Skills Development Scotland submission for Skills Alignment with Business needs December 2021
Skills Development Scotland (SDS) is the national skills body supporting the people and businesses of Scotland to develop and apply their skills. We look forward to appearing before the Education, Children and Young People Committee as members look into this issue at a crucial time for Scotland’s individuals and businesses.
Scotland was already facing into an uncertain and disruptive future before the onset of the pandemic in 2020. Our Strategic Plan in 2019 highlighted our understanding that the world was rapidly changing, and our plan was designed to be responsive to those existing challenges, such as Britain’s exit from the European Union, significant demographic change, the global climate emergency and the uncertain nature of the future of work, in which automation and artificial intelligence seem certain to play a bigger role.
The impact of the pandemic, on top of these existing challenges, has been profound, and we are currently working on the update to that plan, to be released in 2022.
The Enterprise and Skills Strategic Board’s Strategic Plan, released in 2018, noted that each year the Scottish Government invests just over £2bn in enterprise and skills support. This includes c£1.1bn on higher education and c£700m on further education via the Scottish Funding Council (SFC), c£76m on Foundation and Modern Apprenticeships administered by SDS as well as expenditure on various upskilling and other skills initiatives.
As Scotland deals with the challenges of the future, SDS believes it will be important to achieve a balanced portfolio of skills provision, retaining the best of our academic provision while expanding our work-based learning provision and providing re-training for those leaving declining industries. As outlined in the next section, work-based learning provision, in the form of Scottish Apprenticeships, are directly aligned with the needs of employers and industry.
Conditions for success – key attributes that best align skills provision with the needs of employers and industry
SDS administers Scottish Apprenticeships on behalf of Scottish Government, which incorporates Foundation Apprenticeships (FAs), Modern Apprenticeships (MAs) and Graduate Apprenticeships (GAs). The Scottish Apprenticeship Advisory Board (SAAB) provides authentic industry leadership to Scottish Apprenticeships and places industry at the heart of the decision-making and design of apprenticeship frameworks and standards. The Scottish work-based learning system is responsive to the dynamic nature of employer and industry needs, with investment that is demand-led and directed by skills intelligence. We will leave it to SAAB’s submission ahead of this appearance to go into detail on the leading role industry plays in Scottish Apprenticeships.
SDS believes Scottish Apprenticeships provide an excellent example of how provision can fully align with business needs. There are more than 12,000 businesses engaged in the delivery of Scottish Apprenticeships, some 90% of which are small and medium-sized enterprises. Apprenticeships have grown from 10,579 MA starts in 2008-09 to over 29,000 MA and GA starts in 2019-20, before numbers were impacted by the pandemic.
Modern Apprentices and Graduate Apprentices start with a job and a contract of employment and receive high-quality industry-led training. A Modern or Graduate Apprentice could be a new team member or an existing employee seeking to increase their capability. While the number of starts was initially impacted by the pandemic, the Scottish Government has also reinforced its commitment to building the number of apprenticeships starts back up to the 30,000, pre-pandemic, target.
The dual purpose of Modern Apprenticeships is to support people to learn while in work and to encourage economic growth across Scotland. MAs are a joint investment between employers and the Scottish Government. Employers invest the greater amount through wage costs and on-going support, and public funding contributes towards the cost of training.
Historically, MA frameworks were devised by Sector Skills Organisations (SSOs) in consultation with relevant employers and are based on National Occupational Standards. This has now been revised with the creation of SAAB endorsed Technical Expert Groups (TEGs), driven by employers from respective sectors and defining their content based on current and future occupational skills needs. Over the next 3-5 years, SDS through SAAB are leading on the redevelopment of all FA, MA and GA frameworks, creating pathways and enhancing the responsiveness and adaptability of apprenticeships to meet ever changing roles.
Through the new design approach, MAs will be constructed against current occupational activity informed by employees executing these roles at present, captured within an occupational ‘Standard’. This standard will define the series of activities and associated knowledge, skills and behaviours that are required to determine competence, with assessment housed within employer led performance reviews.
The Apprenticeship Approvals Group (AAG) approves the frameworks for delivery in Scotland. In Scotland, there are at present over 100 different apprenticeships in 17 occupational groupings. They are each designed to provide training that meets minimum standards of competence agreed by the AAG, after consulting employers. Within the forthcoming development programme, the number of MAs will be rationalised into broader apprenticeships with multiple occupational pathways.
FAs provide work-based learning opportunities for secondary school pupils in their senior phase. They create strong links between education and employers to help pupils make informed choices about their post school destinations including vocational pathways. They represent a fundamental change in the approach to offering work-based learning in the senior phase of education – providing valuable skills and real qualifications.
