As we continue to mark Manufacturing Week with our we ♥ manufacturing campaign, the Chairman of the Commons Business Select Committee, Peter Luff MP, has written a very positive article on the importance of manufacturing, in which he argues:

"[We should] stop talking manufacturing down.  I get more than a little irritated when politicians and journalists lazily talk of the decline of manufacturing. Yes, I know manufacturing’s share of GDP has shrunk, but in absolute terms we are making more things than ever.  We are the sixth largest manufacturing nation on the planet. We are number two in the world in aerospace. We are number two in the world for life sciences. We are number one in the world in motorsport – and that’s a huge and highly specialised industry employing thousands of engineers. We have the second largest premium car industry in the world. And we have a lot of more traditional industries too – chemicals, metals, bricks and so on that can still flourish in a globalised carbon-conscious economy.

Readers from outside the world of skills policy (a confusing place of shifting sands, jungles of tangled bureacracy and constantly mutating acroynyms) may be forgiven for not knowing that it is currently National Apprenticeship Week.

The initiative is being led by the new National Apprenticeship Service (NAS), one of the new bodies which along with the SFA and YPLA is replacing the LSC (do keep up).

Apprenticeships are hugely valued by employers, as an establilshed model for high-quality work-based training, and it is reassuring that there is a degree of cross-party support for them. 

But the squeeze on public spending presents challenges, and the case for apprenticeships (including those for post-19 learners) needs to keep being made.  As I have said in an article for Personnel Today a long-term outlook is essential if we are to guarantee that apprenticeships are valued for life, not just for this one week.

Friday 13th may be unlucky for some, but for Lord Mandelson, last Friday was an important day.  Hardly anyone, except for consitutional geeks like me, will have noticed, but it was the day on which Statutory Instrument 2009/2748 came into force.

This piece of secondary legislation, approved by The Queen personally at a meeting of the Privy Council last month, goes by the long title of the Ministers of the Crown, Secretary of State for Business, Innovation and Skills Order 2009.  As the name suggests, it puts on a legal footing the changes announced by Gordon Brown in his reshuffle in June, when he gave Lord Mandelson his new empire, and merged the short-lived DIUS with BERR.  Whilst the change in ministerial title took effect immediately (Her Majesty can call her Secretaries of State what she likes, and perhaps in private, she does), the actual merger or creation of Departments takes legislation to transfer their functions and amend existing legislation.

So the latest Order asserts grandly that 'The person who at the coming into force of this Order is the Secretary of State for Business, Innovation and Skills and any successor to that person is by that name a corporation sole.'  It then goes on to transfer the functions of the Secretaries of State for DIUS and BERR to the new overlord, and to clarify that actions taken by those previous Secretaries of State still have legal force.

The most notable element in this order is that the actual transfer of functions itself is relatively simple, transferring the entirity of the old Departments' functions to the new one.  The order two years ago creating BERR and DIUS (as well as DCSF) was much more complex, having effectively to split two departments into three.  A look at that document shows how disruptive and messy organisational restructures can be, and why they should be avoided if at all possible. 

Institutional instability has a very disruptive effect on businesses, and recent structural changes (notably in the skills sector) have risked adding to existing confusion.  Some Parliamentarians have rightly expressed concern about the ease with which Prime Ministers chop and change Departments, and this little-noticed report  by the Public Administration Select Committee is well worth a read.

It’s the third Thursday in August, so it must be A-Levels day.  The annual rituals are now well-established: From before dawn, newspaper columnists and education experts have taken their places in television and radio studios for the annual “Dumbing Down Debate” (more of a pantomime, really – “Oh yes they are!”  - “Oh, no they’re not!”).   Many will not have waited for the actual results, and already published their denunciation of the quality of exams in the weekend press.  Others will wait until tomorrow to dust off tired clichés about how the “all-must-have-prizes” mentality is “devaluing” the “gold standard”.   

Proper analysis of the results inevitably gets rather buried by the flurry of pictures of grinning, leaping teenagers (do drama students rehearse for it?).  However, it is worth looking beyond the overall pass rate at the trends which the national data from the Joint Council for Qualifications reveals. For the second year running, there has been an increase in the number of students taking science and maths subjects, whilst as a percentage of the overall exam entries they have remained fairly constant.  This is welcome news for manufacturers in dire need of such skills, and there are encouraging signs in the AS figures that the numbers will continue to increase next year.  But there is a long way to go to reverse the decline that these subjects have suffered in recent decades, and at this rate it will take a long while to return even to the levels of ten years ago. 

Of more concern this year is the large number of students who will fail to find a place at university due to the increased demand outstripping the funded places available.  The Government announced just 10,000 extra places as an emergency measure, and failed to provide the extra teaching funds even for these.  As a result, many leading universities have refused to take up their extra allocation, believing that the quality of courses would suffer if existing funds have to be spread more thinly. A big risk in the current recession is that companies will lose vital skills when they are forced to lay off staff.  It is an equal danger now that young people interested in studying subjects vital to the economy are also being lost as they fail to find university places. 

The Higher Education Minister David Lammy has today said disappointed students “shouldn’t panic” and that there is “a broad range of options open to them including clearing, reapplying for next year or seeking work experience “.  Whilst there are of course valuable alternatives, how many potential engineers and high-skilled workers can we afford to see spending the next year backpacking round the world, flipping burgers, or enrolling on other degrees instead?

The Times Education Supplement has the news today that Lord Mandelson is considering giving Regional Development Agencies responsibility for drawing up skills strategies, which would then be implemented by the new Skills Funding Agency (SFA). 

Our Head of Economic Policy Lee Hopley has responded to the report here. Many manufacturers, and employers as a whole, will despair at yet another structural reorganisation in a system already in need of stability and simplification.  Such changes are happening with increasing frequency, it seems: the Learning and Skills Council is being abolished after less than ten years; the Department for Innovation, Universities and Skills lasted less than two; and now the Skills Funding Agency is being reformed before it has even been formed in the first place. 

Nevertheless, the debate over whether skills policy and funding should be set on a regional or sector-specific basis is one worth having.  It has always been our view that it makes more sense to look at specific sectors of industry, rather than on regional geography. 

There may be some areas of manufacturing that are defined principally by their region (cheese-making, perhaps?) - but is there a peculiarly North Eastern way of welding an aeroplane fuselage?  Probably not.  British companies operating in the same sector will have similar skills needs, regardless of where in the UK they are based – the ‘what’ is more important than the ‘where’.

Lord Mandelson’s intervention looks set to spark renewed debate on this issue, and we can expect some interesting responses from Sector Skills Councils, which would be the main losers under the proposed scheme.  By all means let's have that debate - but let's make sure that whatever the outcome, the system stands at least some chance of surviving an election and being fit for purpose for more than a couple of years.