The trend towards market-oriented training systems gives an increasingly prominent role to the private sector. Enterprises, in particular, are expected to undertake a proactive role in training. Conversely, the traditional role of the State is evolving from government-led and government-owned training systems towards creating an enabling environment for enterprises and individuals, employers and workers, to invest and actively participate in a collective training effort.
Partnerships and strategic alliances between the interested parties have become the key strategy to improve the relevance, efficiency, effectiveness, equity and sustainability of training policies, systems and programmes. Training is increasingly conceived and promoted as a cooperative effort in which the various relevant institutions in the public and private sectors must participate and share responsibilities. Moreover, the partners concerned are being called upon to contribute to the overall training effort, and to articulate their inputs, making the best possible use of their respective strengths and comparative advantages.
In practical terms, only a few countries have set up a coherent systemic framework and appropriate incentives for these partnerships to flourish on a large scale. Nevertheless, there is already an assortment of innovative and interesting experiences throughout the world which offer options and lessons for promoting public/private alliances in training.
In order to capture the nature, range, and extent of innovations, the constraints faced and opportunities created by these partnerships, the Training Policies and Systems Branch (POLFORM) of the ILO undertook an extensive research programme "Strategic Training Partnerships between State and enterprises". The work between 1995 - 1997 included case studies covering 26 experiences in 14 countries from various regions: Australia, Chile, Denmark, France, Germany, India, Ireland, Ivory Coast, Japan, Malaysia, South Africa, Spain, United Kingdom, United States. Based on these experiences, extensive review of literature and discussions on the subject at national and international levels, analytical, conceptual and policy papers were elaborated.
Preliminary results of the research programme were presented and discussed at numerous seminars and conferences including two major ILO regional meetings, one for Asian countries ("Asian Experiences in Strategic Partnerships between Enterprises and the State", Chiba, Japan, December 1995, in collaboration with the Asian and Pacific Skills Development Programme, APSDEP), and one for Latin American and Caribbean countries ("Strategic Alliances in Training", Santiago de Chile, May 1997, in collaboration with the Inter-American Research and Documentation Center, CINTERFOR).
The research programme also provided a contribution to the ILO Enterprise Forum (Geneva, November, 1996), on the theme "Training for Employability".
The collection of papers produced under this research programme are listed at the back of this document as Training Partnership Papers. They are available in English, French and Spanish from the documentation service of the Employment and Training Department.
The results of the work accomplished in this area, and the experiences, concepts and messages conveyed, have raised considerable interest and contributed to demonstrate possible avenues for innovative ways of rebalancing the roles and responsibilities of the private and public sectors in training. Hopefully, the lessons learned from these experiences will contribute towards building trust and fostering cooperation between the two sectors, stimulating their participation and promoting the best use of their respective strengths in training. It should also help to lay the basis for improving awareness and institutional capacity for collaboration and joint ventures on human resources development and training among a wider span of institutions and interested parties in the public and private sectors.
The variety and dynamism in this innovative and promising area is phenomenal and deserves an on-going effort in accumulating, analyzing and exchanging information, and raising debate at the country, regional and international levels. With this aim, the scope of the programme on Strategic Partnerships in Training will be broadened in the coming years. Readers are encouraged to contact the Training Policies and Systems Branch for further exchange of information and experiences on this theme.
María Angélica Ducci
Chief
Training Policies and Systems Branch
Employment and Training Department
This document has been produced with the assistance of information supplied by the Department for Education and Employment, the Scottish Office, the Northern Ireland Office, Investors in People (UK), the TEC National Council, Norfolk and Waveney TEC, Thames Valley TEC, London East TEC, Leeds TEC, Burstone Marsteller, Michael White and Heather Rolfe of the Policy Studies Institute, and Ian Christie of the Henley Centre for Forecasting. The author would like to give grateful thanks for their help in providing information and ideas.
The views expressed are the author's own and are not necessarily endorsed by the organizations or individuals providing information for the study.
APL Accreditation of Prior Learning
CBI Confederation of British Industry
DTO Department for Trade and Industry
ITO Industry Training Organization
LEC Local Enterprise Company
MCI Management Charter Initiative
NTETs National Targets for Education and Training
NVQ National vocational qualification
SMEs Small and medium enterprises
SVQ Scottish vocational qualification
TDLB Training and Development Lead Body
TEC Training and Enterprise Council
TEED Training, Enterprise and Education Directorate
TfW Training for Work
TUC Trades Union Congress
YT Youth Training
The United Kingdom has a low skill base compared with competitor nations. A number of measures were therefore introduced in the 1980s/90s to improve the skills and qualifications of the workforce which involve greater enterprise participation in training.
These include the setting of National Targets for Education and Training (NTETs) and the establishment of Training and Enterprise Councils (TECs), or in Scotland, Local Enterprise Companies (LECs). Enterprises take the lead in running TECs and LECs, but finance comes largely from the State.
The concept of TECs/LECs as partnership mechanisms to bring together state and enterprise resources is supported by the employers' organization, the Confederation of British Industry (CBI). Improvements could however be made. The CBI believes that too much effort is expended on equipping the unemployed to return to work, rather than upskilling or reskilling existing workforces, which could have a more direct positive effect on the local and national economy.
State training policy focuses on three areas: encouraging employer investment in training, training for young people and training for the adult unemployed. State programmes are dependent on enterprises for their delivery and part of their finance. The State has improved the quality of training offered under its state-funded training schemes through payment by results in terms of qualifications and/or jobs. Moreover, a new integrated qualification system has been introduced, National vocational qualifications (NVQs), which cover all occupations and sectors. Enterprises play a leading role in devising national vocational qualifications.
