Solution to skills shortages rests with better management

By Ben Willmott, Head of Public Policy, @Ben_Willmott

Against a backdrop of stalling productivity levels, which remain some way behind some of our major competitors, it is worrying that UK employers’ investment in training fell 5% between 2011 and 2013 and that the average number of days training per employee has also fallen over the period.

This trend has been picked up by the UK Commission for Employment and Skills’ Employer Skills Survey 2013, which also showed that the number of employers reporting vacancies has increased as the economy moves towards a recovery. Almost three in ten vacancies are reported as hard to fill, with shortages in suitably skilled, qualified/and/or experienced workers the main reason for this.

If you marry these findings with data from the OECD which suggests the UK has a high proportion of low skilled job compared to its main competitors, there are real questions over the education and skills system in the UK.

However the solution to increasing UK productivity does not just rest with increasing the supply of skilled or qualified workers. Evidence suggests that just as much attention needs to be placed on how skills are utilised in the workplace and on building employer demand for investment in skills. Unless more employers adopt high performance working (HPW) practices which stimulate more effective employee involvement and commitment, for example through enhanced leadership and management capability, effective job design, performance appraisal and smart learning and development interventions, the UK will struggle to close the productivity gap.

The UKCES skills survey finds that employers that qualify as HPW organisations (because they adopt a minimum number of HPW practices) are more likely to be recruiting but at the same time have fewer hard to fill vacancies than other employers. HPW working organisations are also more likely to train and train a higher proportion of their workforce.  Evidence also suggests a link between HPW organisations and more sophisticated product market strategies.

The challenge for policy makers is how to support an increase in the uptake of HPW working across the economy, an issue CIPD will be addressing in a forthcoming paper looking at the future of skills policy in the UK.

 

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