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Richard O'Sullivan
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Steve Purdham

Hot for Teacher

The Government says there are all kinds of training opportunities out there for your staff, and that many of them won’t cost you a penny. Too good to be true? EN investigates.

With official unemployment levels nudging the two million mark and expected to go much higher with more businesses going to the wall each week, the Government’s numerous “rescue packages” designed to get Britain’s business community back on its feet are yet to have any real impact.

And many of those initiatives have had employee training at their core. In October last year, skills secretary John Denham announced that small businesses would be the focus of £350 million of Government funds to help them train their staff.

Denham said the new package of support would help small firms get through the tougher economic climate by building the skills and expertise of their workers with the minimum level of bureaucracy or delay: “Small businesses are an important engine of our economy and we must make sure that we support them during tough economic times,” he said.

“We know that firms that invest in skills do better than those who don’t, which is why we will be urging small businesses to take up this offer from Government.”

Train to Gain, the Government’s main vehicle for delivering training, claims to have helped more than 100,000 employers and 570,000 staff improve their skills since it was formed in 2006 – and, in November last year, at a cost of £2.4 million, a highprofile ad campaign kicked off to promote its benefits to businesses.

Peak-time television and radio adverts claimed it was quicker and easier than ever before for companies to get the training needed to keep their businesses moving by accessing the Train to Gain service. Most significantly, the campaign stressed that Train to Gain’s advice was free.

But, despite the attention and funds given to it, businesses aren’t champing at the bit to access training. In fact, research suggests that currently one third of employers do not train their staff, and eight million workers received no training at all last year. It’s a lack of interest that MP Phil Willis, chair of the parliamentary innovation, universities and skills select committee, puts down to an inherently complicated system.

According to Willis, the Liberal Democrat member for Harrogate and Knaresborough, the country is enduring its latest skills crisis, one of which comes round every ten years: “It just seems to go in that cyclical way. We then have a report, Government takes action, new organisations are set up, but many of the existing organisations stay in place so we add to them all the time.

“We have seen a significant number of employers turn their backs on it – not on training per se, but on Government support for training through Train to Gain because the system is just so complex.”

Willis is referring to the abolition of the Learning and Skills Council (LSC), announced in March 2008, that will see funding responsibilities for 16-19 year olds transferred to local education authorities and a new skills funding agency created to provide training and skills for adults. The new bodies will formally take over their responsibilities in April 2010.

The select committee addressed these complications in its report, published in December 2008, “Re-skilling for Recovery” in which it stated: “We received evidence which was highly critical of the way the programme currently operates. We conclude that radical reform is needed.”

The committee’s study refers to the 2006 Leitch report (on which most of the UK’s training schemes are based), which suggested that without increased skills the UK would condemn itself to “a lingering decline in competitiveness, diminishing economic growth and a bleaker future for all”.

Lord Leitch’s assessment was based upon depressing statistics revealing the level of skills among the UK working population. At the time of the report, over a third of adults lacked the equivalent of a basic school-leaving qualification, nearly half of all adults lacked numeracy skills and one in seven was not functionally literate.

To achieve the ambition for the UK to become a world leader in skills, Lord Leitch (until 2004, as plain old “Sandy”, the UK head of insurance company Zurich) recommended “radical change right across the skills spectrum”. He focused on adult skills, in recognition that 70 per cent of the 2020 workforce had already left school at that point, and proposed a series of objectives for 2020 including a new “skills pledge” for employers to commit voluntarily to train all eligible employees in the workplace.

According to Willis, the Leitch review was produced during a period of economic optimism. He says the current economic situation has raised the stakes and the Government’s approach to training should change accordingly.

Indeed, history shows that training and development is not a priority for business during economic downturns, with the training budget often the first to be cut. But everyone contacted by EN on the subject argued that now is the time for employers to find out about the support that is available to help businesses thrive in the downturn.

Research by the Chartered Management Institute (CMI) in December 2008 suggested that up to 18 per cent of employees were going to look for new jobs in 2009 if they don’t get offered the training and development opportunities they are looking for, despite the state of the economy.

Spokesman for the Institute, Mike Petrook, says, “With the recession employers do have a fear of investing money in training and development but now really is the time to do so.

