Ed Miliband’s speech to the Labour party conference set out a ten-year plan for rebuilding our economy. A future British society – ‘one nation’ – based on a person’s potential, and not simply their birth into the ranks of a privileged few. An inconvenient truth for the Tories is that, despite the recent economic recovery, these aggregate statistics are failing to translate into better living standards for most working people
Nowhere is this more harshly felt than in the plight of our young people. Headline youth unemployment may at last be coming down, but it is still amongst the highest of the G7 advanced nations. Under this government higher education tuition fees have trebled, yet, new research shows that 50 per cent of students from some of our universities are still not in professional jobs matching their qualifications one year after graduation. The American economist Tyler Cowen has referred to this phenomenon as the ‘great stagnation’: lower productivity, skills and innovation; technology hollowing out middle-income jobs; and exports struggling to rebalance economies away from debt-fuelled consumption.
The central challenge for progressives is what to do about it? After the slowest recovery since the Long Recession of 1870, we need concerted action from both government and local communities. The party’s six national goals will go a long way to addressing the systemic, underlying problems that have resulted in so many people losing faith in the power of politics to change lives. A major task of an incoming Labour government next May will be to tackle once and for all the skills crisis. We will not solve it overnight. Neither will we manage successful reform by reverting to the old ways of delivering top-down, centrally administered, schemes from Whitehall.
The skills revolution demands devolution in a big way. It means devolution of accountability, with resources, to city and county regions and devolution of purchasing power to individuals and employers through reformed skills accounts. Labour’s fourth national goal in office, the expansion of quality apprenticeships, will help reverse decades of believing a 21st-century economy can be built by simply expanding post-compulsory, mainly academic education. The evidence is mounting that simply producing more and more graduates is neither boosting social mobility nor is it tackling the skills mismatch. Can it be morally defensible or even financially sustainable to be planning university finances on the basis that nearly half of all graduates will never earn enough to pay back their loans?
That is why Britain requires a new settlement for lifelong learning that does not discriminate between academic, entrepreneurial or vocational routes. One way of achieving this aim will be to tackle the underlying public funding anomalies that discriminates by learning pathway and reinforces the notion that we value young people’s choices differently. At the end of the day, head teachers, parents, individuals and our companies have responded to incentives. Schools have no incentive to offer impartial careers advice at the age of 14. For young people and their parents government policy has sent the signal that degrees matter more than practical business and marketable skills. Too many employers have been handed an easy excuse not to offer good apprenticeships, because of the growing supply of graduates and unpaid internships. It has resulted in a skills paradox that needs to be addressed.
In just eight months time, a Labour government can begin to restore the balance. The party can deliver parity of esteem for both academic and vocational learning by ensuring parity of existing public funding. That requires Labour’s technical degrees to be open to high-quality further education colleges, with degree-awarding powers, to challenge the complacency of some of our universities. It means smart government, at the national and local level, using public procurement to ensure more firms offer apprenticeships. And finally, it requires doing things differently, so that we break decisively from the cultural and skills deficits that have dogged the British economy for at least 150 years.
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Tom Bewick is the chief executive of the International Skills Standards Organisation. He also writes an independent blog
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Photo: Barnshaws