Skills
Deficit
The
Consequences & opportunities for UK infrastructure
2015
Thought leadership
02
the skills deficit
The research process
Atkins commissioned Remark Research and Marketing to undertake
a study into the consequences of a shortage of engineering skills in
the UK. The objective was to move on the debate from simply reporting
a widely-recognised skills shortage to focus on the risks that it poses
to real projects. The research aligns to projects in the UK National
Infrastructure Plan, and doesn’t look at the Scottish Infrastructure
Plan as a separate entity.
Over the course of six months, from June to November 2014, Remark
carried out a series of interviews with 40 industry leading experts from
UK infrastructure owners and their supply chains, academia and relevant
industry bodies as well as from Atkins’ own specialists.
Acknowledgements
We express sincere thanks to the following contributors to this research
for their participation:
Koji Agatsuma (Hitachi), Martin Arter (Network Rail), Peggy BarthesStreit (EE), Mike Bradley (Rolls-Royce), Prof. Tim Broyd (The Bartlett,
UCL), Paul Clark (HS2), Ian Duffy (BP), Dr Andrew Edkins (UCL), ScottJames Eley (HS2), Duncan Elliott (Carillion), Roger Evans MBE (Tidal
Lagoon Power), Prof. David Fisk (Imperial College), Prof. David Gann CBE
(Imperial College), Paul Hohnsbeen (Laing O’Rourke), Rod Hulse (Gatwick
Airport), Vicki Hyland (BP), Darren James (Costain), Richard Price
(Southern Water), Jon Prichard (The Engineering Council), Paul Redmond
(University of Liverpool), David Rooke (Environment Agency), John van
Berkel (IBM), David Waboso (London Underground), Gordon Wakeford
(Siemens) and Phil Wilbraham (Heathrow Airport).
Atkins: Allan Cook CBE, Philip Davis, Elspeth Finch, Martin Grant,
Jonathan Guest, Stuart Jackman, Mike McNicholas, Nick Roberts,
Chris Rogan, Steve Tasker, Neil Watt and Mike Woolgar.
Editorial team:
Eleanor Campion, Gary Gaskarth, Jonathan Guest, Mark Hargreaves,
Lucy Hart, Alex Pullin, Sarah Reavley and Winnie Rogers.
A number of contributors participated in this research on an anonymous
basis and we also thank them for their insightful views.
The findings of this report are based on this qualitative, anecdotal
evidence and are not necessarily the views shared by either Atkins or
Remark. The report also draws on a range of published articles and
research reports which are credited in the footnotes throughout.
January 2015
© Atkins 2015
the skills deficit
01
Skills
Deficit
The
Consequences & opportunities for UK infrastructure
02
the skills deficit
“There is a shortage at every level.
I think it’s the biggest risk
to delivery of new infrastructure.
The skills shortage is across the board but
it depends on the technologies.
There is an ageing professional workforce
and we need to increase the number of
young people coming into the industry.”
David Rooke
Executive director of flood and coastal risk management
Environment Agency
the skills deficit
Contents
Foreword
04
overview
06
Transport15
water
23
energy
33
digital infrastructure
43
Conclusions
51
Our time to make a difference 56
disclaimer
58
03
04
the skills deficit
Foreword
Barely a week goes by without seeing or hearing a reference to
skills shortages in the UK, particularly those associated with Science,
Engineering, Maths and Technology (STEM) careers. It would,
therefore, be fair to assume that businesses, politicians and educational
establishments know there is an issue. But despite the many initiatives
underway to try and find a solution, there is still a big challenge ahead.
The impact of the skills shortage is frequently expressed in the context
of ‘damage to the UK economy’, but we have concerns that the longer
term consequences run far deeper. Infrastructure is the fabric of our
society. Whether transport, water, energy or our cities, it’s something
which we all depend on to go about our daily lives. The UK government
has recognised its importance and is investing heavily in maintenance
programmes, upgrades and building new infrastructure. There is a multibillion pound pipeline of projects to be delivered over the coming years
to meet the needs of a growing population and the evolving way we live
and work in the 21st Century. However, all these schemes rely on having
the people with the right skills available to deliver them.
We felt this issue was worth further exploration to understand better the
consequences a shortage of engineers could have on our critical national
infrastructure projects. While we are not at the point of widespread
cancellations of projects, many firms are struggling to recruit staff. Two
thirds of our contributors expect this shortage to worsen over the next
five years.
One of the main consequences of the unaddressed skills shortage will be
a sharp increase in the price we pay to deliver our infrastructure. This will
mean that budgets don’t go as far as anticipated, so we either get less of
what we need, or we pay more for it. In the latter case the cost burden
could fall on the British public through increased taxation or rising utility
and transport costs.
the skills deficit
Industry, academia, government and institutions need to come together
to find the solutions to this looming challenge for infrastructure. The
need for closer collaboration between academia and industry is a very
clear message from this research. Greater investment is needed in
training, apprenticeship schemes and incentive programmes to get more
young people into STEM careers at a younger age. At the same time the
industry needs to look at how it can use new and emerging technologies
more effectively and adapt to make better use of those skills which are
more readily available.
I would like to extend my thanks to all those who contributed to this
research. The consequences of not doing enough to address the skills
shortage are significant and I hope that keeping these in focus will
continue to drive all parties to find a solution. After all, that’s what
engineers do best.
Nick Roberts
Chief executive officer, UK and Europe
Atkins
05
06
the skills deficit
Overview
In December 2014, the Chief Secretary to the Treasury launched
an updated National Infrastructure Plan outlining the government’s
strategy for meeting the UK’s infrastructure needs to 2020 and beyond.
The Plan aims to provide a strategic approach to infrastructure planning,
prioritisation, funding, financing and delivery, with a pipeline of over
£460 billion of public and private investment 1. This emphasises the
government’s commitment to maintaining and developing the UK’s
infrastructure and its importance for driving growth, creating jobs and
generating the networks that allow businesses and organisations
to thrive.
Companies in the UK are projected to need 1.86 million people
with engineering skills from 2010-20202. This means the UK needs
to double the number of engineering-related apprentices and graduates
coming out of colleges and universities3. We estimate that industry
and government will need to invest up to £2.5 billion to train enough
scientists, designers and engineers to meet the requirements of the
economy.
However, the skills shortage also presents some opportunities to do
things differently. With limited resources we believe better strategic
planning which focuses on minimising skills-related issues across the
whole National Infrastructure Plan is needed. This could result in more
than £6 billion of cost savings.
At Atkins we believe there’s an industry need to broaden the debate
on the skills shortage to ensure it continues to remain a top priority
for government, academia and industry. This prompted us to focus on
the consequences a skills shortage could have on the delivery of real
projects in the National Infrastructure Plan. We want this report to be
used as a catalyst for discussion to challenge the status quo of how
we’re currently dealing with the skills shortage.