With a view to encouraging employer investment in training, a programme has been established, known as the Investors in People Programme, to introduce a training culture and install procedures and processes which will lead to good quality training and produce a more effective return from employers' investment in training. The Investors in People Standard is awarded to organizations which achieve prescribed standards of training and staff development. By June 1995, over 23 per cent of the national workforce was employed in enterprises working towards the Standard. The percentage is rising. The programme is financed primarily by participating enterprises, which have found direct benefits, such as lower staff turnover, reduced wastage and accidents, and higher productivity. In 1995, the National Targets for Education and Training for Investors in People were raised from commitment by 50 per cent of medium to large employers by the year 2000 to commitment by 70 per cent. Targets of 35 per cent were introduced for small enterprise participation.
In order to encourage small enterprises to invest in training, some state finance is available for small enterprises. The Skills for Small Business programme is aimed at updating the managerial, supervisory and technical skills of up to 24,000 key employees in enterprises with fewer than 50 employees. This programme is state financed via TECs.
Although current programmes are useful, they are limited in scope. More needs to be done to make small and medium enterprises (SMEs) aware of cheaper alternatives to off-the-job training. Collaborative partnerships with larger enterprises and open learning which can be delivered cost-effectively on site are possible ways forward.
Employment in the United Kingdom grew rapidly during the second half of the 1990s. There are now over 2 million more people in work than in 1983. The Institute of Employment Research projects a growth of 0.6 per cent in jobs per year until 1997, followed by 0.9 per cent growth until 2001. This will create 1.6 million extra jobs. However, much of the growth will be in part-time work. This reflects the growth in the service sector and the decline in manufacturing jobs. Although 62 per cent of the employed and self-employed workforce are currently in full-time employment, this is expected to fall to 57 per cent by 2001. Part-time workers now account for 24 per cent of employees. This is expected to rise to 28 per cent in 2001. Managerial and professional employment is the strongest growth area. The number of unskilled manual jobs has fallen and the long-term trend in manual employment has been towards higher skilled jobs.
Working practices have changed, with more work being carried out in small units. This requires individual workers to contribute a range of skills and to work in teams with a joint problem-solving approach. This has been accompanied by a strong drive to improve quality and increase the subcontracting of work to small suppliers, which has led to a growth in small and medium-sized enterprises (SMEs). At the end of 1991, there were 900,000 more small businesses in the United Kingdom than in 1979. Ninety-six per cent of enterprises, representing 30 per cent of the private sector workforce, employ fewer than 20 people.
The commitment to training of enterprises in the United Kingdom has been low. The Training Agency's 1989 survey, Training in Britain, indicated that 20 per cent of employers gave no training, 70 per cent had no training plan, 80 per cent had no formal training targets and 97 per cent made no cost-benefit analysis of the training provided. The 1995 Labour Force Survey shows that just under 13 per cent of employees received job-related training in the four weeks before the survey, although that was an improvement from the 8 per cent receiving training in 1984. The situation is poorer for those over 35, workers in the manufacturing and processing industries and those in small enterprises.
The lack of commitment to training by enterprises in the United Kingdom may reflect the experience of senior managers, many of whom have low levels of training compared with their counterparts in other countries. A 1989 study found that only 24 per cent of managers in the United Kingdom had university degrees, compared with 62 per cent in Germany, 65 per cent in France and 85 per cent in the United States and Japan (MSC, NEDC and BIM). Moreover, pay differentials between qualified and unqualified workers are smaller than in many competitor nations, leaving the United Kingdom deficient in intermediate technical and supervisory skills. In larger enterprises, the responsibilities of those at the intermediate level are increasing as middle management is being limited. Both individuals and their employers would benefit from individuals upgrading their skills, but many supervisors do not see the need for formal qualifications. Moreover, there is often no link between qualifications, skills and pay.
The low skills base has been accompanied by skills shortages. These are generally less significant than in the late 1980s, but there is evidence that they are increasing. Skills shortages nationally are reported in Skills Needs in Britain. The 1994 edition, based on a survey of 4,000 employing organizations with 25 or more employees, reported that 11 per cent were experiencing recruitment difficulties, compared with 6 per cent in 1993 and 22 per cent in 1990. The CBI Industrial Trends Survey reported in January 1995 that 10 per cent of manufacturing enterprises expected shortages of skilled labour to constrain output over the next four months.
Although small enterprises have traditionally been reluctant to provide training, the picture is improving slightly. The Skill Needs of Small Firms in Britain survey for 1994-95 showed that 36 per cent of enterprises with under 25 employees had provided off-the-job training in 1994-95, compared with 29 per cent in 1992. The percentage providing on-the-job training had increased, but only marginally, from 58 to 59 per cent.
Since August 1995, overall responsibility for vocational education and training policy in the United Kingdom has been vested in the Secretary of State for Education and Employment. This follows the merger of the Department for Education and the Department of Employment to combine responsibility for academic education, vocational education and vocational training. In England, training policy is implemented by the Training Enterprise and Education Directorate (TEED), an executive division of the Department for Education and Employment. In Scotland, training policy is devolved to the Scottish Office and implemented through two bodies, Scottish Enterprise, which covers lowland Scotland, and Highlands and Islands Enterprise in the north. In Wales, training policy and implementation is devolved to the Welsh Office. Northern Ireland has its own training system under the supervision of the Training and Employment Agency. Policy development is primarily state-led, although it is informed by regular consultations between ministers and officials and bodies representing enterprise.
Strategic priorities
Economic constraints and the need for more and higher levels of training have meant that the State cannot support the investment needed to update the skills of employees. This has led to a need to encourage greater employer commitment and investment in training. At the same time, changing patterns of employment have resulted in larger numbers of self-employed and contract workers and greater job mobility. The emphasis in this case is on developing individual commitment to training with individuals subscribing to the idea of lifetime learning and financing their own training.
