A work in progress

3 December 2014

Column originally published in The Municipal Journal on 11 November 2014.

One of the most pressing facts facing local economic development plans in the skills arena is that investment in skills is very heavily focused on young adults, at the expense of people over the age of 24. Investment in 18 to 23-year-olds prioritises higher education at the expense of other types of learning and skills or those not in learning. Educational outcomes are still too strongly correlated with socio-economic factors and the truth for many people is that ‘if at first you don’t succeed in education, then you don’t succeed’.

Our economy will have 13,5,000,000 job vacancies in the next decade but with only 7,000,000 young people entering the labour force in that period, we are heading for a major labour market imbalance. Tackling the skills and employment support needs of UK adults is therefore now a pressing economic necessity and sustainable recovery is dependent on more UK adults participating successfully in the labour market and doing so later into their lives.

An ageing population is one of the most powerful forces shaping the UK’s future. But local government is typically still encouraged to deal with this as a problem for adult social care or acute hospital services, rather than a socio-economic opportunity. While an ageing population will put increasingly high demands on adult social care, health, welfare and pensions, it also opens up opportunities with more adults able to contribute to society, communities and the economy for much longer.

This month NIACE is launching a new package of collaborative work programmes to help Local Enterprise Partnerships (LEPs), combined authorities and councils tackle adult skills shortages in the working age populations of local areas across the country. Among other things, this now includes employability, pathways to work, and local work programme support; the European Social Fund; our highly successful mid-life career review programme, and particularly on learning and skills market development.

On market development, the latest further education and skills 24+ advanced learning loans figures show a collapse in the number of people taking part in learning at Levels 3 and 4. This loan system, similar to the loans system for university tuition fees, was poorly promoted and little understood in local government or LEPs, but is becoming hugely important to the future of tacking adult skills shortages.

In 2012/13 over 400,000 people aged 24 and over took part in learning at Levels 3 and 4. By comparison, in 2013/14 only 57,000 people paid for learning at this level with a loan. These figures are a clear warning that last year was not a blip. Huge numbers of people are no longer participating in learning that will help them to get on in life and in careers which will help the economy to grow.

Making new markets on both the demand and supply side in learning and skills means the prospects of there being enough highly-skilled people to do the jobs – now and in the future – will improve. It also means, critically, that there is a huge capacity development gap on skills, and that blithe talk of devolving the adult skills budget in city deal negotiations is only grasping a small part of the actual fiscal challenge facing new markets in learning and skills.

NIACE will be expanding our programmes of work across local government into 2015 and beyond to help councils, LEPs and emerging combined authorities tackle these challenges and others, as the skills aspect of local growth strategies is absolutely essential to creating a sustainable economic future for the UK.