1
https://www.gov.uk/government/
uploads/system/uploads/attachment
_data/file/381884/2902895_
NationalInfrastructurePlan2014_acc.pdf
2
http://www.engineeringuk.com/_
resources/documents/EngineeringUK_
Infographics_2014.pdf
3
http://www.engineeringuk.com/_
resources/documents/EngineeringUK_
Infographics_2014.pdf
the skills deficit
Nat
Infras ional
t
Plan inructure
cl
projectudes
s
doubling
the current percentage
of women in engineering
will add an extra
96K
totall
in
over g
people to the
talent pool
£460bn
Superfast Broadband – UK Wide
Edinburgh – Super Connected Cities
Western High Voltage
Direct Current
Newcastle – Super Connected Cities
Sunderland Strategic Corridor
Bradford – Super Connected Cities
Mersey Gateway Bridge
Wylfa Newydd Nuclear
Power Station
Northern Hub
Leeds City Flood Alleviation Scheme
Manchester Metrolink Extensions
Nottingham NE2
A14
Improvements
Birmingham Airport
Runway Extension
Cardiff – Super
Connected Cities
Hinkley Point C
A380 South
Devon Link Road
£6bn
saving
to be made
THROUGH BETTER STRATEGIC PLANNING
HS2
Norwich Northern
Distributor Road
Crossrail
Thames Tideway Tunnel
Bristol – Super
South East
Connected Cities Airport Capacity
Exeter Flood
Defence Scheme
the cost to train enough
scientists and engineers
£2.5bn
07
08
the skills deficit
the skills deficit
Sector reports
The report is broken down into four key sector focuses, each
highlighting specific consequences through the view and opinions
of our industry and academic contributors.
 Transport
Water
 Energy
Digital infrastructure
09
the skills deficit
Our key findings
Although findings in each sector varied, there were a number
of common themes that emerged which are likely to affect all
types of infrastructure.
Higher project costs
More than 80 per cent of contributors predict that having too few
engineers in the UK will lead to significant wage increases. With people
representing a significant proportion of project costs, these increases
are predicted to impact all infrastructure sectors. This could be in the
form of higher project costs or reducing the benefit of other types of
cost saving initiatives. Many organisations are already reporting salary
costs rising at levels from anything between five and 20 per cent, with
some instances of engineers changing jobs for 50 per cent pay rises.
Ultimately increased costs of delivering infrastructure will result in either
a higher burden on the UK tax payer, fewer projects being delivered or
work being deferred. Neil Watt, project director, Atkins, said:
“The bottom line is there is a shortage. The price of an engineering
graduate goes up and that has an impact on how we bid for
work, particularly when it comes to infrastructure projects which
are traditionally funded by government. Projects get curtailed, they
become more expensive and you get fewer of them.”
Delays to projects
Many of the experts who contributed to the report believe that delays
to the delivery of critical national infrastructure projects will be a further
consequence. The National Infrastructure Plan identifies a significant
number of projects coming online over the next decade. This provides
welcome clarity around future requirements and opportunities for
the industry. However, there are fears that in some cases projects
will be competing for resources and engineers will be drawn to the
most buoyant sectors. For example evidence suggests we are already
seeing engineers from the water industry transferring to the energy
sector where there are higher salaries and more attractive project
opportunities. This process can lead to an unstable workforce and
could threaten the delivery of water infrastructure when the market
moves into commissioning mode. Experts felt that more needed to
be done to sequence the approach for delivery, providing a smoother
flow of work and reducing the stress placed on limited specialist skills.
Ultimately if sufficient engineers aren’t available to deliver the whole
work programme, some projects in the future could be deferred until
the resources become available.
© FatManPhotoUK
10
http://www3.weforum.org/docs/WEF_
GlobalCompetitivenessReport_2013-14.pdf
- p.397
4
Damage to UK economy and global competitiveness
A lack of engineering skills could easily have a negative impact on the
UK’s global competitiveness. This has a number of implications for the
relative attractiveness of the country as a destination for global business.
The 2014-15 World Economic Forum Global Competitiveness Report
ranked the UK as the ninth most competitive country in the world, but
only 28 for overall quality of infrastructure4. If infrastructure needs are
not being met due to the lack of suitably qualified people to deliver it,
the UK will become less attractive for investors or as a place to live and
do business. Elspeth Finch, director of innovation, Atkins, commented:
“We can’t afford for businesses to choose to locate elsewhere
because our infrastructure is not up to scratch. Our cities compete
internationally and we need to ensure we don’t just keep up – but
remain ahead.“
Delivery quality
The lack of skills could lead to inexperienced or underqualified
people making decisions about critical national infrastructure. This
could be in the commissioning of work, assessment of supply chain
bids or the management of project delivery. If companies and
government don’t have enough of the right individuals, they could be
forced into compromising and putting best fit alternative candidates into
roles. This could then lead to poor planning, delivery and overall usability
of infrastructure. Jon Prichard, CEO, The Engineering Council, said:
“You have the risk where the government is spending money on
these projects. They could be the wrong ones, leading to the wrong
solutions if they don’t have the in-house capability to tell them what
the right solution should be. That is the risk of the skills shortage.”
11
© Dan Kitwood/ Getty Images
the skills deficit
the skills deficit
© Peter Macdiarmid
12
Reliance on overseas skills
& loss of intellectual property
If the UK cannot resource projects, companies will need to import skills
from other countries, either by bringing staff to the UK or by using
offshore resources. Overseas skills can be more cost effective than UK
resources, particularly if wage inflation continues to push up salaries
further. But the UK could lose out if it becomes reliant on them. One
contributor commented:
“Besides the low cost element, other countries are attractive and
have the volume and potential engineering capability that just
doesn’t exist in the UK.”
However, companies are not only facing challenges with domestic
recruits but as highlighted by Dr Andrew Edkins, vice dean of enterprise,
The Bartlett School of Construction and Project Management, UCL,
recruiting overseas talent poses its own issues:
“Post-graduate students who are in the UK on study visas now
have two to four months after completion of their studies to leave
the country. We are in a situation now where we have companies
that want to recruit really good individuals and some of the really
good individuals we are producing are the ones that are on study
visas. Businesses that want to recruit good people don’t necessarily
want to get involved in challenges of getting the work visa, this is
putting the companies off recruiting these talented individuals as
it is an extra hurdle to get over.”
the skills deficit
Using overseas skills to plug the domestic gap also poses issues.
Intellectual property when individuals leave the UK, jobs and income for
UK workers, and tax revenues for government are all lost. In addition,
incompatible or different levels of skills can lead to delays, necessitate
repairs and add further costs. There are also perceived risks from
different national standards in training and delivery of work on projects
that could have health and safety implications.
In some sectors, such as digital infrastructure, the importing of skills
can also pose security risks, which could provide other countries with
insight into the UK’s national infrastructure security systems. Mike
McNicholas, managing director for the design and engineering division
at Atkins, commented:
“If we have projects in our high-security marketplaces then we
can only use UK nationals. Security is becoming increasingly
important in a number of areas, so that would pose a challenge.”
