Skills system is failing business

Nov 4 2009 James Ramsbotham, North East Chamber of Commerce

PETERBOROUGH would not feature high on the list of places I’d most like to be stranded.

Furthermore, it’s definitely not where I’d want to be standing on a platform when I should be heading to the House of Commons for an event with the country’s leading skills experts.

So to find myself and my fellow National Express passengers decamping from a nice warm carriage on to a chilly platform last Wednesday was an unexpected change of plan I could well have done without.

I was due to be speaking as the business voice at the National Skills Forum event in Westminster where the topic of discussion was Skills in a Recession.

Thankfully, I made the event with short amount of time to spare and I was able to convey to politicians and policy formulators the real picture of what firms face when they try to improve the skills of their workforce.

We are in the grip of a serious recession and yet the business community’s reaction to this downturn is considerably different from ones in the past.

Where previously the first consideration was redundancy, a sizeable number of companies now are looking at across-the-board staff-salary reduction instead. It helps them to achieve the same necessary cost reductions so they can continue trading but without losing skilled employees.

Likewise, there is still a surprising appetite among firms to improve the skills of their staff despite the current economic climate. This is understandable when you consider that businesses investing in skills in a recession are 25% more likely to benefit in an upturn.

The fundamental message I wanted to convey in Westminster was that, against this backdrop, the skills system is failing businesses. At a time when they need a smooth, streamlined, easy-to-access system that is flexible to their needs, the whole industry is being thrown into turmoil.

Where we have one body, the Learning and Skills Council, responsible for pushing the skills agenda, we will soon have numerous entities. The fact that we are moving from one institution that businesses recognise to a spaghetti tangle of bodies is wrong-headed; the fact that this change is being made while the UK economy is in the grip of a recession is bordering on the insane.

The lack of flexibility in the system continues to be a bugbear of mine and a source of increasing frustration for companies that have identified training needs for their business but the only help available is to shoe- horn them in to services based on products offered and not what firms demand.

The business community’s primary collective aim at present is to get out of recession and back to growth. We need a training offer available to them that will enable this to happen.

James Ramsbotham is chief executive of the North East Chamber of Commerce