Page 20 - Regional Employment & Skills Plan

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The UK Government’s Industrial Strategy report identifies priority sectors that have the potential to make a greater contribution to future growth and employment. These include advanced manufacturing; knowledge intensive traded services; and enabling sectors, such as energy and construction. Sectors that the current UK Government has concentrated its efforts on supporting are stated in the plan for Growth as including: healthcare and the life sciences; advanced manufacturing; construction; digital and creative industries; retail; professional and business services; the space industry; and tourism, which show clear signs of growth in SW&MW.
The emphasis of the UK government on localism and decentralisation has led to the formation of ‘city deals’ and ‘growth deals’ to directly fund a range of interventions to drive economic development. ‘City Deals and Growth Deals in particular focused to varying degrees on certain aspects of youth employment programmes, adult skills provision and vocational training in order to respond to the needs of specific localities.’29
Many of the city deals that have been proposed to date have a clear skills element including a responsibility for the development of skills strategies and skills partnerships within the city region areas to improve demand led skills responses. ‘There is a growing consensus that local partners can play an important role in delivering more demand-led employment and skills systems.’30
An additional recent policy development within the UK government has been the announcement of the development of apprenticeship levies for UK businesses. ‘In the summer budget [2015], the government announced the introduction of a levy on large employers to help fund 3 million new, high quality apprenticeships this parliament to support the development of the skills base and help to drive productivity over the longer term. The levy is intended to be both simple and proportionate.’31
The system follows a similar principle to that of co-investment which places and emphasis on employer ownership of training. ‘We think it is right that the new funding system rewards those employers who commit to both their own growth and the growth of the wider economy by using apprenticeships to get the skills they need.’32 It is the intention of the UK government that the levy will be made available directly to businesses to support their apprenticeship needs. ‘The best way to make sure that individual employers get the high quality apprenticeship they want is to put the purchasing power directly in their hands and the policy intention is that employers will be free to choose what apprenticeship training they buy.’33
There is a need to further understand the devolved context and implementation for the apprenticeship levy and how its implementation may apply to the region. In particular how it may affect the current delivery model for apprenticeships and how intercompany apprenticeship activity which is currently not well recognised will be incorporated.
A further UK wide policy that we need to further understand is the impact upon the region of the implementation of the National Living Wage for the over 25s which has increased the minimum wage to £7.20 per hour. This will have a positive impact on the regions lower paid workers; however, it may also impact on employers’ ability to retain staff, therefore there is a need to increase the value and skills base of each employee.
29 City Deals and Skills – UKCES/Centre for Cities - 2015
30 City Deals and Skills – UKCES/Centre for Cities - 2015
31 Apprenticeships Levy: Employer owned apprenticeships training – August 2015
32 Apprenticeships Levy: Employer owned apprenticeships training – August 2015
33 https://www.gov.uk/government/consultations/apprenticeships-levy-employer-owned-apprenticeships-training
Regional Employment & Skills Plan South West & Mid Wales Policy Context