ASSOCIATION OF COLLEGES – WRITTEN EVIDENCE (YUN0057)
Youth Unemployment Committee inquiry
ASSOC About AoC
The Association of Colleges (AoC) represents more than 90 per cent of the 237 colleges in England incorporated under the Further and Higher Education Act 1992. English colleges educate over 2.2 million students every year and employ approximately 111,000 full time equivalent staff. Colleges are inspirational places to learn, preparing students with valuable employability skills, helping to develop their career opportunities.
We welcome the opportunity to respond to the Committee’s consultation.
Challenges
Impact of the COVID-19 Pandemic
1.1. The pandemic has had a devastating impact on the lives and livelihoods of people across the country, and particularly on young people. While overall unemployment has not risen as much as expected because of the job retention scheme, there is a risk that it will and there is evidence that young people have borne the brunt of jobs losses.
1.2. Covid-19 has reinforced existing trends in the labour market: some people have done well while others have lost out; unemployment is higher in some places than others; technology is undermining some long-standing sectors; and the workforce is ageing. There are lots of uncertainties about the future created by the pace of change, the climate emergency, and the UK’s new trading relationships. The systems in England for helping people prepare for labour market changes were not in a good state before the pandemic and are now under stress. Department for Work and Pension programmes focus on jobs rather than skills; the focus from Department for Education is on skills.
1.3. Recent youth unemployment statistics showed that since the onset of the pandemic 249,000 more young people have become economically inactive, an increase of 10%; and the number of people aged 18-24 claiming unemployment related benefits has increased by 263,700. Like others, we are also concerned about the impact that the end of the furlough scheme will have. Research carried out by the Resolution Foundation in October 2020 highlighted that one-in-five young people and over one-in-five BAME workers who were furloughed during the first national lockdown had since lost their jobs, with just one-in-three young people who had lost their jobs had been able to find new work.
1.4. The end of the furlough scheme in September 2021 could have similar consequences for young people. It is crucial that unemployed young people can gain new skills which will help them secure and retain good work, and colleges have a vital role to play in this.
The role of colleges in addressing this
1.5. Every community in the UK has a thriving college that works with hundreds of local employers to develop their workforce and anticipate their future needs. Further education colleges are well placed to support people into good jobs, no matter their starting point. There are many examples of FE colleges supporting unemployed people to gain skills and confidence and where the local Jobcentre Plus (JCP) and the local college work together to deliver meaningful progress for people, boost sought after skills for employers and help to combat the impact of the pandemic on jobs and the economy. Existing good practice needs to be replicated across the country, expanded to include a broader range of skills and levels, and supported centrally by DWP and DfE reforms.
1.6. The Government now needs to ensure the colleges are properly supported and funded so that they can provide the high-quality education and training opportunities for young people and help ensure we have a skills-led recovery. When it happens, the spending review will be a vital opportunity to deliver this support through a much-needed long-term funding settlement for colleges, alongside a shift in approach away from the current restrictions toward a more integrated and streamlined offer, as recommended by The English College of the Future report.
Challenges facing employers
2.1. Employers report significant challenges in accessing and retaining the skills they need (British Chambers of Commerce, 2021) - which impacts significantly on productivity and growth. Key mega-trend changes – including across technology and climate – are bringing about significant changes in the skills employers require, which will require people to retrain and upskill throughout their lives.
2.2. And all of this is compounded by more immediate challenges and changes – in changing global trading relationships following the UK’s exiting from the European Union, and most immediately the impact of the COVID-19 pandemic. These changes impact employers very differently according to their sector, size and location, but again underlines a need for adaption and change for employers, and the need for people of all ages to be able to access education and training much more readily.
2.3. Despite this, investment in adult education and training has fallen significantly over the past decade – with a 50 per cent fall in government investment in adult education since 2010, and with investment in workplace training having stagnated during the last decade, with annual training spend per employee has fallen by 5.6% from £1,620 in 2011 to £1,530 in 2017 (CBI-MckInsey 2020).
