University education can’t deliver the skills we need for the economy of the future
TOO many jobs, wage inflation, and an abundance of flexible working opportunities. Compared to the threat of mass unemployment when the pandemic began two years ago, these feel like better problems to have.
But labour market figures released last month revealed one serious problem: an exodus of older workers. Since March 2020, the number of economically inactive 50 to 64-year olds has risen by almost 250,000.
For older workers, the UK faces a perfect storm in maturing pension entitlements and the higher standards of living available to those who’ve paid off their mortgages.
But we shouldn’t overlook the impact of technological transformation in the workplace displacing those without the skills needed to thrive. No age group is immune.
The Institute for the Future claims that 85 per cent of the jobs that will exist by 2030 haven’t been invented yet. The WEF have calculated that 40 per cent of workers will require reskilling in the next 3 years.
These statistics fail to cover just as important a trend: that for those who’ve been employed for several decades the workplace has already changed beyond recognition. Far faster, in fact, than training and skills needed to thrive within it.
In the last five years, 47 per cent of workers have not done any workplace training, according to polling for Multiverse. During that same period the breadth and pace of technological adoption – from databases to analytics tools to automation – has transformed the way most financial and professional services workers do their jobs.
Why this failure? British firms’ investment in workforce training was falling pre-pandemic, and continues to fall. There would be another 20 million training days if investment had stayed at 2011 levels.
There are cultural reasons at play. Historically we’ve been biased in favour of prestigious educational institutions, and ignored the limitations in the skills they actually provide. Even today, we structure our system around the false premise that a three year undergraduate degree can set you up for a multi-decade career.
That, finally, is changing. The proliferation of bootcamps and online courses is broadening access to training, even if the primary motivation is sometimes to provide filler on a CV or LinkedIn profile. This year the government will introduce a lifelong learning entitlement to give workers the financial means to choose their own courses.
Apprenticeships offer another opportunity. They are growing fastest in durable, high-wage career areas like data analytics, project management, and software engineering, and provide a combination of applied learning and coaching that results in the rapid acquisition of essential skills.
The money to fund these courses is available too. The annual apprenticeship budget was underspent by £1bn last year.
Apprenticeships are often seen as the preserve of young people, but the need to give established professionals resilience to technological change is just as urgent. Apprenticeships are enabling city firms like Morgan Stanley and KPMG to equip internal talent with cutting-edge skills, as well as being a mechanism for diversifying the approach to making new hires.
Training represents a brilliant opportunity for firms to retain their talented employees. Access to education is increasingly seen as an in work benefit, alongside competitive pay and working conditions.
In the race for talent where hiring costs are escalating, this particular tool is too valuable to overlook.