This article is part of a special series on growth – where will it come from and what can be done to stimulate it?
The UK is the sixth-largest national economy in terms of nominal GDP, but, like other countries, it is being affected by events in the United States and the eurozone. How well and how quickly the economy recovers affects us all. A buoyant and growing economy creates jobs, raising living standards and real incomes. It means we are wealthier as a nation and better able to invest in things that matter, such as the NHS, education, prisons, transport and other public services that enable society to ‘work’.
One of the key drivers of economic growth is the skills and abilities we have as a nation. In an increasingly globalised and knowledge-driven economy, it’s not volume and cost on which we can compete with the likes of China, India and Brazil, but skills, knowledge, experience and innovation. Employer investment in skills is therefore vital to boost economic recovery. Our skills levels have been rising but so too have those of other countries – and often at a faster rate. We are therefore running to a standstill in the international rankings. Not only do we need to increase the pace of up-skilling in the UK, but we also need to ensure that we are providing the right skills – the skills that allow individuals to secure, sustain and progress within employment, and the skills that businesses require to be more competitive. Serco recognises both the business-wide and national need to invest in skills training, in particular to help young people bridge the gap between education and employment. As such, we have committed to providing 1,000 two- to eight-week work placement opportunities and 500 apprenticeships across our UK businesses.
To this end the Growth and Innovation Fund (GIF) has been set up by the UK Commission for Employment and Skills and the Skills Funding Agency (see below for more on these bodies). The GIF provides employers with government support over three years for innovative solutions to the big skills challenges facing their sectors. After three years, the projects must become self-sustaining with the potential to be scaled up for greater impact. The fund has £25 million to invest jointly with employers and the first round of awards has just been announced, with 15 projects being funded.
In the welfare to work sector, the Employment and Related Services Group will set up a Professional Institute for Employability Professionals in England. The ambitious vision is to professionalise the sector and set goals for skills attainment at practitioner and manager level. With 90% of welfare to work contractors providing support for the vision, employer cash and in-kind support represents nearly a third of the project cost. Over time, the Institute can be extended to the UK.
Another example is the Renewables Group Training Network, which will use its funding to transition 36,000 mature entrants to the sector, train 9,000 new entrants and provide ongoing continuous professional development for the existing workforce.
The Cogent Sector Skills Council is developing an Apprenticeship Training Association, which aims to double the number of apprenticeships in five years in small- and medium-sized firms within the science-based industries. The scheme will charge employers £25 a week to hire an apprentice. In return the Association will take on the administration and legal side of employing the apprentices, which is particularly beneficial for SMEs. A cash investment of nearly £4 million will be made by employers over three years, far exceeding the £900,000 requested from the fund.
These and other GIF projects stand to make an exciting and significant contribution to each sector’s economic performance and that of the whole economy, and we eagerly await their outcomes. The government and UKCES are taking the lead to empower enterprises of all sizes, and this is just the start of the Commission’s vision to boost skills, productivity and growth in the UK.
The UK Commission for Employment and Skills is a social partnership, led by Commissioners from large and small employers, trade unions and the voluntary sector. Their mission is to raise skill levels to help drive enterprise, create more and better jobs and economic growth.
The Skills Funding Agency aims to ensure that people and businesses can access the skills training they need to succeed in playing their part in society and in growing England’s economy.