2.4. As a raft of reports have argued (including the Independent Commission on the College of the Future, 2020; CBI-Mckinsey 2020; British Chamber of Commerce, 2021) meeting the needs of employers – and ensuring that people are able to adapt to changing demands in the world of work - requires not just significant investment in our education and training system, but also a much more coordinated system post 16 education and skills system. As set out in more detail below, this requires coordination at a national government level across skills, welfare and economic strategies – ensuring that skills strategy is effectively embedded in the Plan for Growth and levelling up agenda – and it requires deeper strategic coordination between education providers (schools, colleges, universities and other training providers), agencies and employers at a regional/ local level.
2.5. The way that employers use apprenticeships has changed. Between 2015 and 2020, the government made some major reforms to apprenticeships including the introduction of the levy to pay for them, the introduction of new employer-designed apprenticeship standards and the transfer of control of spending to employers. These changes have shifted the balance of spending towards apprenticeships at higher levels in larger, levy-paying employers (including in the public services) and away from younger people. The number of under 19-year-olds starting apprenticeships has fallen from around 60,000 a year in 2016 to only 10,000 in autumn 2020. There may be some recovery in numbers in 2021 but there appears to have been a structural shift with more young people staying in full-time education. This makes the transition from education into full-time work even more important.
2.6. There is also the case for action to develop traineeships as a pre-employment and pre-apprenticeship route. There were very few people on traineeships at the start of 2020 but the pandemic has prompted the Treasury to allocate a major increase in budgets for 2020-1 and 2021-2. These are short-term funds deployed on a programme with relatively public awareness and where the support for living costs from Universal Credit is pretty unclear.
The role of JobCentre Plus
2.7. JobCentre Plus speak to people and employers every day and should play an increased role in planning how to support people with developing the skills they need in their locality. Whilst there are many examples of further education colleges supporting unemployed people in partnerships with their local Jobcentre Plus (JCP), this happens despite the education and welfare systems, not because of it.
2.8. To enable JobCentre Plus to be a key partner in developing plans to support local people and employers with skills and training, we have a number of recommendations for Government:
Equality, diversity and social inclusion
3.1. The slowdown in social mobility is impacting directly on the labour market and the supply of skilled workers, with a disproportionate effect on groups who continue to suffer from structural disadvantage and discrimination (intersectionally, including across class, race, gender, sexuality and disability) – who consequently struggle to get both into quality jobs, and to subsequently progress. There are also longstanding regional inequities, notably in communities previously economically dependent on traditional industry, and with many rural and semi-rural communities struggling with ongoing urbanisation (2070 Commission, 2020). All of this risks being exacerbated by the economic fallout from the COVID-19 pandemic. Young people from these groups will continue to face significant challenges in gaining employment and will need targeted Government support.
Ageing population
3.2. A demographic time-bomb is ticking, with replacement demand far outstripping the supply of young people entering the labour market. Indeed, by 2030, the population of those aged 65 is projected to increase by 42 per cent, while the percentage of those aged 14-64 is forecast to grow by 3 per cent (UKCES 2014). Challenges in terms of replacement demand are exacerbated by a lack of high-quality work experience opportunities for young people and employers’ reliance on prior experience when recruiting (UKCSED 2011; Purcell et al 2017).
Globalisation and changing trading relationships
3.3. The increasing interconnectedness of the world and the changes in the environment mean that people and goods will move around the globe in new ways. Migration flows will shift to follow the changes in economic demands and employment opportunities. Reverse migration is likely where there are areas of decline in the UK. At the same time, the UK’s withdrawal from the European Union means changes in the immigration and trade policies of the UK with reductions in EU migrant labour in many higher-skilled technical occupations are exacerbating the current pressures on the supply of skilled labour, which is critical to the UK’s place in the world (Cedefop, 2019). Trade deals could have a significant impact on different industries, placing significant pressures on local, regional and national economies, in addition to academic cooperation and exchange (Dhingra et al, 2016).