These priorities are evident in all the relevant legislation adopted in the late 1980s and 1990s, with the State aiming to devote significant resources to fund training for those who need it, are unable to pay and are unlikely to be adequately supported by employers. This includes, in particular, young people and those who have been out of work for some time. For other groups, there is a clear message that they cannot expect training to be state-financed.
|
The White Paper Employment in the 1990s argued that training must relate closely to the circumstances of each local area. This would require local organizations with local commitment to fill a gap in effective local agencies able to communicate with and motivate employers, and particularly small enterprises, which were largely uninvolved in national and sectoral training initiatives. In England and Wales, 81 Training and Enterprise Councils (TECs) were established. The equivalent in Scotland are the 22 Local Enterprise Companies (LECs).
State training policy is translated by the Department for Education and Employment into specific programmes and initiatives which attract state funding and are managed locally by TECs and LECs. TECs and LECs also provide business and training information and advice services, often in conjunction with other organizations in the private and public sectors. LECs have a wider remit than TECs and their responsibilities include environmental improvement and greater involvement in economic development. TECs and LECs have special responsibility for achieving national training and education targets. Each TEC/LEC has a strategic forum of employers, local authorities and education and training providers to manage progress towards these targets.
Enterprises take the lead role in running TECs and LECs, which are structured as independent, private sector enterprises run by 8-16 member boards of unpaid directors. At least two-thirds of TEC/LEC directors must be chairmen, chief executives or general managers of local private sector enterprises. Other board members are drawn from local authorities, voluntary organizations and trade unions. In addition to their boards, TECs and LECs use a variety of consultative and decision-making structures, a key feature of which are TEC board subc ommittees for specific industrial sectors, geographical areas, client groups or issues. The majority of board sub-committee members are senior managers of enterprises.
Although TEC boards may include a trade union member, there is little direct trade union input into the state training system. Trade union membership and influence on training has been declining in the United Kingdom, with emphasis being placed on partnership between State and enterprises, with other bodies, such as trade unions, local government and the voluntary sector, playing a lesser role. TECs' views are represented to ministers through the TEC National Council, which is composed mainly of elected TEC chairmen, who are all business leaders. The TEC National Council meets regularly with ministers.
TECs and LECs are responsible for managing state training programmes in their areas. They do not themselves deliver training, but contract with the State to deliver training programmes to agreed numbers of participants and then contract with local training organizations, generally called training providers, which deliver the training. Training providers may be in the private or public sectors. The majority are commercial private enterprises or further education colleges, but TECs and LECs may also contract with employers to deliver training. Employers tend to be from industries with a long involvement in training young people, such as engineering and hairdressing, as shown by the Training and Enterprise Directory. TECs and LECs are also responsible for collecting local labour market information to identify local employment patterns, sectors of economic growth and skill shortages, with a view to achieving more effective planning of training and other business service resources.
|
TECs have become increasingly integrated with other business, training and development services in their local areas. This has encouraged the setting up of Business Links services, which have integrated local enterprise and information services offered by bodies such as TECs, Chambers of Commerce, export agencies, enterprise agencies and local authorities. A further move towards rationalization is the Department for Education and Employment and Department for Trade and Industry (DTI) agreement of February 1994 that TECs may merge with Chambers of Commerce.
Industry Training Organizations (ITOs)
In addition to TECs and LECs, the other major enterprise-led organizations involved in training development are the 120 sectoral Industry Training Organizations (ITOs), composed of representatives of enterprises. These are financed by their industry members. Their role is to monitor future skill requirements and training needs in their sector, develop and promote occupational standards and encourage enterprises to increase their training efforts. ITOs have a prominent role in the State's training strategy. They advise the State about the needs of their industries and work closely with TECS and LECs in updating and developing the standards of competence for vocational qualifications. They have also played a central role in the development of training for young people.
In the 1980s and 1990s, state training finance has been focused on adult long-term unemployment and young people entering the labour market. For the existing workforce, the State sees its role as encouraging enterprises to take responsibility for their own training and development. Compulsory training levies for enterprises have been abolished. Finance for TECs and LECs comes largely from the budgets they receive from the State to run state training programmes for the unemployed and for young people.
Initially, TECs and LECs had a small discretionary fund, Local Initiative Funding, of around 2 per cent of their total budget, which could be used to finance innovative training projects which met the needs of the local area. This funding could focus on enterprises' existing workforces, rather than on the unemployed or new entrants to the labour market. This funding has now been abolished and absorbed into a single regeneration budget for economic development, administered by the State on a regional basis. TECs must compete for local funding, with preference usually being given to projects which involve a number of partners in the area, including local authorities. The advantage has been to link TEC projects more closely with wider economic aims. A concern has been that TECs, as newer and smaller organizations in their areas, would prove less able to compete for funding. A further disadvantage is that the loss of Local Initiative Funding may prove a disincentive to enterprises to participate on TEC boards and sub-groups. However, the changes are recent and their impact has yet to be assessed.
The scope enjoyed by TECs and LECs to take innovative local initiatives has also been hampered by cuts in state finance for the major training programmes for the unemployed and young people. The surpluses generated by TECs and LECs from the difference between the budget awarded by the State and the sum used to purchase training from local providers have been used to fund initiatives of interest to enterprises. These have often focused on upskilling existing workforces. Budget cuts to national programmes have meant a reduction in the local initiatives financed by these surpluses.
Although state funding to train the unemployed and young people is channelled through TECs and LECs, one aim of state policy is to put "purchasing power" into the hands of consumers of education and training. Funding is often therefore translated into training vouchers, through which eligible individuals can purchase approved training from training providers. By April 1995, all TECs in England had introduced vouchers for young people aged 16-17 who wished to take part in state training programmes. The vouchers enable them to obtain training from an employer or other recognized training provider. The concept has been further developed in the 1994 White Paper Competitiveness: Helping Business Win, which announced an investigation into the practicality of issuing learning credits to all 16-19 year olds for the purchase of all types of education and training.
Two further measures to help individuals pay for their own training are tax relief and career development loans. Tax relief is available for individuals who pay for training leading to national vocational qualifications (NVQs). Career development loans enable individuals to draw upon private sector loan capital to finance training. The Government is now consulting TECs, financial institutions and others on the establishment of individual training accounts to help individuals save money in commercial or employer-based funds, which could be used for their own training and development.
