The UK skills deficit is estimated to cost businesses £10 billion a year. Michael Stark, Head of Skills and Workforce Development at the Learning and Skills Council, explains how the LSC works with businesses to bridge the skills gap.
The harsh reality is that despite making some major steps forward, the UK has a skills gap that prevents businesses in a range of sectors being as productive as they need to be to compete effectively.
British firms are also up against intense competition – both locally and internationally. Businesses embracing new technologies and processes need employees with higher levels of skills, in order to increase their ability to compete in this environment.
An identified skills deficit, be it in terms of job specifics skills or in terms of literacy, numeracy or interpersonal skills, is costing the UK as a whole an estimated £10 billion a year, which is real terms to an SME can be as much as £86,000 per year.
There are over six million adults with no qualifications in the UK and employment opportunities for those with a low skills base are diminishing rapidly.
The LSC’s mission
The LSC is responsible for the strategic planning and funding of all non-university education and training for adults of 16 and over, including work-based learning.
Through its national office and 47 local offices, the LSC works to identify more effective ways of working with business and training providers to close the skills gap.
The LSC has a budget of more than £8 billion.
It works with providers (colleges and private training companies) to offer various skills solutions for businesses including:
ETPs
Employer Training Pilots (ETPs) are LSC-backed training schemes that pay businesses to train their staff.
Training is free and employers are compensated for the time employees spend away from work on training courses.
ETPs were launched in April 2002 to help small businesses improve performance and give employees better career prospects.
ETPs run in Tyne and Wear, Greater Manchester, Derby, Birmingham, Swindon and Essex, Berkshire, Kent, East London, Leicester, Shropshire and South Yorkshire.
Six more areas will soon be announced.
Although the branding and some elements vary between pilot areas, Employer Training Pilots provide employers with:
· An assessment of their skills needs.
· Payment to cover the time taken off by staff for their training (up to a set limit).
· Free training and accreditation.
· Free information, advice and guidance to employers involved in the scheme.
· Training advisors will develop an individual training plan for each employee, taking into account the business' preferred choice of training provider and whether training needs to be conducted on or off site.
To date more than 4,000 employers and nearly 20,000 employees have signed up across England, with no employers and 5% of employees dropping out of training.
The majority - 72% - of companies participating in the pilots employ fewer than 50 employees, with 25% employing 10 or under employees, evidence that ETPs have been successful in attracting SMEs to train staff.
Nearly half - 46% - of the companies involved had no previous contact with public sector support agencies such as the LSC.
Employers are seeing a range of business benefits from their involvement in the pilots, not least providing employees with skills that are important for their business (96%) and improving productivity (82%).
Both employers and learners view their experience of the pilots positively with over 80% expressing satisfaction.
Modern Apprenticeships
Employers can introduce Modern Apprenticeships for existing employees or for new employees that have been identified by a training provider.
Training is subsidised and offers young people the chance to acquire a recognised and transferable qualification - such as NVQ Level 2 or 3 - while earning a wage.
Businesses can develop their current staff while getting a chance to recruit highly motivated young people with business specific skills.
MAs provide employers with the opportunity to assess a young person’s aptitude and motivation and fashion their training to meet the specific needs of their business. Training is designed by employers, for employers and is closely matched to the needs of specific industry sectors.
There are two types of Modern Apprenticeship:
· Foundation Modern Apprenticeships are aimed at young people aged between 16-19. Training covers NVQ Level 2 and key skills in the areas of communication, numeracy, information technology, team working and using one’s own initiative.
· Advanced Modern Apprenticeships are for people aged between 16-24. Training covers NVQ Level 3 and key skills.
There are over 150 Modern Apprenticeships frameworks in approximately 80 industries and sectors.
Currently there are 220,000 young people on the MA programme. 90 per cent of employers questioned thought that Modern Apprenticeship training was relevant to the work of their organisations.
Business benefits
By encouraging employees to participate in this structured training approach, businesses will typically benefit in terms of a better skilled and qualified workforce, increased productivity and quality, more motivated and loyal employees, improved customer service and a positive impact on the bottom line.
Skills shortages create extra cost for businesses. The LSC’s mission is to ensure training is relevant, affordable and closely aligned to the needs of employers.
Through the upskilling of their workforce, employers will see an improvement in their company’s overall performance enabling their business to compete effectively in the global marketplace.
For further information visit the Learning and Skills Council and Modern Apprenticeships websites.
