Demand-led provision of skills for manufacturers and engineers doesn’t sound like a difficult ambition to achieve. But a group of employers in north east England has proved, by surveying their regional peers, this is more ideology than reality. Will Stirling discovers that the research has provided them with a clear route to resolving some business critical issues.
Frustrated with the complexity of the current skills and funding landscape, in January 2010 the EEF North East Regional Council formed a 12-strong sub-skills group to find out whether employers’ real skills needs are being delivered. The group spanned companies from Siemens to SMEs like Contitech Beattie and Metal Spinners Group, all of whom have a special interest in the skills and development agenda at regional and national level. The survey pooled the views of 146 manufacturing and engineering employers in the region, asking them directly which jobs they struggle to recruit and how they go about funding new jobs such as apprenticeships. The results were revealed at the EEF Skills Summit at Newcastle’s St James’s Park on May 12.
The three initial reasons for establishing a group to focus on skills were to:
Endeavour to identify and address some of the known skills issues.
Support new job creation and replacement demand within the North East economy.
Suggest policy and other practical interventions to stimulate and encourage employer demand.
The survey report says that “[EEF] members continue to be frustrated with the complexity of the current skills and funding landscape with which they are expected to engage. While there is widespread concern about the system as a whole, most Sector Skills Councils were singled out for specific criticism.”
Five particular problem areas were identified (some will be all too familiar with readers):-
The promotion of engineering and science within schools to provide the pipeline through to craft and technician apprenticeships. School leavers in the region lack interest in manufacturing, some even lack basic and personal skills.
There is also a lack of systematic engagement with schools from employers – more must be done with relevant support.
Apprentices and technicians – identified as a high priority. Diminishing finances [funding bodies] and little vocational emphasis are endangering this vital feed-stock to industry. Programme-led apprenticeships were successful but no funding was available. Upskilling, re-skilling and growing new skills in-house through the apprenticeship route have become increasingly important for manufacturers. Adult apprenticeships are popular but lack the necessary funding.
Management development – Enhancing leadership and management competency is vital, but no support is available, for example, from Business Link. Managing dispersed supply networks and customer bases together with increased focus on innovation, product and process requires not just technical skills, but also leadership, project management, design skills and more. Talent needs to be nurtured at all levels.
The skills system is overly complex and bureaucratic.
Funding is bound by excessive form filling – particularly for assistance from the European Regional Development Fund, as an example.
The need to de-couple funding from accreditation against the national programme outcomes and assess more against industry, sector and infrastructure requirements.
● The majority of the respondents (57%) were Tyne and Wear based. Companies in Durham, Teeside and Northumberland made up the balance.
● Most employers surveyed had 100 or more employees.
● Only 51% of businesses surveyed could be classed as local, the other half were less likely to be eligible for funding (for meeting the SME criteria) as they are either part of a larger company or part of an overseas owned business.
● 65% of companies engage with government agencies but of these only 40% received grant assistance. 60% did not receive support, possibly due to ineligibility issues and reflected in the fact that only half the companies surveyed could be classed as local SMEs. Could the eligibility criteria could be relaxed?
● A plethora of funding agencies are approached for help. One North East, the Regional Development Agency (RDA), has the highest level of individual approaches at 34%. The RDA & Business Link accounted for nearly 60% of all approaches and these organisations are either to be wound-up or under review for termination. A key question is what will replace them and how will they engage in supporting manufacturing industry in the UK and more specifically in the North East region?
● 58% of companies have apprentices. This is encouraging and there appears to be a similar appetite to invest in apprentices through 2011.
● 44% of apprenticeship programmes are delivered by a training provider. Only 26% of the programme come from an in-house company scheme.
In addition, the survey found that:
● [Aggregate data shows that] the ability to recruit skilled tradespeople and project managers will affect nearly half of the membership companies within three years. Specific skills shortage issues with tradespeople are expected to affect more of the membership in three years time – notably welding, fabrication, CNC and electrical skills.
● Only 4% of respondents who expect to have recruitment issues are not currently running an apprenticeship scheme = the vast majority are still expecting recruitment problems despite this.
● Project manager demand will increase among the membership and recruitment problems are expected. Anecdotally, a large company of civil project managers with over 600 employees has assessed that only 5% are equipped with all the skills needed for future work.
● These changes are expected within three years despite running many training programmes and increasing the numbers of engineers coming through universities.
Report for the North East Regional Council on Manufacturing and Engineering Skills The report makes these general proposals, and a list of 22 specific propositions to answer the problems identified in the survey. The list is available in the full Report for the North East Regional Council on Manufacturing and Engineering Skills, available from Tony Sarginson at EEF North East, email: [email protected]
The report’s overall point is that new models of co-operation are needed between industry, government and education establishments to transform the ‘skills landscape’ in support of economic prosperity based on wealth-creating products, infrastructure and services.
EEF, the report says, is in a unique position not only to provide the ‘employer voice ‘ but to actively promote new partnership models with member support. The national voice needs strong regional input based on the foundation of employers speaking from a common agenda as exemplified by the senior business people attending our regional meetings.
The sub-group says now is the time to push at the ‘open door’ of Government at a time when government is looking for solutions to today’s skills issues.
Members of the Regional Skills Sub-Group respond:
Peter Bernard, Group Managing Director, Responsive Engineering
“The survey has raised the profile of the major skills shortage that exists in manufacturing engineering that has been felt by many companies for years. It also raises serious concerns about the number of skilled people who will be retiring from the industry in coming years.
Manufacturing is seen as a key element of our recovery and with the increasing emergence of global supply chain issues, it is absolutely crucial that UK manufacturing is put firmly back on its feet after years of disinterest. We are doing our bit in the Responsive Engineering Group and investing heavily (£4m) in new facilities and high tech equipment. However, without the skilled people to get the best out of our investments we are wasting both our time and money! The government is slowly cottoning on to the problem but instead of reducing funds for engineering apprentice training, they should be increasing it and getting on with it quickly.”
Geoff Ford, Chairman, Ford Aerospace
Firstly we need to address how we attract people, mostly young people, into engineering because I feel we have an image problem which we must overcome. In a recent straw poll of the public, when asked to identify who they regarded as being an engineer, the majority named an actor who plays the role of a motor mechanic in Coronation Street! A further problem exists in that more than 50% of UK engineering graduates end-up working in finance because they are headhunted for their intellect, rather than their engineering skills.”