A perfect storm to transform our investment approach in the UK Lifelong Learning, Crisis and Social...
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Transcript of A perfect storm to transform our investment approach in the UK Lifelong Learning, Crisis and Social...
A perfect storm to transform our investment approach in the UK Lifelong Learning, Crisis and Social Change
Lesley Giles, Deputy Director
UK Commission for Employment and Skills
18 & 19 October 2012
About us: The UK Commission for Employment and Skills
More employers investing in the
skills of their people
More employers taking ownership of
skills
More career opportunities for
young people
More collective action by employers through stronger sectors and
local networks
Provide outstanding labour market intelligence which helps businesses and people make the best choices for them
Maximise the impact of employment and skills policies and employer behaviour to support jobs and growth
Work with businesses to leverage greater investment in skills
Impact
Investment
Intelligence
Aim: Transform the UK’s approach to investing in the skills of people as an intrinsic part of securing jobs and growth
Five assets and 100 staff to deliver on outcomes3
Global performance is NOT world class
Source: OECD Employment Outlook 2011 and OECD Productivity Database 20104
There are pressures on investment
“Today, our national debt stands at £770 billion. Within just five years it is set to nearly double to £1.4 trillion. To put it in perspective, that is some £22,000 for every man, woman and child in our country.”Speech on the Economy, David Cameron (7th June 2010)
I don’t see a time when difficult spending choices are going to go away”David Cameron, Daily Telegraph interview 19th July 2012
5
Upskilling rates are not making us world class
6
We especially need to address the long tail of individuals with low skills
Low Skills Intermediate Skills High Skills
Current international skills position
21st 25th 13th
25th 26th 11th
Are businesses investing wisely in skills?
There are 2.3 million businesses of 1+ employers across the UK. Of which...
59% train(1.3 million)
41% do not train(0.9 million)
Of those who do train:
23%(0.5 ml)
29%(0.6 ml)
8%(0.2 ml)
Do not knowif they want to
do more
Would like to do more
training
Do sufficienttraining to
meet needs
26%(0.6 ml)
15%(0.3 ml)
No trainingneed
Perceived need but met
barriers
Of those who do not train:
Key Challenges:• Training investment is holding up despite the recession overall• But with only 19% of businesses adopting High Performance Working practices, is this ambitious
enough? 7
8
Employer investment in training
£24.7 BillionIs spent on the direct
costs of training.
Across the UK
£49 BillionIs spent on training.
However:
£24.3 BillionIs the wages of those
being trained.
£13.5 BillionIs tradeable costs (i.e. Elements of
training that can be outsourced)
£11.2 BillionIs non-tradeable (i.e. Elements
of training that cannot be outsourced)
Of which
£3.9 Billionon payments to
external providers
£2.8 Billionon course fees
£1.1 BillionOther activity
Investment in qualifications
23%Of employee’s trained were
training towards a qualification
And this varied by business size
16%
37%
58%
67%
66%
9
Big variations in individual learning, Skills rich vs skills poor well established
Rich: Employed, managerial & income £31K+, younger, qualifications A-levels or above, parent in education after 16.
Key factors: attainment at school and parents education
Learning creates a habit and leads to more learning. Over 8 out of 10 people with higher qualifications (e.g. degree level) undertake learning compared to less than 3 in 10 with no qualifications
Training connected with employment showing a gradual decline
Poor: Older, income less than £10k, qualifications below GCSE, no work or part-time.
10
Are individuals investing wisely in skills?
Ages Learning participation
Income & (Expenditure)
Motivations Barriers
16 - 24
Young AdultBiggest challenge, limited choice
79%£575 wages
(£430)Job prospects
Cost
25 - 39MidlifeWork predictable, class divisions
73%£873 wages
(£559)
Work performance Job satisfactionHelp children
Time Cost
40 - 59
MaturityDefined by experiences. Rich & poor
71%£744 wages
(£485)
Learn something new
TimeCost
60 - 74Old ageRich retire, low income still work
48%£464 social
security(£342)
Learn something new
Too old
75+Truly elderly majority women
24%£331 social
security (£236)
Learn something new
Too old
Dec
reas
ing
Par
tici
pat
ion
11
We must meet future needs, but where will the growth come from?
Projected UK employment change by sector (000s) between 2010-2020
(Source: Working Futures)
Change(‘000s)
-170
-103
-22
237
415
1,195
Sector
Manufacturing
Non-market Services
Primary Sector & Utilities
Construction
Trade accommodation & transport
Business & other services
Private services expected to be the main engine of job growth (2010-2020)
12
What will the future jobs be?
13
Most net job creation (2010-2020) expected in high level occupations, but job openings expected in all occupations due to replacement demands
Net Job Openings
(‘000s)Occupation
Managers
Professional
Associate Professional
Admin & Secretarial
Skilled trades
Caring, Leisure etc
Sales
Operatives
Elementary
1,614
2,726
1,742
1,106
930
1,256
779
535
1,117
Projected England Job Openings 2010-2020(Source: Working Futures)
Replacement DemandJob Creation
Where are the future jobs?
14
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%
Skills play a vital role in performanceFirms in the UK that don’t invest in training, on average...
Are twice as likely to failAnd this varies by sector...
Manufacturing
Construction
Hotels and Restaurants
Retail and Wholesale
Transport and Comms
Likelihood of business failure
2x
2x
2x
4x
9x
Building a new approach to investing in skills
The Growth and Innovation Fund is open to all employer representative organisations (including Sector Skills Councils) and is an England only fund.
Employers invested: £22 million
Growth & InnovationFund invested:
£13 million
£35 MillionSupporting 16 projects that aim to
Develop innovative Working practices
Raise professional standards in sector
Increasing the demand for
Higher skills Provide leadership
& management solutions Support future growth
of the economy
Growth & Innovation Fund
Building a new approach to investing in skills
The Employer Investment Fund is open only to licensed Sector Skills Councils (SSCs) and is a UK wide fund.
Employers invested: £46 million
Employer InvestmentFund invested:
£66 million
£112 MillionSupporting 77 Employer led projects
that aim to
Raise ambition & change employer
behaviours
Drive innovation & develop new ways
of working
Secure momentum to support sustainable
increases in skills levels
Stimulate employer investment in skills and to improve the use of these
skills in the workplace
Support better use of skills
across sectors
Employer Investment Fund
Building a new approach to investing in skills
The Employer Ownership Pilot is open to employers and is an England only fund. Employers invested:
£98 million
Employer Ownership Fund invested:
£67 million£165 MillionWill test new delivery
and investment models
11,000 Apprenticeships
18,500 full time training opportunities
45,000 training opportunities (including work experience &
work placements
Employer Ownership Pilot
To find out more:
More about UK Commission investment:
http://www.ukces.org.uk/ourwork/investment
Employer Skills survey: http://www.ukces.org.uk/publications/employer-skills-survey-2011
UK Employer Surveys site:
http://employersurveys.ukces.org.uk
UK Commission research: http://www.ukces.org.uk/ourwork/research
Thank you