During the 1980s, a vast overhaul of the vocational qualification system was undertaken in order to rationalize and update a system of sector-based qualifications which had grown up piecemeal since the nineteenth century. An integrated system of qualifications consisting of national vocational qualifications (NVQs) or, in Scotland, Scottish vocational qualifications (SVQs), was devised to cover all occupations and sectors. Enterprises played a leading role in devising and defining NVQ and SVQ competencies, which are expressed in terms of a range of activities and the level of competence needed (what people need to be able to do and the standard they need to reach). No specific curricula or length of training are set to reach these competencies. The length of training needed and the methodology for reaching it are a matter for the individual trainees and trainers. The new qualifications have brought occupations into the qualifications framework which previously had no national standards or examinations.
The system is geared to upgrading the skills of young people. Individuals should be able to enter, leave and re-enter the system throughout their lives. Encouraging adult learners to improve their skills, qualifications or parts of qualifications may be achieved through the accreditation of prior learning (APL), which has been applied most often where qualifications have been introduced into sectors where none previously existed, or where enterprises involved in upskilling have decided to obtain qualifications for an unqualified workforce.
NVQs and SVQs are awarded by a number of different awarding bodies. Much of the assessment takes place at the workplace. The awarding bodies train assessors, who are the first line of assessment for NVQs and may be based in commercial training organizations, colleges or enterprises. Many enterprises, especially medium and large enterprises, have trained their own supervisors to act as assessors. The work of assessors is checked by a second tier of assessment, composed of internal verifiers from the assessor's own organization or an outside training organization. Internal verifiers act as the first stage of quality control inspection. A further tier of verifiers, external verifiers employed by the awarding bodies, visit organizations that carry out assessment to check the evidence submitted to the awarding bodies in support of individuals' NVQs and to provide further monitoring and quality control. The role of the external verifiers is also to ensure that assessment is carried out to uniform standards. They are the equivalent of external examiners in the education system.
The NVQ system has suffered from criticism. Although the standards of competence for NVQs and SVQs have been devised by industry, their administration and language is that of educationalists. Enterprises frequently complain that they find NVQs and SVQs too bureaucratic. Consequently, although enterprises are adopting NVQs and SVQs, the bulk of the new qualifications are delivered through state training programmes to the unemployed and to young people.
Concerns have also been expressed about quality standards of NVQs and SVQs. Finance for state training programmes has therefore been progressively switched to payment by results, with training providers receiving much of their funding only if the trainee succeeds in obtaining a qualification and/or job. This has improved the outcomes of state-funded training but, as is probably inevitable, some abuses have been found in a system in which the assessors may be employees of the training provider. However, the awarding bodies of the qualifications provide quality control through the system of internal and external verifiers. TECs and LECs are responsible for the quality management of the training providers with which they contract. Many TECs and LECs also run NVQ networks of assessors who meet on a regular basis to discuss assessment issues and develop common standards of assessment. Overall, funding through payment by results has improved the quality of training by driving out of business training providers who are unable to train trainees to the standards required to achieve qualifications.
The State also places considerable emphasis on improving the standards of training through the development of training for trainers. A cross-sectoral body run by enterprises, the Training and Development Lead Body (TDLB), is responsible for training standards across all sectors. The Training and Development Lead Body has close links with TECs and LECs and is chaired by a TEC Chief Executive.
The creation of TECs and LECs was welcomed by the main representative body of enterprises, the Confederation of British Industry (CBI).
However, since their launch, TECs (more than LECs) have been criticized as bureaucratic. There is a tension between the need of public sector auditors to ensure that state finance is accounted for and the need of TECs for flexibility. TEC credibility has also been dented by a lack of continuity of finance and programmes which are subject to frequent changes, due to shifts in policy and priorities. TECs may also have suffered from high expectations on the part of enterprises, which could not be met in reality.
The enterprise response to TECs and LECs and their policies are found in the 1993 report Making labour markets work: Confederation of British Industry policy review of the role of the TECs and LECs. The CBI report found continued strong support amongst enterprises for the concept of enterprise-led TECs, but confusion about their mission and role. Concern was also expressed that too much effort was expended by TECs on equipping the unemployed to return to work rather than other training, which could have a more direct effect on local and national economies, and particularly employee training. Perhaps not surprisingly, the CBI advocates state funding of initiatives to reskill and upskill employees, and particularly employees in small enterprises.
State training policies and programmes in the United Kingdom focus on three areas:
In all three areas, state programmes are dependent on enterprises for their delivery and part of their financing. Examples of major programmes in the three areas and how they operate in practice are described below. All these programmes are delivered through TECs and LECs. The programmes operate independently, but TECs and LECs aim to involve enterprises in a range of training programmes and initiatives in order to permanently influence their overall training strategies.
One of the State's major programmes to promote quality in training and to encourage enterprises to invest in training is the Investors in People programme. The aim of Investors in People is to promote a training culture and encourage the establishment of procedures and processes that result in good quality training and produce a more effective return on investment in training.
The Investors in People Standard is awarded by TECs and LECs to organizations that achieve prescribed standards of training and staff development. The Standard has four key principles:
Investors in People is considered by TECs and by the CBI to be one of the most important programmes that TECs have to offer. The programme provides a means for enterprises to link their training to business objectives in order to achieve effective and cost-effective training. Investors in People is essentially a quality process to help enterprises create a culture of continuous improvement in training.
The Standard is awarded on the basis of self-assessments carried out by employees themselves, who must provide evidence every three years to retain the award. It is managed by Investors in People (UK), which is a private company with a board of chief executives, chairmen and other senior company directors. TECs and LECs market the programme and provide information and advice on how to implement it and buy in the necessary consultancy time to create a self-assessment system. In most cases, the programme is financed by enterprises themselves, although some TECs and LECs have a small budget which is used to assist a limited number of local enterprises, primarily SMEs.
