Budget Response: Skills Required

REC & APSCo find positives and negatives in Chancellor’s initiatives.

Chancellor Jeremy Hunt has received both praise and criticism from the recruitment industry’s main representative bodies for his Spring Budget.

Neil Carberry, Chief Executive of REC says Hunt had shown an awareness of the challenges the economy faces, and was addressing those challenges – particularly through his focus on employment and labour shortages. Indeed, Carberry believes the Chancellor had adopted many of the recommendations of the REC’s Overcoming Shortages campaign. “It is also good to see government appreciate the need for an overall strategy to boost growth, given forecasts that – even at the more optimistic level set out by the OBR – are far below what we need,” he added.

APSCo were also celebrating a ‘Budget win’ as the Chancellor confirmed plans for 12 Investment Zones across the UK – a move the trade association had called for in its Budget submission earlier this year.

“The confirmation that Jeremy Hunt will create investment zones outside of London is a move we welcome and is something APSCo called for in its original recommendations to the Government,” said Tania Bowers, Global Public Policy Director for APSCo. “We have long advocated that any national skills strategy should be underpinned by investment in skills and training in urban hubs and regions with strengths in particular industries. The planned investment into sectors which continue to struggle with skills shortages including AI, nuclear and life sciences is all welcome news, however a more immediate strategy to provide the skills needed to deliver the growth the Chancellor is hoping for is required.”

In other matters there was a sense that while moving in the right direction, the Chancellor might have done more. Carberry and Bowers both welcomed the initiatives on childcare provision, but Carberry noted the changes wouldn’t come quickly enough to overcome “entrenched labour shortages” in the current economy. Bowers also noted that extra resources would be needed to actually provide in demand care.

“The big gap in today’s Budget is on skills,” claimed Carberry. “While more devolution to local areas is the right choice, government is inventing new qualifications and retiring ones that business values, rather than focusing on what will get employers investing more – reforming the failed Apprenticeship Levy. A missed opportunity yet again.”

“We welcome the focus on the ‘returnships’ and expansion of the skills bootcamps to both support the upskilling of the over 50s and increase the scope of skills,” said Tania Bowers, “however the Chancellor’s Budget doesn’t fully hit the mark on the potential skills development that could be achieved.”

Bowers believes the longer-term skills strategy for the UK also needs to be supported by a strong international labour market. “Where resources cannot be found in the domestic market, the country’s employers need an attractive route of employment for global talent. The current Tier 5 and fast track visa schemes are too narrow in focus and funding needs to be increased for the Home Office to both support existing systems and drive new visa routes which are more viable for highly skilled, self-employed project workers.”

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