Following the announcement from the UK Commission for Employment and Skills (CES) that the Sector Skills Council – Semta has been awarded £5m worth of new funding, Tom Moore speaks to Philip Whiteman, chief executive of Semta, to discuss how the money will be spent.
TM: What was the bid process?
PW: Twenty-two Sector Skills Councils (SSCs) applied for funding and 18 were successful. Semta is benefitting from the restructured financing of SSCs, receiving more now than when we were supported by grants.
TM: How will Semta distribute the funding?
PW: There are three streams.
1) £1.9m for the upskilling project, which is called Transforming the Skills and Productivity of the Supply Chain’s Current Workforce.
2) £2.6m funding for attracting new talent to fill skills gaps in SMEs through apprenticeship programmes.
3) £0.5m investment designed to fill skills gaps in SMEs through graduate recruitment.
TM: How long is the £5m designed to last?
PW: The investment from the commission is for two years, from 1st April 2012 to 31st March 2014. The expectation is that it becomes self-sustaining by the end of the two year period through improving the connectivity of the graduate project. The money will come from the employer, the university and / or the student.
TM: Why is graduate recruitment important for SMEs?
PW: Graduate recruitment is usually done by the big companies, but SMEs tend to be high-tech and focus on niche production. Graduates could bring the high-level skills required by SMEs. Generally, SMEs find it really difficult to connect to the network of universities. The funding for the third stream will try to bridge this problem.
Evidence suggests that businesses are not getting the skills they need unless they’re big businesses that can lever a greater degree of influence and spend more resources engaging with universities.
TM: What more can be done to increase the number of engineering graduates?
PW: 1. There is large support to increase the number of sandwich degrees in order to give students an insight into what it’s like working for the company.
2. We are encouraging work experience during university holidays as there has been a sharp decline in the amount of these valuable experiences.
During the three months the employer spends a lot of the time training students on how to behave in the workplace and actually there isn’t very much productive return for the company. We need to improve the placement process to ensure that the student gets a good experience and the employer also benefits.
TM: How have the employers, universities and students responded – and how will they pay?
PW: Part of the purpose of the project is to find funding and ways forward so the programme becomes self-sufficient. We’ll learn quite a lot over the two year period. The key thing is for everybody to make sure that there is a convincing business case for the employer and argument for the student.
TM: Semta’s figures show that there is a need to train almost 100,000 engineers and scientists before 2016 and upskill a further 363,000 of the current technical workforce. How much of an impact will the new funding make on these figures?
PW: We’re targeting different outcomes for different projects. For the upskilling project where the big skills gap lies, we’re looking at a 10-20% impact. If the project demonstrates a strong business case to continue then the number needing upskilling will decline.
TM: What about streams two and three, what’s their predicted impact?
PW: We target doubling the number of employers offering apprenticeships from 11% to 22%, representing an increase of 12,000 between now and 2016.
We believe that this project will fill the skills gap by 2016. The kick-start funding is only for two years so the continuing success of the project will depend on finding a sensible, self-sufficient funding model.
TM: How will you decide which employers receive funding from Semta? What are you looking for in that sense?
PW: We’re looking for companies that have identified a skills need. It’s usually built around the demographic situation such as company location. There is a huge demographic problem in the sector with lots of employees currently in their 50s and retiring in five years, Semta is encouraging companies to look ahead. An engineering apprenticeship takes three years to complete and so people need to prepare now.
TM: What are you seeing from young people in regards to manufacturing?
PW: We’re starting to see an increase; the apprenticeship figure in our sector has gone up by 27% over the past few years. We’re starting to see more young people looking at the apprenticeship option because university fees have gone up. Apprenticeships are a way for young people to avoid huge levels of debt and still get skills and knowledge while they work, which the employer pays for.
We’re seeing quite high levels of people looking for engineering apprenticeships making it difficult to find the places in companies. That’s where we’re going to have to focus the efforts of the second project and try to get employers to take up more apprenticeships to plug the skills gaps that they’ve got.
TM: How do you view the current climate within the industry?
PW: There are huge opportunities within the green technologies where thousands of jobs need to be created to achieve low carbon agenda targets. The development of wind-turbines is creating a huge number of jobs; the figure quoted at the Green Skills Conference was 30,000. These sectors provide excellent opportunities as most of the green skills agenda depend upon core engineering skills.
Semta’s upskilling project is aiming to engage SMEs through supply chains as there is poor communication between them and the big companies at the end of the supply chain. They don’t communicate effectively so building business plans is difficult.
Smaller companies are not as secure as they could be; putting information and orders through the supply chain gives everybody a clearer idea of how to plan. If this is achieved, companies will invest in skills and capital equipment to deliver supply chains productivity requirements.