A report issued by The Business, Energy and Industrial Strategy (BEIS) committee has highlighted the need for government investment in businesses and skills to kickstart growth.
In particular, the report has urged the government to support “skills development”. This support has been directed at upskilling the existing members of the workforce, either through a reform of the apprenticeship levy or through “other mechanisms”.
Skills gaps and candidate shortages are recurrent themes within our monthly blog The Recruitment Landscape. These articles look at recruitment activity across the UK.
In these pieces, it’s highlighted that addressing these skills shortages require a tandem effort between organisations and the government. Indeed, many MPs from the BEIS committee have called for apprenticeship levy reform to allow for the retraining of existing workers.
Leading thinkers from business academia and professional associations agree that upskilling will be pivotal in addressing the skills gaps we are experiencing within today’s labour market.
Upskilling.
Dorota Bourne from Henley Business School believes that upskilling has many benefits and that organisations could gain from rethinking their outdated training systems. Bourne advises that much organisational wisdom lies at the middle or lower levels of the organisation. These people are a solid resource that business leaders don’t tap into enough.
Upskilling and digital learning.
Combining learning “on the job” with easy-to-access digital learning is thought to be the most immediate way for organisations to prioritise upskilling. Experts have suggested that formal courses are “cumbersome”, and don’t address the real and immediate needs of the business.
Apprenticeships.
The BEIS Committee report used evidence from various sectors, including automotive, food and drink, pharmaceutical and finance. It found that upskilling was a need for many. However, some respondents cited that they believed they were being held back by the apprenticeship levy’s limitations.
According to these respondents, the levy “did not offer the flexibility to upskill workers and boost productivity through short course training and modular training”. In response, the recommendation from the BEIS committee was to revive a taskforce that would investigate the wider challenge of skills shortages in the labour market.
Wider skills levy.
Experts have argued that the apprenticeship levy should be expanded into a wider skills levy. This aligns with data from a recent REC JobsOutlook, It revealed that 50% of employers would gain from a change in the levy. These changes would broaden apprenticeships; they would be more adaptable and available to temporary workers.
Criticisms of Apprenticeships.
While there can be little argument that apprenticeships are a great way to support the development of new and current talent, there has been some criticism of apprenticeships and the levy itself.
Some believe that the apprenticeship levy is a great concept in theory. However many businesses are struggling to utilise the levy within the time frame and are therefore wasting their levy funds.
Others say that some organisations are not structured to adequately offer the time, effort and support apprenticeships require. There also is a significant need for “buy-in” from management. Without manager support, the apprentice will miss out on the coaching and mentorship element of the package as well as the opportunities for the learning to be put into practice.
Returnerships.
The recent budget brought another option to the upskilling debate. In it, a new ‘returnership’ apprenticeship programme was set up. This is aimed at upgrading existing skills-building initiatives and making them more approachable for older workers.
The ever-changing tech landscape makes training workers for the future challenging. Predicting future skills will be difficult and the horizon looks daunting for workers who are not as digitally literate as those entering the workforce.
AI and technology will change some roles and make some functions obsolete. It’s important we equip workers with the abilities to work with technology and advance alongside it. Returnerships will help businesses do this and empower their existing teams.
Tackling the skills gaps.
One study of 501 organisations indicates that 50% of employers are offering training to upskill their employees.
In light of current hiring challenges, a third offer some form of apprenticeship programme, while 26% offer bursaries and scholarships in under-skilled areas of the business.
The same study reveals that more organisations are taking ownership of the issue and reviewing their strategic plans to address any potential skills gaps. This includes L&D opportunities and how these opportunities are accessed but also the number of organisations offering a holistic package and not just relying on salaries to attract and retain staff.
Using these studies as a sample, businesses appear to be taking their role seriously. Perhaps with the advice issued as part of the report, the government will take on the recommendations and readdress the limitations of the apprenticeship levy.
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