Politics » Budget 2021: £3.8bn skills investment aims to address UK talent shortages

Budget 2021: £3.8bn skills investment aims to address UK talent shortages

The rise in skills investment aims to strengthen both foreign and domestic talent in several key areas

New education and skills measures announced by Chancellor Rishi Sunak during his Autumn Budget on Wednesday are key steps towards tackling talent gaps in the UK, industry participants have said.

Sunak confirmed an extra £3.8bn for skills funding, including £1.6bn for new T-level courses, £170m for apprenticeships and £550m for reskilling adults.

There will also be a new ‘Scale-Up Visa’ aimed at making it quicker and easier for businesses to acquire highly-skilled, foreign-born talent.

“There is a global shortage of talent in technology, particularly cybersecurity, so the UK government’s investment in skills and education is welcome news,” said Camellia Chan, CEO and founder of cybersecurity tech manufacturer Flexxon.

Chan went on to hail the funding for traineeships and skills boot camps as “incredibly exciting”, arguing that this will “create a tech workforce of diverse talent”.

Similar optimism was expressed by SJ Boulton, global curriculum lead at virtual lab simulation platform Labster, who described the measures as “fantastic news”.

“Since the pandemic began, the education sector has undergone a massive shake-up – technology evolved, and hybrid learning became the norm but all while the attainment gap increased.

“As such, it’s crucial that the government prioritises accessible education to ensure the skills gap doesn’t widen and no-one is left behind.”

However, the measures have failed to attain unanimous enthusiasm. For instance, CIPD chief executive Peter Cheese argued that there is “still a glaring gap” between the government’s policies and its ambitions.

“Piecemeal interventions like those announced today are unlikely to amount to a skills revolution – more an evolution of things that already aren’t hitting the mark for many employers or jobseekers,” he said.

“There needs to be an economy-wide, joined-up strategy to encourage and enable more firms to adopt strategies where the workforce is recognised as something to be invested in and drives value, rather than a cost to be minimised.”

The direction of the funding has also been questioned, with Paramjit Uppal, CEO of AND Digital arguing that, while a “skills revolution” is certainly needed, some sectors require this more than others.

“Investing in people and their potential will be the catalyst for innovation and will underpin a society that already relies so heavily on digital progress,” she said.

“However, I would like to see more going into the software design skills development. The UK needs more skilled people who can build software and data solutions for every organisation.”

In spite of this, the Chancellor enthusiastically touted the £3.8bn funding to lawmakers in the House of Commons, branding it “the most-wide ranging skills agenda this country has seen in decades”.

Giving a series of fiscal updates, Sunak also told MPs that the Office for Budget Responsibility (OBR) has revised its forecast for the UK economy. It now expects GDP growth of 6.5 percent, up from its original estimate of four percent.

Similar revisions were made to unemployment projections, with the OBR expecting unemployment to peak at 5.2 percent, revised down from 12 percent. That means over two million fewer people out of work than previously feared.

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