Industrial revolution 4.0
3.4. Advances in information and communications technologies (ICTs), artificial intelligence (AI), virtual reality (VR) and robotics are profoundly changing the way people work, learn, communicate and live. This has the potential to support smarter and more agile ways of living and working in future, requiring a different skillset and fundamentally changing notions of career pathways – with increasing emphasis on higher and more specialised skills, and a consequent need for lifelong learning. At the same time, there are stark challenges around digital inclusion (in the workplace, in accessing public services, and in participating in society), the displacement of jobs with task automation, and concerns around privacy and safety (CSJ, 2019).
3.5. The global pandemic has accelerated the application and development of new technologies, responding to and creating new demands – as well as highlighting shortcomings in digital infrastructure, resources and skills across all sectors.
Climate change
3.6. The challenge posed by the climate crisis is existential, and the consequent changes are already greatly impacting on our lives and our world (IPPC, 2014). To mitigate the magnitude of global warming and the climate crisis, urgent action must be taken. This means dramatic changes to industries, with people needing to develop skills in new areas and continued change to the way that people live. The Committee on Climate Change (2020) has argued for governments across the four nations to develop coordinated strategies for a net-zero workforce, integrating relevant skills into education frameworks. The Committee has additionally argued that education systems have a wider role to play supporting the transition to a net-zero economy and preparing for the risks of climate change including the need for greater public awareness and understanding, and the need for technical skills in the workforce.
College funding
4.1. Despite recent uplifts, further education funding remains wholly inadequate, and compares extremely unfavourably with both university and school funding - with annual public funding per university student averaging £6,600 compared to £1,050 for adults in further education.
4.2. Recent research from IPPR (2020) has found that if further education funding had kept up with demographic pressures and inflation over the last decade, we would be investing an extra £2.1bn per year on adult skills and £2.7bn per year on 16-19 further education.
4.3. The Education Committee’s recent “A plan for an adult skills and lifelong learning revolution” published in December 2020 highlighted the need for a long-term funding settlement for lifelong learning – a point that echoes the English College of the Future report which recommended a new three-year funding settlement for colleges, alongside a shift in approach away from the current restrictions toward a more integrated and streamlined offer, all underpinned by a 10-year national education and skills strategy.
4.4. The Department for Education’s recent Skills for Jobs White Paper also recognised that funding has been wholly insufficient, and sets out the need for simpler, longer-term funding settlements which will allow colleges to deliver on longer-term strategic priorities. These plans are due to take effect in 2022 and should involve the removal of ringfences between funding, greater ability for colleges to deploy money towards need and a stronger focus on outcomes, including those related to local employment. In the short-term, however, DfE plans to take back adult education grant from colleges in autumn 2021 where 2020-1 targets were missed. In some cases, these missed targets resulted from a reduced number of Jobcentre referrals of unemployed people for mandated skills programmes. There is the prospect that Jobcentre activity will revive later in 2021 but the colleges they wish to work with have cut back their activity to keep their budgets balanced.
Primary and secondary education
6.1. We believe that every young person, particularly those who are unemployed, should be able to access expert careers support and financial support for a course at college when they need it to get into good local jobs, no matter their starting point.
6.2. Currently few unemployed people are pointed in the direction of college courses and training even though this might support them to be more work ready. Making lifelong learning meaningfully accessible to all must see colleges working with others to deliver a much more holistic lifetime skills and careers guidance service. Every part of the skills and welfare system needs to work together to ensure that people are given the right advice for them and where necessary signposted to the training that will support them, with the financial support they need.
6.3. The Independent Commission on the College of the Future report recommends a new lifetime skills and careers advice and guidance service to be hosted within colleges, where appropriate. It also states that where holistic services already exist, strong links should be built to complement this, ensuring a coherent and connected community service. This must also include quality information and guidance about available student finance. We were encouraged to see this ambition echoed in the Skills for Jobs White Paper, which says “impartial, lifelong careers advice and guidance available to people when they need it, regardless of age, circumstance, or background”.
