Employers are facing a 'skills emergency'

The CBI said the new apprenticeship levy won't go far enough in improving the workforce.

by Jack Torrance
Last Updated: 09 Sep 2015

The CBI (and British business in general) has long complained about the skill levels of Britain’s workers, but today the group sought to add a fresh sense of urgency by warning that employers were facing a ‘skills emergency’ and that plans for a new apprenticeship levy didn’t go far enough.

The group surveyed 300 organisations, of which more than half (55%) fear they will not be able to find staff with the skills need in the future. Around one third (37%) said they were concerned about the quality of school leavers’ English and maths skills and 49% said that some couldn’t communicate effectively. If current levels of economic growth remain then that’s only likely to get worse as competition for staff hots up.

‘We betray our young people if we fail to equip them with the knowledge, skills and attitudes needed to progress in work and life,’ said the CBI’s deputy director-general Katja Hall. ‘We must better support schools and teachers from day one to develop the confidence, resilience and creativity that will help the next generation of talent to succeed.’

Particularly concerning is that those employers’ who depend on STEM (science, tech, engineering and maths) skills appear to be especially over-stretched. Around three quarters (64%) of engineering companies, 73% of construction firms and 69% of manufacturers said they expect to need more skilled staff in the next few years.

Apprenticeships have been touted as an important method of addressing the skills gap over the last few years. The total number of apprentice starts almost doubled between 2008/9 and 2013/14 and the Government pledged in last week’s Budget to create more by introducing a new ‘apprenticeship levy’ on large employers. But the CBI doesn’t think this will go far enough.

‘The new levy announced in the budget may guarantee funding for more apprenticeships, but it’s unlikely to equate to higher quality or deliver the skills that industry needs,’ said Hall. ‘Levies on training already exist in the construction sector where two-thirds of employers are already reporting skills shortages. Employers have a critical role in upskilling the workforce, but part of the deal must be for real business control of apprenticeships to meet their needs on the ground.’

A lot of people think of apprentices as being involved in building trades and other technical professions, but in recent years they've become increasingly common in other fields, including retail and hospitality, leading to concerns they're not delivering the type of training needed to rebalance the economy.

Just 2% of apprenticeships in 2013/14 were 'higher level' qualifications equivalent to a degree, and more than 70% of new apprentices were aged 19 or above, suggesting they're not helping as many school leavers as you might imagine. Of course older workers should be helped to reskill as well. But it's important that government and industry avoids focusing on apprenticeships for apprenticeships' sake and instead ensures that training is fit-for-purpose. Only then will the Government's stated intention of solving britain's productivity shortage have a chance of bearing fruit.

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