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The public, politicians and policymakers are talking about productivity - the only way a country can improve living standards and workers' their take home pay. This report examines the contribution skills policy has made in recent decades to address the UK 'productivity gap'. Based on quantitative analysis and interviews with leading education experts, including former policy advisers, the authors outline why the UK has been 'running to stand still' when it comes to upgrading skills and qualification levels in the workforce. Despite strong ministerial leadership, including the well-intended efforts of civil servants and delivery bodies, none of the fundamental metrics appear to have shifted in a significantly positive direction since 2008. As the UK prepares for a general election before January 2025, the report provides critical insights into the main skills and policy challenges facing the next government.

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There have been significant political and economic changes in the UK which provide the backdrop to employer expenditure on training: Brexit and a new immigration policy, the [Coronavirus Disease 2019] COVID-19 pandemic, and the cost-of-living crisis caused by the Russia-Ukraine war. Against this backdrop, the UK faces the long-term challenge of increasing productivity. Productivity can be raised through increasing investment in physical capital, human capital and new technology. Employer expenditure on training can be divided into two parts: expenditure on general training provision and expenditure on apprenticeships. This publication seeks to discuss a series of key issues regarding: employer spending on general training provision; employer spending on apprenticeships; employer engagement in publicly funded post-16 education; and employer involvement in work placements. It includes analysis and recommendations on how to boost the demand for skills and employer investment in training from 21 leading organisations and experts. It concludes with key messages and recommendations from Campaign for Learning. From a policy perspective, ideas to increase employer spending on training in general and post-16 education and skills in particular refer to England.

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The contents are as follows: Introduction / Julia Wright and Mark Corney. Part one, 'Employer investment in context', contains the following papers: Investment in the round / Louise Murphy; UK enterprises and investment in capital and training / Vicki Belt; Employer investment in training in England / Becci Newton. Part two, 'Drivers of employer investment in training', contains: Derived demand, British management and employer investment in training / Neil Carberry; Strategies to drive-up employer investment in training / Ewart Keep; Transitioning to net zero, green skills and employer investment in training / Sam Alvis; Job quality, job design and driving-up employer investment in training / Dan Lucy; Local inward investment, business support and employer demand for training / Natasha Waller; Universities, R&D, business innovation and meeting employer skills needs / Jovan Luzajic; FE colleges, business innovation and meeting employer skills needs / David Hughes.

Part three, 'Increasing employer investment in training', contains: Why should employers invest in training in a flexible labour market? / Paul Bivand; Why should employers invest in training with large net worker migration into the UK? / Aidan Relf; Raising employer investment in training / Stephan Evans; Increasing employer investment in training / Robert West; Encouraging employer demand for training / Lizzie Crowley; Increasing employer demand for management training / Anthony Painter. Part four, 'Raising employer demand for publicly funded post-16 education and skills', contains: Increasing employer demand for post-16 apprenticeships in England / Jane Hickie; Increasing employer demand for level 4-5 technical education in England / Mandy Crawford; Increasing employer demand for higher technical education in England / Ian Pryce. Part five, 'Raising employer demand for work placements', contains: Increasing employer demand for work placements for level 3-5 vocational courses in England / John Widdowson; Increasing employer demand for undergraduate work placements in England / Stephen Isherwood. The Campaign for Learning concluding section contains: Key messages / Mark Corney; Recommendations / Mark Corney. Show less

In the UK, nearly 40 per cent of adults now go on to higher education (HE). Yet university is not the only place of learning beyond the school gates. There is a wide range of education and training undertaken by adults, from vocational courses at local colleges to ongoing on-the-job training and apprenticeships. This post-18 education and training receives less attention than HE, but is crucial to developing the skills needed by the UK's workforce and to boosting economic productivity. There is a range of potential policy levers available to a government wishing to encourage employers and individuals to invest in post-18 education and training.

