Denham announces deal to skill workers for jobs of the future in construction, hospitality and process industries

25th June 2008

A new agreement between the Government and employers will deliver more skilled workers to do the jobs of the future in construction, hospitality and processing and manufacturing, Skills Secretary John Denham has announced...

The Government will earmark over £300m from its training budget to tackle current and future skills shortages within these key sectors - with £133m to help construction, £112m for hospitality and £62m for processing and manufacturing. The funding will enable employers in these sectors to improve the qualifications and skills of their workforce, and offer greater numbers of apprenticeships.

It is the first major stage of a radical shake-up of the skills and training system instigated by John Denham to tackle expected skills shortages. He expects to announce similar deals in the future. As part of the shake-up, John Denham will also today meet business leaders in Westminster to discuss what more can be done to ensure the supply of skilled labour matches the emerging skills gaps in key sectors of tomorrow's economy.

Secretary of State for Innovation, Universities and Skills John Denham said: "Industries such as construction, hospitality and processing are key to our future prosperity, but there is a need for more highly trained people if we are to continue to lead the world in an increasingly competitive global economy. The success of our country will depend on doing even more to increase people's skills and their ability to gain jobs in growing and successful industries, such as these.

"We've come a long way. Radical changes to the skills and training system over the past two years, making it more demand-led, have helped ensure that last year £38 billion was spent on training by British businesses.

"But more can be done. It's not enough to have a system that is demand-led. If we're going to skill people for the jobs of the future, then we must work closely with employers to identify those needs and ensure that training providers are ready to deliver. We've listened to employers and taken action to remove barriers to training. Now we must take it one step further."

In return for this funding, the Sector Skills Councils, ConstructionSkills, People1st and Proskills, will use their unique sector understanding to encourage employers to take advantage of Government initiatives such as Train to Gain, to make the Skills Pledge, to offer more Apprenticeships and to ensure their staff are given the opportunity to gain relevant qualifications and training.

Government support will be tailored to meet employers' specific skills needs. Part of the Train to Gain budget will now be available specifically to train employees who already hold GCSE or A-level equivalent qualifications (level 2 and level 3) but who need more specific, or more up-to-date, business qualifications. There will also be more funding for specialist skills training, marketing and recruitment.

Future compact agreements will similarly rely on the expertise of Sector Skills Councils (SSCs) to encourage employers to take up government skills programmes, in return for funding and support. Those sectors in which increased investment in skills is needed to shape a modern, competitive economy will be prioritised. The move follows a recently announced compact with Semta, the SSC for the science, engineering and manufacturing, a consultation on a new right to time to train for employees, and a renewed commitment to ensure the skills system delivers appropriately trained people for industries employing the workforce of the future. Mark Farrar, Corporate Services Director, ConstructionSkills, said:

"This is a great opportunity for us to build on the success we have had in working with the construction industry to meet its skills needs. Through the compact we now have a better opportunity to access funding from the Train to Gain budget to address existing and future skills needs.

We are well placed as both a Sector Skills Council and an Industry Training Board to provide the support that the construction industry needs to ensure that those entering the industry have the skills they need and those already in the industry are able to adapt to changes that will take place."

Brian Wisdom, People1st Chief Executive, said:

"More and more employers are realising the increased need to invest in the best staff to improve their businesses. In an environment of rising costs the most enlightened employers are even more committed to investing in the skills of their people and improving the customer experience and profits - this deal shows that government are dedicated to investing in the areas most critical to industry."

Terry Watts, Proskills Chief Executive, said:

"The skills pledge represents a vital element in our sector's drive to raise skill levels and protect its future. The sector is keen to raise its profile and attract new entrants, and recognises that it is essential to be able to offer employees both a wide range of opportunities together with relevant training and personal development."

Mark Haysom, Chief Executive of the Learning and Skills Council (LSC) said:

"The LSC welcomes these sector compacts as a key part of LSC support to employers through our Train to Gain Service. We have a strong track record of meeting employer skills needs in these sectors and are pleased to be working with ConstructionSkills, Proskills and People1st to increase the number of employers who will benefit from this enhanced support." Government investment in Train to Gain will rise to over £1 billion by 2010-11, supporting over 800,000 learners to improve their skills and gain new qualifications.

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