Bringing back manufacturing jobs?

 

The UK is not an industrial economy in the traditional sense, despite what some politicians try and persuade us -remember George Osborne’s ‘march of the makers’. Like other countries, the proportion of the GDP devoted to manufacturing has dwindled as consumers become richer and spend a larger proportion of their income on services.  Though it is also true that the process of ‘deindustrialisation’ has been more acute and taken place more quickly than elsewhere. 50 years ago, around 8 million people were employed in manufacturing and the sector absorbed about a third of school leavers. Even as recently as 1982 the sector continued to employ 22% of the workforce. Today 2.6 million earn a living working in manufacturing – barely 8% of all workers, while the sector contributes 10% of national output –down from 14% in 1997.

The decline of manufacturing has been blamed on specific events, or even specific people – for example, during Mrs Thatcher’s first term of office, almost 1 in 4 jobs in the sector disappeared, while more recently, ‘deindustrialisation’ has been linked to the increased ‘outsourcing’ to countries with lower labour costs –  President Trump has pledged to both reintroduce protectionism and to punish American companies that relocate abroad. Unlike in other countries, UK manufacturing has also been hindered by the lack of any real national Industrial Strategy, or anything resembling a National Investment Bank.

Despite all this and despite representing a declining share of GDP, the UK continues to be the world’s 11th largest manufacturing nation – and ONS figures show UK industry has continued to increase on average by about 1.5% a year since 1948 with the sector still accounting for 44% of all exports. Productivity growth in the manufacturing sector has also been stronger than in most other sectors (3.4% compared to a 0.2% increase for the economy generally). Advanced production techniques, mean that three cars roll off the UK’s production lines every minute and output in 2014 was 25% than in 1990, yet employment has fallen from 502,000 in 1971 to the current total of 142,000.

The main reason for both the increase in productivity and the decline of employment in manufacturing has been the introduction of new technology. According to 2015 survey by the Manufacturer on-line journal,koncir_milan-1024x576 little under half of respondents said that they are in the process of implementing a major project, and 21% said that they last did so in 2014. This means that just under two-thirds of UK manufacturing businesses committed to major automation projects in the past two years. Investment in information and communications technology (ICT) continues an upward trend; 61% said they are spending more that year than last.

Even so, the speed at which automation will be introduced should not be overstated – investment in robotics by British manufacturing companies for example, continues to trail that elsewhere. Governments have continued to complain about a shortage of skills, but the number of apprenticeship vacancies posted by the manufacturing sector in 2015/16, was under 30 000 – the majority of these being at a relatively low (skill) level. 

More on the Skills Plan

The DfE and BIS published the long awaited post-16_skills_plan  in the summer of 2016. Based on recommendations from the Sainsbury Review, its main proposal was a new ‘technical route’ with qualifications available from Level 3 and above and with parallel status to the academic pathway. Now included in Theresa May’s industrial-strategy                                             

New technical qualifications are proposed in 15 occupational areas. The new programmes will, it’s argued have ‘genuine labour market value’; be available from 2019, designed by panels of employers and other representatives from industrial sectors. Each programme will include a ‘common core’ including English and maths requirements and digital skills as well as ‘transferable skills’. They will also include work placements.

We should welcome all attempts to improve education and training opportunities for a generation of young people facing increasingly insecure and uncertain employment prospects and recognise that not everybody may want to continue with specialised academic study post-16: nevertheless, its shortcomings can be identified below. 

To begin with, this has all been tried before. Labour introduced (post-14) Specialist Diplomas for different occupational areas in 2008 – also designed by employers – but with a low take up they were abolished by Michael Gore within hours of his coming to office. It could certainly be argued that delaying choices till 16 is a much better outcome, a key recommendation of the Wolf Review.

Schools have been excluded. Young people wishing to follow one of the new routes need to transfer to local colleges, which, it must be assumed, will now be organised through new Institutes of Technology announced by May.   Many schools will be reluctant to lose large numbers of sixth form students as there will be serious financial implications. Improved relationship between schools and colleges will be required. Alternatively, schools will continue to offer the Applied awards -like those for Business Studies, Health & Social Care and Information Technology, which do not currently count towards Tech Level qualifications.  Applied qualifications attract approaching 100 000 students every year.

Though May has promised to inject £170 million, many of the further education colleges that are expected to deliver the new technical qualifications will remain under huge financial pressures. The current area reviews of post-16 education may reduce opportunities for technical and vocational learning still further as colleges are closed or merged.  Private providers are also likely to expand.

In recent years, Post-16 students have continued to use vocational and technical qualifications for university entry, but they have often mixed these with academic courses. The new proposals, despite a promise of ‘bridges’ between the two pathways will largely put an end to this practice.  Meanwhile academic education remains unchanged and there are no plans for future reform.

The new technical route will be linked to employment based apprenticeship   training, but the government has not been able to deliver real apprenticeship opportunities for those under 19.  Most remain at Level 2 (GCSE equivalent) and are started by adults/existing employees. It won’t be possible to transfer from the technical to the apprenticeship route as the Plan implies. Beginning an apprenticeship is dependent on having a full-time job.

