Last week Skills Minister Matt Hancock MP gave an interview during which he said firms have a duty to train, and employ, British workers and to resist the ‘easy option' of filling jobs which foreign workers. This he argues would give the economy a much needed boost.
It is true that manufacturers recruit employees from across the globe. With our 2012 Skills Survey revealing how businesses bring in new skills to the workforce
Seven in ten said they specifically recruit UK employees
A quarter said they recruit EU (non,UK) employees
11% said they recruit non-EU employees
A quarter said they use intra-company transfers
So why do manufacturers need such a wide pool of talent from which to recruit? The answer is simple. They cannot find the skills they need. Four in five companies said they were currently experiencing recruitment problems.
And with demand for skills in all areas of business is expected to increase in the coming years, we anticipate that these difficulties will continue. If we were to restrict supply of skilled workers (Hancock's argument not to recruit from overseas) then this will limit the ability of manufacturing firms to grow.
Now we don't like to moan and groan about the lack of skills in the domestic workplace, but unfortuantely our survey data gives us real evidence as to why manufacturers are struggling to recruit:
Two-thirds said applicants lacked technical skills
Almost half said they had an insufficent number of candidates
Four in ten said applicants lacked relevant qualifications
Over half said applicants lacked experience
This lack of skills then has implications on manufacturers' ambitions on innovation, exporting and wider growth strategies. Our Invest for Growth report for example found that access to a supply of skilled workers already influences businesses decisions where to invest. Yet, they are commited to invest in their workforces as their most significant investment plans were focused on staff training and skills development.
Whilst I can see the argument that employers should be training and investing in their employees, and particularly potential young employees, this is already happening. Here's a few stats to support this:
Two-thirds of our members currently offering Apprenticeships
Three-quarters said they offer Apprenticeships specifically for 16 to 18 year olds
Over a half of manufacturers said they had increased their training budgets in the past two years
Six in ten firms said they plan to increase training budgets in the next two years
Still need convincing? Ok then I could talk about all the excellent case studies and evidence we have of manufacturers engaging with young people through schools, colleges and universities, so that they can actually attract young people into manufacturing.
Seven in ten manufacturers offer work experience
Over a half offer site visits or go into schools
A third offer internships
Three in ten sponsor students throughout university
But the Government hasn't made this very easy. Employers regularly cite barriers to engaging, and Government policies are actually breaking down the relationships employers build with local schools including removing compulsory work experience at Key Stage 4.
This is particularly damaging given that UK nationals are less likely to work in manufacturing as EU(ex UK) nationals. In the Government's recent Review of Balance of Competences Free Movement of Persons it reveals that whilst 10% of UK working age nationals work in manufacturing, 15% of EU (ex UK) do.
And if we are to start the debate that British firms must employ British workers, is Government suggesting employers recruit only British students too?
We blogged recently about the idea put forward by The Forty Group recently on introducing a cap for non-EU students.
If Hancock's comments include employers focussing solely on British students, then this would restrict the talent pool even further. Let's for example look at applications to study Engineering at university. Currently 18% of acceptances are for non-EU students - a route which Government has already cracked down on by abolishing the post-study work route. If Government were to then tell businesses not to recruit EU students, that's a further 7% of talented graduates manufacturers don't have access too.Similar trends can also be seen for technologies, computer sciences and maths.
In comparison to the restrictions placed on employers wanting to recruit non-EEA workers (we won't go into the difficulties now), the free movement of persons has been a real success story, with businesses becoming familiar with the ability to recruit skilled workers from the EEA, widening the talent pool they desperately need to fill their vacancies - of which 29% are hard-to-fill.
If Government wants to boost the economy, and give manufacturing the support it needs, then it must resist the temptation to tell businesses who to recruit. It is employers that know what skills their business needs, it is employers that know what vacancies they need to fill, and it is employers that are proactively engaging in their future workforces. So how about letting employers recruit who is simply best for the job. Far from being the 'easy option' it is sometimes the 'best option.'