If the UK is to remain a major independent economic and political power in the new century, and if living standards are to be enhanced, it is crucial Britain develops and maintains a highly skilled workforce.
Deficiencies in skills and training have been a source of weakness for the British economy throughout the 20th century. In a survey conducted by NOP for the Institute of Directors last year, 65 per cent of respondents stated that while recruiting over the past 12 months their company had experienced a shortage in the availability of skilled people. Many employers feel employees have lower skill levels than are necessary to meet their business objectives. Almost half of the participants in our survey considered they faced this problem.
Addressing skill shortages, skill gaps and other recruitment difficulties is ultimately the employer's responsibility. British employers invest over £10bn a year on training, and our survey showed 97 per cent of respondents provide it in some form. However, the Government must ensure school-leavers have a basic mastery of the 3Rs and the generic skills needed in the workplace. We welcome David Blunkett's emphasis on the need to improve literacy and numeracy standards. However, the Government also needs to improve basic educational standards among adults. Moreover, it needs to reconsider its approach to post-16 and higher education. While the UK has the highest proportion of graduates in the European Union, we have a relatively low proportion of employees with intermediate level vocational qualifications. There should be no further publicly funded expansion of higher education. The Government should concentrate its resources on expanding the number of individuals with intermediate level qualifications.
The Government can help British business secure skilled personnel through an appropriate immigration policy. Additionally, it should keep the tax and regulatory burden low so firms will have more resources for investment in general, and training in particular.
Finally, the Government must maintain a stable macro-economic framework. The boom and bust cycle engenders acute skill shortages and bottlenecks and jeopardises investment in training. It is partly for this reason the IoD supports the Government's decision to grant operational independence for the Bank of England and opposes premature entry into the euro. Britain's new monetary system shows every sign of deli