In this report, we focus on the funding and financing of adult education and training in England. This encompasses four policy areas: the public funding of adult education (which covers funding for post-18 further education), the non-HE student loan system, apprenticeship policy, and the taxation of training. We do not cover other areas in detail, such as the regulation of training, although these are unquestionably important to the skills system. We begin by setting out how adult education and training participation has changed over time and how the experience in the UK compares with that in other countries. We draw lessons from the history of skills policy. We then analyse each of the four different policy levers in England through the lens of the trade-off between costs and benefits. The report concludes by setting out the lessons that can be drawn from this analysis and some of the government's options for reform.

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The Skilling the Territory investment plan outlines the Northern Territory (NT) Government's commitment to building a skilled workforce through investment in training programs and initiatives. Funding is targeted towards programs that will maximise job opportunities for Territorians and support business and industry to build the workforce they need.

Apprenticeships and traineeships are an integral part of the plan. The existing User Choice Program together with the targeted and responsive programs create additional opportunities for Territorians to take up an apprenticeship, traineeship or other training opportunities. The plan underpins the NT Government's vocational education and training (VET) investment framework, to provide transparency on government's investment priorities in workforce development.

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The political economy of skills formation represents a complex area of research since it explores the convergence between public policy ambitions and market economy. This particularly applies to apprenticeships policy, which sees private sector involvement in skills formation as fundamental. In England, technician-level skills shortages in advanced manufacturing are at a critical state and continue to worsen with the emergence of new technologies. This problem matters because technicians are important contributors to innovation, sectoral productivity, and the country’s economy. To address this, waves of structural and institutional reforms have been introduced by governments over the last three decades, shifting elements of skills planning between national, regional, and local institutions.

The latest reform of this sort was the localisation of the economic development policy, which encompassed skills formation. As such, Local Enterprise Partnerships (LEPs) were introduced in 2011 as local institutions of governance aimed at enabling 'a strong, more responsive skills system', using local knowledge and expertise. Nevertheless, in the context of national administration of apprenticeships, nationally defined targets, national funding and taxation system, the actual role of LEPs with regards to motivating employers to engage in apprenticeship investment in order to achieve local economic growth appears to be unclear and unexplored.

This research explored the extent to which the institution of the LEP engaged in solving the skills shortage problem of trained technicians required by the advanced manufacturing sector in England. The thesis starts with an analysis of the context in which LEPs operate and take strategic decisions, using the theory of polycentricity (Chapter 4). Furthermore, Chapter 5 uses the IAD Framework to help analyse the influence LEPs have on firms' training investment decision making. Chapter 6 continues this analysis by presenting firms' patterns of interaction in training investment, as well as the outcomes that resulted from these behaviours.

The findings suggest that LEPs have potential for generating local cooperation in training investment. This potential can be further developed if the institution of the LEP explores its local scale of governance beyond its superficial skills capital investor role and into the support of homogenous club-like employer networks, intrinsic to the polycentric order of governance in economic development. Despite its weakened polycentric attributes, which limit the impact of its skills capital allocations, the evidence presented in this thesis suggests that there is a link between LEPs' local scale of operation and firms' decision to invest in training that addresses the collective act ion problem of technician skills shortages: the support for club-like, homogenous, and small-sized local employer networks. Consequently, these findings provided the answer to the research question raised in this thesis: 'how (if at all) has the institution of the LEP facilitated local cooperation in training investment, to address the collective action problem of technician skills shortages in advanced manufacturing industry in England?'.

The methodology used was the exploratory case study methodology, which enabled an extensive depth description of the institution of the LEP and its role in the local skills formation in England. The researcher used a triangulation of methods for data collection, which included interviews with 55 study participants, submissions of Freedom of Information (FOI) requests, and quantitative national datasets such as Burning Glass Technologies and the Employer Skills Surveys (ESS). Study participants included representatives of LEPs, local employer networks and firms, training providers, and national/sectoral organisations.

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This report supplements findings from the main evaluation of the Construction Skills Fund (CSF). The CSF supported the development of 23 onsite training hubs which were mobile training facilities situated on construction sites. They delivered training for in-demand entry level construction skills. By offering trainees the opportunity to learn and apply their knowledge in a real-world industry-led environment, the hubs intended to bridge the gap between training and working in the construction industry. This research fills a gap in the main evaluation by focusing on the medium-term learner perspectives and experiences of looking for work after completing the course and career and learning progression. A qualitative method was used to provide deep insight into whether and how participants were able to enter employment in the construction sector and any barriers they experienced. In total, 30 interviews were achieved with respondents between nine months and two years after they completed training. The sample included respondents in a range of situations and from a range of backgrounds.

