"Skills to pay the Bills” was a rap by the Beastie Boys in 1992, when I was halfway through university as a mature student learning new skills. Skills are key to improving productivity and pay, ensuring that we can build inclusive growth.
When I joined CIPD eleven years ago, I was asked to look at the Leitch report which recommended a focus on the supply of intermediate skills. Various other initiatives have come forth since. Two years into my CIPD role in skills and learning, I joined a Scottish Government working group on Skills Utilisation. The approach rightly focused on the fact that we needed to boost the skills effectiveness of the existing population. Many years on, with the Apprenticeship Levy dominating the skills agenda, we are a bit further on but not much.
That’s why it’s very timely to see a new report by my colleague Lizzie Crowley, Over-Skilled and Underused.
The report focuses on the fact that the UK is becoming a low skill nation. Only 54% of respondents to our survey said they used advanced literacy skills, and only a third required high numeracy in their jobs.
We might think that education is the answer, but not when 30% of graduates find themselves in jobs which don’t require graduate skills. Many have skills in subject areas which are a world away from the STEM skills required. As the scissors of automation close that will be become critical. If “bots” can write sports articles and crunch data at an advanced insight level, there is a real risk of jobs being lost.
But remember those with higher education are the lucky ones. Much more concern and attention needs to be placed on those at the bottom of the skills and qualifications ladder. Just 12% of those earning less than £20,000 report that they had been promoted, compared to 45% of those earning double that. Those from more affluent special groups are more likely to have experienced progression. You need skills to progress to earn more and to have a better life. Firms need people with better skills to generate greater productivity so that Scotland and the rest of the UK can get a pay rise.
Yet, a quarter of the workforce report receiving no training, especially in SME’s, which employ 60% of the private sector workforce. The Apprentice Levy, designed to direct funding into vocational training, has been disconnected from wider skills and industrial strategy. According to a recent OFQAL report it is being used to send already qualified managers on MBA’s.
CIPD recognises that the skills and productivity gap is very much about management, but generic management education for the already qualified won't necessarily help struggling managers with poor qualifications. The report recommends raising awareness among business of the issue, putting skills utilisation at the centre of industrial strategy, targeting specialist support to help firms take the high skills route, and crucially better careers advice.
In Scotland we think some of these things are happening but that there is still much to do. Skills utilisation needs to be receive parity of focus with other skills and enterprise initiatives as it did in 2009.
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