In a new report published yesterday by the Institute of
Directors (IoD) and education and skills researchers CFE, the
consequences of a flawed skills system to the economy are laid
bare. Despite ten years of intense government activity and effort
on the skills front, 58 per cent of company directors report that
skills gaps are holding back the growth of their firms.
The report, based on a critique of government policy in the
2000s allied to research carried out among employers, sets out to
challenge existing thinking about skills policy and to offer an
'employer's eye view' of the skills system. It analyses the latest
skills strategy and concludes that while the new government's
approach to skills policy should be broadly welcomed, there are
some worrying signs that it may repeat policy mistakes of the
past.
IoD East Midlands Regional Director, Ron Lynch commented:" The
findings echo was IoD members in the region have been saying for a
long time, particularly in relation to skills gaps holding back
growth and the complexity of the systems."
Key points from the report:
· Skills deficiencies continue to shackle businesses and
undermine economic recovery. According to the survey evidence
presented in the report, 58 per cent of company directors said that
skills gaps were holding back the growth of their firms. 31 per
cent of directors were struggling to fill vacancies in their
workforce, and 47 per cent said that some of their organisation's
employees lacked the skills needed to do their job to the required
level.
· The Government skills strategy published last year,
Skills for Sustainable Growth, offers a positive prospectus for the
future of skills policy. It is based on sound principles and the
commitments to free up the skills system and to move away from a
target-driven, command-and-control model should be applauded.
However, other aspects of the strategy disappoint: the
simplification of the skills infrastructure is too timid and the
encouragement of collective measures such as training levies is
unwelcome.
· The IoD/CFE report outlines six headline proposals to
help realise the potential of Skills for Sustainable Growth and
deliver a more effective skills system. They include
recommendations to measure the effectiveness of the skills system
rather than counting aggregate numbers of qualifications; to give
true purchasing power to customers of training; and to free up
training providers to respond to businesses' needs.
Ron Lynch, added: "There is much good in current skills policy,
but from the employer perspective it can look too much like
situation normal. And situation normal doesn't work. It is vital
that the Government concentrates on supporting the majority of
employers that do invest in training, rather than being preoccupied
about the minority that do not. Good intentions can easily result
in unhelpful and unnecessary interventions. Employers will always
be best placed to know what training they need: it is better to let
competition decide what works in business, not government
policy."
James Kewin, Managing Director of CFE, said:
"Our research suggests that skills policy should focus on
creating the environment in which employers can invest in the
skills of their workforce and training providers can respond
effectively to their needs. Employers, and those colleges and
providers that supply training to them, have the potential to work
together even more effectively than they currently do, but the role
of government in this relationship should be informed by the
lessons from previous policy interventions we identify in the
report."