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Tech’s reaction to the Budget’s skills promises

During the 2021 Autumn Budget, chancellor Rishi Sunak announced several measures aimed at increasing skilled workers in the UK – but does the tech sector think it’s enough?

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Funding for education, investment in innovation and skilled immigration were among the promises made by chancellor of the exchequer Rishi Sunak in the 2021 Autumn Budget.

Figures thrown around included investment to help “education recovery” after the pandemic, including funding to support schools and colleges, bringing investment in reversing the pandemic’s effect on education to almost £5bn.

Some £3.8bn was also announced to develop skills across the UK, not just for those of school age, but also to ensure lifelong learning for adults as the world goes increasingly digital.

Sunak said in his Budget speech: “As well as investing in infrastructure and innovation, there is one further part of our plan for growth that is crucial: providing a world-class education to all our people. Higher skills lead to higher regional productivity. And higher productivity leads to higher wages.

“With 80% of the UK’s 2030 workforce already in work, our future success depends not just on the schooling we give our children, but the lifelong learning we offer to adults.”

So what are the initiatives behind these figures, and how do they contribute to closing tech’s skills gap?

Providing the UK with skills

Claiming that the Budget included investment in “the most wide-ranging skills agenda this country has seen in decades”, Sunak announced a 42% increase in funding for skills to £3.8bn to expand T-levels, build institutes of technology, fund apprenticeships, increase places on skills bootcamps and roll out the government’s lifetime skills guarantee, among other things.

Although these measures pave the way for a more digitally skilled UK workforce, the consensus in the tech sector is that more could be done, and careful thought needs to be put into the nitty gritty of these plans to make them work.

For James Petter, vice-president of international at Pure Storage, the proposals for increased spending on skills and training in the Budget are “valid” but “simply not enough”. He called for “serious money and resources” to be invested in developing the UK’s own skills, and attracting tech talent to the country.

“This is a mere drop in the ocean compared to the number of young people in the UK and the gaping hole we have in terms of those capable of working in fast-moving, high-growth industries such as cloud computing and artificial intelligence [AI],” said Petter.

The Budget put a heavy focus on encouraging young people to develop technology skills with a view to feeding the talent pipeline. Funding was mentioned to grow T-level qualifications, which were developed as a more technical alternative to A-levels, created in partnership with industry organisations to ensure the qualifications on offer are designed to fill the UK’s talent shortages.

Earlier this year, the government offered funding for employers supporting T-level placements, with part of the 2021 Autumn Budget’s funding going towards investment in specialist equipment and facilities for delivering T-levels, as well as contributing to the delivery of the 20 promised institutes for technology, aimed at teaching people skills such as AI and cyber security.

This year, the government also announced a scheme allowing firms to apply for a £3,000 grant to support apprentices – this has now been extended into January 2022.

With the UK’s tech skills gap leaving firms complaining of a lack of skilled workers, in many cases apprenticeships may seem appealing to teach people the skills required for particular roles.

But the tech industry has already complained of a lack of apprenticeship support, with many saying initiatives to encourage skills development are too disparate and do not take into account what young people want from work and education.

Russ Shaw, founder of Tech London Advocates and Global Tech Advocates, said more also needs to be done to break down the barriers many people face when trying to enter the tech sector, and to encourage as many young people as possible to engage with these technology-based qualifications.

“It is important to note that this is not a silver bullet and the government will need to work more closely with education providers and the private sector to address the other issues causing the skills shortage,” he said.

“More needs to be done to encourage the uptake of digital skills in under-represented groups, including women, the black community and people with disabilities, as well as valuing apprenticeships and digital programmes alongside university education as credible alternative routes into the industry.”  

A commitment to lifelong learning

A large part of the digital skills gap is people not having the basic digital skills to perform day-to-day tasks, as well as many left without the technical or softer skills required to walk directly into advertised roles.

With concerns that the UK “lags behind” on both technical and basic skills, the government wants to ensure people have the opportunity to “upskill and retrain”. As part of the National Skills Fund, the government is set to increase investment in adult skills funding by 29% between 2019 and 2025, which will contribute to the lifetime skills guarantee allowing adults in England to access funding for qualifications such as Level 3 courses and skills bootcamps for in-demand skillsets such as engineering and digital.

