Time for direct action?

The Department for Education (DFE) announced this month that there had been a 26% drop the number of apprenticeships being taken up in industry in the first quarter of 2018. There has also been a 40% fall in new apprenticeship entrants in the six months since the introduction of the new Government levy scheme in April 2017, when compared to the previous year. There is the added issue that skilled labour from the European Union are returning home as result of uncertainty surrounding the status of EU nationals.

A number of clients are saying they can’t get the right people and they are struggling for answers to this issue.

The Government has introduced the concept of the University Technical Colleges as an educational option so that students between the ages of 14 and 19 can augment a standard education model with a more technical qualification, such as construction and engineering. This methodology is aimed to better equip young people for a career which would include entering an apprenticeship contract or having a clear pathway to further education at university. However, this program is also suffering under limited take up numbers in the newly created schools.

Clearly the plan by Government to introduce increased skilled labour via the above schemes needs a drastic rethink.

What are the options open to manufacturers given the above skills shortages and the lack of success of Government plans?

When you look overseas to what countries like Germany are doing, there is a huge amount of support from Government to make their manufacturing sector more productive and to attract and retain talented people. Without the same level of taxation and investment from the UK government, the UK can’t compete. This is not going to be a quick fix, these type of training programmes take a long time to flow through.

Some manufacturing engineering firms are being proactive and setting up their own apprenticeship schemes, if businesses run their own schemes there is a cost to them, but there are positive examples of where they can help to increase turnover. One Sussex business is reported to have invested £250k in their own scheme, but they believe the impact on turnover has been an increase from £13m to £30m. If a business is sitting on cash, it might be worth considering setting up its own scheme now.

This isn’t an issue which is unique to the manufacturing sector, skilled labour shortages are being reported elsewhere. I suspect more businesses will look to take matters into their own hands to help build and train the workforce they need for the future.

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