Stifling innovation
Innovation is vitally important in creating solutions to modern day
infrastructure challenges. Introducing a new solution takes time
and effort to ensure it works properly, it’s safe and secure, and can
be delivered practically and used through its lifetime. If resources
are strained and staff are too busy coping with their workload, the
opportunities and time to look for and develop new ideas can become
limited. Innovative solutions, when developed, not only benefit
companies and projects, but have wider positive effects on the industry
and country as a whole. If a shortage of engineers stifles innovation it
could hold back development of future infrastructure projects in the UK.
Although a number of respondents felt the skills shortage would stifle
innovation, some held a counter view. They felt that the pressure on
skills was a burning platform which would force people to find quicker,
more efficient ways of delivering projects.
13
14
the skills deficit for the transport
transport
How will the Transport sector and its projects be affected by the
skills deficit? This section of our report highlights the four key
consequences facing the sector.
Consequences of the skills shortage identified in this section have been categorised into four themes:
increased
costs
Delay to
projects
Stifling
innovation
Damage to
UK economy
the skills deficit for the transport
transport
The shortage of engineers in the Transport sector, which includes rail,
roads and aviation, could have wide scale impacts on the construction
of some of the critical projects outlined in the government’s National
Infrastructure Plan. As KPMG highlighted in a recent report, 57 per cent
of the total forecast expenditure on all central and local government
construction projects in the coming years will be focused on transport
schemes. However, a skills shortage is already being felt across all
parts of the sector including expertise in logistics, planning, electrical,
signalling, tunnelling and project management, and the direct business
cost of the skills shortage within the Transport sector could rise by £19
million by 2020.
Given the scale of the planned expenditure in this sector, the demand
for engineering skills is expected to increase in the next decade. On
top of the existing shortage of engineers, this rise could put significant
pressure on costs and delivery across the UK. Industry experts have
identified four key consequences of the skills shortage increased costs,
delay to projects, stifling of innovation and damage to the economy.
Chris Rogan, managing director, rail communication systems at Atkins,
commented:
“We’re putting a tremendous amount of effort into developing
our existing teams and bringing new people into our business.
This is against a background of skills shortages across the industry.
Key pressure points include making sure that we have sufficient
experienced engineering managers – people with 10 years good
experience who really understand what our clients need and can
deliver technically excellent solutions. We are continuing to make
significant investment in our people by providing excellent training
opportunities, for example through our apprenticeship schemes and
a bespoke rail MSc, and by building on our capability by bringing
new people into the industry.”
© Darren Baker
16
the skills deficit for the transport
Increased costs
salaries
increases
between
20%
5%
Above average wage inflation is already being felt across the Transport
sector as companies compete for the most in demand resources.
Some participants in our research have reported increases in salaries
of between five and 20 per cent, with instances of some individuals
moving for as much as 50 per cent increases. As staff costs represent a
significant proportion of any infrastructure development, an increase in
salaries will start immediately to counteract cost savings in other areas
and could translate into higher costs of delivering projects. For publicly
funded projects this ultimately means there is an increased burden
on the tax payer or fewer schemes are able to be delivered within the
available funding. Martin Arter, programmes and commercial director,
Network Rail, commented:
“We are in some areas at the limits of the supply chain capacity.
This has consequences for delivery, but also an impact on cost. Many
suppliers are reporting significant wage rate inflation of the order
of 15 to 20 per cent.”
Speaking on the BBC Newsnight programme in July 2014, Sir David
Higgins, the chairman of HS2 said that the project could require 20 to
30 senior people to be paid more than the Prime Minister within the
next six months. He justified this by saying:
“The worst money you can save is skimping on paying the
best people 1.”
As many of the engineering skills required to build different aspects of
new infrastructure are interchangeable, organisations are seeing their
staff leave to move into other sectors for higher salaries. Paul Clark,
interim project engineering director phase 1, HS2, said:
“We’re all chasing the same scarce resource. This has an impact
on salaries and therefore costs.”
1
http://www.bbc.co.uk/news/uk-28156292
17
18
the skills deficit for the transport
This is a particular issue for public sector or quasi-public sector
organisations that are subject to government pay constraints.
The aviation sector in particular is witnessing movement of engineers
to other sectors to take advantage of better remuneration packages
on offer. Rod Hulse, head of quality assurance, Gatwick Airport,
commented:
“There will be cross competition for talent between various
infrastructure projects. We’ve had quite a few people move
© jukov
from the aviation sector.”
the skills deficit for the transport
Delay to projects
It’s predicted the skills shortage will increase the likelihood of
delays to projects with the long-term possibility of work being
postponed indefinitely or cancelled in the future. Martin Arter,
Network Rail, commented:
‘‘The worst case scenario over the next five to 10 years is that the
projects won’t get delivered.”
Industry experts have also expressed concerns that the National
Infrastructure Plan itself is, as an unintended consequence, adding
further pressure on skills. As large numbers of projects are given the
green light, scheduling to deliver these projects will start to become a
challenge. Resources will be stretched as too many programmes need
to be delivered within the same time frame, particularly those where
engineers with easily transferable skills can apply them in any of a
number of sectors. Network Rail’s Martin Arter, added:
“The danger is that we overheat the market because there are
a number of things coming together: fracking, nuclear, gas fired
power programme, core rail, HS2 all providing a pull. It depends
on how they are all sequenced or not, and I think that will drive
a new challenge around professional leadership and management.”
At the same time as delivering the new projects, there is a considerable
amount of maintenance of existing infrastructure which needs to be
carried out in tandem. Although many of the core skills needed for new
build are different from those needed to maintain, infrastructure owners
and their supply chains will have some tough choices in terms of where
to train, develop and apply their resources to meet the requirements
for both. It is predicted this impact of the skills shortage will not be felt
properly until we move into the next decade.
19
the skills deficit for the transport
© egdigital
20
Stifling innovation
Technology is likely to play an increasingly important role in meeting
the UK’s needs for 21st Century transport infrastructure. Encouraging,
supporting and most importantly funding innovation may help the
sector find new ways of both overcoming the shortage of skills and
increasing efficiency in the delivery of transport schemes. However,
the pressure on resources could also have the opposite effect by
restricting the amount of time individuals have to dedicate to developing
innovative solutions. Phil Wilbraham, development director, Heathrow
Airport, commented:
“We will struggle to find the innovation we will need, that often
comes through the design phase. As a consequence we will get a
more risk adverse approach particularly from the designers and that
will lead to more expensive and less innovative solutions.”
Damage to UK economy
If the skills shortage is not addressed, the UK’s reputation as a centre
of excellence in engineering could be lost with a negative impact on
the economy. An integrated and forward-looking transport strategy
is a critical condition for sustainable economic growth and social
inclusion in the UK. David Waboso, capital programmes director,
London Underground, commented:
“It affects our ability to export as well as not building sustainable
resources and skills in Britain, so would be a double whammy.”
the skills deficit for the transport
If the skills shortage leads to transport projects being delayed or
cancelled, or if it increases the capital investment cost, which in turn
leads to higher charges for users, it is likely to damage the wider UK
economy. Transporting passengers and freight around the UK will
become more expensive, more time consuming and less reliable.
Rod Hulse, Gatwick Airport, said:
“If we can’t move goods and people around the country and
have an efficient means of export how can we possibly compete?