Despite initial scepticism from enterprises and others about the take-up of Investors in People, it appears to be successful. As of February 1995, over 15,200 organizations were committed to achieving the Standard and over 1,370 had achieved it. Over 4.8 million employees (23 per cent of the national workforce) are employed in enterprises working towards the Standard. The Standard is prestigious and successful companies incorporate the Investors in People logo on company stationery and public material. The programme is marketed primarily through case-studies and endorsements by participating enterprises, which have found that evaluating and rationalizing their training systems and linking training to business objectives has resulted in direct benefits, such as lower staff turnover, a reduction in wastage and accidents, and higher productivity.
In 1995, the State was sufficiently confident of the level of commitment to Investors in People to raise the National Targets for Training and Education from commitment by 50 per cent of medium to large employers in the year 2000 to commitment by 70 per cent, and to set targets of 35 per cent for small enterprise participation.
Telephone Cables Limited (a division of GEC Plessey Telecommunications GPR), employs around 700 people in the design, manufacture and installation of leading edge copper and optical fibre telecommunications cables and accessories. A large number of the workforce in Dagenham is from ethnic minorities and many hourly workers could not speak English. Few middle-managers had any management training and there was a rigid, status-bound culture which fostered avoidance of responsibility, distrust of new ideas and a reluctance to share information and skills. In early 1991, the London East Training and Enterprise Council introduced the Investors in People programme to Telephone Cables. A partnership was formed to steer a Business Skills Project, based on a strategy of action learning involving groups of managers. Employees were reintroduced to learning through a "learn how to learn" module. Self-development was encouraged through the use of distance learning. The main framework for the Business Skills Project was provided by Investors in People. Mentoring was provided and team values were reinforced by individuals undertaking outdoor activity courses with their mentors. Business understanding was increased by running a bespoke business game for ten months and managers were trained in business skills such as project management, finance, the management of meetings and presentation skills. Discussions were also held with unions to inform them of the business strategies. English classes were provided for ethnic workers and their families. A project was initiated to research and implement an induction process for new employees. An employee magazine was introduced to improve employee communications, and Innovation and Individual Contribution Award schemes were introduced. Telephone Cables received Investors in People recognition in November 1993 and also received a National Training Award for their Business Skills Project. The first phase of the Business Skills Project and Investors in People brought clear benefits to the business. Telephone Cables survived the industry shake-out in a highly competitive market and increased its market share; profitability has been maintained despite the recession and price cuts; there has been a 17 per cent increase in sales per employee; hourly output has increased by 8 per cent; waste reduction targets have been exceeded; inventory runs have increased by 21 per cent; the working relationship with unions has improved considerably; lead times on stock cables have been reduced from over three months to four days; delivery conformance has increased to 100 per cent; hourly paid employees have an enthusiastic understanding of customer quality requirements; and the innovation scheme has grown from zero to 11 inputs per month. For employees the benefits include job stability and security, greater involvement, understanding, job interest and responsibility, pride in their achievement, career development opportunities and a happier workplace. |
Another programme to encourage enterprise investment in training and the development of quality training is the National Training Awards programme, which is an annual competition administered by the Department for Education and Employment. The competition is popular and there are around 1,400 entries a year. From the perspective of enterprises, winning an award is a useful boost to external prestige and internal morale. Associated local publicity can be helpful when recruiting staff.
Approximately 80 national awards are given to organizations, employers and training organizations, and around 20 to individuals. The awards to enterprises are for exceptionally effective training that addresses real business needs. Winners have to show a link between the training provided and outcomes in terms of benefits to the organization. Judging is by independent regional panels of employers and education and training providers, TECs, the voluntary sector and trade unions. Financing for the National Training Awards comes from donations by private sector organizations, such as national newspapers and employers' organizations. Trade unions also support the awards through their representative organization, the Trades Union Congress (TUC).
Management training is an area of deficiency in the United Kingdom. Except for small enterprises, the financing of management training is considered by the Government to be the responsibility of enterprises and individual managers or would-be managers. A small amount of state finance is provided to the Management Charter Initiative (MCI), which is an employer-led body dedicated to improving the quality of managers and the relevance of management training. Its management standards can be used both for in-house training and for NVQs. MCI has a system of local networks which translate its national aims into local practice. The MCI networks are hosted by TECs, LECs and other organizations. Over 1,700 employers, representing 25 per cent of the national workforce, are members of MCI. Most are large private sector companies. State finance of £500,000 was provided in 1992-93 for core funding and to finance projects to maximize the use of competence-based standards and associated qualifications for managers. Recently, the MCI Influencing Project has been approved to build awareness of the benefits of management development, management standards and NVQs among employers and individuals.
Small enterprises have traditionally considered training to be a cost rather than an investment. The inclusion in the latest National Targets for Education and Training of specific Investors in People targets for SMEs highlights the emphasis given by the Government to encouraging investment in training by smaller enterprises. SMEs have traditionally been reluctant to become involved in state programmes, which are often perceived as bureaucratic and time-consuming. To meet their needs, three specific programmes have been set up.
In 1994, the Government announced it would make £63 million available over three years for a new programme called Skills for Small Business. The programme aims to update the managerial, supervisory and technical skills of up to 24,000 key employees in enterprises with fewer than 50 employees. Under the programme, small enterprises are encouraged to see training as a business investment, with managers who have received training acting as mentors to train others. Financing is provided through the TECs. Although the programme appears potentially useful, it is small in scope in view of the fact that 30 per cent of the private sector workforce is employed in enterprises with fewer than 20 employees.
Another source of state finance for small business training is the Small Firms Training Loans programme, which was launched in June 1994. The loans are designed for enterprises with up to 50 employees and amount to between £500 and £125,000 per enterprise. They can be used to help small enterprises pay for training courses, or for consultancy for drawing up effective training plans. TECs and LECs endorse applications and the funding is provided through the banks, thereby enabling small enterprises to draw upon private sector capital to train their employees. In 1994-95, funding was provided for 3,000 loans, with a total budget of £4.4 million. This will rise to £9.6 million and 4,500 loans in 1996-97.
