Ensuring Apprenticeships
Support Economic Growth
Thursday 29th November 2012
Vince Cable,
Secretary of State for
Business, Innovation and
Skills
“There is an urgent need to raise UK skills
levels to help drive productivity, growth and
jobs.”
“The skills and capabilities of our people are
ultimately the basis for our long-term
competitiveness.”
Charlie Mayfield,
Chairman, UK
Commission for
Employment and Skills
About the UK Commission for
Employment and Skills:
Transforming the UK’s approach to investing in the skills of
people as an intrinsic part of securing jobs and growth
More employers More career
taking ownership opportunities for
young people
of skills
More collective
action by employers
through stronger
sectors and local
networks
More employers
investing in the
skills of their
people
FE, HE and Careers
Our Commissioners:
Training in the UK:
There are 2.3 million businesses in the UK with 1+ staff...
59% train
…of which:
Of those who do
not train:
41% do not train
(0.9 million)
(1.3 million)
15%
26%
Perceived need
but met
barriers*
Said they had no
training needs
*Also includes small proportion of businesses that said ‘don’t
know’ or ‘no reason’, or that ‘people learnt as they went’
Barriers cited include:
£ i
Cost
Time
Lack of
information
The consequences of not training...
Employers who do not train, on average, are twice as
likely to fail, opposed to those that do...
Macro level issues facing the UK
Youth unemployment and the long-term economic effect
this will have on UK PLC and internationally
•
•
•
average rate of unemployment across Europe is about 22%
UK is about average
Spain and Greece hovering around 50%, Germany just 8%
Within the UK, there are large variations in youth
unemployment across cities
•
•
At its highest in Tees Valley at 32%, followed closely by
Sheffield, Manchester, Birmingham and London.
It is at its lowest it Oxfordshire at just 9%
Youth unemployment is a local issue across the country
Barriers to entry
The sharp decline in the number of jobs which are
available to young people
•
•
Jobs that have traditionally helped young people into work
are in decline
The ‘jinxed’ generation
The most common way to find a new job is through
informal, word of mouth methods
•
Takes time to establish, and where families and friends
don’t have these connections, the route is blocked
The emphasis employers place on experience when
they are hiring new staff
•
¾ of employers state experience was either of ‘significant’
or ‘critical’ importance in their recruitment decisions
Why ‘employer ownership’?
The skills system: the rise and rise of the skills
bubble, over centralised
Less globally competitive: ‘system’ is too complex
Two markets for skills development
A lack of alignment, leverage of
employer investment
Employers need to own the problem and the
solution
Putting the purchasing power into the hands of
the employers
Employer Ownership objective
To find more effective and sustainable ways to improve
skills in the workforce and use these to drive up
productivity and growth.
“By giving businesses the chance to
shape and set their own training agenda,
we’re giving them the power to enrich their
workforce with the skills needed for their
future success."
Matthew Hancock,
Minister for Skills
Business, Innovation
and Skills
Employer Ownership vision
Employer led, sector based
collaborations who are the
primary customers
Simplify and extend existing
competitive funds, routed
through employers
Employer/provider
partnerships which deliver
high quality outcomes
“We need to take
determined steps to
encourage greater
employer ownership of
skills, working to secure
a sustainable
partnership for the
long term.”
Charlie Mayfield, Chairman
UK Commission for
Employment and Skills
Future jobs market: which sector?
Projected UK employment change by sector (000s) between 2010-2020
(Source: Working Futures)
Sector
Change
(‘000s)
Manufacturing -170
Non-market Services -103
Primary Sector & Utilities
-22
Construction
237
Trade accommodation &
transport
415
Business & other services 1,195
Private services expected to
be the main engine of job
growth (2010-2020)
Future jobs market: which occupations?
Most net job creation (2010-2020) expected in high level occupations,
but job openings expected in all occupations due to replacement demands
Projected England Job Openings 2010-2020
(Source: Working Futures)
Occupation
Managers
Net Job
Openings
(‘000s)
1,614
Professional
2,726
Associate Professional
1,742
Admin & Secretarial
1,106
Skilled trades
930
Caring, Leisure etc
1,256
Sales
779
Operatives
535
Elementary
1,117
Job Creation
Replacement Demand
Employer
objective
Future
job Ownership
market: which
regions?
While growth will occur almost
everywhere, the north-south
divide will continue to be
exacerbated.
Projected change in total employment
across the UK: 2010-2020
6-8%
4-6%
2-4%
0-2%
How does this impact on future
apprenticeships?
Future apprenticeships should exemplify the employer
ownership concept and:
• be based on a leading edge industry standard in a real
job
• address current and future skills needs of an occupation
and sector
• be good value for money – employers, employees and
state
• be accessible and well delivered
• give individuals an appetite for continued learning
Design Principles Moving Forward
1. Government creating the space for employers to step up and
take ownership of the skills agenda for the growth of their
industry or locality
2. A relentless focus on employers and employees as the primary
customers of quality outcomes
3. Routing the public contribution through employers so that
responsibility and reward rests with them and in so doing
leverages public investment against private investment
4. Ensuring that there is only one market for skills where supply
is shaped by informed employer and individual demand rather
than funding incentives
5. Locally investing in ‘bottom up’ business and college
leadership to co-own, co-develop and deliver high quality
vocational education which meets local economic needs.
Thank you very much for listening
Caroline Robert, Assistant Director, UKCES
If you would like to hear more please contact:
caroline.roberts@ukces.org.uk
01709 774 800
www.ukces.org.uk