Rapid increases in people’s qualifications and skill levels have stalled since the mid-2000s, and both policy makers and employers must restart this progress, according to a new Resolution Foundation report published today (Monday).
Pick up the pace – a comprehensive audit of skills and educational attainment across Britain – shows that the profile of Britain’s workforce has completely transformed over the last 25 years. As recently as 1996-98, the most common qualification level for a UK worker was no higher than GCSEs. Today, the most common qualification is a degree.
The report shows that this transformation – which has included the number of people with degrees more than doubling from 17 per cent in 1996-98 to 40 per cent in 2016-18 – has reduced the big gender and race divides on educational attainment. For example, the proportion of young black women with degrees has more than trebled over this period (from 13 to 49 per cent).
However, big geographic and class divides still persist across Britain. People living outside major cities and the South East are still less likely to have a degree than people living in Inner London were 25 years ago. On class, young people with high-skilled parents are almost three times as likely to have a Masters degree as those with low- and-mid skilled parents, despite the widening of access to Bachelors degrees.
The Foundation warns that the even bigger problem facing Britain as it approaches Brexit has been the slowdown on education attainment growth since the mid-2000s. Between 1997 and 2003, the number of young people with degrees increased 1.8 percentage points a year. However, since 2004 this growth has halved to just 0.9 percentage points.
This slowdown means that Britain still has a long-tail of low-skilled workers, with one-in-eight young people not having GCSE A*-C-equivalent qualifications. The report adds that Britain’s skills slowdown does not reflect a lack of demand from firms, as 220,000 skills-shortage vacancies were reported in 2017. The Foundation says these problems prove that Britain is nowhere near the limits of growth in educational attainment, with demand particularly high for technical level 4 and 5 qualifications between school and degree stage.
The report shows that rises and falls in migration levels are neither the cause, nor the solution, to Britain’s skills challenges, as some have claimed. It finds that higher migration in the 2000s, far from dragging down average qualification levels, actually boosted them slightly. It adds that the slowdown on education attainment has taken place whether we focus on the whole workforce or just on UK born workers.
And while firms have lost out from the attainment slowdown, they also bear some responsibility for it. Training rates for high-skilled (Masters+) workers are around three times that of low-skilled (below GCSE A*-C-equivalent) workers.
The Foundation says restarting progress on raising qualifications and skills for UK-based workers must now be a top priority for government, whatever the eventual form or timing of the UK’s exit from the EU. The upcoming Spending Review should inject much-needed cash into T-levels and the wider FE sector (where spending per student has fallen by 12 per cent in real terms between 2011-12 and 2017-18), building on the progress already made in reform vocational education.
Firms in migrant reliant sectors with skills shortages, like hospitality and construction, should also prepare for the move to a stricter migration scheme post-Brexit by doing more to upskill existing workers. This should include offering greater training opportunities for young people via apprenticeships and other level 4 qualifications.
Kathleen Henehan, Policy Analyst at the Resolution Foundation, said:
“People’s qualifications and skill-levels have increased substantially over the last 25 years. This has boosted our productivity and their pay, and transformed Britain’s economy and society.
“But worryingly, this welcome progress has slowed considerably since the mid-2000s. As a result, Britain still has a shamefully long-tail of young people with only basic-level qualifications, while firms report skills shortages for higher level technical qualifications.
“With Brexit set to bring about a huge shake-up of our labour market, policy makers and firms should use it as a prompt for restarting progress on skills and educational attainment. This should involve massively increasing the provision and quality of technical and vocational education, and doing far more to upskill existing workers.”