How will reforms to England’s skill system affect productivity?

The Government released its long-awaited Skills for Jobs white paper in January 2021, which sets out ambitious plans for the future of technical and professional education in England. Our academics shared their take on England’s skills system and how reforms might impact productivity levels crucial to boosting the UK’s recovery.

Professor Andy Westwood, Professor of Government Practice, The University of Manchester

“This white paper provides welcome recognition that reforming England’s skills system will be critical to improving productivity. Expanding the role of employers in driving delivery alongside the introduction of a lifetime skills guarantee with flexible loan funding are important steps.

However, we should also note that this white paper is just the latest in a long line of similar reforms. Since the Further and Higher Education Act in 1992, there have been 15 major white papers and five overarching Parliamentary Acts covering skills reform. Gavin Williamson is the thirteenth Secretary of State with responsibility for England’s FE and Skills system. The challenge is not always coming up with new plans and strategies, but sticking to them as the efforts only pay off for productivity in the medium- to long-term.”

Professor Andrew Henley, Professor of Entrepreneurship and Economics, Cardiff University

“Investment in vocational skills is a huge component in meeting the wider goal of improving the UK’s productivity. There are many aspects of the white paper which are to be welcomed in terms of meeting this objective for England – the focus on employer articulation of future skills needs, the support for further education providers who are often neglected players in the education sector, the proposals to provide improved finance for vocational student learners, the emphasis on life-long learning and skills enhancement, and the importance of providing high quality data and intelligence on skills.

It provides a good basis for policy renewal as the UK grapples with challenges of restoring the performance of the economy after Covid-19, the transition to the post-Brexit business environment, and the investment in the enhancement of skills needed to achieve clean growth for future generations.”

Professor Chris Warhurst, Director of the Warwick Institute for Employment Research, University of Warwick

“The Skills for Jobs white paper is to be welcomed for wanting to tackle the marginalisation of vocational education and training in the UK – a sector that has been neglected, even undermined, for too long. This neglect has contributed to a lack of good training and skills opportunities for young people not going to university and a skills mismatch in the UK economy, which is a major deterrent to restoring productivity to the UK economy.

Placing employers at the heart of the skills system sounds good but it assumes that a ‘system’ exists in which all of the stakeholders are included and have clear roles, responsibilities and outcomes.

Small firms, which make up a significant proportion of UK businesses and feature large in any solution to the UK productivity puzzle, are often excluded, leaving engagement solely with larger firms. All employers and stakeholders need to be part of a national workforce development plan that looks to the skills employers and employees need – not just today, but also tomorrow.”

Professor Eugenio Proto, Cairncross Chair in Applied Economics and Econometrics, University of Glasgow

“The skills gap is a problem which has affected the UK economy for decades and been a critical explanation for the productivity slowdown. This is made even more compelling by the reduced labour mobility that will likely follow Brexit. An open and interesting question is if just making training and vocational education more available will be enough to induce people to effectively learn and choose the professions the economy is missing. Or do we need greater support to encourage behavioural change in both students and business to ensure they take up these opportunities.”

Professor Jill Rubery, Professor of Comparative Employment Systems at The University of Manchester and Director of the Work and Equalities Institute at Alliance Manchester Business School

“The support for upgrading of skills and retraining across a person’s life through a lifetime skills guarantee and flexible loan funding in the white paper are particularly welcome. The twin challenges of Covid and the acceleration of technological change are likely to leave many people in need of upgrading skills or a restarting their careers and without this type of support, there are risks not only of unemployment but also further growth of a low skill, low productivity economy. The involvement of employers is also welcome but we must not forget that training systems also need to ensure they provide transferable skills based on strong foundational knowledge that will facilitate skill upgrading and development over the life course.”