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October 26, 2021updated 29 Jul 2022 5:42am

UK ‘skills revolution’: Will £3bn help close the digital skills gap?

The Chancellor has pledged to boost skills funding in this week's budget. But will the cash be targeted at the right areas?

By Matthew Gooding

Chancellor Rishi Sunak has pledged to boost skills funding by £3bn in Wednesday’s budget, with greater investments in T-Levels and tech ‘boot camps’ for adults set to be announced. Experts have welcomed news of the additional cash, but they have also raised concerns about whether the funding is being targeted in the right areas.

Though full details of the funding will not be revealed until the budget itself, an announcement from the Treasury on Sunday stated that £1.6bn will be ringfenced to fund more T-Levels, the post-16 technology qualification launched last year, with £550m earmarked for adult skills provision and £830m to revamp and modernise colleges.

UK skills funding

Chancellor Rishi Sunak is set to announce £3bn in funding for skills training in Wednesday’s budget. (Photo by Ian Forsyth/Getty Images)

Sunak described the investment as a “skills revolution” that would help transform post-16 education in the UK, but those working in the sector are waiting anxiously to see if the reality lives up to the hype.

Are T-Levels the answer to the tech skills shortage?

As reported by Tech Monitor, the UK faces a growing digital skills gap: three million new tech jobs are set to be created over the next four years but only 48% of the population has the digital skills to take advantage of these opportunities. Already this year tech hiring has eclipsed its pre-pandemic levels.

Industry groups and tech businesses have called for action from the government, and offering more education options to young people, as well as upping the availability of training for adults wanting to reskill, is seen as a positive step.

"It's great to see an ongoing commitment to skills, especially as this is a budget that was billed as being about saving rather than spending," says Lisa O'Loughlin, principal of The Manchester College, the UK's largest further education college. But, she says, "we know the sector has been underfunded for many years, so while this funding hits a lot of the right buttons for us, we do think more funding is needed and this should be just the start."

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T-Level courses, which are receiving the biggest funding boost according to the treasury announcement, were introduced last September as an alternative to A-Levels. Covering a number of subjects including many digital-related areas, the two-year courses offer a mixture of classroom learning and practical experience with an industry placement.

The Manchester College's first cohort of T-Level students are halfway through their courses, and O'Loughlin believes the programmes are beneficial to both students and businesses. "We can see the difference T-Levels make to young people, particularly when they come back from their work placements," she says. "We believe it's the right investment to make for 16-19-year olds."

The rise of T-Levels has coincided with cuts to other established vocational courses such as BTECs. Stephen Evans, CEO of the Learning and Work Institute think tank, says other routes to work must be retained for young people. "T-Levels are a good idea and much more in line with what we see in other countries in terms of time spent in the classroom and on placement," he says. "But one of the challenges we hear about from employers is that they need to understand better how to engage with them. They don't know what 'good' looks like when it comes to a work placement, and they are being asked to do so many things by the government, with apprenticeships and the kickstarter scheme. It isn't clear what the priority is."

Evans is also wary that location may end up being a factor for those wishing to get into tech via T-Levels. "If you live in an area where there aren't any IT companies offering placements, do you just have to pursue a different career?," he asks. "We could end up missing out on talent. That's one of the reasons I'd be concerned about taking other options away and focusing on T-Levels when it is still early days and we don't know for sure how well they will work."

Tech bootcamps: do they work?

The Treasury says the £550m for adult training will go into the Skills Fund, which provides grants for short training courses, or skills boot camps, which are designed to reskill older people with digital expertise so they can find new jobs.

Evans says his concern is that these boot camps are not attracting the right sort of people to make a difference. "It's early days but the government's own assessment of the skills boot camps run so far shows that 84% of those attending already have level three qualifications (A-Level standard) or above," he says. "That might work in terms of meeting the requirements for jobs in IT and elsewhere, but I worry we're removing the opportunity for people without that level of education."

He continues: "We have nine million adults with low literacy in the UK, and a further 13 million with low digital skills which really affects digital inclusion and blocks the pathway to careers in IT. So while I think boot camps are a good idea, we don't yet have the data to know how well they work and whether they are the correct ladder to use for people looking for these opportunities."

It remains to be seen if the funding in the budget will constitute a fresh pot of money, or if the government is simply restating existing commitments, Evans adds. But, he says, the recent announcement of ten new Institutes of Technology across the UK, which will offer specialist courses for adults aged 19 and over in STEM subjects such as artificial intelligence, digitisation of manufacturing and cybersecurity, is a positive move to deal with the skills shortage. "These are level four and five courses which sit just above A-Levels but below a degree," he says. "This is a gap which we have in our system so it's a positive step to see it being addressed."

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