In the aviation business the clear rivals are Schiphol in The
Netherlands and Istanbul in Turkey. If we don’t do something in
the UK about increasing our airport capacity, those two airports
in particular are both expanding hugely, with very ambitious plans
and they will take on all the potential traffic from the UK airports.”
Building Information Modelling (BIM) is a further area where the
infrastructure sector is currently lacking sufficient skills. With the
use of Building Information Modelling being a requirement for all
publicly funded construction projects in the UK from 2016, there is an
opportunity for British companies to lead the way in project delivery
around the world. These skills will inevitably give the UK a competitive
advantage against other countries. However, as identified by one of our
contributors, the skills base of Building Information Modelling is already
showing signs of a shortage. HS2’s Paul Clark said:
“Where there is a big shortage in Building Information Modelling
is at a high level where you are looking for people with leadership
skills combined with the technical knowledge and technical demands
that Building Information Modelling creates. It sometimes feels like
there are only half a dozen people in the country capable of offering
that because the same names keep cropping up.”
Scott-James Ely, skills and employment strategy manager, HS2 added:
“I think our ability to embrace modern construction methodology
to its fullest extent and deploy that in delivering HS2 is one of the
things that could potentially be at risk because of skills shortage.”
21
22
the skills deficit for the water
water
How will the Water sector and its projects be affected by the skills
deficit? This section of our report highlights five key consequences
facing the sector.
Consequences of the skills shortage identified in this section have been categorised into five themes:
increased
costs
POOR DECISION
MAKING
Delay to
projects
Stifling
innovation
Loss of intellectual
property
24
the skills deficit for the water
water
A shortage of engineers in the Water sector could have wide-ranging
implications for the delivery of projects in the National Infrastructure
Plan as well as those being delivered by water companies around the
country as part of the normal regulatory cycle. The government has
stated its vision for an innovative, sustainable, resilient and customerfocused Water sector that is equipped to meet the challenges for the
UK in the long term. Its task is to secure the provision of clean water,
manage waste and tackle flood management while also:
 adapting to and mitigating the effects of climate change
 managing the needs of a growing population
 complying with ever more stringent environmental standards
 maintaining ageing infrastructure
 meeting the requirements of a low carbon economy.
However, the skills shortage could cost the water industry £12 million
in recruitment and resources by 2020. Our experts have identified a
number of key challenges of delivering new water, flood and waste
infrastructure and maintenance of existing systems. These include:
increased costs, delays to projects, the stifling of innovation, loss of
intellectual property and poor decision making.
25
© Getty Images
the skills deficit for the water
26
the skills deficit for the water
Increased costs
A skills shortage is expected by a number of people to lead to reduced
efficiency, which in turn will cause increased costs to the delivery of
new water projects. Richard Price, director of construction, Southern
Water, commented:
“I think the efficiency of UK delivery of infrastructure could be
compromised by resource scarcity as programmes will struggle
to get the right people leading to potential elongation of projects.
We will end up paying more for the right resources and there will
probably be a dilution of expertise. All of these mega projects and
programmes will want the best resources. Whilst Southern Water
will not compromise on quality and experience in our capability,
there is clearly a danger organisations may accept less experienced
resources because of the necessity to deliver the projects which could
compromise the success of the project.”
There is a further concern that a lack of engineers and technical staff
with the right levels of knowledge and experience could mean the
wrong projects are being delivered. Public sector pay constraints add
to the problem which potentially leads to having less experienced
people determining the scope and nature of these infrastructure
projects. Jon Prichard, CEO, The Engineering Council, said:
“You have the risk where the government is spending money
on these projects. They could be the wrong ones, leading to the
wrong solutions if they don’t have the in-house capability to tell
them what the right solution should be. That is the risk of the
skills shortage.”
the skills deficit for the water
27
Wage inflation
As competition for resources on projects become more apparent due
to the number of engineers available, wages may become a primary
tool used to incentivise people onto large scale projects such as Thames
Tideway Tunnel and upgrades to water supply and sewage networks
across the UK. One contributor commented:
“We are seeing civil engineering work starting to cost more, which is
caused by wage increases as well as materials.“
Sector competition
Experienced engineers with transferable skills are in demand. A
particular concern for the Water sector and something which evidence
suggests is already happening is talent being poached by other sectors.
With a strong pipeline of work, the opportunity to work on iconic
projects such as HS2, Crossrail and Hinkley Point C, can lead to resources
leaving for higher wages and other projects, and the Water sector is
already losing people to Rail and Energy. Mike Woolgar, Atkins’ water
director, commented:
“The shortage is occurring where investment is being focused. We’ve
more people leaving the sector to go into energy because they can
see that more money is being put into the sector. When we start
© Daniel Berehulak
to build more railways, this will add pressure too.”
28
the skills deficit for the water
The Water sector is also perceived to be at a skills disadvantage to some
due to working in five-year funding cycles. These cycles create peaks
and troughs in investment and consequently in the demand for skilled
engineers to deliver infrastructure projects. Without a more consistent
flow of work, talented staff will seek work in other sectors or countries
where there is more demand for their skills and better employment
certainty. David Fisk, vice president of development and innovation,
Imperial College London, said:
“Other comparable economies have learnt that you don’t do boom
and bust construction, because it wrecks the industry and you end up
short of skills. If you don’t give people a reasonably constant flow of
work, then they go elsewhere, which is exactly what has happened in
the Water industry because its investment is so cyclical. So I wouldn’t
be at all surprised if the National Infrastructure Plan created a skills
shortage because it is pulling all the strings in one go.”
Delays to projects
Not only are sectors competing for the best science and engineering
talent, but so too are regions which likewise need to ensure that their
infrastructure projects can be delivered. With engineers in short supply,
this could result in a regional imbalance between now until 2020, during
which time the government’s five year programme to invest £2.3 billion
in flood defences and more than 1,400 flooding and coastal erosion
projects needs to be delivered1. This could put significant strain on the
engineering resource in certain regions. Ultimately this could potentially
lead to delays to project start times and overall delivery. David Rooke,
executive director of flood and coastal risk management, Environment
Agency, commented:
“The feedback we are getting from our supply chain is that there is
a shortage of construction skills in the marketplace given the current
amount of investment that is going into it that is going right down
through the trades.”
1
https://www.gov.uk/government/
uploads/system/uploads/attachment_
data/file/381884/2902895_
NationalInfrastructurePlan2014_acc.pdf - P9
the skills deficit for the water
29
Scheduled flood relief projects to 2020 – 2021
113 schemes
to reduce flood RISK & coastal
erosion in the NORTH EAST OF
ENGLAND
161
schemes
to reduce flood & coastal
erosion in the North West
195 schemes
to reduce flood RISK & coastal
erosion in YORKSHIRE AND THE HUMBER
215 schemes
to reduce flood RISK & coastal
erosion in THE EAST MIDLANDS
121 schemes
to reduce flood RISK & coastal
erosion in THE EAST OF ENGLAND
65 schemes
to reduce flood RISK TO HOMES IN
THE WEST MIDLANDS
244 schemes
to reduce flood & coastal
erosion in the sOUTH West
MAJOR schemes
to reduce flood risk to homes including
THAMES ESTUARY PARTNERSHIP 2100 and the
River Thames; Dachet to Teddington in London
312 schemes
to reduce flood RISK & coastal
erosion in THE south east
THAMES TIDWAY
TUNNEL
IN LONDON
the skills deficit for the water
© TBimages
30
Stifling innovation
Contributors identified innovation as a vitally important factor in solving
the future challenges faced by the Water sector.
