Semta chief Philip Whiteman outlines the current state of play for the UK electronics industry and what Semta is doing to help
The UK electronics industry is worth approximately £23 billion a year and is now the fifth largest in the world in terms of production.
The electronics manufacturing sector covers the manufacture of electronic components including semi-conductors, communications technology, consumer electronics, computers and other IT equipment. It also includes the manufacture of electronic instrumentation and control equipment. The UK leads the world production of fibre optic systems and components and is home to 40% of Europe’s semiconductor design houses. A further 40% of European semiconductor design revenue comes from this country.
Semta, the employer-led skills council for science, engineering and manufacturing technologies, has completed a Sector Skills Agreement (SSA) for the UK Electronics sector. SSAs are a form of contract between employers, trade unions, government and training providers to ensure employers have the right people with the right skills at the right time.
SSAs allow Semta to identify skills gaps and shortages in a much more precise way meaning employers can get targeted support and funding to address the real problem areas.
The SSA shows that, for such a high value industry, the electronics sector is actually made up of many small to medium sized businesses with 91% of all UK sites employing fewer than 50 people. Only 2% of all UK electronics sites employ 200 people or more. Semta research estimates that there are 1,200 electronics companies in the UK, employing a total of nearly 6,000 people. The majority of these are smaller companies who form the vital supply chain for UK PLC.
The problem is that these companies sometimes lack the in-house resources to provide or fund the necessary training. Thus it is these companies can benefit most from the support that we can offer at Semta.
A commonality amongst employers of all sizes is the increasing reliance on highly skilled labour and a marked decline in the number of low-skilled workers required. There is a greater need for professional engineers to work in design, research and development. Employers also need more technicians with good technical skills combined with team leadership and forward-planning skills. In the future there will be an emphasis on high value New Product Design and Introduction (NPDI) and improving the skills of the existing workforce through Technical Workforce Development.
In a survey we carried out, 72% of electronics employers who reported skills gaps felt they had technical engineering talent shortage and this was particularly important for managers, professional engineers and technicians. Skills gaps for operators, sales/customer service staff and technicians would have the most significant impact on employers.
Semta has recently negotiated a £100m training package with the Department for Business, Innovation & Skills (BIS) and the LSC in England. This funding compact allows sector companies in England to access support and funding for a wide range of skills identified by the SSA, including Apprenticeships, Management and Leadership (for companies with between 5 – 250 employees), Business Improvement Techniques and Skills for Life (such as literacy, numeracy and English as a foreign language). Semta can help sector employers access similar support or funding in Scotland and Wales.
For electronics employers the key to surviving the downturn is investment in their workforce. Investment, innovation, supply chain management and lean manufacturing are key factors that will bring major productivity gains for the electronics sector. Boosting competitiveness and productivity through skills and training is producing on average a 6:1 return on investment using National Skills Academy for Manufacturing programmes. Taking the opportunity to invest now in the talents of their workforce is an investment in the future well-being of their business.
Employers interested in finding out more about the Semta compact should contact Semta Customer Services on 0845 643 9001, email [email protected] or visit www.semta.org.uk