Generic Skills Survey 2003 DRIVERS OF SKILLS NEEDS

1. Generic Skills Survey 2003DRIVERS OF SKILLS NEEDS

2. Introduction • Drivers of Skills Needs: • Demand Side – Industrial Structure of Area • Generic Skills – Communication & Team Working skills across most sectors • Industry Specific Skills – Customer Handling & IT skills • Size of Firms & Markets affect type of skills required • Human Resource – Aptitude, Motivation & Barriers

3. Employment Growth In Wales • Largest sectors in Wales are: • Wholesale & Retail (16.5 % of total employment) - Growth • Manufacturing (15.3 per cent) – Long-term decline • Health (13.6 per cent) – Growth • Other growth sectors - Other services (including leisure) and other business services

4. Recruitment of Graduates • Link between recruitment of new graduates and level of formal qualifications in the workforce • Graduate numbers rising – qualifications being used as a screening device • Graduates employed for their generic skills • Larger firms more likely to recruit graduates • Supply of graduates outstrips demand in some cases

5. Generic Skills • Generic Skills highest rated by employers in all sectors: • Understanding customer needs / Communication skills • Education system emphasising Essential Skills • Skills gaps mainly for Communication Skills • Other generic skills rated as important:- • Ability to Follow Instructions / Initiative / Team Working / Adaptability & Flexibility • The shift from manufacturing towards a more service based economy will lead to the increasing importance of these skills.

6. ICT Skills • ICT SKILLS – Growing in importance to all Firms • Current level for most sectors – Intermediate • Higher skills in Financial & Business Services • Lower in Construction • Growth in demand for ICT skills outpacing supply • Demand expected to rise in all sectors • Strong growth in Public Services and Utilities

7. Business Attitudes & Demand for Skills • Changing Government agenda to stimulate demand • Marked difference in attitudes across sectors • Larger firms rate skills more highly • Of employers who see benefits from investment in skills : • One third had not funded off the job training in the past year • Only 59% of employers with skills gaps had funded off the job training in the past three years • Little Regional variation in demand for generic skills

8. Supply of Skills • Demographic Changes – rise in Mid Wales population • Formal qualifications - Mid Wales workforce highest qualified • Generic Skills – little regional variation • Three-quarters say skills levels are increasing • Two-thirds say they can develop the skills they need at work… ……..But only half can develop skills for the future • Individuals can lack motivation to learn new skills

9. Supply of Skills

10. Conclusions & Policy Implications Drivers of Skills Needs • Largest Recruiters of Graduates are public administration, education, health, finance, insurance and other services, energy & water. • To fully utilise higher education skills in Wales & to prevent graduates leaving the country to look for relevant work – Policy should focus on attracting employers within these sectors. • Forecasting above average employment growth in the services sectors – suggests future demand for graduates likely to increase over the next five years. • Issue – growth in actual graduate jobs or employers taking on graduates for traditional school leavers jobs. • Policy needs to focus on encouraging employers to fully utilise the skills of graduates. • School Leavers – Skills lacking! Policy should concentrate on ensuring that school leavers skills are up to standards expected and required by employers.

11. Conclusions & Policy Implications Which Skills are Critical • Communication & Customer Handling • 39% of employers found Communication skills lacking in school and college leavers • Importance of communication & handling skills increasing as competitive forces lead firms to use customer service as a way of gaining competitive advantage. • Policy needs to focus on improving communication skills in schools and to a lesser extent graduates and to address the gaps in the current adult workforce. • IT SKILLS – DEMAND OUTPACING SUPPLY • Policy needs to focus on brining the whole labour force up to a minimum level of IT know how.

12. Conclusions & Policy Implications ATTITUDES TO SKILLS & TRAINING • Cost of Training – Policy needs to encourage and help those employers improve their investment in skills through recognising the business benefits. • Cost of off the job training – Policy needs to address ways of making this more accessible and affordable, particularly to micro and smaller businesses.

13. Conclusions & Policy Implications REGIONAL VARIATIONS • Little variation in the need for generic skills – main exception Welsh language skills North & Mid Wales. • Formal Qualifications – only the North does not have a competitive advantage, but has a relatively high supply of formal qualifications. • North enthusiastic about learning. • Policy specifically needs to encourage firms in the North to fully utilise the local labour force. • Mid Wales – significant barriers to people furthering their skills – time constraints, availability of courses in the local area were notable constraints. • Policy needs to address the accessibility of training establishments and promote remote learning. • South East – Higher average share of people with no formal qualifications. • Employees in this region most likely to feel employers did not give them the opportunity to develop skills. • Policy in this area needs to be aimed at encouraging employers to recognise the importance of developing employees skills and the benefits to business this can bring.

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