult task of ensuring the supply of STEM skills in the workforce.

There is no universal definition of what should be counted as a STEM subject or job, which makes it difficult for government to clearly understand what STEM skills are needed.

As technology advances, the skills required of the workforce change, but the pace of change means that skills development often lags behind. DfE is conducting an employer skills survey, which is expected to provide a more detailed picture of skills supply and demand, but the results are not due to be published until summer 2018.

The departments’ lack of urgency is also demonstrated by their heavy reliance on the work of the Migration Advisory Committee, which is due to report on European workers in the UK labour market in September 2018, and has been asked to address the issue of the number of visas available for highly skilled migrants.

We are also concerned that BEIS is uncertain about whether the public sector pay cap is restricting organisations’ ability to recruit workers from overseas with the skills needed to help deliver major infrastructure projects.

Recommendation: Following publication of the Migration Advisory Committee report in September 2018, BEIS and DfE should, within six months, set out the further steps they will take to ensure that STEM skills shortages are addressed. 

We remain to be convinced that the proposed Skills Advisory Panels will properly understand national and global skills issues.

The UK Commission for Employment and Skills, the main body previously responsible for producing strategic information on skills supply, closed in early 2017, creating a vacuum in terms of government labour market intelligence.

DfE is setting up Skills Advisory Panels (SAPs), which will work with Local Enterprise Partnerships (LEPs) to better understand regional and local skills needs. This Committee has previously reported its concerns about LEPs’ variable capacity and capability. DfE plans to establish an initial group of seven SAPs in 2018, and intends to evaluate their success in summer 2019.

Given the nature of the market for high-level STEM skills, we are sceptical as to whether SAPs will be sufficiently aware of national and global skills supply issues to carry out their responsibilities effectively.   

Recommendation: DfE should set out what specific steps it will take to ensure that SAPs are sufficiently aware of national and global skills supply issues to be fully effective.

We are concerned that government STEM boards and working groups do not include enough practical industry or commercial experience to spot key problems and deliver effective solutions.

We recognise that government is taking some steps to address the long-standing lack of co-ordination on STEM issues. In the last year, DfE has set up a cross-government STEM group, and the Department also has an internal STEM board, whose role is to consider STEM issues across the education pipeline.

However, these groups are generally staffed by policy experts, and DfE does not know which of the group members has any practical experience – for example, through working in industry.

As such, the groups may be missing crucial knowledge of STEM issues, which could stop them from being sufficiently responsive to the changing demands of employers. 

Recommendation: By summer 2018, the departments should review the membership of all STEM boards and working groups, and address any shortfalls in expertise – for example, in industry knowledge or experience in STEM learning and work. 

DfE does not know whether people given financial incentives to undertake teacher training are remaining in the profession. 

In 2016, the Committee expressed concern that DfE did not know what proportion of those receiving bursaries and other financial incentives to enter teacher training (particularly in STEM subjects) actually went on to qualify and teach in that subject. The Department undertook to examine the issue as a matter of urgency, and conclude on the value for money of the bursary scheme by April 2018.

While the Department has examined the impact of financial incentives on the number of applications for teacher training, it still does not know how long the successful applicants stay in the teaching profession, and therefore cannot say whether these incentives are achieving the desired outcomes.

Recommendation: DfE must identify as soon as possible whether financial incentives for teacher training have delivered value for money, and report its findings to the Committee as promised. 

The departments are making insufficient progress in addressing the gender imbalance in many areas of STEM learning and work, which is particularly troubling given the Committee’s previous concerns.

When the Committee examined the apprenticeships programme in late 2016, it recommended that DfE should set up performance measures for the programme that included whether it is delivering improved access to under-represented groups across all occupations.

Performance measures have been established for the number of black and minority ethnic apprentices and those with learning disabilities. DfE did not introduce a target relating to female apprentices, because it was satisfied with the fact that women made up over 50% of apprenticeship starts overall. But only 8% of STEM apprenticeship starts are undertaken by women.

The gender imbalance is also apparent for A levels, where women and girls are well represented in biology, but little progress has been made in increasing the numbers in subjects like computing and physics.  

Recommendation: By the end of 2018, the departments should establish, and start to monitor progress against, specific targets relating to the involvement of girls and women in key STEM learning programmes such as apprenticeships.

We are concerned about the quality of careers advice in our schools and colleges. It is clear that many young people perceive STEM subjects to be too challenging, and conclude that STEM-related careers are therefore not suitable for them.

Government’s efforts to boost STEM skills in the workplace will fail if these perceptions continue and not enough children choose to study STEM subjects. DfE’s December 2017 careers strategy acknowledges a significant gap in the quality of careers advice in schools. In response, the Department has asked the Careers & Enterprise Company to focus particularly on STEM when producing toolkits on what works.

Careers guidance is one of many elements that Ofsted may examine when inspecting secondary schools. But Ofsted does not give those schools an explicit rating that indicates the quality of careers guidance offered.       

Recommendation: DfE should make better use of data on career destinations and salaries to incentivise young people to work towards careers in particular STEM sectors where there is higher need. As part of its plans to improve the quality of careers advice, DfE should work with Ofsted to consider rating the quality of advice provided in schools.

The current education funding model will make it difficult for new types of learning institution, such as the institutes of technology, to establish themselves.

Schools are funded per pupil and so have a clear financial incentive to retain their existing students, rather than encouraging them to move to learning institutions that provide vocational skills. In addition, many parents and young people regard academic learning as inherently superior to the acquisition of vocational skills.

The new institutes of technology are intended to provide an alternative ‘offer’ from that delivered by school sixth forms, but they will face a major challenge to persuade pupils to leave the school environment. University technology colleges (UTCs) are a case in point; they have been in existence since 2010 but many have struggled to attract enough students to be financially viable. DfE risks wasting time, effort and money if it does not learn lessons quickly from past initiatives.

Recommendation: As a matter of urgency, DfE needs to develop a clearer plan for how new types of learning institution, such as the institutes of technology, will attract the numbers of students they need to be viable. 

The departments have allowed poor quality provision – especially in apprenticeships – to continue for too long without being addressed.

Many of the old-style apprenticeship ‘frameworks’ delivered poorly designed and inadequate programmes of learning for several years. Some stakeholders have claimed that a significant proportion of the programmes of learning do not constitute real apprenticeships. The Department is introducing new, employer-designed ‘standards’, which are meant to represent more relevant and better quality packages of learning for apprentices.

Good monitoring systems are required to ensure that current and future apprenticeships are of the required quality. Ofsted will play an important role in assessing the quality of apprenticeship programmes being delivered by individual providers. But it is unclear whether DfE has systems in place to identify poor quality provision in a timely way, and take appropriate action. 

Recommendation: DfE should ensure it has effective monitoring systems in place to quickly identify apprenticeship programmes that are not fit-for-purpose, along with poor quality provision, and the action it will take in each case.

Evidence relating to this Report can be found here.