Collaboration projects by groups of small enterprises are seen by the Government as a way for small enterprises to share costs of training. A small firms training challenge has recently been announced to finance innovative ideas which can show best practice in action. Coordinated training initiatives funded by ten or more small enterprises will be eligible for funding. The aim is for 1,000 enterprises to take part and develop ideas that can be disseminated to others.
All of these programmes appear potentially useful, but their impact has yet to be assessed.
The main state-funded training programme in England, Scotland and Wales is Youth Training (YT). Developed from the former Youth Training Scheme and Youth Opportunities Scheme, Youth Training offers a place for all young people aged 16-17 who are unable to find a job, although people up to the age of 25 are also considered. In March 1995, 169,200 young people were involved. Numbers have risen in parallel, though not so steeply as school staying-on rates. Around 35 per cent of trainees are employed by an enterprise or other employer while undergoing training. Non-employed trainees receive a small training allowance. The trainees generally aim to achieve an NVQ level 2 (craftsperson) qualification.
Funding for Youth Training is administered by TECs and LECs from public financing, with different levels of payment for courses with higher training costs. State finance is insufficient to fund the full cost of training and provide trainees with a training allowance. Employers pay for trainees to be placed with them. These payments are essential to fund the system.
The image of Youth Training has suffered from bad publicity regarding the quality of the training provided by some schemes and the low attainments of trainees. However, 55 per cent of leavers in the period October 1993-September 1994 obtained jobs and 15 per cent were in full-time education or other training. Qualification rates are low, but have risen since the establishment of TECs and LECs and the adoption of the payment-by-results policy. Around 46 per cent of trainees obtain a qualification or part-qualification, compared with under 30 per cent in 1988. There has also been an increase in the number of enterprises participating in Youth Training. In 1990, around 40,000 employers offered placements, rising to 200,000 in 1994.
Modern Apprenticeships is a more advanced programme targeted at more able 16-17 year olds, which also involves employees. An agreement is made between a young person and an employer, setting out the training to be provided, the qualifications to be obtained (normally a technician-level qualification) and the commitment of both parties to a successful outcome. Modern Apprenticeships programmes have no fixed time-limit, but emphasis is placed on reaching a required standard of competence rather than "time-serving". Modern Apprenticeships programmes were prototyped in 14 industrial sectors in 1994 and are due to be extended across another 50 other industrial sectors to cover 150 occupations. The aim is for 150,000 places to be available in the year 2000. Employers contribute to the cost of training by paying wages and/or training supervisory costs. The success of the programme has yet to be determined, but there have been initial difficulties in recruiting sufficient employers.
|
Vocational education and training for young people: Youth Training programme Zeneca Agrochemicals' UK research station employees 800 staff, of whom 600 are scientists, including 350 graduates and 150 postgraduates. Zeneca has been committed to government Youth Training programmes and has trained young people as support workers for scientists since 1982. From 1990, a drop in the quality of the trainees, largely due to more young people staying on at school after the age of 16, meant that it became more difficult to recruit suitable young workers. When the local TEC was launched in 1990, the research station saw it as an opportunity to revive the training programme and develop the managerial skills of the scientists. A two-year programme of training was established for young people to gain relevant work skills and a vocational qualification, and to move into permanent employment, either with the research station or with other local enterprises. The company contracts with its local TEC, Thames Valley Enterprise, to deliver the Youth Training programme and is paid partly for each week of the training programme and partly by results. Trainees receive a government training allowance, which is supplemented by additional payment from Zeneca. An individual training plan is drawn up with trainees and is reviewed every three months. The training programme consists of a day at college each week and four days at the research station including learning the relevant skills, general laboratory duties, the handling of equipment and chemicals, and computer literacy and numeracy. Training ranges from one-to-one instruction from supervisors to personal development workshops, using innovative multi-media and other materials. During the course, trainees aim to gain a craftsperson- or technician-level qualification in science or business. A new supervisory programme has also been developed to improve the overall proficiency of supervision throughout the site. This is closely linked to the Youth Training programme. Supervisors are set a number of training objectives, including helping to recruit 12-15 new trainees each year, developing the trainees' personal effectiveness, generating training plans for trainees, ensuring trainees understand site safety policy, coaching trainees in new tasks, reviewing their progress, attending new vocational qualification assessor training and coaching on development courses. Since 1991, 51 out of 53 trainees have found jobs and all have achieved qualifications or part qualifications; 23 have been recruited into permanent jobs with Zeneca. The remainder found work with other enterprises. From the company's point of view, other benefits of the scheme are that the company now has a junior recruitment plan for the next five years and £70,000 has been saved in recruitment costs. The training methods developed are now used for other training, including the site's management development programme. The quality rating of the research station has risen. In 1994, Zeneca received a National Training Award for its work. |
Training for Work (TfW) was launched in April 1993 and is the main state-funded training programme for unemployed adults. By way of illustration, in March 1995, 107,500 people were receiving training under the programme. The budget for 1995-96 will be £578 million. Individuals aged 18-63 who have been unemployed for six months or more are eligible, but priority is given to those unemployed for over 12 months. Access to the programme is also facilitated for persons with disabilities, the victims of large-scale redundancies, members of the armed forces, ex-prisoners, persons needing literacy, numeracy or basic English training, and persons returning to the labour market.
Training for Work is managed by TECs and LECs, which contract with training providers for the delivery of programmes. Training is provided according to the local labour market needs identified by TECs and LECs. Individuals receive guidance as to the most appropriate programme.
