Our hidden trade tax

Posted on 12 Mar 2012 by The Manufacturer

Sophie Howe, director of Comtec Solution, a specialist translation services company describes the debilitating effect of the ‘tax on trade’ produced by poor language skills in the UK.

Sophie Howe, director, Comtec Translations

China, Russia, Brazil – the opportunities are certainly out there. But is language a barrier to the UK’s success in these markets?

Research suggests so. At least 11% of SMEs acknowledge they have lost potential business because of a lack of language skills and a study of 1,000 businesses by the British Chambers of Commerce showed that 80% of English exporters cannot competently conduct business dealings overseas in even one foreign language.

EC research shows that the UK has the worst language skills in Europe.  As Roland Rudd, chairman of Business new Europe stated in a recent paper published by the Education and Employers taskforce, “our national language deficit effectively acts as a tax on trade”. This is a tax businesses can’t afford to pay.

Working closely with exporters, Comtec regularly encounters situations where lack of investment in language capability has cost a business dearly. This may mean being unable to respond to a new enquiry from overseas, or failing to work effectively with a new supplier. Sadly employers are finding that UK graduates just do not have the language skills they need to respond to these situations.

So why is our language ability so poor? There are a number of factors, but clearly recent education policy has contributed to this deficit of language skills. In 2004, we saw a radical change in policy making languages optional after the age of 14. This disastrous decision resulted in a dramatic decline in the number of students studying a foreign language for GCSE with over half (57%) of UK pupils taking no language at GCSE level in 2010.

Contributing to our language deficit is the still prevalent view, even at the highest levels of government, that everyone speaks English so we needn’t bother to learn of foreign language.

Do they really? Sevent five per cent of the world population do not speak English at all according to the National Centre for Languages and the same organisation observed a dramatic shift in the use of English on-line, dropping from 50% in 2000 to 29% in 2009 – see the report Talking World Class: The impact of language skills on the UK economy.

While it may be acceptable to use English if you are buying from another country, it won’t be appreciated when trying to sell to international customers.  In fact, customers are three times more likely to buy when addressed in their native language. In today’s climate, talking to customers in their own language pays dividends.

This is a call to action to our business community to support the development of language skills in our young people. This will be key to avoiding the looming ‘language deficit tax’.

Visiting schools to promote language learning, I regularly hear the frustrating response from young people “I don’t really need languages for my career”. I’m sure you will agree they are sadly misguided.

As we look overseas for growth, businesses are crying out for staff with some level of language ability. This misconception from young people needs to be reversed. And who better to do this, but the businesses that require those very skills. Understanding the real business context can make all the difference in helping young people to understand the value of language skills for the growth of our economy.