Skills for economic growth - An overview of priority sectors
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Skills for economic growth – An overview of priority sectors
Acknowledgements The Learning and Skills Improvement Service (LSIS) would like to thank Birmingham Metropolitan College for providing the photographs of learners that appear throughout this publication. Publisher Published by the Learning and Skills Improvement Service (LSIS). © LSIS 2010 Publication reference: LSIS239 This document is available to download at www.lsis.org.uk 2 Skills for economic growth – An overview of priority sectors
Contents
1. Introduction 5
1.1 Terms of reference 5
1.2 Background 5
1.3 Scope and purpose 6
1.4 Methodology 6
2. What are the priority sectors? 7
2.1 Developing skills to support growth in the priority sectors 8
2.2 The impact of new job growth and replacement demand on skills need 9
2.3 The regional picture 10
3. Priority sectors 14
3.1 Advanced manufacturing 15
3.2 Low carbon 25
3.3 Life sciences 36
3.4 Digital economy and creative industries 42
3.5 Engineering construction 46
3.6 Business and professional services 50
3.7 Care 54
3.8 Retailing 56
3.9 Tourism, hospitality and leisure 60
4. The role of providers 64
4.1 Actions for providers 64
Annex A 72
Annex B 77
Annex C 78
Annex D 79
Annex E 80
Skills for economic growth – An overview of priority sectors 3
4 Skills for economic growth – An overview of priority sectors
1. Introduction
1.1 Terms of reference
This research study aims to inform the Learning and Skills Improvement Service (LSIS) and
providers in the learning and skills sector about the priority for future economic growth
and future job growth in England, and how the opportunities arising for training and
business services could be exploited. The research was conducted in March 2010, prior to
the May general election.
1.2 Background
This report reflects the outcome of interviews with a sample of stakeholders in the learning
and skills sector, with sector skills councils and with training providers. It describes at a
high level, the priority sectors in England for future economic growth. It considers how far
these are common across the nine regions in England, and how well these priorities are
communicated and understood by providers and other stakeholders working to develop a
skilled workforce.
The priority sectors on which this report focuses were selected using a range of documents
produced prior to March 2010.
Those sectors were:
Advanced manufacturing;
Digital economy and creative industries;
Engineering construction;
Financial and business services;
Life sciences;
Low carbon energy;
Care;
Retail; and
Tourism, hospitality and leisure.
Skills for economic growth – An overview of priority sectors 5
1.3 Scope and purpose
This report sets out:
The national and regional priority sectors for growth and overarching
skills requirements;
A summary of the current and future skills requirements for each of the priority
sectors identified;
What providers are currently doing with respect to the priority sectors, how they can
improve and suggestions for the support required.
For the purpose of this research, the learning and skills sector comprises all providers who
access employer responsive funding provided through the Skills Funding Agency (formerly,
the Learning and Skills Council).
This report looks in some detail at the first six of the priority sectors identified above
and in less depth at the final three. It considers who are the key stakeholders associated
with each sector. In particular, it considers which of the nine regional development
agencies (RDAs) have included these nine priority sectors in their own regional strategy.
Based on the research undertaken, it identifies actions to help providers respond to the
needs of businesses, and build and strengthen their capacity in the priority sectors for
growth. Possible support activities to help providers are also identified. The report is
structured around these nine priority areas and considers each in turn.
1.4 Methodology
The research conducted in March 2010 has included:
Desk research of existing policies, strategies, research and labour market information
about current and future skills and employment requirements; and
Interviews with 33 stakeholders, including RDAs, sector skills councils (SSCs), the
Skills Funding Agency (The Agency), National Apprenticeship Service (NAS) and
providers and colleges from the learning and skills sector. Over 68 stakeholders were
invited to participate in an interview as part of the research.
6 Skills for economic growth – An overview of priority sectors2. What are the priority sectors?
A variety of approaches can be used to identify priority sectors, including identification of:
Those sectors with highest forecast employment growth as identified in Working
futures (UKCES, 2007) and Skills for Jobs, Today and Tomorrow (UKCES, 2010)
Economically significant sectors potentially constrained by skill deficits, as identified
in Skills for Jobs, Today and Tomorrow (UKCES, 2010)
Emerging sectors expected to deliver sustainable economic growth and jobs across
England, and secure a competitive advantage for the country in the global economy, as
identified in New Industry, New Jobs (BERR, 2009) and Jobs of the Future (BIS, 2009).
Table 1 shows a summary of the priority sectors identified using the three approaches
highlighted above.
Table 1: Priority sectors
Sectors with highest Economically significant sectors potentially Sectors identified Sectors identified in
forecast employment constrained by skill deficits in New Industry, Jobs of the Future
growth (from New Jobs
Working futures) Current Future
Business services Computing Business services Advanced Advanced
Health and social Construction Education manufacturing manufacturing
care Hospitality Financial services Digital and Business and
Hotels and Retailing Health and social creative economy professional
catering Transport care Engineering services
Retailing. equipment Retailing construction Care
manufacture Wholesale Financial and Digital economy
Utilities. distribution. business services and creative
Life sciences and industries
pharmaceuticals Engineering
Low carbon. construction
Life sciences
Low carbon
Retailing
Tourism,
hospitality
and leisure.
