UK ‘sleepwalking’ into skills crisis, CIPD warns

19 Apr 2017 By Emily Burt

Report says inadequate education and low employer spend on training are harming country’s long-term prospects

Two decades of underinvestment and failed government skills policies mean the UK is “sleepwalking into a low-value, low-skills economy” that is unprepared for a post-Brexit future, the CIPD has warned.  

Statistics featured in the CIPD’s new report, From ‘inadequate’ to ‘outstanding’: making the UK’s skills system world-class, show the UK lagging behind its European neighbours and the majority of OECD (Organisation for Economic Co-operation and Development) countries in at least four key skillsets. England and Northern Ireland rank in the bottom four OECD countries for literacy and numeracy among 16 to 24-year-olds, and out of 19 countries the UK ranks bottom of the class on young people’s computer problem-solving skills.

The analysis, which forms part of the CIPD’s response to the government's industrial strategy green paper, has also highlighted flagging L&D in the workplace. Participation levels are low, with the UK ranking fourth from the bottom of an EU league table of job-related adult learning. UK employers also spend less on training than other major EU economies; in 2010, the cost per employee was €266 in the UK compared with €511 across the EU, and the gap is widening.

“This is a sobering analysis of the state of skills in the UK,” said Lizzie Crowley, CIPD skills adviser and the report’s co-author. “Our report should serve as a real wake-up call for the government to break with the past two decades of failed skills policy and set the UK on a new course that delivers the right results for individuals, organisations and the economy as a whole.”

Experts have warned that, while talent development has become a hot topic among executives in recent years, employers are not yet taking the practical steps to put the development of capabilities into practice.  

“It’s interesting that CEOs have been highlighting a lack of skills as a top three issue for the last decade but, in spite of much discussion around talent management strategies, HR functions have by and large failed to come up with coherent strategies to address these issues,” said Norman Pickavance, senior independent adviser to A Blueprint for Better Business, working on business, ethics and society.

“We partially refer to ‘talent’ as an ability to recruit people instead of growing capability – but we need to be thinking about an organisational renewal agenda,” he said. “Organisations need to benefit from innovation-related commercial development, and we need to be thinking not only about skills development, but job design, work design and skills design.”

The CIPD has made several recommendations for building strength into the UK skills system, including the reframing of the controversial apprenticeship levy as a broader and more flexible ‘training levy’, and for the government to “seize the moment” and place skills at the heart of the national industrial strategy. The report also calls on organisations to raise their skills-based ambitions and invest in workplace learning, and suggests HR professionals have a key role in addressing the “deep rooted” skills shortages that are limiting the potential of individual workers and businesses alike.

“Some of the research highlighted in this report shows the impact strong people management and leadership skills play in how skills are brought into place,” said Crowley.

“Poor management has been identified as one reason we have a productivity problem in this country, so this should act as a wake-up call for the ways in which HR needs to address some of these challenges. It doesn’t mean taking full responsibility – but there is a clear need for the profession to strengthen its role in ensuring businesses can develop the necessary skills they need to grow, and support the current skills needed for employees to reach their full potential.”

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