John Hayes MP: Building a highly-skilled workforce is critical to rebalancing the economy

John Hayes MP is the Minister of State for Further Education, Skills and Lifelong Learning. 

Last week’s Budget recognised the urgent reality that Labour failed to address - that Britain’s working age population currently has lower skills than those of America, France and Germany.  We cannot, and should not, compete on a low-skills basis, which is why it is essential to our economic success that we build a highly-skilled workforce. 

This endeavour is critical to rebalancing the economy and returning to sustainable growth.  History proves that prosperity is inseparable from production: the invisible economy of banking and finance has revolutionised the UK over the past century, creating an abundance of jobs and wealth, but it has to be reinforced by a thriving industrial base.  

The Government understands this well.  Last year’s announcement of funding for an additional 75,000 apprenticeships has been buttressed by the statement in this year’s Budget that an extra £180 million will be available to fund up to 50,000 more apprenticeships.  Crucially, 40,000 of these places will support progression from an expanded Work Programme, thereby helping more unemployed young people into skilled employment. 

Taken together with the decisions to boost work experience placements from 20,000 to 100,000, and to double the number of University Technical Colleges, this will have a dramatic effect on both youth unemployment and the nation’s skills base.  Building as this does on the biggest ever expansion of Adult Apprenticeships that was outlined in the Skills Strategy I published last November, there will be now be over 430,000 apprenticeships during the next four years – more than the UK has ever seen before. 

Support will be extended to groups of employers, focusing on SMEs, to enable them to offer more Advanced and Higher Apprenticeship schemes.  In Austria, Germany and Switzerland, one in four employers already offers such on-the-job training, whereas only one in ten businesses does so here in the UK. 

Finally, and perhaps most importantly, this Government will reverse the systematic devaluation of apprenticeships that took place under the previous Government.  Under Labour’s watch, two thirds of apprenticeships were awarded at Level 2, as opposed to the internationally-recognised standard of Level 3.  Under this Government, Level 3 will become not only the standard to which apprentices and employers aspire but also the path to higher learning at Level 4 and beyond.

Investing in human capital is an essential component in reshaping our economy to build a more sustainable future.  The Budget boosts such investment, helping to build businesses and better jobs.  In terms of apprenticeships, we can have both quantity and quality: indeed, we must settle for nothing less.