While some respondents felt capable and understood how to access work, especially those with wider networks and contacts in the sector, other motivated respondents were not able to do so. While the [Coronavirus Disease 2019] COVID-19 pandemic undoubtably affected labour market experiences, participants experienced other barriers to entering and sustaining work in the sector. These barriers included: a lack of suitable local roles, a lack of support to enter work, and poor early experiences in the sector. The CSF programme successfully trained motivated participants to become employment and site ready. It could have placed greater emphasis on supporting trained participants to enter work more consistently. This would have been likely to have improved the ability of the programme to achieve the job entry target and enabled employers and participants to reap fuller benefits of the training investment.

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In the Autumn of 2019, many businesses across the UK were struggling to access and retain the skills they needed, impacting on productivity and growth while, at the same time, annual business investment in training was falling year on year. In response, [British Chambers of Commerce] BCC convened the Workplace Training and Development Commission to consider the question 'How can we achieve a world-class system for retraining and upskilling our workforce to take advantage of rapid changes in technology, working practices, and industrial and consumer trends?' The commission's inquiry into workplace training and development confirms what research data and business feedback has been saying for many years - the skills system is not working for employers or the workforce. Pervasive skills shortages are damaging business productivity and employers still face too many barriers to accessing the training they need. Part of the solution is to boost the capacity of workplaces to act as sites of learning and incentivise more businesses to invest in training and reskilling the adult workforce. At the same time, the education system must ensure that young people enter the workplace with the basic and soft skills they will need to be successful.

Businesses recognise they have a responsibility to invest in the skills of their adult workforce, yet too few firms are doing so proactively. Overall, business investment in training is falling year-on-year and, more recently, the impact of the Coronavirus [COVID-19] pandemic on revenues and cashflow has reduced resources for training and associated costs still further, jeopardising a skills-led recovery. The speed and scale of the post-pandemic economic transformation also requires a skills system with the agility to respond to high levels of unemployment, the trading down of skilled workers in the labour market, and the overall impact on employment opportunities for low skilled workers. Now, more than ever before, businesses need an agile skills system that helps them to continuously train and develop their workforce in response to the evolving business environment. A skills-led recovery will support business to innovate, and be more productive and competitive, but everyone in the workplace must be included in the transformation journey. Our report focuses on a long-term vision for the skills system and the steps we need to take as businesses and policymakers to get there.

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This collaborative report from PwC, Social Ventures Australia, the Global Apprenticeship Network (Australia) and the Apprentice Employment Network (Victoria) identifies measures that are required to build an apprenticeship system that works in the modern world and remedy Australia's chronic skills shortages. In June 2021, PwC was engaged by SVA and the AEN to provide analysis on: (1) gaining an understanding of the factors shaping employers' willingness to hire and train young people; (2) building an understanding of the actions governments have taken, including internationally, to increase opportunities for young people to get into work and develop their skills; and (3) identifying what action(s) can be taken to substantially increase the availability of those opportunities for young people in Australia.

The approach to provide analysis for this research project included the following: an in-depth literature review of over 70 documents; a targeted employer survey (50 respondents); one-on-one consultations with employers, academics, youth advocate bodies and training bodies; and a roundtable focused on testing the impact of potential solutions. Research for this report includes reviewing policies designed to increase employer provision of career paths for youth, with a focus on evidence from examples such as the Training Guarantee (Australia); the Apprenticeship Levy (UK); use of procurement (such as the Major Project Skills Guarantee) and evidence from pilot projects e.g. higher apprenticeship pilots.