6.4. In order to address this, we have the following recommendations for Government:
Further education, higher education and training
Funding
8.1 As highlighted previously, further education funding remains wholly inadequate, and compares extremely unfavourably with both university and school funding - with annual public funding per university student averaging £6,600 compared to £1,050 for adults in further education. This must be addressed if parity of esteem between vocational and academic study is to be achieved.
A statutory right to lifelong learning
8.2. For people to fulfil their potential and help ensure parity of esteem between vocational and academic study, there should be a statutory right for people to be able to upskill and retrain throughout their lives through access to affordable and relevant lifelong learning opportunities. This should include a statutory free lifetime entitlement to studying or training up to English-Northern Irish-Welsh L3/Scottish L6 – essential as the minimum platform which enables people to secure good quality jobs in a modern economy. This entitlement should allow free choice for all adults across all publicly-funded tertiary education and training providers.
8.3. Funding should be equalised across further and higher education routes, with students able to access the maintenance support they need to engage in education and training, based on the following principles:
9. What is the role of business and universities in creating a thriving jobs market for young people? How should they be involved in developing skills and training programmes at further and higher education level?
9.1. The College of the Future report called for the development of college network strategies to meet local priorities across the tertiary education system, which will help create a thriving job market for young people. It called on Governments to introduce a duty on colleges to develop strategies across appropriate economic geographies that identify local and regional needs and priorities in line with the national strategy. These should be developed in consultation with employers and other key stakeholders, especially other education providers, and should deliver a coordinated approach to the learning and training offer. They should align to the local industrial structure, economic development plans and employment needs, strategic employer engagement, workforce development and local investment plans, including capital investment.
9.2. This requires a matched duty on other tertiary providers to collaborate, including universities, schools, independent training providers and adult community learning providers. This should be reinforced through institutional/network outcome agreements across the appropriate economic geography, focused on long-term systems priorities.
9.3. Positively, the Skills for Jobs White Paper has affirmed this approach, under the Skills Accelerator umbrella. This works to bring together colleges across a relevant economic geography to deliver on strategic priorities for the region, agreed with employers/ employer representative bodies.
9.4. There are several key principles which will be critical to retain as this policy approach develops:
10. What can be done to ensure that enough apprenticeship and traineeship placements are available for young people? Is the apprenticeship levy the right way to achieve a continuing supply of opportunities?
Apprenticeship provision shifting towards the already qualified
10.1. Current apprenticeship policy has put larger employers much more in control of how public funds have used. More employers are engaged but have tended to spend the largest share of training funds on managers and professionals. There is a lack of public information about apprenticeship training trends but clear evidence of growth in high-cost degree apprenticeships, in mid-career manager apprentices and in money being spent on professional roles located in the biggest cities (for example accountancy apprenticeships). Obligations previously covered by the tuition fees have been shifted onto the apprenticeship budget. There is evidence that many employers have focused on current needs over the future as well as the needs of existing staff over new recruits. The government’s Post 18 review considered this issue and recommend restrictions on the ability of employers to use degree apprenticeship funding for those who already have degrees. The Department for Education needs to ensure that apprentices in small companies taking economically valuable courses should continue to be funded following the transfer of activity to the Digital Apprenticeship Service.
Apprenticeships for young people
10.2. As mentioned above, there is a risk that young people are been squeezed out. Between 2016 and 2020 the number of 16-to-18 -year-olds starting apprenticeships has fallen by around 80% and there is a risk that they will come second best as funding becomes even tighter in the increasingly competitive apprenticeship training market.
Apprenticeships in post-Brexit England
10.3. There will be particular need in early 2020s to develop new places at level 2 to support progression into apprenticeships and to increase training activity at Level 2 to avert skills gaps previously covered by inward EU migration .
10.4. Recommendations:
Jobs and employment
11. What lessons can be learned by current and previous youth labour market policy interventions and educational approaches, both in the UK and in other countries?