There are two schools of thought on the impact the skills shortage will
have on innovation. Some believe the investment in innovation will lead
to the creation of time and cost saving ideas with long-term positive
impacts for the future of development and maintenance of water
infrastructure. Others felt that time and productivity pressures would
not enable engineers to think more broadly about the challenges they
face, and that they are more likely to stick to traditional, tried and tested
solutions. David Rooke, Environment Agency, said:
“New technology and innovation will help with some skill shortages,
but it is still going to require skilled staff in various competing sectors
to deliver the overall infrastructure that the government is planning
over the next six years.”
Water sector experts suggested the industry will require a different
set of skills if it’s to manage demand and think of creative solutions
to environmental challenges. Innovation and new technology may
alleviate some of the shortfall in skills, but with an already stretched
team, will businesses have enough capacity to allow individuals to spend
time developing innovative solutions? Professor David Gann CBE, vice
president of development and innovation, Imperial College London, said:
“25 per cent of the UK’s water supply is wasted; we have to
get that figure down. That will require a different engineering
skill from the ones that have traditionally been going into
those industries.”
25%
of the UK’s
water supply is
wasted
the skills deficit for the water
Another barrier to innovation and developing in-house capabilities and
intellectual property could be could be the increased use of contract and
agency staff. One expert commented:
“A very specific impact is that in some areas we end up with too
many agency staff. That does not allow us to collectively develop
sustainable long-term solutions for important capability areas. The
whole digital environment from Building Information Modelling to
collaborative communication platforms is clearly such a big
opportunity – and yet we are still working in an industry where many
of the people who work in these areas are agency or contract.”
Loss of intellectual property
As with other forms of infrastructure there are clear challenges for
the Water sector around sourcing enough experienced engineers to
maintain the existing water and wastewater infrastructure. As the pool
of people with the required skills is expected to reduce in the coming
decade, one of the options facing UK water companies will be to look
overseas for individuals to deliver their projects. These individuals who
join projects for a few years, often take back their expertise to their
own country. This ultimately has negative impacts on the long-term
investment in skills, expertise and competitive advantage of the UK.
Richard Price, director of construction, Southern Water, commented:
“We’re light on the right resources. We’ve been out to Madrid
recently and recruited a whole batch of resources. The reason we
went out there is because the Spanish economy is still recovering
and there are lots of engineers who are good English speakers,
highly qualified, good people who are twiddling their thumbs in
Spain that we are going to bring over here.”
31
32
the skills deficit for the energy
energy
How will the Energy sector and its projects be affected by the
skills deficit? This section of our report highlights the five key
consequences facing the sector.
Consequences of the skills shortage identified in this section have been categorised into five themes:
increased
costs
Delay to
projects
Loss of intellectual
property
Damage
to UK economy
Power
outage
34
the skills deficit for the energy
energy
© bomboman
The consequences of a skills shortage for the Energy sector are varied
and could lead to a number of challenges for the future development of
UK infrastructure projects. Costs linked to the skills shortage within the
sector could double by 2020 to over £17 million. Consequences have
emerged which can be categorised into five themes: increased costs,
delays to projects, loss of intellectual property and skills, damage to the
economy and power outages.
Aberdeen & Grampian Chamber of
Commerce, Oil and Gas Survey 15th Survey:
Published November 2011.
1
the skills deficit for the energy
Increased costs
Our contributors raised wage inflation as a key factor that could lead
to increased costs. For example, oil and gas engineers currently earn
around three times the national average wage. The sector has already
witnessed salaries rising by 6.5 per cent in 2012, equal to three times
the rate of inflation1, however with the price of oil and gas currently
declining in the short-term, it is possible engineers in the sector will
experience limited or no wage inflation whilst prices are depressed.
It is inevitable though that oil prices will recover and escalating wage
inflation will continue to exist as a challenge for the sector in the future.
The wage inflation we have seen already is, in part, being fuelled by a
lack of skilled engineers within the sector. This is anticipated to worsen
over the next decade as the high proportion of engineers reaching
retirement age leave the profession. As too few engineers break through
into the profession, businesses are increasingly forced into competing
for the best and most experienced talent to deliver their projects, which
in many cases means offering higher, more attractive remuneration
packages. With labour being a substantial proportion of any project
delivery costs, higher wages will either lead to an overall increase or will
have to be offset in some other way. Stuart Jackman, energy sector lead
in Atkins’ Design & Engineering division, commented:
“Projects will be delayed and will be more expensive if we don’t
have the correct skills balance in the UK. To deliver the new projects
there will be a lot more importing of staff and skills into the country.”
35
the skills deficit for the energy
© renewable UK
36
Delay to projects
As the Energy sector begins to get to grips with upcoming projects
outlined in the National Infrastructure Plan, delivery becomes critically
important. One of the biggest challenges associated with the skills
shortage will be potential delay to projects, particularly as so much
infrastructure is set to be delivered at the same time. This will not
only impact nationally, but at the local level as well. With too few
skilled engineers in rural and even some urban areas, strain will become
more prevalent as multiple large projects are given the green light in
certain areas of the country. For example, in Wales and the South West
three infrastructure projects have been proposed in the local area: Tidal
Lagoon Swansea, a new nuclear plant in Anglesey and the M4 relief
road around Newport which are all being developed alongside each
other. Roger Evans MBE, Tidal Lagoon Power, commented:
“There are big opportunities with skilling up for Tidal Lagoon.
There will be such a big demand for indigenous suppliers, they
are going to have to grow and the demand will outstrip the supply.
We’re already aware of that. So from construction skills to having
enough people with electrical engineering, to people making the
turbines and then assembling them; we will need to find
something like 20,000 to 35,000 people.”
the skills deficit for the energy
Loss of intellectual property and skills
The impact of many senior energy specialists reaching retirement
age in the very near future provides a further challenge to the skills
shortage. It’s this group that is responsible for managing risk in energy
infrastructure development. They are the individuals who understand
what to do when problems arise, and have the knowledge and
experience from the past which can be applied to the present and
future. Although their places in the delivery process can be taken up by
a newly qualified set of graduates, it’s this deep knowledge and years
of experience which can’t. As the ‘baby boomer’ age group of energy
engineers retire the sector loses these vital skills in nuclear, oil, gas and
renewables. Martin Grant, CEO of Atkins’ Energy business, commented:
“Every engineer will tell you that they have been on a project where
there is a wise old head that says before anyone else, I’m not sure I
like the look of some aspect or other of the design. In the future that
person will not be there. Realising there are problems later in the
process will inevitably cost more and lead to delays.”