While many employers identify cost as a significant barrier to investing in young people, wage subsidies are not always the most effective way of addressing cost barriers. On their own, they are not enough to address the challenges employers face. Some employers have the knowledge, experience and scale to build employment pathways within their own organisations. But most employers lack this capacity and find themselves having to navigate a complex, and often costly, system. Employers told us that they want to see better-designed incentives, more coherent and comprehensive intermediary support and a quicker return on investment when they hire young people. It is clear from this research that a combination of measures is needed to generate change. We identified five broad approaches, some combination of which should be considered: (1) financial levers including more tailored subsidies and consideration of schemes to promote training investment; (2) stronger and more coherent intermediary support models for employers; (3) collaborative pre-employment (training) models which are directly linked to employers; (4) use of integrated work and learning, particularly in sectors without strong existing apprenticeship systems; and (5) use of government procurement and contracting to drive skills development. The report identifies a number of possible next steps to test and refine these ideas.

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The Skilling the Territory investment plan outlines the Northern Territory (NT) Government's commitment to building a skilled workforce through investment in training programs and initiatives. Funding is targeted towards programs that will maximise job opportunities for Territorians and support business and industry to build the workforce they need.

Apprenticeships and traineeships are an integral part of the plan. The existing User Choice Program together with the targeted and responsive programs create additional opportunities for Territorians to take up an apprenticeship, traineeship or other training opportunities. The plan underpins the NT Government's vocational education and training (VET) investment framework, to provide transparency on government's investment priorities in workforce development.

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This report provides the results from the 2018 to 2019 survey into the views and experiences of employers involved in apprenticeships. The survey covered: employers' experiences of offering apprenticeships; who they took on and to what types of apprenticeship; their motivations for offering apprenticeships; and satisfaction of employers. For the first time, a separate survey was also conducted of employers who had either current degree apprentices or Level 6+ non-degree apprenticeships at their site as of August 2018. The report sits alongside the accompanying learner report [available in VOCEDplus at TD/TNC 139.935]. Recent policy developments have been oriented toward driving up quality while at the same time delivering increased quantities of apprenticeship starts, and with a focus on the central role of employers in the design of suitable apprenticeships. These policy developments have included: the move from frameworks to standards; new requirements for minimum levels of off-the-job training; changes to the approach to apprenticeship assessment (standards require end point assessment); the establishment of the Institute for Apprenticeships and Technical Education to oversee quality and to approve apprenticeship standards and assessment plans; and increased emphasis on Maths and English. This has been accompanied by changes to the funding of apprenticeships, seeking to address perceived employer under-investment in training coupled with the need to fund the desired increase in apprenticeship volumes. The research is intended to help monitor key progress indicators and assess the impact of recent policy reforms to help shape future development of the apprenticeship programme.

Key findings include: (1) despite official data indicating that, since the introduction of reforms in May 2017, a fall in apprenticeship numbers, the vast majority (83 per cent) of employers surveyed planned to continue offering apprenticeships in future, as in the 2017 research when awareness of the reforms was much lower; in addition, more employers who had apprentice completers in 2017 said they had increased their apprenticeship recruitment as a result of the reforms than decreased it; (2) the vast majority of employers who had apprentices completing in the February to September 2017 period were satisfied with the apprenticeship programme, and considered there to be multiple benefits to the organisation, including a range of tangible business benefits, especially in terms of productivity; this finding is consistent with the 2017 survey; (3) employer satisfaction varied by apprenticeship subject, with those such as Construction, Agriculture, and Engineering and Manufacturing receiving lower satisfaction scores among employers; they scored particularly poorly on the flexibility of delivery and the level of influence employers were able to have over structure and content; Arts and Media apprenticeships had the lowest satisfaction rate with the programme overall (66 per cent), and this subject was consistently amongst the lowest scoring for each of the specific elements; this was also the case in 2017; (4) most employers said that there was sufficient information, support and guidance available to employers interested in offering apprenticeships, more than in previous surveys; (5) employers of current degree apprentices or Level 6+ non-degree apprenticeships were generally satisfied with quality of training delivered by the training provider, their ability to select a relevant standard, and the quality of applicants; however, they were less satisfied on all other measures, particularly on complexity of paperwork and ability to influence the training; and (6) about a quarter of employers with Level 6+ apprentices cited the Apprenticeship Levy as their main reason for recruiting these apprentices, although there was little evidence to suggest widespread replacement of graduate recruitment.

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