Skills and welfare policies should work together as part of a government wide employment strategy
11.1. Too many people who are unemployed are not being directed to advice and training that could get them into good jobs because of a disconnected system across skills and welfare. The Chancellor has invested in programmes in both the Department for Education and the Department for Work and Pensions to support 16 to 24-year-olds, but they do not operate in tandem and are difficult to make work for employers, for students/unemployed people and for colleges.
11.2. We are calling for the Government to:
12. What economic sectors present opportunities for sustainable, quality jobs for young people? How can we ensure these opportunities are capitalised on and that skills meet demand, particularly for green jobs?
Colleges and green jobs
12.1 All jobs in the future will need to be green jobs to meet environmental targets, and the Government’s recently published Industrial Decarbonisation Strategy is clear about the important role colleges and other education providers will need to play in that; “the future workforce will also need to be equipped with the right skills to help them succeed in a low carbon world; supporting sustainability through the education system will be crucial” .
12.2. Despite this, all too often, college resources and expertise can be poorly understood, underutilised and insufficiently funded in relation to other parts of the education and skills system. In order to ensure that the necessary skills and capacity are developed in time to meet our environmental targets, it’s absolutely essential that the strong and central role colleges can and must play in this process is recognised. They also need to be invested in as a key vehicle for delivering the skills needed for green jobs and in supporting business innovation.
Need for investment
12.3. It is only with significant new investment can we substantively repurpose vocational training with the urgency required, which we believe is critical to Government delivering the green jobs of the future and a resilient and sustainable post COVID-19 recovery.
12.4. In July 2020, we wrote a joint letter , in partnership with the University and College Union and Students Organising for Sustainability UK, to the Minister for Apprenticeships and Skills and the Chancellor of the Exchequer urging them to commit to major new investment in further education to close the skills gap that is rapidly widening across the low carbon sectors. This letter called for £500m of new money for green jobs allocated to colleges over this parliament. This would allow cash-strapped colleges to bring in experienced additional staff to prioritise the development and delivery of low-carbon vocational training and reskilling. £400m of this money should be delivered directly to colleges alongside a framework for implementation and monitoring, which we can draft, working in partnership with industry. The remaining £100m should be used to establish a new network of National Centres of Excellence in Low Carbon Skills at number of further education colleges (with the funding being ringfenced for colleges, rather than the private sector), each focusing on different aspects of the low carbon skills gap.
Bringing together industry, training and education
12.5. Alongside this urgent need for investment, it is vital that the capacity for partnership and collaborative working is increased. This will require direct action from Government to bring ‘Industry’ (in its broadest sense) into direct and manageable contact with training and education. This will involve breaking down the intelligence, advice and projections from ‘Industry’ into workable groups that work across both skills specialisms and geography.
Preparing for future need
12.6. When preparing for future need there is an immediate requirement to invest in readiness for that future need. All parties need to be confident that the future need will indeed materialise and there needs to be investment from all those involved at that point. It is important that this is recognised and funded as appropriate. The communication from Government of strategic direction and investment is also needed to give employers the confidence to invest in training and recruiting for green jobs, and seeking support from their local college.
Preparing college staff
12.7 Investment for initial training on the preparation of college staff is needed to be able to deliver the new skills training and on the existing workforce who will probably be the first to transition. It also points towards some preparatory additions to lower-level training that make learners aware of the changes that are coming and begins to prepare them across all subject areas.
Educating all students in sustainable development
12.8. Colleges take seriously their responsibility for raising awareness of climate and sustainability issues. Post-16 study programmes should make some reference to Education for Sustainable Development as an entitlement for all students and government should fund this.
The need for flexibility in the qualification system
12.9. Qualification systems are developed in line with the standards needed when they are built. Flexibility is needed in qualifications and apprenticeships standards to be agile and responsive to the development of green skills and jobs. Additionally, the development of T-levels should include sustainability.
14th May 2021