Skills England’s latest report raises further questions about its role

Skills England’s third report – Assessment of priority skills to 2030 – has some important takeaways.

The topline finding feels like fairly good news for tertiary education: the quango estimates that employment demand in what it calls “priority occupations” will increase by almost a million in the next five years, and that two-thirds of this demand will be for workers with qualifications at level 4 or above.

Though it’s not front-and-centre of the report – head to tab five of the accompanying data tables to actually see them spelled out – the identification and selection of so-called priority occupations across the ten sectors Skills England is concerned with (the IS-8 plus construction and health and social care) is an important move forward too, with at least the potential for some granular planning to be done around them in DfE’s forthcoming policies.

Some 233 job areas have been chosen as government priorities – that feels like it ought to be quite a big deal. This has, we’re told, been done by the lead government department for each sector the occupations belong to. Each has been newly mapped to a SOC code, and assigned an expected education level, or levels. Again, what used to be the Unit for Future Skills is quietly putting together quite a powerful toolkit for the government to do work around education and employment, and maybe even one day put into practice this join-up between skills and migration it keeps going on about (though the Migration Advisory Committee and hence the immigration system is, for now at least, using a different measure of assigning qualification levels to jobs).

The new report does give an indication of how DfE has been making use of this kind of forecasting work. Table 6 plots the percentage of employed higher education graduates entering priority occupations, generating a kind of ranking of which subject areas have been contributing most to the chosen key roles within the industrial strategy sectors.

Here’s a version of table 6 with some additional rows (from tab 8 of the data tables):

If the list – possibly – looks familiar to you, that might be because there is a very clear overlap between the top entries here and the beknighted subject areas chosen for LLE modular provision by DfE. At the time, we were simply told that these were “subject groups that address priority skills gaps and align with the government’s industrial strategy.”

However, if this ranking is the yardstick for selection, it becomes a bit hard to justify exactly where the cut-off was drawn – business (not selected for the LLE) is marginally ahead of health and social care, and languages is only fractionally behind (for example). More charitably, we could say that as the government and institutions pilot what can work with the LLE and what can’t over the next several years, this list gives us a sense of what might come into scope further down the road.

Curiosity cabinet

While it’s nice to be able to draw the odd line from Skills England’s modelling to the policy decisions that have appeared so far under Labour, some curios remain. First up, it’s not clear why starting from top-level subject codes and then taking a crude overall percentage of “graduates in priority occupations” is the way to think about what’s needed, either for modular provision or for the country’s overall education needs.

The report also contains work on the “key education pathways” by sector, highlighting areas such as degree-level study in the creative arts and performing arts – but these didn’t get the nod for LLE modular provision, and it’s not clear why (indeed, no high-level subject area immediately relevant to the creative industries sector did, despite it being one of the IS-8).

If we drill down further into the priority occupations list, there are other oddities around DfE policy choices thus far. For example, roles such as newspaper reporter and editor make the cut – but the government has recently diverted high-cost subject funding away from journalism, suggesting it isn’t that much of a priority.

What we might say is that the longer-term review of how high-cost funding can be “more effectively targeted towards priority provision that supports future skills needs” – currently taking place behind the scenes at DfE and OfS – might perhaps lean a bit more on Skills England’s work here. It’s pretty clear that the initial round of cuts in May was primarily driven by reducing costs rather than a proper strategic look at the landscape of provision.

There are also some methodological questions about the work the report does in its – admittedly fiendishly difficult – task of projecting employment demand and skills needs. For one thing, the overall finding that employment demand in priority occupations is expected to increase “1.6 times faster than other employment in these sectors,” given that priority occupations have been defined as (my bolding):

occupations which are expected to see growth in employment over the next five years; currently face skills shortages; are in high demand; or have high importance to the sector.

And just what these increases in demand will be have quite a finger-in-the-air quality to them, when you dig down into the annexes. Employment projections have been generated in different ways for different sectors: some are based on trends, in quite a blunt way (for example in life sciences: “employment growth for the sector is based on historic employment growth between 2020 and 2022 for the whole Life Sciences sector, and applied uniformly across all occupations”); some use national projections and assume growth rates in the sector will be the same as across the UK; and most optimistically of all, a couple are “policy-based” (housebuilding: “2030 employment is based on an illustrative trajectory to deliver 1.5 million homes this parliament”).

There is plenty that doesn’t get included in the modelling: regional demand, the impact of technology on different sectors, policies already announced in the industrial strategy, supply of workers via migration, the possibility of employer-funded training (perish the thought), levels of “replacement demand” for filling roles that become vacant, and more. Some projections are UK-wide, some are only for England or Great Britain. For higher education, the estimates look at UK graduates from English providers.

Plus, the priority occupations for health were selected based on the 2023 NHS Long-Term Workforce Plan, which Labour’s more recent 10-year vision roundly panned. A new version is planned for the autumn.

Teeth

It’s not unusual for skills forecasting to be based on speculative methodology – plenty of previous DfE publications have leaned on ambitious forecasts about skills needs from consultancies, employer surveys and, on occasion, academics. But there’s a wider question about Skills England’s purpose that comes into focus as you wade through this latest report (notably, most of the interesting stuff we’ve looked at above is in the annex or the spreadsheets).

The report is presented in the following terms:

This analysis provides a public evidence base for the Department for Education’s (DfE) policies to support the Industrial Strategy sectors as well as to provide insight to shape the skills system.

But does it? A public evidence base surely requires a variety of approaches and perspectives, and ideally a debate about them. With the defunding of level 7 apprenticeships, DfE said that Skills England was put to the task of seeing whether there was a reason not to restrict eligibility (after the move had already been announced), but didn’t come up with anything compelling enough, and the exact deliberations were not made public. We can see something similar with the lack of transparency over choices made around the LLE thus far, if it is indeed the case that the forecasting here has informed plans for modular eligibility (which hasn’t in fact been made explicit).

It’s not clear why a departmental body is needed to make skills forecasts for central DfE (a couple of desks over) to then interpret as it sees fit – an independent committee, along the lines of the MAC in the Home Office, would make much more sense if the role is to be limited to modelling, gathering stakeholder feedback, and making the odd recommendation. It’s also not clear why this should be the same body which is simultaneously taking on IfATE’s responsibilities.

Ahead of the election, it felt plausible to predict that Skills England would be a very big deal, with “teeth” to ensure accountability for how funding was spent regionally, and the ability to act as a “gatekeeper” for the growth and skills levy. This conception probably stemmed in part from optimism about a new government, and in part from inputs such as the ambitious Report of the Council of Skills Advisers in autumn 2023.

This wasn’t what we ended up getting. The first surprise was that the quango would only be an executive agency rather than fully independent. Ministers reassured peers during the bill’s passage that this was only about being able to act more quickly – it feels like we’re now in a position to see the true difference, with two DfE civil servants job-sharing the chief executive role and staff from the Institute for Apprenticeships and Technical Education now in many cases doing the same job at its replacement.

A Skills England blog this week suggests that this new report is one of a “range of helpful tools to support people exploring career options and training routes,” which – let’s face it – it clearly is not.

Rather, the report offers useful data ammunition and definitions for thinking about the join-ups between education and employment, framed in the traditional boosterish way about how supplying more skills will straightforwardly drive growth. It would be nice to have a debate about it – the worry is that DfE will just add a dash of Skills England’s stats here and a splash there as it goes ahead with its business as usual, insisting that it’s all part of the industrial strategy.