National Apprenticeship Week: Value of apprenticeships

As #NAW2023 comes to an end we wanted to reflect on our CEO Alison Webster 's keynote speech at Activate Learning Reading College's Apprenticeship myth-busting business breakfast.

Alison asked businesses at the event to think about the economy right now and what that has to do with supporting skills provision and local economic growth.

Many of us are feeling the pressures of the #costoflivingcrisis. The past few years have been a long slog, and we all hope that this may be the year when things finally start to improve.

So what does the Berkshire economy look like just now?

In Berkshire, employment rates stand at about 75%. The unemployment rate is about 4%

The key figure is the economic inactivity rate, which is about 21%. The economically inactive are those who do not have jobs but are not looking for work.

Why is this figure so high?

Nobody forecast the ‘great resignation’, as fifty-somethings didn’t return to work after being furloughed. Attracting them back into the world of work must be a major priority for government and employers to address.

Some of course will be forced back, as they struggle to meet cost of living pressures. But they will be better employees if they come back to work voluntarily, if they come into the office or onto the shop floor because they want to be there. ?

So how do we do that? Here’s an idea. In the 2021 census, Slough saw the South East's largest percentage-point rise in the share of people who were economically inactive because they were looking after their family or home. This points to the importance of support for carers, as well as childcare policies, as part of an economic policy package. And for employers this signals an incentive to look at more flexible working patterns and options.

And what of young people, those whose futures we feared so much for during the pandemic?

In fact, young people have fared better.

Youth unemployment has fallen to pre-pandemic levels in many countries, including the UK, according to the OECD.

Sarah O’Connor of the Financial Times recently said this is especially surprising, as young people often suffer during recessions. They find it harder to find work and, when they do, it is often for a job for which they are overqualified. But that’s not the case this time.

To an extent, the story of young people and the story of older people go together.

The employment story of the past two decades has been the rise in the proportion of older people still working.

Those older workers are now retiring early and have left more opportunities for their younger colleagues.

However, businesses are still facing labour shortages across a range of occupations, heightened by that fall in the number of older workers in the labour market.

Remote working was a lifeline during the pandemic. With many people still working from home or hybrid working, this could lead to fewer opportunities for Berkshire residents as employers can source new staff from across the country, even across the world.

These facets of the economy have a skills dimension; higher skilled employees command higher wages and can compete with candidates from outside Berkshire for remote jobs, but those with fewer skills could lose out.

From an employer’s perspective, how do you attract the workers you need is the major challenge.

If there are fewer over-50s in the labour market, how do you entice young people to your company?

If youth unemployment is low, how do you attract those young people entering the labour market to come to work for you?

The answer to both questions is skills training. In the same way that universities open up academic opportunities for those studying for a degree, then apprenticeships open up vocational opportunities for those whose talents are best developed outside academia – remember apprenticeships today aren’t just about practical technical skills but apprenticeship routes are available for almost every sector or occupation. ?

Apprenticeships and broader training have a key role to play in ensuring that future labour supply issues do not restrict the economic potential of Berkshire. Unfortunately in Berkshire, employers have historically been less likely to employ apprentices than employers elsewhere in the country. This is where our colleges and businesses can pull together and support the skills provision in Berkshire.

In addition to enhancing the employability of young talent, apprenticeships are also an effective and affordable way to upskill existing staff of any age, ensuring their knowledge and skills are up-to-date.

The business benefit of apprenticeship schemes is clear: they provide a sustained home-grown workforce.

I’m proud to say that in recent years the LEP has employed two young apprentices and upskilled two colleagues with apprenticeships in Project Management and Finance.?

The LEP has also been supporting the local skills provision for over a decade through our annual Skills Reports and creating Berkshire Opportunities an online portal for students, employers, schools, colleges and residents, wanting to upskill or find a career; and explore all the resources they require to understand the career opportunities and pathways available in the area.

The LEP delivers the The Careers & Enterprise Company for Berkshire and has built a network of business people volunteering as #EnterpriseAdvisers working in almost all of our Secondary Schools and colleges to help young people think about and prepare for their future working lives.

We’re delighted to now be supporting the Thames Valley Chamber of Commerce with the delivery of their Berkshire Local Skills Improvement Plan and its focus on the post-16 technical skills training needs for specific important sectors in Berkshire such as Creative (Screen Industries), Construction and the Built Environment, ICT, Health and Care, Life Science, Transport & Logistics, Low Carbon, and Digitalisation.

On Monday government made a game-changing announcement confirming young people will be able to search and apply for apprenticeships alongside degrees on UCAS as of 2024. This will help widen the opportunities for businesses to promote their apprenticeship roles.

So, if you do one thing today, next week or next month think about what skills do you need to build within your workforce that you don’t have currently and will need in the next few years? And speak to the local colleges.

For me, I see great opportunity for businesses in Berkshire to get ahead of the curve by offering programmes that diversify, #upskill and strengthen the capabilities of your employees in strategic areas.

This can truly be the year that things start to get better.