It’s up to businesses to break the skills ceiling

15 May 2019 By Rob Alder

The UK’s woeful record on upskilling is linked to its poor productivity, says Rob Alder. But things can change

Whatever industry employees work in, regular upskilling and training opportunities are required to succeed in the modern workplace. Digital, financial and general business skills in particular are needed to grow workers and, in turn, help meet the changing needs of their employers. But there is significant evidence to suggest that upskilling opportunities are disproportionately going to those already highly skilled and well paid. 

AAT has analysed the latest data from the ONS’s Annual Survey of Hours and Earnings (ASHE) and the Social Mobility Commission’s Adult Skills Report and found a skills ceiling, which is costing lower-paid staff as much as £12,000 a year – the earnings gap between those who receive regular upskilling opportunities and those who do not. 

Most concerning is the trend that staff upskilling is in decline at a time when UK productivity continues to suffer. The UK spends just two-thirds of the European average on adult training, and investment is in decline. According to the Centre for Social Justice, employers’ investment in skills training has dropped by 25 per cent in the past decade, with just one in 10 workers currently studying for a nationally recognised qualification. In addition, while 79 per cent of UK businesses expect to increase their number of higher-skilled roles over the coming years, 66 per cent fear there will not be sufficiently skilled people available to fill these vacancies. 

It has been well-documented that UK labour force productivity has been lower in the last decade than at any time in the 20th century, despite the relative health of the UK economy. Businesses can tackle the productivity problem by equipping their existing employees with the essential skills needed to drive growth and feel more confident and enthused in their work. A fact of business life in the UK is also the high rate of employee turnover. By investing in and upskilling existing staff, firms can breed loyalty and save on spiralling recruitment costs. 

There are other factors at play too. Nearly one in seven people are now suffering mental health problems as a result of their work. LinkedIn research found that employees who are offered opportunities to learn at work are 47 per cent less likely to be stressed, 39 per cent more likely to feel productive and successful, 23 per cent more ready to take on additional responsibilities, and 21 per cent more likely to feel confident and happy. Job and general security are key influencers of happiness and wellbeing, and businesses can play their part by helping employees diversify their skillsets and grow in their roles. 

Businesses also need to respond to a shift in workers demanding greater flexibility in all facets of working life. Employers can help meet this demand by offering shorter, targeted upskilling opportunities with instant practical benefits for employees. Businesses will benefit from not having to take a significant financial risk of investing in expensive, long-term professional development courses for staff with no guarantees that they will stay with the business. Equally, flexible training options mean businesses can focus on the exact areas they require their workers to become more proficient in, a far cheaper alternative to recruiting someone externally who has skills in those areas.

The need to tackle the decline of investment in upskilling is clear. The skills ceiling is damaging productivity, exacerbating recruitment and retention issues and acting as a block to wellbeing. It is in the power of businesses to invest in, grow and retain a productive and happy workforce – and upskilling is a key tool for achieving this.

Rob Alder is head of business development at AAT (Association of Accounting Technicians), the UK’s leading qualification and professional body for technical accountants and bookkeepers 

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