We must seek out those who really need help gaining qualifications, argues Jim Hillage
For too long, the Government has been subsidising training and skills development that would have happened anyway, or helping those who are already well qualified to get more skills and therefore better jobs and pay. That's no way to start the sort of skills revolution envisaged by Lord Leitch in his recent review of skills.
The Government's response to the Leitch review at last signals a shift towards targeting funding towards parts of the "learning market" that work least well. The lack of any extra funds for higher education won't please university finance directors, but it makes much more sense for the taxpayer.
The growing wealth gap in the UK is matched by an increased polarisation in learning activity. People who already have qualifications are those most likely to partake in further learning (either in or outside work), while those with low or no qualifications (and therefore probably in most need of skills development) are least likely. So it makes sense to concentrate public funds on developing the skills of those who have least - for reasons of equity, and in the interests of enabling people to reach a minimum level of employability and get on to the ladder for learning.
There is a clear link between a lack of qualifications and unemployment, and higher levels of literacy and numeracy are associated with a greater likelihood of being in work. Although the number of jobs that do not require qualifications is substantial (more than 6 million), research has found that many still require job-holders to possess a range of non-certified skills to do their job effectively. At the other end of the scale, the economic return that individuals and employers receive from investing in skills development at higher levels remains comparatively high.
Even when targeting funds at low-level skills, there is a tendency to just mop up employers and learners who would have done the training anyway. The evaluation of the Employer Training Pilots (the precursor to Train to Gain, the main gateway to the Government's workplace learning offer) found little or no positive effect on training levels, and many of the employers involved said that they would have trained their employees without the public subsidy. This is why the Train to Gain brokerage service is now targeted to engage with "hard-to-reach" employers - those with little previous history of training - in the attempt to involve new learners and avoid "massive deadweight". Whether this steer will be enough to rally the fresh start in learning activity that the Government is looking for will need ongoing attention.
There is no new money in the hands of the higher education sector to help it take part in the drive for a "world-class" skills base, and with the situation we are in, quite rightly so. Instead, some existing funding will be siphoned off to secure an extra 5,000 employer co-funded student places, made available year on year. In the meantime, universities are simply urged to expand their involvement in work-based learning - and this relationship-building with employers is in itself a major and challenging role for the sector, if only because it has a lot to learn. Most employers use external providers to deliver their training needs, and about a third of those work with further education colleges. Despite the huge amount the sector has to offer, only one in eight employers is engaged with higher education, and they tend to be less satisfied with their experience than those who use, for example, private training providers. To maximise the impact, higher education therefore needs to not only improve its offer but also focus on employers with no tradition of involvement at that level but who would still benefit. The trick is to avoid the temptation of meeting simplistic targets by rounding up the usual suspects.
Universities should be focusing on building relationships with different, often smaller, workplaces, and that will require more understanding of this group, along with greater flexibility about meeting their individual needs. Higher education also has an important role to play in its own right as a major employer. About one in 12 employees in the sector (40,000 people) has either no or very low qualifications. While this is half the proportion in the economy as a whole, it does contrast rather negatively with the two thirds of employees in the sector qualified to degree level at least. Whether or not universities sign the Skills Pledge and commit to improving the skills of their lowest-qualified employees or not, they certainly have the learning futures of their low-qualified staff in their hands.
Jim Hillage is director of research at the Institute for Employment Studies.