Based on existing and successful MA frameworks, FAs enable pupils entering S5 to complete elements of a MA framework. Delivered in partnership by schools, employers and learning providers, such as colleges, Local Authorities and learning providers, FAs usually take two years to complete. Shorter duration types of FA frameworks are also available.
GAs provide an opportunity to be in paid work while gaining qualifications from DipHE up to Master’s level from SCQF Level 8 to 12. These have been developed with employers, which ensures that learners gain the knowledge and skills they need for their chosen work area.
As stated in the Scottish Employer Perspectives Survey (2019), key reasons employers started to offer apprenticeships were because they view them as a good way to get skilled staff, followed by viewing them as a good way to bring in young people to the company.
The key to the success of Scottish Apprenticeships, which will be crucial to maintain as we move into an uncertain future, derives from that industry leadership and engagement which has always underpinned their development and delivery.
To support partners and stakeholders involved in delivery across the skills system, SDS developed the Skills Planning Model in 2010 to articulate a systems-based approach in which investment in skills, learning and career choices has the capacity to be informed by the most up-to-date intelligence available of the skills demands of industry and the needs of our economy.
By understanding the demand for skills, and responsive planning and provision, partners can work to ensure the skills and learning system is underpinned by the intelligence to meet the current and future demands of Scotland’s economy, employers and people. Achieving this relies on building a robust evidence base which articulates the current and future skills demands of Scotland, as well as intensive partnership work, at both a local and national level.
SDS work with stakeholders, including industry and employer representatives, to understand the current and future demand for skills in the Scottish economy. A robust evidence base of Labour Market Information (LMI), career intelligence, and analysis of current and future skills needs is core to the organisation’s development and delivery.
Regional Skills Assessments (RSAs), built up from existing datasets and forecasts, aim to support strategic skills investment planning across Scotland’s regions. They have evolved over time based on independent review and feedback from partners. RSAs are developed and published by SDS in partnership with Highlands and Islands Enterprise, Scottish Enterprise, SFC, Scottish Government, the Scottish Local Authorities Economic Development Group and South of Scotland Enterprise. RSAs are available for all College Regional Outcome Agreement areas, Rural Scotland and all City and Growth Deal Regions. The most recent RSAs were published in July 2021. These reports are supplemented by the RSA Data Matrix, an interactive tool offering data from a variety of sources to consider Skills Supply: the supply of people within the labour market; Skills Demand: the demand for skills within the labour market; and Skills Mismatches: where there is a gap between the demand for skills and the supply of skills within the labour market.
A Regional Skills Investment Plan (RSIP) is a mechanism through which SDS is committed to working collaboratively with partners across Local Authority boundaries to embed an evidence-based approach to skills planning, investment and delivery that is aligned to the needs of employers and the regional economy. To date RSIPs have been published for Highlands and Islands, Glasgow City Region, Tay Cities, Aberdeen City and Shire, Edinburgh and South East Scotland and the South of Scotland. Work is currently underway in Ayrshire. RSIPs are developed and co-produced with a range of national and regional partners.
Sectoral Skills Assessments (SSAs) – last updated in June 2021 – use existing datasets to consider current and future skills demand in key sectors across Scotland.
SDS’s skills planning evidence base and publications have continued to adapt to circumstances, with monthly COVID-19 Labour Market Insights introduced in 2020. A Climate Emergency Skills Action Plan was published in late 2020.
Alongside these publications and their associated collaborative activity, understanding skills demand is also utilised in:
• responsive action planning (e.g. Energy Jobs Taskforce, COVID-19 Response);
• training programme demand statements;
• responsive demand-led training and retraining interventions (National Transition Training Fund, CodeClan, National Manufacturing Institute Fund, Digital Start Fund).
In addition to Scottish Apprenticeships, SDS manages a range of demand-led programmes for individuals and businesses which provide a responsive investment in skills based on labour market intelligence and employer insight. More information can be found on the SDS website but these currently include Individual Training Accounts, Employability Fund, Skills for Growth, STEM Bursary, National Transition Training Fund, National Third Sector Fund,Digital Start Fund, Marketplace and the Flexible Workforce Development Fund.
Individuals are also supported by our Career Information, Advice and Guidance services in school, and post-school. Responding to a recommendation of the Young Person’s Guarantee: No-one left behind (Sept 2020), work began in February 2021 on a Review of careers services in Scotland. The Review has examined existing policy, funding, service offers, user perception and performance of current provision; identified gaps; designed and developed prototypes for new services, changes to existing services and a target operating model to support these. This work is now concluding with recommendations due to be presented to the Scottish Government very soon.