37
the skills deficit for the energy
Reliance on overseas skills
If the skills shortage continues to widen the UK could be forced into
recruiting more engineers from overseas to deliver the infrastructure
that is so important to the country’s future. Importing skills can have
wider benefits associated with learning different practices, methods and
experience from international projects. However, this approach comes
at the expense of providing UK engineers with the experience and
development opportunities which are often cited as part of the business
case for major infrastructure investments. Furthermore, as individuals
from overseas return home after the project completes, they are the
ones who are able to take with them the learning, experience, skills and
insight of these projects, and apply it elsewhere. The cycle then has to
start again. If we need to import the skills to deliver the infrastructure,
the UK economy will miss out on the economic benefits that new jobs
could bring and will also lose the commercial potential of a workforce
with new skills and knowledge that might then be exported to other
global markets. Atkins’ Stuart Jackman, commented:
“The plan is to build five new nuclear power stations in the UK
over next 15 years. We haven’t built a civil nuclear power station
for 20 years, and whilst we have a thriving nuclear industry built on
decommissioning, station upkeep and defence projects there are gaps
in our knowledge base. France, Japan, China and the US have these
skills and are looking to invest in the UK and to use their technology
and resources to build here.”
© Alexander Helin
38
39
© renewable UK
the skills deficit for the energy
Damage to UK economy
The lack of key individuals with the right skills is ultimately leading
to the UK having to outsource entire energy projects to other nations.
This not only makes it more difficult to negotiate the best deal for tax
payers, it also means that the UK has little of the intellectual property
to export overseas.
Signs of a skills shortage are already showing as UK companies are set to
miss out on the majority of specialist contracts to build Hinkley Point C.
France’s EDF Energy, which has won the contract, has already admitted
that due to a shortage of hi-tech engineering skills in the UK supply
chain, firms will struggle to win key contracts. The first nuclear facility to
be built on British soil in almost 20 years will see many of the available
contracts go overseas, according to Ken Owen, commercial director for
nuclear new build at EDF Energy:
“There are a lot of critical components where quite frankly the
UK has lost its capability. We don’t mind that because we know there
is capability from a global perspective 2.”
http://www.theguardian.com/
environment/2013/oct/14/british-hinkleynuclear-contracts-edf
2
Without enough qualified and experienced engineers, the UK will
struggle to meet and deliver the energy demands of the future and
ultimately lose its competitive advantage. These implications will not
only be felt by individuals and businesses but will have implications
for the economic prosperity of the UK. A combination of the UK
government seeking foreign investment for overseas funding of new
energy infrastructure and the lack of UK-based skills could lead to us
losing out to other competitors. Without enough engineers we can’t
deliver the upgrades to our infrastructure that are needed, making us
less competitive or appealing for inward investment.
© renewable UK
40
the skills deficit for the energy
the skills deficit for the energy
Power outages
The shortage of engineers could increase the likelihood of power
outages in the future or result in unsustainable short-term fixes to deal
with the long-term problem. Without sufficient engineers, the Energy
sector could struggle to build and develop new sources of energy and
maintain the existing infrastructure. Media coverage over the last year
highlighting the impending threat of lights going out in winter has
brought the importance of the UK’s energy generation capacity into
sharp focus.
A report released in 2014 by National Grid predicts that spare electricity
capacity is at a seven year low. In its 2014/15 ‘Winter Outlook’,
electricity margins are shown to have decreased, with the average cold
spell margin expected to be just over four per cent, a figure attributed
to planned generator closures, breakdowns and new plant not coming
online as quickly to replace them. This margin is the narrowest it has
been since 2005 and some predict it could reduce to two per cent in
2015. Dr Colin Brown, director of engineering at the Institution of
Mechanical Engineers, said:
“While we’re unlikely to see blackouts this winter, the drop in
the amount of spare electricity capacity illustrated in National Grid’s
new report is a wake-up call that shows how vital it is that we invest
in new energy infrastructure 3.”
© maldesowhat
3
http://www.imeche.org/news/institution/
institution-responds-to-new-national-gridreport
41
42
the skills deficit for the digital infrastructure
digital infrastructure
How will digital infrastructure be affected by the skills deficit?
This section of our report highlights the six key consequences
facing the sector.
Consequences of the skills shortage identified in this section have been categorised into six themes:
Security
risks
reduced
reliability
digital
exclusion
Damage to
UK economy
increased
costs
Delay to
projects
44
the skills deficit for the digital infrastructure
digital infrastructure
The skills shortage poses immediate challenges to digital infrastructure.
The National Infrastructure Plan makes provision for £790 million in
central government funding to support the development of the UK’s
digital infrastructure, including the delivery of superfast broadband
coverage to 95 per cent of the country by 2017. Not only do we
need more skilled people now, but a bigger issue is how the industry
continuously updates the skills of engineers in a sector where
technology evolves at a rapid pace. Neil Watt, project director for digital
infrastructure, Atkins, said:
“It’s hard to predict what will be required in the future. Digital
technology is changing so fast.”
Consequences of the skills shortage identified in this section have been
categorised into six themes: Security risks, reduced reliability, delay to
projects, increased costs, digital exclusion and damage to UK economy.
Security risks of importing skills
Without having the right skills in the UK to deliver the digital
infrastructure requirements there will be a short-term need to import
skills from overseas. However, in this sector more so than some
others, importing skills can present specific risks. Handing over the
management, development and operation of our digital infrastructure
poses a number of cyber security risks. Atkins’ Neil Watt said:
“ We are relying on these skills coming out of the UK and Europe
so the implications of this shortfall are quite serious. Other countries
such as India, for example, produce a great number of engineers
compared to the UK, but in terms of the protection of the key
elements of the digital infrastructure, importing these skills
from outside Europe can create all sorts of problems, including
security implications.”
risks for cyber security
45
© BirgerNiss
the skills deficit for the digital infrastructure
John Van Berkel, technical engineering and construction manager,
UKI & Nordics, IBM, added:
“If our data centres are inefficient and slow the risk is that data
centres will migrate away to other countries. With the movement of
data across borders, the reality is it will be driven elsewhere. That will
present security issues.”
Reduced reliability
Experts also confirmed that very few graduates or technicians in the
UK are skilled in fibre optics, broadband technology and mobile data
infrastructure. Not only does this highlight the breadth and depth of
the current shortage to develop new digital infrastructure, but there is
also concern about the numbers of technicians who have the skills to
fix and maintain our existing infrastructure. This could lead to increasing
numbers of failures due to standard maintenance being deferred. It
would also take longer for the repairs to be carried out. Atkins’ Neil
Watt, commented:
“Very few graduates have an understanding of the practical elements
of digital or wireless infrastructure design and operation. Academia
appears to push students towards research or further study and they
are therefore not being adequately prepared for industry.”
46
the skills deficit for the digital infrastructure
Cost of digital exclusion
The cost of digital exclusion is a very real challenge for the UK. To stay
competitive in the global market the UK’s digital infrastructure needs
to be amongst the very best in the world. Our contributors outlined a
number of advantages of the UK being an advanced digital country.