Although Training for Work is funded mainly by the State, it is also supported by placement payments by employers. Funding has been reduced and is increasingly output-related and dependent on trainees obtaining qualifications and/or jobs. The aim of training providers is often to minimize training costs and for most training to be provided on the job by the employer. A typical trainee may attend the training provider's training centre one day a week and spend four days on placement. For employers, the incentive to participate is to obtain a cheap trainee for the training period who, while needing training, will also contribute to production. The trainees continue to receive unemployment benefits while training. The training period can also serve as a vetting period for employers, who can then decide whether to employ the trainee. However, employers are under no obligation to employ a trainee at the end of the training period, and there is a danger that individuals may be exploited as "cheap labour" in situations where there is no vacancy at the end of the course.
Although the outcomes of Training for Work are better than comparable schemes before the establishment of TECs and LECs, they are still relatively poor. Around 46 per cent of trainees who complete their training find jobs, or enter self-employment, full-time education or other training. Some of these outcomes might, of course, be achieved without any state intervention. A problem of Training for Work is that the funding and length of training provided may be insufficient to meet the skill needs of enterprises, since the duration of courses tends to be less than six months.
The programme has been most successful when customized courses are designed specifically for enterprises with skill shortages and offer definite vacancies for successful trainees.
Comet is a major high street electrical retailer, which faced a recruitment problem in 1994, when it was unable to identify suitably qualified audio engineers for the Leeds sales and service headquarters. Candidates who had the relevant qualifications lacked the experience to be effective in the workshop and could not be recruited without top-up training. The Leeds Training and Enterprise Council entered into three-way discussions with training providers and Comet. It was agreed that Comet would provide premises, equipment and materials for the training, with the training provider supplying the expertise and administrative support. The TEC would provide funding under the normal Training for Work rule and quality assurance. A customized training scheme was set up under the auspices of Training for Work to offer long-term unemployed electronic servicing engineers with little or no practical experience, the opportunity of in-house training, as well as the possibility of full-time employment with Comet. Candidates, who were required to hold an intermediate-level electronic servicing certificate, were recruited by the state employment service and colleges for the first training scheme, which commenced in June 1994. This began with an intensive eight-week theoretical and practical training programme at the Comet after sales service headquarters in Leeds. The aim was for all the candidates to obtain an audio qualification. Six of the trainees were offered full-time employment with Comet and a further ten trainees were taken onto a second scheme. In all, 22 trainees have now been employed by Comet and one has found work with a smaller local enterprise. The TEC is now sufficiently satisfied with the company's training to contract directly with the company to deliver the training. Comet is now considering introducing a similar scheme in other sections of its service headquarters. This will benefit local long-term unemployed people by enabling them to improve their skills and gain access to jobs which would not otherwise be open to them. |
State action to encourage investment by enterprises is needed to improve the skills base in the United Kingdom. However, government financing is directed almost entirely towards the training of those who enterprises are unlikely to fund, namely the unemployed and new entrants to the labour market, through programmes which have social and political, as well as economic aims. The employers' body, the Confederation of British Industry (CBI), believes that too much effort is expended on equipping the unemployed to return to work, rather than upskilling or reskilling the existing workforce, which could have a more direct effect on the local and national economy.
TECs and LECs were introduced as a partnership mechanism to bring together state and enterprise resources. However, the potential to influence local economies has been reduced as discretionary funding for local projects has been eroded. Moreover, tension exists in the concept of TECs and LECs. They should be local organizations, run by local enterprises and responding to local needs, but their remit is to deliver nationally devised and regulated state training programmes. If their contracts with the State were to be more flexible, they would be more successful in meeting the needs of enterprises and it is likely that training would be directed towards those most likely to produce results in terms of qualifications and jobs. However, equity might suffer as TECs focused on those most likely to succeed in obtaining jobs and qualifications. Differential funding for individuals from disadvantaged groups would need to be maintained or increased to ensure equity and equality of access to training opportunities.
The Government has improved the quality of the training offered under its training schemes by adopting the system of payment by results. However, there are dangers in harnessing a system of payment by results to qualifications that are assessed at the initial stage by those likely to gain financially from the success of trainees. But these are outweighed by the advantages to enterprises of qualifications that can be used as measurements of the quality of on-the-job training.
A major focus of government activity is to encourage greater enterprise investment in existing workforces through the Investors in People programme, which has had an important impact. It encourages employers to invest in training as part of quality processes, in line with business objectives. State investment in the programme is relatively low and the paybacks are potentially high in terms of the more effective use of private sector funding for training.
However, the quality standard ISO 9000 (formerly BS5750) is much more widespread, particularly among SMEs, than Investors in People. Enterprises readily make the connection between quality, profitability and competitiveness, and ISO 9000 is required by major manufacturers from their suppliers. Investors in People would spread more quickly if it was imposed down supply chains. Some large enterprises might be willing to do this, but the State could take a lead by making the Investors in People commitment compulsory from its own suppliers.
For SMEs, obstacles to training include its cost and difficulties in arranging cover when an employee is absent for off-the-job training. However, collaborative partnerships with other enterprises are beginning to attract SMEs. The recent small firms training challenge takes up this scheme, but the programme is limited to small enterprises and excludes collaboration between large and small enterprises. An extension of state funding for training partnerships and collaborations in training using large company facilities would benefit large enterprises by offsetting their training costs and small enterprises by providing accessible training.
Another way forward is open learning, which is cost-effective and can be delivered on site. Many enterprises are now using open learning. The development of new technologies and training media, such as interactive video, means that training can more be easily delivered through open learning materials. However, SMEs are not generally aware of the benefits of open learning and how it can help train part-time and shift workers. TECs and LECs have an important role to play here. More information is therefore needed by SMEs on the benefits of training in general and of open learning in particular. There is also scope for collaboration in this area between large and small enterprises.
It is important to continue to focus on the development of intermediate, supervisory and management skills, particularly for SMEs. The Skills for Small Business programme and Small Firms Training Loans are useful initiatives in this respect and should be encouraged and developed. The system of national vocational qualifications, with its emphasis on the training of supervisors as in-house assessors, has a role to play in this connection, as supervisors become trainers.
