Skills investment: the business case

 

Jeremy AndersonThe way we work is changing. Companies are investing in new technologies and processes. But, asks Jeremy Anderson, a Commissioner for the UK Commission for Employment and Skills (UKCES), are we equipping employees to work productively in this evolving environment?

The battleground for the UK economy is no longer domestic; it is global. To ensure that the UK remains competitive, and generates growth as well as a good level of jobs, British businesses must operate at high levels of productivity. This requires a good level of skills within our workforces; yet one in five vacancies in the UK today is hard to fill due to a lack of suitably skilled candidates.

A collaborative approach

The desired level of skills can only be met by companies, government, and industry bodies working together. That takes planning. Research1 from UKCES suggests that nearly half of businesses would have liked to provide more training over the last 12 months than they were able to fund or arrange. There is clearly a significant business case for companies of all sizes to address this challenge head on and invest in the skills they need to support their ambitions.

In fact, UKCES research shows that 5% of the UK workforce doesn’t have the full set of skills they need to perform their role properly. As such, they are not as productive as they might be – which can negatively impact the bottom line, employee satisfaction and customer experience.

Conversely, there is also evidence of a surplus and mismatch of appropriate skillsets, with nearly half of employers reporting having staff with skills and qualifications that are not used in their current role. It’s essential we take a closer look at our workforces and channel resources appropriately to ensure we don’t have pockets of untapped talent.

Keeping pace with change

Infographic: The Skills Gap

Employers must look to the future. The nature of work is changing and different skills will be required to keep pace. Science, Technology, Engineering, and Mathematics (STEM) careers are expected to grow, and skills in those areas are increasingly in demand. We must ensure that the generation now entering the workplace has the right skills and training to prepare for what the UK needs economically – and are ready to take advantage of where the opportunities and jobs will be in the future.

Investment in skills today will also help to prevent sector-related skills shortages that can result from an ageing workforce. These potential shortages are more likely in certain sectors, such as the food processing industry, where there is a preponderance of people in the 55 to 65 age group – meaning that over the next ten years the skills gap will widen as these workers retire. Unless, of course, we tackle the problem now.

The UKCES report The Future of Work: Jobs and Skills in 20302 makes for interesting reading for those keen to explore the trends and disruptions that might affect their sector and business: demographic changes, digitalisation, and globalisation for example.

Where to start

For companies looking to plug any current or future gaps in their skills base, the first step should be to benchmark themselves against high performance organisations. There are a number of tools and measures that companies can use here – such as employee engagement surveys, or tools such as the Investors in People frameworks.3

If a company wants to benchmark itself within a specific sector, their Sector Skills Council can be useful. For local or regional comparisons, the Local Enterprise Partnerships (LEPs) have a wealth of information. Similarly the Business is Great portal4 is a valuable resource, as are the British Chambers of Commerce.

Winning the battle

In summary, UK businesses are in a battle for efficiency and effectiveness. Although companies talk about people, processes and technology being key weapons in this fight; it is often easier to pinpoint where improvements in technology and in processes can be made. Taking a closer look at your workforce and investing in people and skills is just as important – for British businesses, and the UK economy.

About UKCES

UKCES is a publicly funded, industry-led organisation that offers guidance on skills and employment issues in the UK. Jeremy Anderson CBE is Chairman of KPMG’s Global Financial Services practice and part of a UK-wide team of Commissioners who represent large and small employers, the public, private and voluntary sectors and further and higher education.

Footnotes

1. UKCES Employer Skills Survey 2013.

2. See www.investorsinpeople.co.uk/about-iip/framework

3. See www.gov.uk/government/publications/jobs-and-skills-in-2030

4. See www.greatbusiness.gov.uk

Useful links

Back to Gameplan

Back to top

Calls may be monitored or recorded in case we need to check we have carried out your instructions correctly and to help improve our quality of service.

Lloyds Bank plc Registered Office: 25 Gresham Street, London EC2V 7HN. Registered in England and Wales no. 2065. Telephone: 0207 626 1500.

Authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority under Registration Number 119278.

We subscribe to The Lending Code; copies of the Code can be obtained from www.lendingstandardsboard.org.uk

Eligible deposits with us are protected by the Financial Services Compensation Scheme (FSCS). We are covered by the Financial Ombudsman Service (FOS). Please note that due to FSCS and FOS eligibility criteria not all Business customers will be covered.

Lloyds Banking Group includes companies using brands including Lloyds Bank, Halifax and Bank of Scotland and their associated companies. More information on Lloyds Banking Group can be found at www.lloydsbankinggroup.com