These have positive implications for residents and the economy,
including a potential average household saving of £560 if a family
starts to shop and pay bills online and a total figure of £63 billion
for the potential benefit of becoming a leading digital nation in the
global economy 1. Lord Jim Knight of Weymouth, chair of the Tinder
Foundation, said:
“The fact is that digital exclusion costs Britain money. Not having the
access, motivation or skills to use the internet has a real social and
human impact, affecting pay, health, educational attainment and
more. In turn, that has an economic impact, and it’s holding Britain
back. Over the last five years the evidence has grown to show how
a 100 per cent digital nation could make Britain truly great – saving
the government and NHS billions of pounds, boosting the economy
and building human capital. The cost of digital inclusion – based on
this new model – is a drop in the ocean compared to the potential
savings and benefits of investment 2.“
http://www.tinderfoundation.org/
our-thinking/news/putting-price-digitallyincluded-britain
© swilmor
1
http://www.tinderfoundation.org/
our-thinking/news/putting-price-digitallyincluded-britain#sthash.OOf76fTJ.dpuf
2
47
© Kritchanut
the skills deficit for the digital infrastructure
48
the skills deficit for the digital infrastructure
Damage to the UK economy
Digital communications networks are recognised by the government
as a critical part of the UK’s core infrastructure and an increasingly
significant enabler for economic growth.
© Oli Scarff
Speaking in Davos in January 2014, the Prime Minister, David Cameron,
said it will be essential to secure the UK’s cyber security, resilient
infrastructure and good communications, and that these are key to the
UK’s attractiveness and the ability to move goods, services and people
around the country. He said that the commitment to the UK being on
a quest to have “the best superfast broadband network in Europe3 is
vital.”and that the UK needs to tackle the current skills shortage within
the UK or this is an unachievable vision for the future and will lead to
the UK paying a price for lack of competitiveness.
3
https://www.gov.uk/government/speeches/
world-economic-forum-davos-2014-speechby-david-cameron--2
the skills deficit for the digital infrastructure
A key strand of the commitment to digital infrastructure is improving
access to super-fast broadband, enabling consumers and businesses to
gain from improved service quality, increased coverage and affordable
prices. The government hopes that this will underpin the UK’s position
as a leading digital economy and will help to create local jobs and
national growth. Atkins’ Neil Watt commented:
“The UK is currently seen as the centre of engineering excellence
around the globe. The key consequence for UK plc is, that if we’re
not doing it here then it will have an impact on our ability to sell our
expertise around the world and compete internationally.”
However, the UK doesn’t currently have enough of or the right mix of
digital infrastructure and communications engineers to deliver these
upgrades in the timescales needed to keep the country competitive.
John Van Berkel, IBM, commented:
“Superfast broadband is a realistic prospect as it is just about cable
connectivity. The real challenge is the construction aspect of replacing
the copper. It is not a technological challenge, it is a construction
challenge.”
Despite the funding being made available and the political will to make
it happen, the shortage of engineers means it could take longer to
deliver vital upgrades to the network putting more UK businesses at a
competitive disadvantage.
49
50
the skills deficit for the digital infrastructure
Increased costs
A shortage of engineering skills could lead to the cost of delivering new
digital infrastructure increasing, mainly due to wage inflation and the
need to import skills. With fewer experienced and qualified engineers in
the UK, companies will have to offer increasingly higher remuneration
packages to attract the best individuals to deliver the infrastructure,
impacting the cost of delivering projects. If the cost of delivery increases
it could mean the investment outlined by government will fail to stretch
as far as initially hoped, ultimately delivering less coverage across the
UK. Decisions will then need to be made and prioritised about which
areas should benefit from the roll out and in what order: urban vs rural
or north vs south. This could have consequences, with the potential
for rural areas or whole regions being left behind, breeding social and
economic inequality. Atkins’ Neil Watt said:
“The impact will be in that in five years the infrastructure won’t
be as extensive as that originally envisaged. Your money won’t go
as far.”
Delay to projects
Delays to the roll-out of next generation broadband and mobile
infrastructure, together with other initiatives will be an inevitable
consequence of having too few skilled engineers to deliver the digital
infrastructure outlined by government. A country can have the best
digital, fibre optic engineers and data analysts, but they will be of little
value unless you can put the physical infrastructure in place as well. This
is one of the greatest challenges for the delivery of digital projects such
as super-connected cities and 4G commercial rollout. Atkins’ Neil Watt
commented:
“The doomsday scenario is that engineering projects will cost more
and take longer. You can bring in resource from outside the UK’s
borders but that is just going to drive up costs and if we’re competing
with the rest of the world for that market then time delays are
inevitable.”
© Christian Mueller
conclusions
52
the skills deficit
conclusions
The National Infrastructure Plan states:
“Improving the UK’s productivity is a vital element of the
government’s Long-Term Economic Plan. High-quality infrastructure
boosts productivity and competitiveness, allowing businesses to grow
and enabling them to reach suppliers, deepen labour and product
markets, collaborate and innovate and attract inward investment 1.”
This excerpt highlights the critical importance of infrastructure to the
UK’s global competitiveness, economy, businesses and society. It’s
important we have the right skills and employees across the country
to deliver the £460 billion pipeline of public and private investment in
national infrastructure until 2020 and beyond.
Throughout this report we have highlighted some of the very real
consequences that could arise if we don’t address the skills challenge in
the UK. There is still time to stem the tide, but it’s important we continue
to challenge the status quo. Much of the emphasis is placed on a
somewhat theoretical debate about how to attract the next generation
of engineers into the profession. This remains important but we also
need to pay particular attention to how we deliver the shorter term
infrastructure projects in the pipeline.
Peggy Barthes-Streit, head of mobile data, EE, said:
“Infrastructure is critical in determining citizens’ quality of life.
Through taken for granted when it works well, you will hear about
it when it doesn’t! Skilled people are therefore crucial to the vitality
not only of infrastructure organisations, but in a very real sense to the
vitality of the nation itself.”
1
https://www.gov.uk/government/
uploads/system/uploads/attachment_
data/file/381884/2902895_
NationalInfrastructurePlan2014_acc.pdf
the skills deficit
53
In the context of the challenges highlighted by our contributors,
some areas for further focus could include:
With fewer engineers, businesses will need to be more innovative
and make better use of new technology to drive down the costs of
delivery to offset higher costs in other areas, such as wage inflation.
Tax payers and investors want to see projects delivered on budget.
Wage inflation is something that will affect the whole industry and
we need to make sure short-term competition for resource doesn’t
result in UK businesses becoming uncompetitive in the long term. It’s
also important that business and industry ensure higher wages are
factored into pricing of projects, so there are no surprises at a later
date.
Delays to projects
Better planning, prioritisation and coordination is needed so individual
projects can be delivered to make best use of available resources. This
thinking should be expanded across the National Infrastructure Plan
to ensure projects aren’t competing unnecessarily for the most in
demand skills.
In the UK’s contractor / consultant focused delivery model, people
with scarce skills would not be available to work on certain projects
if their employer didn’t win the contract. Therefore there could be a
case for infrastructure owners and the supply chain to explore some
kind of pooling of the scarcest resources.
