FIR0035

Written evidence submitted by the University of Edinburgh

Executive Summary

1. The Fourth Industrial Revolution presents challenges that can only be addressed through a cross-sectoral, place-based approach and significant public and private investment.

2. One important model is the Edinburgh and South East Scotland City Region Deal ‘innovation strand’, which combines education, research, industry adoption, dataset management, and entrepreneurship to boost regional future readiness to lead this revolution and garner its benefits.

3. Evidence indicates that on-going investment is needed from the private sector and government to optimise approaches to enable all citizens to thrive in the new environments.

4. Key to success of such initiatives is close and open collaboration and co-production between academia, industry, the public sector and government/regulators, and sufficient resources to support widespread adoption of innovative practice to drive productivity, economic growth and public sector efficiencies.

Submission context

This submission has been prepared on behalf of the University of Edinburgh by members of its Data-Driven Innovation Programme, a major component of the Edinburgh and South East Scotland City Region Deal. –

The group members are:

• Prof Lesley McAra, Director of the Edinburgh Futures Institute, College of Arts, Humanities, and Social Sciences
• Kevin Collins, Assistant Principal Industry Engagement
• Dr Mark Graham, City Region Deal Economic Advisor
• Alison Muckersie, City Region Deal Programme Manager Skills
• Prof Judy Robertson, Chair in Digital Learning, School of Education
• Dr Michael Rovatsos, Director of the Bayes Centre, College of Science and Engineering

This submission provides key insights from our experience in developing a place-based, cross-sectoral strategy for enhancing the regional skills base in preparation for the Fourth Industrial revolution, and provides evidence in support of our approach.

1. The Challenge

1.1      The digital economy is growing two to three times faster than the UK economy overall.[1] Data and its uses lie at the heart of the next phase of the ‘digital and data revolution’. The importance of tackling critical shortages in digital and data skills (to fully realise the benefits of this revolution) have been recognised by both the Scottish and UK governments.[2] In addressing this issue, the primacy of joint public and private investment in research, development and innovation is frequently highlighted.[3]

1.2      The increasing use of data science, machine learning, and AI poses both a threat and opportunity to the Scottish workforce[4]. Predictions of new technology and automation related redundancy range from 9% to 47% of the workforce[5], but the adoption of data-driven technologies and processes are also likely to see an increase in many jobs. This includes the creation of new, as yet unforeseen, occupations. There is a lot of uncertainty about the shape of the future job market. However, we can be more certain that jobs that rely on routine, simple tasks are easier to automate, whereas creative and complex tasks will be more resistant to replacement. This risks exacerbating inequality in a number of ways:

1. Socio-economic: “Many low- or middle-skilled occupations (e.g., manufacturing production) are expected to become less important in the workforce. The predicted decline in administrative, secretarial and some sales occupations is also consistent with these trends … Employment growth is expected to derive disproportionately from smaller, generally high-skilled job families that will be unable to absorb job losses coming from other parts of the labour market[6]”

2. Gender: “There is a strong gender dimension to expected employment changes whereby, notably, gender gaps appear to be more pronounced within both high growth and declining job families. For example, women make up low numbers in the fast-growing STEM job families, pointing, on current trends, to a deteriorating gender gap over time[7]”

3. Generational: Much of the current workforce in employment will still be in employment in 2030. With the rapid adoption of data-driven technologies and ‘automation’ the current workforce needs to access re-training so they are not left behind.

1.3      In addition, employer investment in skills and training of their workforce has declined significantly across the UK in recent years and is a huge contributing factor to flagging productivity. The Apprenticeship Levy and associated programmes are beginning to increase investment in ‘new talent’ but there are comparatively fewer skills enhancement programmes targeted at those already in work.

2. Place-based opportunity and approach

2.1      Digital tech jobs in Edinburgh increased at over three times the national average between 2014 and 2017, according to a recent report by Tech UK[8]. There was a rise of 42 per cent in three years from 6,814 jobs in the technology sector in 2014 to 9,704 in 2017. Digital tech turnover in Edinburgh was also worth £1.14bn in 2017 and contributed £1.3bn gross value added.

