CENTRALISED SKILLS SYSTEM COULD LEAVE SIX MILLION PEOPLE BEHIND BY 2030 – LGA

Six million people in England risk being without a job or in work they are over-qualified for by 2030, new research for the Local Government Association suggests today.

A new report commissioned by the LGA, which represents councils in England, estimates that not meeting the skills needs of employers could lead to a potential loss of £120 billion in economic output by the end of the decade.

The research for the LGA by the Learning and Work Institute (L&W) also reveals that by 2030 there could be:

• 5.1 million low-skilled people chasing 2 million low-skilled jobs – a surplus of 3.1 million low-skilled workers;
• 12.7 million people with intermediate skills chasing 9.5 million jobs – a surplus of 3.1 million people;
• 17.4 million high-skilled jobs with only 14.8 million high-skilled workers – a deficit of 2.5 million.

Brexit is an opportunity to improve the current centrally-governed skills and employment system, which sees £10.5 billion a year spent by eight government departments or agencies across 20 different national schemes.

The LGA says this is creating a confusing, fragmented, untargeted and ineffective system.

It said that councils, combined authorities and their partners can help the Government tackle skills gaps and more effectively reduce long-term unemployment and the number of young people out of work by being able to target support locally.

The LGA is calling for the Government to use the Budget to devolve all back-to-work, skills, apprenticeship, careers advice, and business support schemes and funding to the local areas in which they are used.

This would see groups of councils across England given the power and funding to deliver a one-stop ‘Work Local’ service for skills, apprenticeship, employment, careers advice and business support provision. It would bring together local skills planning, oversee job support including Jobcentre Plus and the Work and Health Programme and coordinate careers advice and guidance for young people and adults.

Cllr Kevin Bentley, Chairman of the LGA’s People and Places Board, said:

“Millions of people face a future where they have skills mismatched for jobs at a huge cost to people’s lives and the local and national economy.

“Councils are ideally placed to lead efforts to help the Government bring growth and jobs to all parts of the country and ensure everyone is fully equipped with the skills they need to compete for future jobs.

“For that to happen, our complex and fragmented national skills system needs to adapt to a changing jobs market.

“Better local coordination of services would provide better opportunities for young people to increase their skill levels and adults retrain and upskill for future jobs. This is key to driving up productivity, closing local skills gaps and boosting local economies.”

Stephen Evans, Chief Executive of Learning and Work Institute, said:

“Improving skills is central to making the 2020s a decade of growth.

“Other countries have continued to invest in skills, while progress in England has stalled over the last decade, the result of large cuts in England’s adult education budget which has left us lagging behind other countries and the number of adults improving their skills at a record low.

“We now need a decade of investment, in order to boost life chances, economic prosperity and to level up the country. That investment needs to be delivered through a partnership between national and local government, employers and trade unions. The cost of inaction is large and growing: it is time for action and investment in lifelong learning.”