Investment in skills offers areas, regions and sectors an opportunity to strengthen business competitiveness, support innovation and help people access better-quality employment. But uncertainty over future demand, project delivery and funding can hold back the investment needed to realise these benefits and capitalise on assets.
GC Insight works with clients across the UK to support economic development, identify growth opportunities and strengthen the case for investment. Here, we consider who benefits from skills investment, the support governments, stakeholders and funders can offer and how investment in skills can be de-risked to build the workforce their local economies need.
The benefits of skills investment extend beyond economies and business competitiveness to individuals and communities. Investment in skills leads to better-quality employment, higher incomes, improved financial security of households, and supports spending in the economy. This in turn increases tax revenue of the Exchequer and positively impacts on welfare expenditure. Good quality employment can also build confidence and improve health and wellbeing for individuals which at an aggregate level, enhance es communities. Together, these benefits support more inclusive growth.
There has been a lot of governmental and media discussion on skills and learning for young people and those who are not in education, employment or training. However, there is also recognition of the need to invest in adult learning for those already in work, those who are not currently working, and those in the workforce and are looking to upskills, reskill or repurpose their skills.
There have been some recent announcements that are both encouraging and welcome, for example the expansion of Mayoral Apprenticeship Brokerage Pilots giving all 14 Mayoral Strategic Authorities access to funding to support employers create new opportunities and help young people find apprenticeships. The UK Government has also confirmed the return of the Union Learning Fund in England to support workplace learning and skills development. In Scotland, the Scottish Government has committed to an expansion of apprenticeships, establishing the Apprenticeship Accelerator Grant to support SMEs to provide apprenticeships, and launching the Flexible Workforce Development Fund. There is also a great deal of investment in evidence-led skills planning through Skills Development Scotland and Skills England.
Investment in skills is of course very welcome but long-term funding certainty remains essential for training providers to invest in their staff and facilities, and for employers to plan for and invest in future workforce needs. Investment in skills can be expensive and risky. In our work on place-based economic development, key sectors and growth, we consider opportunities and project pipelines, often linked to policy, for example net zero and the need for new green or greener skills. Time and again we see uncertainty in project timelines, volatility in skills pipeline, social license challenges, and shifts in policy and regulation. These uncertainties can leave training providers, employers and individuals unwilling to invest in new skills and workforce development. The result is that there can be a time lag in the skills that sectors need and individuals lose opportunities for skills development and good quality employment.
Sharing the financial risk between industry, education providers and the public sector offers a way to unlock investment in skills development for providers, employers and sector supply chains. Collaborative funding packages could support new entrants, upskilling and reskilling, rather than leaving individual organisations to bear the cost alone. This approach could create greater total value for regional economic development, working with employers to grow the workforce. Through this ‘co-opetition’, employers would remain competitors while working together towards a shared goal: access to a skilled workforce.
At GC Insight, we support local authorities, combined authorities, education providers and public sector partners to make informed investment decisions and respond to economic and labour market change. From building robust evidence bases and developing strategies to preparing business cases and evaluation frameworks, we help partners identify skills priorities, strengthen the case for investment and understand its impact. Get in touch with our team to explore how we can support your approach to skills investment and workforce development.
