The £80bn question

June 22, 2007

Can universities equip 21st-century workers with critical thinking and industry-specific skills? Success will bring huge rewards but the challenges are great, says Chloe Stothart

In December 2006, one of the UK’s top businessmen made a startling announcement: the UK has £80 billion of natural resources lying untapped. According to Lord Leitch, former chief executive of Zurich Financial Services, these buried treasures are not diamonds or coal, but people — workers who could make the British economy much stronger if they were more productive. The way to make them so, Leitch told the Government, was to improve their skills.

In Prosperity for All in the Global Economy: World Class Skills — the report of the Leitch Review of Skills, a Treasury-commissioned review — Leitch says universities should be at the forefront of a drive to equip more than 40 per cent of adults with graduate-level skills by 2020, up from 29 per cent in 2005.

Since the Leitch report, universities have launched into earnest discussions about what this skills drive means for them. The idea that the academic and the vocational are at odds has died, with vice-chancellors citing medicine and law as evidence of intellectually rigorous vocational subjects. But there is debate over where the line should be drawn between the generic skills that degrees have always provided, such as communication and problem-solving, and more specific training for employment. Most people in higher education believe that becoming too narrowly vocational is a mistake if universities are to provide skills relevant for a graduate’s whole career.

"There’s an interface between where we provide education and where employers provide training," says John Brooks, vice-chancellor of Manchester Metropolitan University. "I do not think universities should drift into training. Training with a very short life span that is very specific is not an area we should be involved in."

It is unlikely that Leitch’s targets will be met by workers taking full undergraduate degrees. It is more likely that they will take a few modules of courses that they might later build into a diploma or certificate, Brooks says. But universities should take care not to overhaul their undergraduate degrees so much that they lose coherence and value. "People know what a degree in physics or engineering means," he says. "It has a currency, and people with those qualifications get employment. We have a responsibility to ensure that the undergraduate curriculum has some rational meaning."

In the past, further education colleges were seen as the main public provider of education for the workplace. But now colleges and universities should be uniting to harness their different strengths, many in higher education say. Further education colleges often have good links with local industry, while universities can influence teaching with cutting-edge research. More collaboration would also ensure that education does not split into two separate tracks — the vocational and the academic. Students could move from the new vocational diplomas into a foundation degree that is accredited by a further education college rather than a university, once colleges gain accreditation powers under the Further Education and Training Act. "An underprivileged group will be getting a different form of higher education," Brooks says. "Students should have the absolute opportunity to progress into university. Foundation degrees planned in isolation will not have that link."

However, Derek Longhurst, chief executive of Foundation Degree Forward, says only a few colleges will get the power to accredit foundation degrees, and the bulk will be offered by universities. In addition, the accrediting colleges may still retain links with universities, so a two-track education system will not develop.

There is also heated debate about the business case for universities being involved in skills-based education. On the plus side, working with employers may bring more students into universities at a time when they are sorely needed. The sector is about to face recruitment challenges as the number of 18-year-olds drops and the strength of the pound against other currencies increases the difficulty of signing up students from overseas. An obvious way to plug the recruitment gap is to fill those empty chairs with Britain’s army of workers.

Those would-be students could also help universities meet other recruitment targets. Widening participation has proved difficult, and some think that attracting workers into education will broaden the social mix. But

it is not known if those who grasp the chance to advance through workforce education will come from the groups under-represented in higher education.

A recent report from the Higher Education Policy Institute cast doubt on whether the sector could hope to double the number of part-time students over 30 — which is what would need to happen to meet Leitch’s 40 per cent target — and it questioned whether the most socially excluded would get these new employer-backed educational opportunities.

What’s more, universities fear the pitfalls that could come from working with employers. Leitch is trying to create a demand-led system in which universities supply courses to meet the needs of employers. But universities will not want to take the financial risk of running courses in subjects where demand is uncertain; so not every employer may find the courses they want. Some universities have got around this stalemate by having employers guarantee a certain number of students, to make the course viable in the early years, or agree to underwrite losses. "The Government should provide upfront transitional investment to enable universities to develop courses if we are trying to stimulate a market — which we are, as we are not turning away thousands of people in this area," Brooks says.

Another difficulty is getting a clear picture of what different businesses want from education. Companies in the same industry often require different skills from their workers, and some employers find it difficult to articulate exactly what they want. Leitch’s vision is for the 25 employer-led sector skills councils, which represent the industries, to talk to employers about their needs and to license vocational qualifications. But some are unconvinced that the SSCs are accurate barometers of employer demand for skills education.

Martin Finlayson, senior specialist in higher education at One NorthEast, a regional development agency, says: "The sectors are large, and employers do not see themselves in terms of sectors, but as an industry." He believes one solution could be found in a group that One NorthEast helped to set up representing computer gaming companies. It works with local universities to ensure their courses equip graduates with the skills required by the industry. CS

Key points of the Leitch report

  • Individuals and employers to pay the bulk of the additional costs of expanding education for skills 
  • More funding to go through a demand-led mechanism, such as Train to Gain, with a broker helping employers find courses 
  • Sector skills councils approve vocational qualifications receiving public funding 
  • Joint funding of university chairs by employers and government
  • Better access to university for young people of all backgrounds 
  • A Commission for Employment and Skills to help employers voice their needs.

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