The government has announced the launch of Skills England to bring together the ‘fractured skills landscape’ and create a shared national ambition to boost the nation’s skills.
The education secretary, Bridget Phillipson, has appointed Richard Pennycook, former chief executive of the Co-operative Group, as Skills England’s interim chair.
The Department for Education said that between 2017 and 2022 skills shortages in this country doubled to more than half a million, and now account for 36% of job vacancies.
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The government is hoping the new body will boost economic growth, with a third of productivity improvements over the last two decades attributed to skills improvements.
Skills England will bring together central and local government, businesses, training providers and trade unions to meet the skills needs of the next decade across all regions, providing strategic oversight of the post-16 skills system aligned to the government’s industrial strategy.
Sir Keir Starmer said: “Our skills system is in a mess, which is why we are transforming our approach to meet skills needs over the coming decades.
“They will help to deliver our number one mission as a government, to kickstart economic growth, by opening up new opportunities for young people and enabling British businesses to recruit more home-grown talent.
“From construction to IT, healthcare to engineering, our success as a country depends on delivering highly skilled workforces for the long term. Skills England will put in place the framework needed to achieve that goal while reducing our reliance on workers from overseas.”
The government said that supporting local areas to develop the skilled workforces they need – in particular across construction and healthcare – is fundamental to its mission to raise growth sustainably. By working with the Migration Advisory Committee, Skills England will also help reduce reliance on overseas workers.
Phillipson said: “Our first mission in government is to grow the economy, and for that, we need to harness the talents of all our people to unlock growth and break down the barriers to opportunity.
“The skills system we inherited is fragmented and broken. Employers want to invest in their workers but for too long have been held back from accessing the training they need.
“Skills England will jumpstart young people’s careers and galvanise local economies. It will bring businesses together with trade unions, mayors, universities, colleges and training providers to give us a complete picture of skills gaps nationwide, boost growth in all corners of the country and give people the opportunity to get on in life.”
Skills England, which will be established in phases over the next nine to 12 months, will identify the training for which the government’s new growth and skills levy – which replaces the apprenticeship levy – will be accessible, giving employers more flexibility to spend levy funds on training for the skills they need.
The Skills England Bill, announced this week, will transfer functions from the Institute for Apprenticeships and Technical Education to Skills England.
Kate Shoesmith, deputy chief executive of the Recruitment and Employment Confederation (REC), said: “The urgency with which the new government is setting out to lessen worklessness and to encourage ambition among employers and workers is hugely encouraging because they are key to achieving greater prosperity, productivity and economic growth.
“Making the skills system more responsive to the labour market and committing to a collaborative approach with employers is absolutely the right way to help industry overcome longstanding worker and skills shortages.
“Allowing the apprenticeship levy to fund modular courses in worker-short sectors and allowing spending on non-apprenticeship training will calm employers who have grown very frustrated with the current rigidly flawed rules, which were next to useless for most of the one million temps on assignment every day, for example.”
Lizzie Crowley, skills adviser for the CIPD, said: “The new agency must join up policy across the government’s industrial strategy, the Migration Advisory Committee and local skills and growth priorities. This is no easy task. It’s a challenging road ahead but it’s vital that the government sees this as a long-term project that can finally bring stability and certainty to the skills agenda.
“A key focus for Skills England must be on unlocking apprenticeship opportunities for young people and reversing the decline in take-up among small businesses in recent years.
“When looking at the new growth and skills levy it will be vital to consider how this will work in practice. The new levy must encourage employers to invest more in training that will address workforce skills gaps and shortages and boost apprenticeship opportunities for young people. Getting this balance right will be essential to reversing the collapse in employer investment in apprenticeships and training in recent years.”
Adult education budgets will be simplified and devolved to Mayoral Combined Authorities to ensure that they can address their adult skills needs directly and support growth in their areas.
Skills England will hold responsibility for maintaining a list of levy-eligible training to ensure value for money, and that the mix of government-funded training available to learners and employers aligns with the identified skills needs.
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