How to build back better? Boost basic skills

26 April 2021

By Andy Norman

4 minute read

New research shows why improving basic skills coverage in Birmingham should be a priority for the next mayor of the West Midlands CA, writes Andy Norman for the LGC.

For many years, the main focus of skills policy in England has been at level 3, equivalent to A levels. While this is where the strongest wage gains for learners begin to kick in, we must not forget about the importance of basic skills. New research from the Centre for Progressive Policy shows that reducing the number of people who lack any formal qualifications is a vital step towards building inclusive local economies.

In 2006 the influential Leitch Review of Skills sought to shift the balance of intermediate skills in the UK to level 3. A decade on, another major review of skills – this time led by Lord Sainsbury – set in motion the development of T-levels, a new range of technical qualifications at level 3. And now the centrepiece of Boris Johnson’s new Lifetime Skills Guarantee is a free first level 3 qualification for all adults.

This approach has much to commend it. Research has consistently shown that it is at level 3 and above that wage and productivity gains really kick in. But let’s not forget about those at the bottom of the skills spectrum, the people who lack any formal qualifications whatsoever. We now know they are more likely to have lost their job because of the coronavirus and less likely to quickly bounce back into employment. Even in normal times, without any certifiable skills people are cut adrift from prosperity.

Building inclusive and resilient local economies requires high coverage of basic skills. Previous CPP research has shown that areas with low coverage of basic skills saw bigger increases in unemployment and bigger falls in GVA following the 2008 financial crisis.

Unfortunately, there is still significant place-based inequality in basic skills coverage across England. In some parts of the country, only about one in 40 people lack any formal qualifications. In others, it’s as high as one in five. New CPP research suggests that this disparity comes at the cost of lower employment. Using a new statistical model, we estimate that employment would be up to 573,000 higher if basic skills coverage in all areas of England was as high as the top 10% of local authorities.

More than half of this missed employment uplift is concentrated in the most deprived 20% of local authorities. Despite being a major economic centre in the Midlands – and the UK more widely – Birmingham has some of the highest levels of deprivation in the country. Our research shows that increasing basic skills coverage in the city could boost employment by up to 28,800, helping to drive inclusive growth. This should be a top priority for the next mayor of the West Midlands.

Reengaging people without any qualifications in formal learning is, almost by definition, very difficult. These are the people for whom the school system failed to deliver any certifiable knowledge or skills. But breaking down barriers to learning is possible. Supplementing training programmes with comprehensive support for learners – ranging from free childcare and transport to pre-employment and career readiness services – have been shown to be effective. For example, Barking & Dagenham LBC offers financial support for childcare, travel, specialist equipment and course books.

There is a role for unions too, with Unionlearn showing significant success in engaging people without formal qualifications in learning. The government’s decision to cut funding to Unionlearn is therefore a lamentable backwards step.

Of course, there are no silver bullets when it comes to building prosperous and inclusive local economies. Reducing the share of people without any formal qualifications is just one policy goal of many. But it is an important one nonetheless. Without a solid foundation of basic skills, it is difficult for individuals to access decent work, businesses to move up the value chain and local government to deliver inclusive growth.

With the coronavirus pandemic threatening to push unemployment past 6.5% by the end of the year, the importance of getting people into work is only going to grow. To build back better, let’s boost basic skills.