Many studies of the labour market also suggest that ‘middle’ and ‘technician’ level jobs are disappearing because of technological changes and automation.  Many studies of the labour market also suggest that ‘middle’ and ‘technician’ level jobs are disappearing because of technological changes and automation.  While there is a need for young people to have better generic and transferable skills, it isn’t clear if the specific occupational skills the government says there is a shortage of will continue to be required.  Wouldn’t it be better for everybody to enjoy a good general education and then have access to specific job training, if and when required?

Arguably the Plan is less to do with developing employment skills and is more about  trying to stem the number of young people going on to higher education as a result of the absence of  proper alternatives, but ending up ‘overqualified and underemployed’

 

A new technical route?

Technical and vocation education would appear to be one of the main thbeneficiaries of Theresa May’s new ‘industrial strategy’.   May has announced £170m of additional funding for institutes of technology (we assume this will involve an upgrading of existing FE provision on a regional basis)

While several high-tech sectors have been identified, the government will use the industrial strategy to relaunch the post-16_skills_plan one of the last policy statements produced by David Cameron’s administration which sets out 15 new routes into high skilled employment, enabling those young people not going to university to gain a technical qualification at level 3 and above.

Though this will sound an attractive opportunity for many who work in the UK’s ailing and underfunded college sector, it isn’t clear whether it will help employment opportunities for the 50 % of young people who don’t go on to HE – neither is it a particularly new idea (remember New Labour’s infamous 14-19-specialist-diplomas, which were axed by Michael Gove during his first week as education minister?)

In the past, there may have been some truth in the argument that Britain had fallen behind other countries in terms of the level of ‘intermediate’ skills held by its workforce and many commentators continue to see the German system of vocational education and apprenticeships as the way forward. But it’s now increasingly recognised that many skilled and ‘technician’ level jobs across the economy are disappearing because of further  automation and digitisation and that where they do continue to exist, they are likely to be filled by graduates who find themselves ‘overqualified and underemployed’.

So, it’s unclear whether ‘vocational alternatives’ are really needed, or whether young people should be encouraged to develop more generic/general skills to enable them to move across different economic sectors and to be able to take up very different types of employment during their working lives. But, in any case it’s also very possible that there won’t be enough highly skilled jobs for everybody qualified to do them and that (as is the case now) it will be unskilled work at the lower end of the service sector that will continue to increase. 

In other words, it’s likely that its growing inequalities, rather than lack of skills that will be the main problem in labour markets of the future and thus governments will need alternative strategies to address these.

Apprenticeships : many more applications than vacancies

Recent Department for Education statistics show that the number of apprenticeship applications far outstrip the number of apprenticeship vacancies.

For example, between Aug 2015/16 there were a total of 1,656,680 applications for 211,380 vacancies a ratio of about 8 to 1 – about half of these were from 17-18 year olds. Three quarters of vacancies were for Intermediate (GCSE level) positions. The figures do not allow us to calculate the number of young people wanting apprenticeships because they will include multi applications, but they do reflect a continued shortage of opportunities. The largest number of vacancies are in the Business, Administration and Law category – well over a third. In comparison, there were just over 8000 vacancies in Construction ( a sector considered to be suffering from skill shortages) and  30 000  in engineering and manufacturing, a 20% increase on the previous year.  

These totals are based on ‘on-line’ vacancies only and do not include the large number of (mainly low-level) apprenticeships created by regrading existing existing workers, allowing employers to qualify for funding

Full statistics: 

https://www.gov.uk/government/statistical-data-sets/fe-data-library-apprenticeship-vacancies-archive

14-19 hiatus

As 2016 draws to a close we are still awaiting a statement on the English Baccalaureate/ upper secondary curriculum from new Secretary of State. Justin Greening – the  consultation period for Ebacc ended almost a year ago.

Nicky Morgan’s – now largely shelved –White Paper Educational Excellence Everywhere reaffirmed the Cameron government’s objectives of a 90% participation rate in the Ebacc subjects, but with entry rates for Modern Foreign Languages (MFL)  continuing to fall  (in all other Ebacc areas they  continue to rise)  this has surely become unreachable? The Ebacc is not being prioritised as a performance indicator by Ofsted, leaving schools to concentrate on maximising their Progress 8 score.

Although Progress 8 is driven by Ebacc subjects, students do not have to do the complete Ebacc to maximise their scores. This explains why the provisional statistics for 2016 recorded a ‘neutral’ -0.03 overall average score for Progress 8, but only a 39.6% entry and a 24.5% pass rate for Ebacc. The Department for Education made no comment on this ambiguity.  Perhaps Secretary of State Greening would rather the EBacc slide off the agenda and avoid conceding victory to the well organised and high profile Bac for the Future campaign, we should still expect an announcement of some sort though.

