New solutions for tackling skills shortages

6th May 2014

Column originally published in The Municipal Journal on 23 April 2014.

A new SOLACE report on local economic growth confirmed over 75% of chief executives see this as the top priority for their localities. With a growing focus on skills as the key “people” ingredient in local growth strategies, now is the time to focus on solutions benefitting the whole local labour market.

Local government is well versed in dealing with an ageing population in social care, but how does this also affect their skills and growth plans.

Currently one in six of the population are over 65, by 2050 it will be one in four. There is a simple economic argument about the effect of this on our economy.

Employer plans show there will be 13.5 million vacancies over the next 10 years, but only 7 million young people will leave school and college and enter the job market. LEPs’ skills interventions have to support people over the age of 24 to develop their skills and to cope with these transitions.

Recent cuts in FE and HE have seen a huge loss of learning opportunities for people aged 24 and over. We have seen a collapse in part-time HE and in Level 3 and 4 apprenticeships for adults and next year reduced funding will put more of a squeeze on opportunities for older people.

The national focus on helping young people in the transition from school to work is absolutely right. Young people need better learning and skills options, and opportunities to be able to successfully make that transition.

But to ignore later transitions that people face in life – redundancy, new technology in the workplace, returning from maternity or long-term sick leave and leaving care – makes no economic sense for LEPs.

We know people will have to work for longer, and will need to have the right skills – and good enough health – to continue working into their late 60s and 70s and perhaps beyond that. This needs support for planning and preparing for learning new skills to be available, affordable and accessible.

For the last year NIACE has been running a large-scale national pilot that can be a big part of the solution for LEPs. Like most good ideas, it is simple and as a bonus it is relatively cheap and we are proving that it works.

Government asked us to look at how a rounded career review could support people to make changes during mid-life, to plan and prepare for the next stage of their life, with a particular focus on employment, finances, health and retirement.

Over 3,000 people – most of them aged between 45 and 64 – participated in the pilot. Around half were in work and the other half unemployed. One-third of those in work were facing redundancy, others wanted to adapt to a new way of working and some simply wanted to stay in their current job.

Two-thirds had achieved their highest qualification over 10 years ago – and only one in five in the last 5 years. One in five hadn’t participated in learning or training since they left school and a similar proportion hadn’t in the last 10 years or more.

There were people who were drifting in their careers, but as retirement recedes into the future and the reality of low pension income becomes clear, people consider their options. Add to that pressure the technological changes in the workplace and the need for higher productivity and the situation can often look bleak.

The pilot demonstrated that a career review can stimulate people to understand and consider options with more confidence and more insight. Four-fifths of surveyed advisers said that their clients had improved confidence or motivation to explore career options and make changes, following their review.

A re-motivated, re-energised workforce – particularly those in mid-life – is vital for our economy. We are calling on the government to give all adults an entitlement to a career review in mid-life. We also know that this assessment is central to shaping reformed skills provision for adults that LEPs and employers are concerned with, and that this is an ideal intervention for LEPs to support through their European Social Fund budgets.

There is a clear demographic case for LEP skills strategies needing a lifelong approach to career education. LEPs, councils and employers are committed to finding opportunities for people to retrain and reskill throughout their working lives.

Without this, skills shortages will continue to rise, vacancies will go unfilled and people will languish in unemployment or underemployment, and risk entering retirement less well off and less healthy. The mid-life career review pilot provides part of that solution.