Part of the need for digital skills training for adults is addressed in the funding offered to continue rolling out institutes of technology, 10 of which have already been launched to help about 4,000 working adults in the UK gain tech-based skills.

Although the Budget mentions a commitment to ensuring adults have the ability to develop “lifelong” skills, this appears to be heavily focused on other essential skills, such as mathematics, rather than digital skills.

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The government has made a step in the right direction, said Samuel Schofield, vice-president of EMEA and APAC at talent transformation platform Udacity, but although the Budget may have an “undoubtedly positive impact” on those aged between 16 and 19, there should be more consideration of the need for “job-ready digital skills”.

Schofield said: “Certain technical skills are in exceptionally high demand and the government should consider addressing this directly via new funding to upskill our existing workforce, ensuring that they too are well placed for the careers of the future. This means widespread, meaningful technical training that will directly combat the digital skills gap.”

Rob Chapman, co-founder of Firebrand Training, said that as well as helping young people and the general public to develop tech skills, there needs to be a focus on encouraging employers to train people already in their organisations and more support on how to do that.

Chapman said that while apprenticeship support and bootcamps give employers a way to find and recruit tech talent with relevant skills, “it’s important that businesses are also using these incentives to upskill their existing employees”.

He added: “In the midst of the ‘Great Resignation’, it is crucial that companies don’t continue to overlook internal talent and favour new talent. The talent war has left many businesses scrambling to poach the right talent from competitors rather than investing in their existing talent. Upskilling existing employees can help address the lack of skills in the short term and can also help to retain talent in the long run.”

Overseas vs home-grown talent

Nic Redfern, finance director of NerdWallet, said the Budget’s contribution to skills sends a “positive message that the UK is prepared to prioritise home-grown talent, post-Brexit” – something that many were concerned would not happen when the UK decided to leave the European Union. But Redfern added: “As is always the case with such policies, the devil will be in the detail.”

Since the Brexit referendum, the government has also been working to ensure skilled tech talent still has access to work in the UK, with its Global Talent visa scheme replacing the Tier 1 (exceptional talent) route for skilled applicants applying to work in the UK without a job offer.

Among plans announced in the Autumn Budget, Sunak focused on attraction and retention of the most skilled workers from overseas, confirming the criteria for eligibility for the UK’s new Scale-Up visa, designed to make it easier for fast-growing businesses to hire talent from overseas, due to launch in spring 2022.

But Martin Taylor, deputy CEO and co-founder of Content Guru, said the UK already has a local potential source of talent in women and young girls – and more should be done to tackle the reasons why they choose not to go into technology careers.

“We need a rapid increase in women graduating with STEM [science, technology, engineering and maths] skills,” he said. “Women are half of the workforce but barely exist in technology roles. Without any need for immigration, we have a whole, vast, untapped potential skills pool.

“However, the root is at A-level choices. For various reasons, girls of school age are not being attracted to maths and science subjects, which self-perpetuates. Secondary education is where the shaping happens that leads to subject choices for university degrees, which, in turn, industries harvest. Secondary schools are where the focus needs to be.”

Looking further afield, the new Global Talent Network was also announced in the Budget, aimed at helping businesses and research institutions to pinpoint skills needs and work with partner organisations in other countries to bring talent from around the world to the UK to work in the science and technology sectors. Launching in 2022, the programme will initially be in the Bay Area and Boston in the US, as well as Bengaluru in India.

Nimmi Patel, policy manager for skills, talent and diversity at TechUK, said: “TechUK welcomes the Budget’s focus on migration, which includes the UK’s new Scale-Up visa and Global Talent Network. This will make it quicker and easier for growing digital businesses to bring in highly skilled individuals. The ability to attract the best global talent was has also been a key tenet of the government’s R&D People and Culture Strategy.

“As we approach the end of the first year of the new immigration system, TechUK believes this is an opportunity to streamline the immigration system so that it engenders public confidence and works for businesses of all sizes.”

The technology sector is certainly welcoming the steps this year’s Autumn Budget has taken to start addressing some of the talent issues faced by the sector. But as usual, more needs to be done, particularly to train people already living and working in the UK in digital skills and to encourage more young people into the industry.

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