South West Regional Skills Enterprise and Employment Analysis 2007/2008

Final Report

8. RECOMMENDATIONS FOR ACTION

A Productivity, Skills Utilisation and Future Skills Needs

A1 Issues

• The UK performs less well in terms of skills when compared to other countries. The Leitch review proposes tough new targets for improving the UK’s international position. If implemented by government, these targets will be challenging even for a region as relatively well-skilled as the South West. The region will need to raise its skills levels further by 2020 if such targets are to be met and the region is to retain it competitiveness.

• Whilst raising the region’s skills levels will be important, it is also essential to improve the impact of skills on the region’s productivity performance. For this to happen it is important that individuals and business can apply the skills at their disposal. Skills utilisation, as well as acquisition, is important. Work undertaken as part of this analysis shows that investing in leadership and management is the most effective strategy for improving skills utilisation and hence productivity. This should therefore remain a priority for the region and be the focus of co-ordinated action. See also Section H.

• Changes in the region’s occupational structure will largely follow national trends, shifting in favour of higher level occupations. This in turn will drive up the demand for higher level skills and qualifications. Much of the rapid increase in employment will take place in those parts of the economy already characterised by a highly-skilled and qualified workforce. Progression to Level 4 and beyond may therefore need to become a priority in the future. Certainly it will be vital to ensure that HE is comprehensively linked into planning with respect to future skills needs.

• Forecasting information will allow the region to identify future employment trends at the sectoral and occupation level and the extent to which the skills of the workforce are likely to be able to meet those needs. However, forecasting information is not sufficiently robust for planning purposes and needs to be regularly reviewed, as the basis of a continued dialogue with partners and sectors.

A2 Recommendations

• The region should enunciate clearly the linkages between skill development, skill utilisation and productivity, underpinned by a clear ESP plan to promote these linkages. Strategies and projects undertaken by ESP partners to increase the demand for skills should clearly demonstrate their impact on productivity.

• The ESP should work with partners to agree clear regional targets and milestones for skills development in the region in order to meet the proposed 2020 requirements.

• Services delivered by Business Link and emphasised as part of the IDB and Skills Brokerage services should drive the demand for skills, promoting the importance of improving productivity through skills development.

• To encourage higher-level vocational skills development, regional skills objectives need to be clearly embedded in the regional priorities established by the HE Regional Strategy Group. See also Section B.

• Through SLIM, there should be regular reviews of forecasting information and research as the basis of a scheduled dialogue with sectors and key agencies.