Eliot Gillings, Policy Analyst at Public Policy Projects explores the different ways we can close the skills gap across different sectors
The rail industry will need between 7,000 and 12,000 additional workers each year for the next five to ten years, as forecasted in a report released last year by City & Guilds and the National Skills Academy for Rail (NSAR). The report’s press release states, ‘serious systemic issues in the industry’s talent and skills pipeline have created a shortage of trained and talented employees just when the industry needs them most’.
But the rail industry isn’t alone. The offshore wind sector in the UK needs an additional 69,000 people to reach the 40-gigawatt target that the government hopes to reach by 2030. In late 2021, more than 60 per cent of the 400 firms asked by the South West Manufacturing Advisory Services and the Manufacturing Growth Programme said they had struggled to find skilled staff since mid-2020.
In some industries, there are hopes that advancements in technology will help bridge these widening gaps. However, the experience of the manufacturing sector highlights that these new technologies (or Industry 4.0) still require people with the right skills to harness their potential. Industry leaders know this, which is why every industry impacted by the growing shortage of skilled workers is currently heavily invested in finding solutions to widen and upskill their available talent pools.
Many of the initiatives being undertaken by industry to address systemic issues within their respective fields have found success already. But they require greater support from the central government to deal with the root causes of a skills gap that has been widening for some time.
While last year’s effective cancellation of the 2017 Industrial Strategy in favour of The Plan for Growth was heralded by the Rt Hon Kwasi Kwarteng as a move away from ‘a pudding without a theme’ it was considered by many to be a move away from a solid foundation for industry to collaborate with government.
The Plan for Growth focuses on capital, people and ideas. But aside from moving away fromindustry-specific strategies, and emphasising more generalised ‘levelling up’ programs, it is not clear what exactly the plan will do to address those areas of concern. As the government continues to develop its long-term vision this lack of clarity has problematised planning across industry and created anxiety over the future. These fears were only exacerbated by Chancellor Rishi Sunak’s apparent rejection of the idea that the ‘government should decide which sectors will be important in the future’ in this year’s Mais Lecture.
The Plan for Growth does have potential. In the right climate, doing away with industry-specific strategies could simplify the broad strokes of planning investment and training. Promises to simplify qualifications and review the Apprenticeships Levy are also welcome. But in other areas the plan fails to show the adequate ambition to address the issues facing British industry, and a prime example is its narrow focus on adult skills education. In late 2018, 81 per cent of UK manufacturers and 70 per cent of service sector firms stated that they struggled to find people with the right experience and qualifications to fill vacant roles, according to the British Chambers of Commerce (BCC). The difficulty of recruiting overseas workers post-Brexit has a significant role to play, but much more of this demand has been stoked by an ageing workforce. For instance, nearly 15,000 rail industry employees are expected to retire by 2025, which could seriously disrupt its development just as it needs to expand to support the UK’s net zero ambitions.
Adult skills training programs will be able to help plug some of the gaps, but they won’t be sufficient given the scale of the problem. They also won’t be able to fully address the clear imbalances in age, gender, and ethnic representation within a number of industries that pose serious obstacles to upping recruitment.
Breaking down the barriers to entry is a job that requires a deeper analysis of the UK’s education system. The direction that groups such as Women in Rail have been headed is proof. The aforementioned study by City & Guilds and the NSAR revealed that just 16 per cent of the rail industry’s workforce is female and only 24 per cent of women would consider a career in rail, compared to 41 per cent of men. Women in Rail have been looking to address this imbalance through a mixture of industry initiatives that prioritise collaboration and mentorship programs that serve those already in rail, and recruitment and education programmes that bring new people in.
On the latter point, Shona Clive (Vice-Chair of Women in Rail) has said that ‘reaching young people at school age is key’ to changing the perception of rail as a career option. This outlook is consistent with data from the NSAR that shows that only 26 per cent of 18-24-year-olds would consider a career in rail, and a recent report from Brunel in which 41.3 per cent of employers in the UK energy sector ‘felt that the biggest driver of the skills shortage is insufficient education and training’. Of the 7 recommendations put forward by the NSAR report, 4 focused on building participation and interest in younger generations.
While the development of OT skills almost by necessity requires robust and functional adult education pathways, and IT skills can be similarly developed on the job, a lack of education in key fields before leaving school poses a significant barrier to entry that can prevent industries from recruiting more broadly. A lack of a developed pathway for young people to work in industry also impacts gender and racial representation. As such, the more that the Plan for Growth can integrate its aims with the UK’s educational strategies, the better it can raise the profiles of industries that are in desperate need of new recruits.
There are initiatives out there already improving access to technology in schools and emphasising the digital upskilling of teachers and students with an eye to industry – like the Design and Technology Association’s Skills for Industry programme and Digital World’s Tech Industry in the Classrooms. These initiatives build on the ethos of DfE’s digital and technology strategy, which has emphasised the integration of digital technologies into education and has already produced positive results since its unveiling in 2019. Based on surveys conducted at the end of 2021
and the beginning of this year, 88 per cent of headteachers and 84 per cent of teachers reported that they felt ‘edtech had or would better student outcomes’.
Further integrating education into the Plan for Growth and collaborating with industry to develop skills more effectively in classrooms should be considered by the government a means to both raise the profiles of various industries and improve the quality of the candidates they can access. It should also be considered as an essential part of any other program to deal with the issues faced by British industry – such as a widening productivity gap that has opened by 26 per cent since 2008 according to the Office for National Statistics (ONS).
The journey to more efficient, productive, and equal industries begins with improving the quality of candidates entering the workforce. That in turn demands plans to improve primary, secondary and tertiary education become part of any industrial strategy or Plan for Growth. Ongoing initiatives show that industry is aware of this need, but added support from central authorities will speed up this necessary work. It will also help industry address issues that ostensibly go beyond the scope of skills training, such as the falling value of UK exports. Add in the fact that the US and EU are committing hundreds of billions to transform their economies, and the case for serious investment into the UK’s human capital seems overwhelming.
Eliot is a Policy Analyst at Public Policy Projects specialising in industrial development and green infrastructure. Serving as the policy co-lead for PPP’s Mission Zero series, Eliot is interested in finding policy solutions to maximise social value in the procurement and delivery of infrastructure projects