Download SKILLS AND WHAT ELSE MAKES THE DIFFERENCE?

SKILLS AND WHAT ELSE
MAKES THE DIFFERENCE?
Ewart Keep
Deputy Director
ESRC Centre on Skills, Knowledge
&
Organisational Performance,
University of Warwick
AIM OF THIS TALK
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To identify the range of factors that,
along with skills, are essential
building blocks for a successful
regional economic strategy.
To argue the case for the integration
of skills policies into the planning and
delivery of wider economic
strategies.
STRATEGIC PLANNING FOR THE
ECONOMY AND SOCIETY
Unless we know where we want to be,
our chances of getting there are slender!
In order to be clear where we want to be,
we need to have answers to the following
questions:
DESIRED FUTURE SHAPE OF
THE ECONOMY
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What is the desired profile of the economy?
What proportion of output should be in high value
added goods and services?
What levels of service quality will be required in public
services?
Are we aiming for an economy where there are high
levels of R&D, innovation and investment in plant and
equipment?
What sectors and sub-sectors do we expect or want to
be driving economic growth?
DESIRED PATTERNS OF
EMPLOYMENT
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What pattern of employment is being aimed for?
What proportion of jobs do we want to be highly skilled?
Are we anxious to reduce the proportion of low skilled
employment (and if so, how)?
Do we want to avoid a polarised labour market, with a
concentration of high skilled employment at the top end, a
concentration of low skilled employment at the bottom, and
relatively few middle-ranking jobs?
DESIRED PATTERNS OF
INCOME
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What dispersion of income is being aimed for?
Is it a long-term aim to reduce what has been a
widening gap between the best and worst paid in
our society?
Do we aim to reduce the proportion of the
workforce in our region that is low paid? If so,
how?
DESIRED PATTERNS OF
WORK ORGANISATION
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What patterns of work organisation, job
design and people management do we
want to see as the norm in UK
workplaces?
For instance, do we want to see only a
small number of jobs where employees
are engaged in highly routinised and
closely controlled work, in which there is
little room for discretion, autonomy and
creativity?
If yes, how?
DESIRED SOCIAL AND POLITICAL OUTCOMES
AND THE WIDER BENEFITS OF LEARNING
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What kind of society do we aspire to?
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How will our political system involve citizens?
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What expectations are there about the ability of,
and need for, citizens to debate and decide on
complex issues, such as global warming, genetic
modification, membership of the Euro, and so on?
What levels and types of cultural, sporting,
community, and voluntary activity does society
want to be taking place, and how widespread do
we aim for participation in these to be?
ONCE WE HAVE
ANSWERS……..
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Once we have answers then we can proceed
to plan.
In thinking about planning, we need to see
skills as one facet of a broader problem.
Planning that treats skills in isolation from
many of the issues flagged up above is
liable to produce poor results and weak,
narrow strategies.
SKILLS AND THE OTHER DRIVERS
1.
2.
3.
4.
5.
6.
7.
As the Treasury emphasise, there are several drivers of
economic success, of which skills is but one. Unless the UK
economy is characterised by:
High levels of R&D and innovation
High levels of capital investment in plant and equipment
A high quality public infrastructure, including
communications and transport
Readily available sources of patient and knowledgeable
capital
A domestic market for goods and services that demands
high levels of product quality, specification and
customisation
A domestic income distribution and public purchasing policy
that can support point 5 above
higher levels of skill supply may have very limited effects on
Economic outcomes. Skills can support a more productive
economy, but on their own are fairly unlikely to create one.
THE PORTER REPORT
The UK currently faces a transition to a new phase of
economic development. The old approach to
economic development is reaching the limits of its
effectiveness, and government, companies and other
institutions need to rethink their policy priorities…..
We find the competitiveness agenda facing UK leaders
In government and business reflects the challenges of
Moving from a location competing on relatively low
costs of doing business to a location competing on
unique value and innovation.
(Porter and Ketels, 2003: 5)
DO WE HAVE WHAT IT TAKES
TO MAKE THE TRANSITION?
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Current indications suggest that such a
transition may be difficult to achieve and
that many of the above listed supporting
factors are either not in place or are
available at levels that will not drive moves
towards a higher value added approach
across large swathes of the economy.
One example is the fact that many large UK
firms tend to be clustered in sectors
characterised by very low R&D intensities.
Proportion of sales in very low and low
R&D intensity sectors
Country
V. Low
USA
Japan
Germany
France
UK
World
19.5%
13%
10%
34%
Low
Total
6.5%
14%
14%
20%
26%
27%
24%
54%
56%
22% 78%
23%
13% 36%
SOURCE: DTI, 2005:13
Suggests hi-tech enterprise among large firms may be a
minority sport!
LABOUR MARKET REALITIES
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Full-blown HPWO covers tiny fraction of
workforce
On EU definitions, about 25 per cent of the UK
workforce is low paid
The labour market is polarising (the ‘hourglass
economy’), with more managerial and
professional work, and more low paid, low end
work.
The proportion of workers who will receive inwork tax credits is set to rise.
REMEMBER – the workers in your region are
also the bulk of the consumers!
TAYLORISM AND FORDISM – ALIVE
AND KICKING
Despite talk about a Post-Fordist world and an end to
Taylorised work patterns, evidence suggests that much
work continues to have:
 A low skill content
 Highly routinised patterns
 Low discretion
 Low autonomy
 Short job cycle times
 Hierarchical organisation
Supply more skills, of itself, may do little to
change this.
IF THESE ARE THE PROBLEMS,
WHAT ARE THE SOLUTIONS?
Traditional: Supply more skills
Emergent: Supply more skills AND
simultaneously seek to help firms to move
up market, become more profitable,
increase productivity, develop new markets,
organise work differently, and use skills
better.
SKILLS AS ONE COMPONENT IN LEVERAGING
IMPROVEMENTS IN BUSINESS PERFORMANCE
Skills Supply
2. Business Support to Firms
3. Cluster, Network and Supply Chain
Development
Key Policy Goal: Engineering Mutually
Supportive Interaction between the
three
components
1.
A NEED TO DESIGN INTERVENTIONS
TO IMPACT ON:
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Product market strategies
Goods and service quality and specification
Investment strategies (plant, R&D, product development)
Production/service delivery systems
Employee relations
Work organisation
Job design
In order to create higher demand for, and better usage
of, the skills being supplied.
THE CONCLUSIONS OF
NORWEGIAN POLICY MAKERS:
It is not how much knowledge employees have, but
what they collectively manage to do with that
knowledge, that drives value creation…….The main
message….is that knowledge resources are enhanced
through use; knowledge and skills must be activated and
put into play in order to create future growth and social
welfare. Work organisation plays a key role in this
respect……this approach is challenging, as it forces us to
establish a closer connection between competence policy
and other important areas such as industrial policy,
innovation and labour market policy.
Competence Report 2003.
DIFFERENT SOLUTIONS FOR
DIFFERENT SECTORS AND FIRMS
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Tailor made solutions rather than blanket
solutions – NETP
Joined up design and delivery of business
support and skills support.
Developing expertise among advisors, RDAs,
SSCs, Business Links, etc.
This represents a major challenge for
RDAs, SSCs, LSC, LLSCs and other
players.