2.2      However, companies within the sector reported ongoing challenges around access to talent, and demand for digital and data talent is expected to grow strongly in the medium to long term. The Scottish Futures Trust has forecast that, as Scotland emerges as a world-leading digital hotspot, 175,000 new digital jobs would be created by 2030. It has also been estimated that approximately 30%, or 50,000 of these additional jobs would be created in the City Region as a whole, with 37,000 of these being in Edinburgh.

2.3      The Edinburgh and South East Scotland City Region Deal Data-Driven Innovation (DDI) Programme, a partnership between local business leaders, six local councils, five universities and five further education institutes, has been designed to develop new skills and approaches to support data-enabled change, translation and diffusion in and across key sectors of the UK economy through five key activity themes:

1. Talent: by meeting data skills demands in the City Region, Scotland and the UK through a range of new undergraduate, post graduate and CPD programmes (engaging with around 716,000 people across the UK and globally, of whom around 62,000 will receive formal certification[9] and an additional 30,400 CPDs);
2. Research: through expanding the City Region’s leading DDI research activities to meet industry and other sectors’ future data needs (by leveraging £608m of public and private sector funds to support DDI research and adoption activities);
3. Adoption: by increasing the practical use and adoption of DDI by the public, private and third sectors in the City Region and beyond (supporting over 1,000 organisations, including high-growth companies and increasing their levels of data adoption and innovation);
4. Data: through providing the secure data storage, analytical capacity and data accessibility to underpin all DDI Programme activities by creating and analysing over 1,000 new data sets; and,
5. Entrepreneurship: by enabling entrepreneurs to develop new DDI-based businesses through Programme support in commercialising research, accessing relevant talent, legal and business services, and access to relevant datasets to nurture the formation and scale-up of over 400 data-centric companies.

2.4      The University of Edinburgh and Heriot-Watt University have set out a capital investment funding bid to Government of £270 million. This will be complemented by a commitment - from the Universities - of a further £142.7 million of capital investment and £122.7 million revenue funding that will leverage around £29.1 million capital and £122.6.1 million revenue funding from third parties to support the activities of a:

1. Network of five DDI Innovation Hubs that will enhance and accelerate the City Region’s existing DDI capabilities (in talent development and research, adoption and data analysis);

2. World-Class Data Infrastructure to ensure international competitiveness by transforming the City Region’s data, research, adoption and talent capacity through sustained capital investment in underpinning data capability, computing and data storage infrastructure; and,

3. Programme Delivery activity to engage with key industry sectors and drive cross- sectoral innovation through a range of adoption and entrepreneurship activities and inward investment and inclusive growth programmes.

2.5      The net present value (NPV) of the Programme is forecast to be £2.3 billion[10] gross value added (GVA). The net benefits[11] to the City Region will be £672.5 million; to Scotland £989 million; and, for the UK £2.3 billion.

3. Workforce readiness

3.1      The Edinburgh City Region has the opportunity to drive economic growth by rapidly increasing the adoption of data-driven innovation, however without the local skills base enabled by better labour force planning, investment in lifelong learning and flexible training opportunities, many people within the region will be ill-prepared to benefit from economic growth. The aim of the DDI Skills Gateway is to provide high-quality data education from schools through to lifelong learning with clear routes into data-related jobs for people within the City Region.

3.2      Included in the Skills Gateway proposal is a suite of activity to empower at-risk employees and low-paid workforce to prepare and equip themselves with the skills to take advantage of the world of work shaped by data-driven automation. The aim is to test innovative approaches to up-skilling and re-skilling adults in order to learn more about how to support and incentivise adults to learn the data skills that will help them, the local economy and national productivity. Amongst the approaches being proposed is a Data Skills Credit scheme aimed at encouraging employers and learners to share responsibility for developing data skills.

3.3      In addition, the lack of well-established pathways to enter data-focused occupations makes it difficult to navigate the skills journey. Recognising this, a data skills framework is being developed for the region’s workforce that will evolve to respond to the changing needs of those in and looking for work. Included in the framework would be data career pathways, open accreditation routes and an online portal to allow individuals to self-assess against job profiles.

