1. Employment Research Institute EXPLORING EMPLOYERS’ SKILLS UPGRADING NEEDS AND LOCAL VET PROVISION IN DIFFERENT PARTS OF THE UK Professor Ronald McQuaid, Colin Lindsay, Malcolm Greig Employment Research Institute, Napier University, Edinburgh w ith Ulster & Leeds Met. Universities Nairn, 24 th April 2004

2. Employment Research Institute SSDA Research Prospectus Focus on priorities of ‘understanding the demand for skills’ and ‘identifying and meeting skill needs’. Specifically, the research Project 4.7: “Exploring employers’ skills upgrading needs and whether local VET provision meets those needs in different parts of the UK”.

3. Employment Research Institute The research will broadly: investigate the nature of employers’ skills upgrading needs, and VET providers’ responses, in selected sectors & regions of Scotland and Northern Ireland; identify lessons for the skills agenda in both Scotland and NI, and compare the employer-VET provider interface across these two countries; relate findings to existing practice in England; build upon, and compare findings with existing research carried out elsewhere in the UK in order to explore the ability of VET to meet employers’ changing skill needs.

4. Employment Research Institute Team Led by a core team at the Employment Research Institute at Napier University, Edinburgh Supported by researchers at the Policy Research Institute at Leeds Metropolitan University and the Business and Management Research Institute, University of Ulster

5. Employment Research Institute Context Employers report substantial problems from skills shortages among job applicants (hard-to-fill vacancies) and skills gaps among existing staff. Mismatches between employers’ rapidly changing skill needs and the services delivered by VET providers. However, there is a wide variation in the extent to which employers in different sectors seek to address upskilling needs through engagement with VET providers, and in the extent to which VET providers are able to respond to employers’ training requirements.

6. Employment Research Institute Recent SSDA research Responsiveness of VET providers to employer skill needs in telecommunications, mechanical engineering and other sectors in England. On-going work in Wales on the needs of social care and audio-visual industry employers. SSAScot, ‘Futureskills Scotland’, Sector Training Councils etc. have made considerable progress in identifying employers’ skill needs.

7. Employment Research Institute Surveys in Scotland & Northern Ireland Scottish Employer Skills Survey 2003 and 2005 (commissioned by Futureskills Scotland) Northern Ireland Skills Monitoring Survey 2001 and 2003 (DELNI Skills Unit )

8. Employment Research Institute But… data on skills gaps and shortages remain relatively basic (broad, generic terminology such as ‘communication skills’ or ‘problem- solving skills’ ) limited detailed information on factors affecting engagement between employers and VET providers, and inter- and intra-sectoral differences in the role of VET provision in addressing skills needs

9. Employment Research Institute And further questions… while only 5% of Northern Ireland employers who responded to the last Skills Monitoring Survey identified problems in sourcing appropriate training as a barrier to working with VET providers, it is unclear as to whether employers would give greater priority to upskilling if VET provision was more responsive to their needs.

10. Employment Research Institute The research will identify: the extent and nature of potential mismatches between employers’ upskilling needs and VET provision in both Scotland and NI critical success factors where employers and VET providers have worked effectively together factors to develop more responsive services in the VET sector, so that employers can more readily meet their training needs and help better understand the barriers preventing a more effective relationship between employers in key sectors and VET providers

11. Employment Research Institute Objectives 1) In the selected sectors, what are employers’ main skills upgrading requirements, with particular reference to the occupation groups that they believe to be critical to their organisations’ future performance? 2) To what extent do employers rely upon external VET providers to help meet these skills upgrading needs? What alternative approaches do employers take? 3) How do employers make decisions around purchasing training and related services from VET providers, and what are the main factors that influence employers’ decisions (perceived relevance and cost-effectiveness )?

12. Employment Research Institute Objectives 4)What types of college and other external training provision are most attractive to organisations as ways of meeting skills upgrading requirements? 5)For colleges and other training providers that are heavily involved in supplying training services to local employers, what are the main factors that help to nurture these relationships? And what are the main barriers faced by VET providers not heavily involved in supplying training services to local employers? 6)What specific kinds of changes in the organisation and funding of colleges and other VET providers would help them to respond more effectively to employers’ training needs?

13. Employment Research Institute Methodology Phase One: Secondary Data Analysis and Policy Review Phase Two: Survey of Employers Specifically, the research will seek to build upon NIESR’s work in England (Raising Sector Skills Levels: How Responsive is Local Training Supply?, SSDA RS No. 9, 2005) Phase Three: Case Studies Phase Four: Report writing

14. Employment Research Institute Phase Two: Survey of Employers Sectors – two industrial sectors, at SIC Group Level (SIC 2 or 3 digit classification), manufacturing and service industries with different: labour productivity and foreign trade exposure; skills and training requirements; reported internal employee skills shortages; barriers to workforce development (including perceived gaps in local VET provision); levels of engagement with FE and other training providers for workforce upskilling

15. Employment Research Institute

18. Phase Two: Survey of Employers - Geography Still to be confirmed: two Local Economic Forum (LEF) areas in Scotland two NUTS III regions in Northern Ireland

19. Employment Research Institute Phase Three: Case Studies Eight qualitative case studies will be carried out in Scotland, with a further six taking place in Northern Ireland (14 in total). Chosen to cover all the relevant sectors and geographical areas. In-depth interviews with senior managers in VET providers (such as Department Heads in FE establishments and Heads of Training and/or CEOs within private sector providers), as well as course leaders. Supplemented by a review of academic/policy documents etc. Plus 10 key stakeholder interviews with sector specialists.

20. Employment Research Institute Outputs and timescale Phase 1 and early Phase 2 results: late August 2006 Interim report Draft report: November 2006 Final report: December 2006, plus ‘Lessons for Policy and Practice’ summary to discuss barriers to VET meeting the needs of employers in key sectors, and potential policy solutions Two dissemination events: Early 2007 (Edinburgh and Belfast) with 40 attendees

21. Employment Research Institute Some Issues - What other literature should we be aware of? - Do you have any views on the questions raised under the objectives? - Further questions in the Workshops

22. Employment Research Institute Contacts Employment Research Institute Napier University Craiglockhart Campus Edinburgh EH14 1DJ Telephone: +44 (0)131 455 4310 e-mails: eri@napier.ac.uk r.mcquaid@napier.ac.uk

23. Employment Research Institute Workshops Questions Skills Shortages vs Skills Gaps. Which is most critical to the future success of your sector? To what extent do employers currently rely upon external VET provision to upskill their workforce? What is the future role of the VET provider in upskilling the workforce? What needs to be done to achieve the required VET provision in the future and what are the barriers preventing this?

24. Employment Research Institute SCOTLAND: ESTIMATED AND PROJECTED AGE STRUCTURE 1901-2031 MALESFEMALES MALESFEMALES MALESFEMALES MALES FEMALES Scotland 1911 Scotland 1951 Scotland 2001 Scotland 2031

25. Employment Research Institute Population Projection 2002-18