THE UK'S SKILLS GAP
Employers and business groups have been issuing warnings about the UK's skills shortage for some time now, but the gap between the skills needed to fill vacancies and those possessed by applicants has widened still further during the coronavirus (COVID-19) lockdown. Here, we look at the areas where the issue is most acute and consider some of the solutions being proposed.
Funding boosts are needed for vocational and technical education, for apprenticeships, and for incentives to help more employers provide high-quality job-related training.
To address the ongoing challenges that the economy faces, the Chancellor of the Exchequer, Rishi Sunak, announced a large-scale plan to support people in finding jobs in his July Summer Economic Update. The Chancellor made funds available to enable jobseekers to gain the skills they need to get jobs and provide targeted help for young people to get into work.
The Kickstart Scheme
One of the main announcements in the Update was the introduction of a new Kickstart Scheme designed to 'fund the direct creation of high-quality jobs for young people at the highest risk of long-term unemployment'.
This is a £2 billion fund aimed at creating hundreds of thousands of high-quality, six-month work placements for those aged 16-24 who are on Universal Credit and are deemed to be at risk of long-term unemployment. Funding available for each job will cover 100% of the relevant National Minimum Wage (NMW) for 25 hours a week, plus the associated employer national insurance contributions (NICs) and employer minimum automatic enrolment contributions.
Training and apprenticeships
The government is also funding high-quality traineeships for young people by paying employers who provide trainees with work experience £1,000 per trainee.
Additionally, there is now payment of £2,000 to employers in England for each new apprentice they hire aged under 25, and a £1,500 payment for each new apprentice they hire aged 25 and over. This applies from 1 August 2020 to 31 January 2021.
Many businesses are still suffering from a cash crunch and reduced demand despite the welcome interventions made in the Summer Economic Update. Those looking to the future must invest wisely, using the available government support, to develop a skilled and motivated workforce.