3.4      There remain relatively few data science courses offered in flexile, diverse formats that can be accessed by those in-work or returning to work. Employers and individuals struggle to find suitable training routes, limiting broader participation. Furthermore, whilst some industries have the potential for growth through data-driven innovation, many do not understand how they can start on the data journey or how they can support their current workforce to develop the skills necessary to take advantage of this opportunity. The City Region Deal aims to address these challenges through the development of new courses and delivery models, including subsidising delivery of Data Science Adoption training for managers in small and medium sized enterprises.

4. Schools and curricula             

4.1      The Fourth Industrial Revolution will require school learners to be prepared to live and work in an increasingly data-driven and automated society. We not only need learners with the technical skills and interests which can lead them into careers in artificial intelligence and data science; we also need our learners to be critically aware of how technology is reshaping societies and democracy. 

4.2      As the Royal Society's recent review of computing education in the UK indicates, there have been recent changes to the computing curriculum in England, Wales, Scotland and Northern Ireland. Properly implemented, these changes will greatly assist in preparing learners for this revolution. Unfortunately, the evidence to date, as presented by the Royal Society, suggests that the implementation of curricular reform is patchy at best. The Royal Society recommends addressing this by investing in teacher education and support and ramping up research into computing education in the UK. 

4.3      The Skills proposition in the Edinburgh and South East Scotland City Region Deal will take both of these steps with a programme for Data Education For All in all local schools within the region, for learners aged from 3-18 years. As well as developing an imaginative data curriculum and learning materials, we will invest in professional learning for teachers and better initial teacher education in this area. We will run a large-scale study over the eight years of the intervention to explore what works in this form of computing education and make our findings available for policy makers in the future.

4.4      For us to be ready to tackle the demands of the Fourth Industrial Revolution, we need better integration between provision in schools, colleges, universities and workplace learning. This will enable more flexible learner pathways into work in key areas.

4.5      A key challenge facing the Fourth Industrial Revolution is that curricular reform and life-long learning opportunities are not in themselves sufficient to ‘help people to climb the ladder of opportunity’, and maximise ‘productivity’, but rather that research about the social transformation that will be brought about by the Revolution is necessary to understand its broader implications and ensure it has a positive impact on society.

5. Social implications

5.1      At the University of Edinburgh, we have hosted a series of research programmes to highlight ways in which poverty and deeper seated inequalities (themselves linked inter-alia to housing, health, transport, labour markets, and access to justice), are strongly linked to poor educational outcomes (see AQMeN research on education and social stratification[12]). 

5.2      Our research has also highlighted how inequalities are transmitted across generations and adverse childhood experiences have a longer-term impact on citizenship and well-being in adulthood (see The Edinburgh Study of Youth Transitions and Crime[13], Centre for Research on Families and Relationships[14]).  Unless governments take a more holistic approach to policy development and delivery (working meaningfully across established portfolios) and tackle these broader structural inhibitors, then there is a clear and present danger that the Fourth Industrial Revolution will exacerbate rather than ameliorate social and economic exclusion.

5.3      The Edinburgh Futures Institute, one of the five hubs supported by the City Region Deal, is launching a ground-breaking programme that will harness the new research modalities associated with the Fourth Industrial Revolution (e.g. big data analytics, robotics, the Internet of Things) to drive solution-focused thinking on a range of key challenges including:

1. Citizenship: increasing participation, mobilising marginalised groups and building community; experimenting with e-governance, creative informatics and human-centred design, as a means of engaging and empowering communities;

2. Spatial concentrations of disadvantage: tackling the long-standing concentrations of poverty and inequality found in specific neighbourhoods of cities and in some rural communities, utilising multi-level and multi-scale modelling to understand the drivers and longevity of these patterns;

3. Re-imagining the nature of public services and mechanisms for their delivery: linkage of data sets and big data analytics to better understand multi-morbidity across the life-course, tackling complex needs (associated with justice, health, benefits) in new and more effective ways; and,

4. Promoting public trust and confidence in data-driven innovation and good governance.

5.4      Each of these themes is aimed at the promotion of greater social justice and are an essential first step to realising the social, cultural and economic benefits that the Fourth Industrial Revolution can bring.

June 2018