“Most individuals say that their remuneration package is not just about take-home pay. It’s about the skills they are being given. There is a huge call on employers to retain their best talent by developing it.”

But soon it won’t be left to employers to decide whether to introduce training. By 2010, some 25 million employees could benefit from a right to request time at work to undertake training. Under the Children, Skills and Learning bill, all employees who have worked for their employer for more than 26 weeks will be able to ask to undertake either accredited courses that lead to a qualification or unaccredited training.

The right relates to skills that are relevant to the employee’s job, but employers would be required to consider seriously the requests they receive, using the same sort of processes they have in place to manage requests for flexible working.

The same rules will apply to all firms, although the Government says small businesses are likely to have more good business reasons to refuse requests. An employee can only expect their employer to consider a request once in any 12- month period and, while the legislation won’t force employers to pay for the training, Government expects most businesses to do so if it is related to what the business does.

Willis tells EN, “The plans are in their infancy but it’s up to employees to ask the employer for time off and there will be an obligation on employers to consider that. But there’s not an obligation on employers to grant it.

“If an employee sees there is an opportunity for some training, which could offer some gain to the employer and the business, that becomes a sensible conversation. But if an employer who makes brass widgets is approached by someone wanting to do paperfolding, it would be reasonable for them to question whether that could improve business.”

There is some government help for businesses with fewer than 50 employees to help cover the costs of employee training. They can receive a wage subsidy when releasing eligible employees for training through Train to Gain.(see WAGE SUBSIDY below).

After cost, employers’ next priority surrounding training courses is ensuring that they will genuinely benefit their business. This is trickier – there is a lack of research to support the idea that training increases productivity.

A rare piece of research was carried out by the National Audit Office in 2005, entitled, “Employers perspectives on improving skills for employment”. This says that a typical 50- employee company could save £165,000 every year by filling the gaps in its employees’ skills. But proponents say it’s blinkered only to look for drastic changes to the bottom line.

Willis says, “What we know is that when employers have a perceived need to improve the skills of their staff, that is the bit that increases productivity, where it’s bespoke and tailor-made. The idea that you can have state programmes and suddenly give people more qualifications and that improves productivity – there is not a great deal of evidence to support that.

“But I never believe a  business doesn’t need training. Any employer who says they have a perfect business model and a perfect workforce is a business heading for the dustbin. Eventually, it will die.”

The LSC admits new skills translate into higher wages and other research by the CMI shows that those with professional qualifications have a nine per cent greater chance of employment than those without. So what’s to stop a business spending on training-up an employee only for them to take those skills to a better-paid job with a rival firm?

Petrook says, “Organisations are gifted with good talent for a certain period of time and employers recognise this. The whole idea of a job for life went out of the window a while ago and the idea of a career for life no longer holds the sway that it did.”

Not massively reassuring, then.

Jayne Allman, business development manager at Bolton Community College, offers more practical advice: “Cost is the main concern for employers. I always say to clients, ‘Don’t look at the cost of something, look at the cost of not doing something.’ If an employer doesn’t train reception staff on fire safety and someone gets killed in a fire, the employer will be the one held liable under corporate manslaughter.

“Small businesses could [and often do -ed] put a clause in a contract to say, ‘If we put you through all this, if we fund it and if you leave within a year, you have to pay us back.’”

Allman says employers should do their research through the sector skills council, the regional development agency and through Business Link to find out to whom they can talk to explain their business needs.

“It’s very likely that it will be free,” she says. “There is funding, it just depends whether the employer meets the criteria and we can tell them straight away whether they are eligible or not.”

The Learning and Skills Council cites staff retention, fewer unfilled positions, increased competitiveness, efficient and motivated staff and enhanced profits as the benefits of investing in training.

Willis too emphasises the amount of free training available, though bemoaning the Byzantine bureaucracy involved in accessing it. But his point that companies should not need to shell out for training is clear: “If anybody comes to you and says, ‘This is the training we are selling you,’ show them the door.”

 

WAGE SUBSIDY
Businesses with fewer than 50 full-time (or equivalent) employees may be eligible for a contribution to the wage costs for each employee who takes up a Train to Gain-funded course. A payment of £5 per hour or actual wage for every hour an employee is released from normal work up to a maximum of 70 hours can be claimed for each employee. Payment is made on achievement of the qualification.

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