How well are the skills needs of employers in Northern

Ireland being met?

Lesley Giles, Deputy DirectorUK Commission for Employment and Skills

DEL lunchtime seminar16th January 2014

Our Commissioners

What does the UK Commission for Employment and Skills do?

CommissionerInsights

DeliveringInvestmen

t

Research and Intelligence

Our ambition is to transform the

United Kingdom’s

approach to investing in the skills of people as an intrinsic

part of securing growth

Skills matter, skills play a vital role in performance What’s the value of skills?Firms in the UK that don’t invest in training, are on average...

Twice as likely to failAnd this varies by sector...

Manufacturing

Construction

Hotels and Restaurants

Retail and Wholesale

Transport and Comms

Likelihood of business failure2x

2x

2x

4x

9x

Are businesses investing wisely in skills?Are skills needs being met?

There are 59,700 businesses with a headcount of 1+ across Northern Ireland. Of which...

41% do not train(0.9 million)

Of those who do train:

9%

Do not knowif they want to

do more

Would like to do more

training

Do sufficienttraining to

meet needs

No trainingneed

Perceived need but met

barriers

Of those who do not train:

Key Challenge:Training investment is declining in real terms, and only 19% of UK businesses are

adopting High Performance Working practices, is this ambitious enough?

63% train 37% do not train

15%22%31% 23%

Source: UKCESS 2011; Note: Figures relating to whether those who train and would like to do more training come from the skills equilibrium follow up survey, this survey covers employers with 2 or more working proprietors and no employees as well as employers with 1+ employees.

Is skills investment of sufficient quality?What’s the shape of the training market?

Across Northern Ireland

£1.36 BILLIONis spent on training, however:

6

£805 million is ondirect costs of training

£558 million is the wages of those being trained

these direct costs include…

£76 million was counted as fees to external providers for courses£228 million was spent on training management

£221 million was spent on training centres*£235 million went on the wages of trainers providing on the job

trainingSource: UKCESS 2011, Investment in Training Survey

* Training centres either on-site or off-site within the same company

Pockets of skills deficiencies persist and are growing

Between 2008 and 2011 there was a small increase in vacancies in Northern Ireland. This was primarily driven by micro businesses (1-4), where the number of vacancies per employee increased almost three-fold.

7

Total 1-4 5-10 11-49 50+

2.4

3.13.4

2.32.1

2.7

8.8

1.92.2 2

2008

2011

Number of vacancies per employee by employer size in Northern Ireland

Source: UK Employer Skills Survey 2011, Northern Ireland Skills Monitoring Survey 2008; Vacancy base: all establishments in Northern Ireland within each size band; Skills-shortage vacancy base: all establishments with vacancies within each size band.

Persistent skills deficiencies impact on NI firmsThere are opportunities to exploit business benefits

Increased operating costs

Lose business to competitors

Struggle to meet customer services

Delay developing new goods or services

Increased workload for other staff

36%

20%

20%

58%

33%

40%

40%

49%

72%

Skills shortage vacancies Skills gaps

8Source: UKCESS 2011; Base: Employers in Northern Ireland with skills shortage vacancies (124 unweighted), Employers in Northern Ireland with skills gaps (618 unweighted)

Are skills programmes being sufficiently used? From two markets for skills to one

UK Northern Ireland

Any private 40 39

Commercial 35 34

Third sector/not for profit

11 13

Any public 14 14

FE College 12 11

HEI 6 7

Proportion of all employers using public or private training providers

Source: UK Commission’s Employer Perspectives Survey

22%Of employee’s trained were

training towards a qualification

Are skills programmes being sufficiently used?

In total 6% of employers in Northern Ireland have apprentices currently on site and a further 7% offer them but don’t currently

have any

Source: UKCEPS; Base: All Northern Ireland employers

6%

7%

87%

Have staff undertakingOffer but don't haveDo not currently have / offer

Are there sufficient career opportunities for young people?

17-18 yr olds leaving school

17-18 yr olds leaving FE

Young people leaving HE

47%

26%

Most businesses found education leavers well prepared for

work

(with preparedness increasing with age)

The minority of employers report issues with education

leavers.

The two key issues were:

•Experience of world of work

•Poor attitude/ Personality

Across Northern Ireland, 28% of businesses had recruited education leavers in the past 2-3 yrs.

16 yr olds

53%

35%65%

74%

80% 20%

32%0.17 0.18

0.25 0.28 0.32

0.63

Total 2 to 4 5 to 9 10 to 24 25 to 99 100+

0.320.25 0.31

0.40.53

0.68

Base: 2 to 4 (221), 5 to 9 (230), 10 to 24 (224), 25 to 99 (219), 100+ (106)

Source: UKCEPS; Base: Primary (55), Manufacturing (67), Construction (84),Trade (341), Business (208), Non-market services (245)

By size

By sector

Work experience – a rare commodityThe extent to which placements are offered to young people by size and sector

Sectors matter to skills investmentA key basis to develop strong collaborations

When we look at investment in training provided by employers across different sectors, there is considerable variation:

Mining & Quarrying 15%

Agriculture 47%

Construction 51%

Transport & Communications 54%

Electricity, Gas & Water 54%

Manufacturing 54%

Community, Social & Personal Services

57%

Hotels & Restaurants 60%

Wholesale & Retail 60%

Business Services 76%

Finance Services 76%

Health & Social Work 83%

Education 91%

Public Administration 92%

Sector Percentage doing training

Future skills considerationsInforming plans for growth in the economy

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Our latest Working Futures report shows that business services are expected to continue to be a key engine of growth in Northern Ireland

Non-market services

Business and other services

Trade, accomod. and transport

Construction

Manufacturing

Primary sector and utilities

-20% -10% 0% 10% 20% 30% 40% 50% 60%

Output Employment

Forecast output and employment by broad sector for Northern Ireland 2010 - 2020

Source: Working Futures

Investment Funds • Employer Investment Fund (UK)• Growth & Innovation Fund (England)• Employer Ownership Pilot (England)

EIF & GIF Investment so far ...• 124 investments• £111m UKCES•£103m employer

EO Pilot investment so far ...• 36 investments• £102m UKCES• £98m employer

Leveraging investment: Employer Ownership of skills

“We want to encourage employers

to take the lead in designing, developing

and delivering the training and

employment solutions they need.”

Charlie Mayfield, ChairmanUK Commission for Employment and Skills

LMI for All will be an online portal where the data is stored

Developers will access LMI for All

to get data to build websites and apps

Data sources will be pulled or pushed into

LMI for All

LMI for All

Thank you!

Find out more…

@UKCES

www.ukces.org.uk