An increase in investment in education and skills training could lead to a £206 million net present value for the UK economy, a recent socio-economic impact report finds.
This is the key finding of the report, commissioned by national education and training provider, Learning Curve Group, which outlines the socio-economic value of training and skills-development.
Titled The Value of Training, the report looks at the benefits of training and skills development for the economy, businesses, individuals, and wider society. It outlines how important they are in offsetting the impacts of rising energy costs and the fall in job vacancies.
The report looked at sectors with severe skills shortages. Basic digital skills, leadership and management, and STEM, are amongst the future skills-demands that are at risk of not being met by the UK.
As the economic crisis hits the employment market, the number of people looking for work is on the rise, and training and skills-development could be a fundamental factor in resolving this.
The drive to solve labour market shortages through training would lead to faster economic growth, with a 1.4% boost in the economy by 2027, the report calculates from a survey of training recipients of Learning Curve Group.
A £12 million wellbeing benefit is also present, based on evidence of trainees entering employment within 6 months of completing their course and the physical and mental improvements this financial security and job satisfaction bring with it.
Economic and societal benefits of training include greater economic growth and helping create a culture of lifelong learning. Business investment would also be boosted by 3.7% by 2027 if training were to fill vacancies.
The report also found that 3 in 4 people are likely to undertake further learning or training upon completion.
The economy will also see a significant increase in pay, the report outlines, with a collective £32-£50 million in annual wage gain, or £16,000-£25,000 per trainee.
Whilst individual benefits varied from wage gain, to increased confidence (73%), to amplified promotion and pay-rise opportunities, the report also foreshadows businesses benefitting from a £5.4 million productivity gain and a 2.3% reduction in unit wage costs.
Training and skills-development increase the human capital in the national labour force, narrowing skills gaps and increasing productivity rates.
“The government should seek to place more emphasis on skills as part of their levelling up agenda and invest more effort in ensuring that businesses can adequately invest in the training and the skills they seek”, outlines the report.
IMF has predicted the UK to be one of the worst performing economies this year, shrinking by 0.3% in 2023, with this weak economic performance stemming from high gas prices, rising interest rates, and ascending unemployment levels.
“To make sure we have a productive economy the national skillset must be aligned with businesses’ organisational and recruitment objectives. This is an essential investment for the long-term prosperity of the country.” says Anne Milton, former Minister of State for Skills and Apprenticeships.
“We are in the midst of a recruitment, skills and cost of living crisis and skills training can often be an area that has budgets reduced during these times. I think this report illustrates that if anything, it is imperative to ensure there is a strong commitment to skills and training if we are to flourish as a nation,” says Brenda McLeish OBE DL, CEO of Learning Curve Group.