Skills system not meeting needs of employers

New research for the Local Government Association (LGA) suggests six million people in England risk being without a job or in work they are over-qualified for by 2030.

A new report commissioned by the LGA 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; and 12.7 million people with intermediate skills chasing 9.5 million jobs – a surplus of 3.1 million people. The research also suggests there will be 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.