University education cannot provide the skills we need for the economy of the future

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Tuesday 01 March 2022 06:15

College graduates aren’t always equipped with the skills they need (Photo by Dan Kitwood/Getty Images)

TOO many jobs, wage inflation and an abundance of flexible work opportunities. Compared to the threat of mass unemployment when the pandemic began two years ago, these issues seem better to have.

But labor market figures released last month revealed a serious problem: the exodus of older workers. Since March 2020, the number of inactive people aged 50 to 64 has increased by almost 250,000.

For older workers, the UK faces a perfect storm when it comes to the expiry of pension rights and the higher standard of living available to those who have paid off their mortgages.

But we must not overlook the impact of technological transformation in the workplace that displaces those who lack the skills to thrive. No age group is immune.

The Institute for the Future says that 85% of the jobs that will exist by 2030 have yet to be invented. The WEF has calculated that 40% of workers will need reskilling over the next 3 years.

These statistics don’t cover an equally important trend: For those who have been employed for several decades, the workplace has already changed beyond recognition. Far faster, in fact, than the training and skills needed to thrive there.

In the past five years, 47% of workers have had no on-the-job training, according to a survey for Multiverse. During this same period, the scale and pace of technology adoption — from databases to analytics tools to automation — has transformed the way most financial and professional services workers do their work.

Why this failure? UK business investment in workforce training was declining before the pandemic and continues to decline. There would still be 20 million training days if the investment had remained at the 2011 level.

There are cultural reasons at play. Historically, we have been biased in favor of prestigious educational institutions and ignored the limits of the skills they actually provide. Even today, we structure our system around the false premise that a three-year undergraduate degree can prepare you for a decades-long career.

That, finally, is changing. The proliferation of bootcamps and online courses broadens access to training, even if the primary motivation is sometimes to fill in a CV or a LinkedIn profile. This year, the government will introduce a right to lifelong learning to give workers the financial means to choose their own courses.

Apprenticeship offers another opportunity. They experience the fastest growth in sustainable, high-paying career fields such as data analytics, project management, and software engineering, and offer a combination of applied learning and coaching that results in rapid acquisition of essential skills.

Money to finance these courses is also available. The annual learning budget was underspent by £1billion last year.

Learning is often seen as the preserve of young people, but there is an equally urgent need to equip established professionals with resilience in the face of technological change. Apprenticeships allow city companies like Morgan Stanley and KPMG to equip internal talent with cutting-edge skills, while also being a mechanism to diversify the recruiting approach.

Training represents a tremendous opportunity for companies to retain their talents. Access to education is increasingly seen as a perk at work, alongside competitive wages and working conditions.

In the race for talent where hiring costs are rising, this particular tool is too valuable to overlook.

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