But as a result of the way it has been constructed – and that Key Stage 2 SATs results are being used as the baseline for value added calculations, Progress 8 cannot be considered an improvement on the Ebacc or even the lesser of two evils. Indeed the recent Kings College research on the effects of the Key Stage 4 reforms,   sponsored by the NUT,  reports widespread concern by teachers about its reliability and workload implications. Examination data also shows that non Ebacc subjects continue to be marginalised and that large numbers of secondary schools are beginning their GCSE programmes during Year 9. 

Compared with Ebacc, there has been little, if any discussion about how to oppose Progress 8. Can it be reformed to allow a broader range of subjects to be included? Or should the main emphasis be on trying to find other value added measurements, rather than Key Stage 2 SATs?

2016 has seen the further erosion of vocational education at Key Stage 4 – the result of the Progress 8 requirements, but also Michael Gove’s qualifications cull   which has prevented schools using a ‘vocational track’ at KS4 as no qualification can now be equivalent to more than one GCSE, if it is to be included in league tables -the Wolf Report also recommended no more than 20% of a student’s timetable should be spent on vocation learning.

2016 however, saw the publication of a  post-16_skills_plan even though the planned consultation appears to have been delayed. The Plan sets out proposals for new technical route into employment (the term ‘vocational’ is to be discarded) with new qualifications planned for 15 employment areas. Though not due to begin until 2019 at the earliest, the technical route will be ‘college based’.

At first sight this would appear to have significant implications for school sixth-forms which have continued to provide vocational courses as alternatives to A-levels, but most of the Business Studies, Health and Social Care and ICT  ‘BTEC  type’ qualifications offered by schools are now classified as ‘Applied’ and will be  outside of the more occupationally specific technical track.

2016 also saw government continue to promote apprenticeships as an alternative to university for young people, the development of new ‘trailblazer’ specifications and the firming up of details for the employers levy.  Yet over half of apprenticeship starts continue to be only level 2 (GCSE equivalent) and less than a quarter are by those under 19. With any guarantee of progression or even future employment, most young people that can, will continue with the academic route with the aim of progressing to university.

During 2016 a great deal of debate has taken place about 14-19 education, especially the design and suitability for particular students, but there has been little progress with developing alternatives. Neither has there been a real appreciation of the type of labour market that young people seek to enter – the implications of changes in the occupational structure for the future of many technician level qualifications for example, or that large numbers continue to end up in jobs for which they are over-qualified

If the immediate focus should be on developing curriculum alternatives, then over the longer term,  because many young people are now no longer able to rely on education to ‘move on’, the real problem may be  its potential loss of legitimacy.

Education’s ‘Great Reversal’

They used to  focus  on skills shortages, but now more labour market commentaries are emphasising the under- utilisation of skills and qualifications;  particularly in relation to the excess supply of graduates compared to the number of ‘graduate jobs’ available.  More recently still, concern has focussed on the extent of unpaid student debt  – the consequence of graduates not earning enough to hit the pay back threshold, with estimates suggesting that with many graduates  trapped in low-paid jobs, up to half it may never be repaid.  This is Alison Wolf’s starting point and the justification for the Remaking of Tertiary Education[i] in which the influential Wolf calls for a sub-degree pathway providing more cost effective opportunities for young people to enter employment.

As Wolf correctly recognises, qualifications like Higher National Diplomas have long since disappeared as polytechnics have become degree issuing universities. Her proposals tail the Department for Education’s Post-16 Skills Plan[ii] which also outlines a new college based ‘technical’ pathway between academic education and work based apprenticeship training.

The problem is that (as Wolf acknowledges) the nature of the occupational structure is changing.  The expanding middle of the post-war period which generated most of the new technical jobs has been replaced by an ‘hour-glass’ or has gone increasingly ‘pear shaped’   – as more work has been automated and those who would have been expected to end up in ‘the middle’ being pushed down into less skilled and less well paid employment, but also finding that where this sort of employment continues to be available, employers are able to recruit graduates.

This is the reason for mass enrolment in higher education.  Despite the high fees, which were supposed to ‘price’ large numbers  out of HE, young people continue to enrol because even though having a degree may earn you less than it used to, in most cases it still provides  a ‘premium’ compared to being without. Unless a sub-degree qualification –which would be completed in two years and charge lower fees  -or a technical route, offers guarantees of a job and with few opportunities to complete more than a low-level and dead-end apprenticeship, there  would seem to be little chance that large numbers would reconsider anything but a university route.

Progressives should not support these ‘alternatives’ they are part of a  Great Reversal of education policy.  Despite its contradictions and distortions, mass participation in higher education, just like the comprehensive education that’s driven it, is a positive development and something not considered possible even  thirty years ago.  Higher education needs to be reorganised to accommodate these developments. Rather than offering different types of education, for different types of young people FE colleges and universities should be part of  local networks  of post-16 provision available to all and not only offering a variety of courses but a variety of assessment methods and different time frames.

 

[i] Remaking Tertiary Education: can we create a system that is fair and fit for purpose?

http://epi.org.uk/wp-content/uploads/2016/11/remaking-tertiary-education-web.pdf

[ii] Department for Education/ Department for Business, Innovation and Skills. Post-16 Skills Plan

https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/536043/Post-16_Skills_Plan.pdf