Damage to the UK economy
If a shortage of skills results in issues with delivering infrastructure,
the UK’s reputation as a centre of excellence for engineering could
be damaged, resulting in a negative impact on the economy. An
integrated and forward-looking infrastructure plan which aligns
projects and resources, is a critical component for sustainable
economic growth and social inclusion in the UK.
© Philip Chidell
Higher project costs
54
the skills deficit
Cutting edge engineering skills can give the UK a competitive
advantage against other countries in the future. We need to ensure
more engineers have more of these future core skills, such as Building
Information Modelling, to guarantee our competitiveness globally.
Bad decision making / poorer delivery
It is vital to have the right people in the right jobs. Public sector pay
caps could be a false economy if it means people don’t have the right
skills to ensure projects are identified, defined and delivered most
effectively. This needs further consideration.
Early involvement of the supply chain means the right questions
are being asked at the outset and ensures that projects can actually
be delivered. This needs to happen as much as possible across all
infrastructure.
Reliance on imported skills / loss of intellectual property
Overseas recruitment is likely to be required to fill the gap. More work
is needed around the immigration policy to ensure companies can
bring in the right people who are going to make a real difference to
infrastructure delivery.
We also need to make better use of the overseas resources of multinational organisations, moving the work to the people rather than
the people to the work. Being ‘at home’ rather than on an overseas
assignment in the UK means the people involved are less likely to
move on after the project is complete, and if they do, the knowledge
is still retained within the company. It also ensures that work is
delivered to consistent global standards.
Industry needs to continue investing in graduates and apprentices
to work alongside more experienced colleagues on projects. This
helps retain long-term intellectual property . Expanding initiatives
such as ‘The 5 per cent Club’ which commit companies to having
a specified percentage of their workforce on formal education
programmes would help formalise this.
Stifling innovation
Infrastructure owners need to include innovation from the supply
chain in the scope for their projects. This could mean building in more
time to develop and test new ideas, financial incentives for suppliers
to share a proportion of savings from a new idea or simply requiring
companies to demonstrate an innovative solution in response to the
ITT.
the skills deficit
A more focused innovation culture needs to be embedded within
consultants and contractors to encourage their people to continually
think about new ways of delivering projects, such as looking across
industries at established ideas and adapting them in a different way.
What next?
There are also a number of more generic ideas to help make sure the
consequences highlighted in this report either don’t materialise or are
minimised. These require a more collaborative approach across industry,
government and academia to drive forward an agenda of inspiring more
young people into engineering:
Make best use of transferable skills across industries to deal with
peaks and troughs of infrastructure delivery. This means investing
in existing engineers to enhance their skills and make them more
transferable across sectors.
Explore further how we can embrace non-traditional skills into the
industry, such as those linked to digital working and technology
to enable a greater contribution from young people. This will help
deliver infrastructure in a different way.
Continuing efforts to get more young people into STEM related
subjects is vital. However, the industry must adopt a single agenda
and a common language, rather than lots of individual campaigns
and mixed messages.
Challenge the current perceptions of the engineering profession
among wider society, teachers, schools and the media. We need to
have a clear and collective narrative about the role of the engineer,
as well as promoting inspiring role models.
Closer collaboration with industry and academia to guarantee young
people are being prepared with the best tools, skills and knowledge
for joining industry. Including universities offering industry-focused
courses, to provide in-depth sector knowledge.
We also need to make an extra effort to broaden the diversity of
people within the profession, in particular we need to attract more
women and people from a wider variety of ethnic backgrounds.
For example, if we can double the current percentage of women
working in the sector we will add an extra 96,000 people to the UK’s
science and engineering workforce.
55
56
the skills deficit
Our time to make
a difference
There is no doubt that we have a very real issue on our hands. In many
cases we are only just starting to see the negative effects of the skills
shortage, and as backed up by the contributors, there are numerous
examples across all sectors where it is already restricting our ability to
operate efficiently in a global, competitive market. This study offers a
glimpse at what the future could hold if we don’t find the solutions,
and it’s a future we cannot contemplate.
The Royal Academy of Engineers, Engineering UK and the Department
of Business, Innovation and Skills, as well as professional institutions such
as the ICE, IET and IMechE, are just some of the bodies which are already
delivering excellent work. But we still need to do much more and I hope
these findings can help provide additional focus, drive and determination
to fix the problem.
The most significant challenges will be in the years ahead rather than
on the immediate horizon. By then not only will we be dealing with a
shortage of young people joining the profession, we will have to replace
the current generation of scientists and engineers who will have retired.
Therefore our number one priority has to be encouraging, inspiring and
motivating young people to choose STEM careers.
If you offered a selection of young people a job profile that offered
great career progression opportunities, excitement, job security, above
average compensation and an opportunity for your work to make a real
difference to people’s lives, many of them would grab it with both hands.
So why is it that engineering, which offers all of these – and much more
– is such a turn off?
There are many deep seated, but out-dated perceptions about the
profession. We need to change these to ensure young people see
engineers alongside doctors, solicitors and astronauts when they talk
about ‘what I want to be when I grow up’. Part of the solution is to
make sure that parents and teachers, who are probably the biggest
influencers on children’s career direction, have sufficient information,
understanding and knowledge of what engineers do to promote it as a
potential career choice.
the skills deficit
We also need to make an extra effort to broaden the diversity of
people within the profession, in particular we need to attract more
women and people from a wider variety of ethnic backgrounds. For
example, as the research shows, if we can double the current percentage
of women working in the sector we will add an extra 96,000 people
to the UK’s science and engineering workforce. That would make
a real and tangible difference.
I joined the profession as an apprentice, so I appreciate the value of
having the right guidance, support, opportunities and mentoring in the
early part of your career. As an industry we must continue to invest time
and money in providing these for the next generation. This means offering
a range of ways for young people to start a STEM career, not only via
the traditional university route, but through apprenticeships and work
experience whilst still at school. We are seeing the number of engineering
skills academy’s growing, with government and industry match funding
initiatives to focus on training young people in areas such as energy and
tunnelling, both of which will be required to deliver key projects in the
National Infrastructure Plan.
In addition to his role at Atkins, Allan
Cook is chairman of the Sector Skills
Council for Science, Engineering and
Manufacturing Technologies (SEMTA).
He is also the lead non-executive
member of the departmental board for
the Department of Business Innovation
& Skills and chairs the Skills and Jobs
Retention Group established by the
Business Secretary in 2010. Allan also
leads the Royal Academy of Engineers’
employer-focused Diversity Leadership
Group, part of the BIS STEM Diversity
Programme.
This research shows that the shortage of skills could affect us all in one
way or another. Therefore we all – parents, teachers, students, politicians
and the current science and engineering communities – have a role to
play in finding the solution. We won’t achieve this if we each do our own
thing. As engineers we work together in partnerships every day to deliver a
common goal. This is the only way we really can reduce the skills deficit and
guarantee we can deliver the critical national infrastructure of tomorrow.
Allan Cook CBE
Chairman
Atkins
57
58
the skills deficit
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