With regard to training for young persons, the Youth Training programme has proved to be effective in involving large numbers of enterprises in helping to train new entrants to the labour market. Good quality training linked to labour market needs can be delivered to young people through the programme. Some Youth Training programmes have more than enough applicants. However, many programmes are not sufficiently attractive to encourage well-qualified school-leavers to choose them in preference to staying at school and entering higher education. Participation in education after the age of 16 is very high. But the question arises as to whether more attention needs to be paid to bringing young people over the age of 18 into the vocational training system. Participation in higher education has been pegged by state funding restraints at around 30 per cent of school-leavers. The remaining school- and college-leavers will need further training, or jobs with training, if they are to develop the skills needed in the economy. Some provision has been made under what are known as Accelerated Modern Apprenticeships, but this will be insufficient to meet the needs of all young people over 18 years of age.
Training for the adult unemployed raises important political, social and economic issues. Training and retraining the adult unemployed is an important aspect of state policy, but most participants in the major current programme, Training for Work, do not achieve either a job or a qualification. The programme is not therefore meeting the needs of enterprises and needs to be better focused. Customized training programmes for the unemployed, which meet the needs of particular employers with skill shortages, have had much greater success and provide a better return on public investment than "training for stock". Most Training for Work programmes are short in duration and may be insufficient to raise the skill levels of the long-term unemployed to the levels needed by enterprises to get them "job ready". More higher level programmes are needed. These will undoubtedly be longer and more expensive. A solution would be to cut numbers and improve quality, but this would create political difficulties.
Other means of training the adult unemployed are available, but are not currently funded by the State. These would be cheaper in many cases than the current state programme and could help maintain or increase the numbers trained if the main programme were to be refocused. Training for the adult unemployed is mainly available through specific courses funded by the State and devised to meet skill shortages identified in local labour markets. However, there have been good results in cases where the unemployed have been allowed, through special schemes, to purchase a wider range of training than is normally funded. This implies that this type of training meets the needs of enterprises. Shortages of specialized skills are often identified which are not brought to light by local labour market information. In one case, this type of individualized training was provided by purchasing open learning programmes for the unemployed. In another instance, unemployed people were issued with training vouchers enabling them to buy any training that met their needs. Training vouchers were relatively low in value (£300), but some individuals and employers topped up the vouchers with their own funding. Vouchers can be a successful way of empowering the unemployed to upgrade their skills. They also fit the Department for Education and Employment's strategic priority of developing "individual commitment" to training, while at the same time providing incentives to employers to recruit the long-term unemployed.
In the light of these conclusions, the following recommendations may be made:
Bennett, R. J. and McCoshan, A.: Enterprise and human resource development: Local capacity building, Paul Chapman Publishing Ltd., London, 1993.
Bennett, R.J., Wicks, P. and McCoshan, A.: Local empowerment and business services: Britain's experiment with Training and Enterprise Councils, UCL Press, London, 1994.
CBI: Training and Enterprise Councils: The way forward, CBI, London, July 1989.
--: Making labour markets work: CBI policy review of the role of the TECs and LECs, CBI, London, 1993.
--: Industrial Trends Survey, CBI, London, 1995.
Crowley-Bainton, T.: TECs and employers: Building effective links Pt2, Research Series No. 13, Department for Education and Employment, 1993.
--, and White, M.: Costs and benefits of National Vocational Qualifications to Employers, PSI, 1993.
-- and Wolf, A.: Evaluation of the access to assessment initiative, Department for Education and Employment, 1994.
--: Evaluation of the Open Learning Credits Pilot Programme Summary report, Research Series 45, Department for Education and Employment, 1995.
-- and Christie, I.: TEC challenge evaluation, Department for Education and Employment, 1995.
Department for Education and Employment: Training for Work: Keys to success, Sep. 1994.
--: Labour Market Quarterly Report, Aug. 1995.
IFF Research: Skills Needs in Britain: 1994, IFF Research, London, 1994.
MSC, NEDC and BIM: The Making of Managers: A Report on Management Education, Training and Development in the USA, West Germany, France, Japan and the UK, Manpower Services Commission, National Economic Development Council and British Institute of Management, NEDC, London, 1989.
Nove, A.: Skill needs of small firms in Britain 1994/95, PAS, High Wycombe, 1995.
TEC National Council: TEC Key Facts, London, June 1995.
--: The Training and Enterprise Directory 1995, Kogan Page, London, 1995.
Training Agency: Training in Britain: A study of funding, activity and attitudes, HMSO, London, 1989.
Vaughan, P.: TECs and employers: Building effective links Pt1, Research Series No. 12, Department for Education and Employment, 1993.
Relevant United Kingdom Government White Papers:
DES/ED/WO: Education and training for the 21st Century, Cmd 1536, HMSO, London, 1991.
DTI et al.: Competitiveness: Helping business win, Cmd 2563, HMSO, May 1994;
--: Competitiveness: Forging ahead, Cmd 2867, HMSO, May 1995;
Department for Education and Employment: Training for jobs, Cmd 9135, HMSO, London, 1984;
--: Employment in the 1990s, Cm. 540, HMSO, London, Dec. 1988;
--: A strategy for skills: Guidance from the Secretary of State for Employment on training, vocational education and enterprise, Nov. 1991;
--/SO/WO: People, jobs and opportunities, Cmd 1810, HMSO, London, Feb. 1992;
--: Prosperity through skills: A statement from the Secretary of State for Employment on his vocational education and training strategy for Great Britain;
--: Training in Britain: A guide;
--: Prosperity through skills: The National Development Agenda 1995;
Access and opportunity: A strategy for education and training, Cmd 1530, HMSO, London, 1991;
Industry Department for Scotland: Scottish enterprise: A new approach to training and enterprise creation, Cm. 534, HMSO, London, 1988.