Skills for economic growth – An overview of priority sectors 72.1 Developing skills to support growth in the priority sectors
Skills are a crucial component of future economic success in any sector. Ensuring that the
nation is equipped with the skills employers need in the future will maximise the amount
it benefits from the opportunities for economic growth that lie ahead. To fully maximise
economic performance, to generate real opportunity for individuals and for business
success, it is imperative to supply economically valuable skills which effectively meet the
changing needs and requirements of the labour market.
Skills for Jobs, Today and Tomorrow (UKCES, 2010) highlights the predicted long-term
structural changes in occupational structure across a variety of the sectors listed in Table 1.
Substantial growth is forecast in managerial, professional and associate professional/
technical occupations. Such growth raises the need for high, intermediate and generic skills
to secure future economic prosperity. In doing so it places an emphasis on strengthening
training pathways, including intermediate vocational career pathways, to ensure skills
requirements are met, and that people can progress into intermediate and higher level
skills. Important skills areas for growth include:
management and leadership skills, especially for corporate managers across a wide
range of sectors to ensure successful growth and full exploitation of the potential of
emerging technologies;
professional skills, particularly in teaching and research occupations and in the
following sectors: the computing and software sector, parts of health and social
care, pharmaceutical and medical technology and manufacturing (i.e. traditional
and advanced)
technician and equivalent skills across many sectors, such as health and social
care, utilities, chemicals, life sciences and pharmaceuticals, automotive engineering
and broadcasting;
intermediate and higher level vocational skills within sectors such as manufacturing,
engineering, processing and construction associated with skilled trades as the current
ageing workforce retires and emerging opportunities develop in some sectors and to
support future demand;
customer service and employability skills including customer handling, problem solving
and team working will be of growing importance, particularly for the service industries,
including retailing, as well as for after-service and maintenance roles in manufacturing
and the digital economy.
Skills for Jobs, Today and Tomorrow (UKCES, 2010) also notes the ageing population
will lead to increased demand for care services with particularly significant increased
volumes of staff in care assistant roles, who will need greater understanding of ICT to
support care users with assisted living technologies.
8 Skills for economic growth – An overview of priority sectorsLow-skilled jobs are expected to persist. Despite the continued growth of highly
skilled work within the labour market, and a substantial overall decline in recent years in
lower skilled jobs, in the future significant employment is expected to remain in sectors
traditionally requiring low skilled jobs. Skills for Jobs, Today and Tomorrow (UKCES, 2010)
reports that employment opportunities in sectors traditionally requiring low skilled jobs
will still be significant. These jobs are important as a labour market entry point for many
groups, such as those seeking to move out of unemployment. However, many of these
jobs will subsequently be in need of upskilling in order to make improvements in service/
product quality and to meet changes in consumer demand.
Other developments in skills policy will also affect the demand for skills in priority sectors.
These include:
The effect of the imminent cap on non-European Economic Area migration on skills and
training needs
The intention to create a more spatially balanced economy
The results of the new government skills consultation in shaping policy to create an
internationally competitive workforce (see Annex A for details.)
2.2 The impact of new job growth and replacement demand on skills need
Skills for Jobs, Today and Tomorrow (UKCES, 2010) identified a net requirement for more
than 13 million job openings in the next ten years, of which only 1.9 million relate to new
demand. These job openings will arise as a result of structural change across occupations.
In contrast, over 11.5 million will arise due to replacement demand as a result of staff
turnover, including retirement. The two occupational groups with the largest volumes of
replacement demand are corporate managers and caring personal service occupations.
Occupations for which replacement demand is predicted to be significant will require skill
replacement, including upskilling.
The volume and types of new versus existing skills required to support both “new” job
growth and replacement demand, remains unclear at present. However, the change in
demand for skills is likely to include:
the application of existing skills to new technologies in existing jobs;
the application of existing skills to new technologies in new jobs; and/or
the development of new skills for new occupations.
The balance between the drivers of change in the demand for skills will vary across
different occupational sectors.
Skills for economic growth – An overview of priority sectors 92.3 The regional picture
A variety of factors impact on which of the sectors reported in Table 1 will be important for
economic and job growth at a regional level, including:
the strategic priorities for a region and the supporting policies;
the distribution of the sectoral employment across the region;
existing national and international competitive advantage and regional distinctiveness,
particularly with respect to research and development assets and business; and
the structure of sub-regional economies.
These factors provide regions with a stronger or weaker existing platform on which to
develop growth in the priority sectors. Figure 1 shows which sectors have been identified
as priorities by most regional development agencies (RDAs) within their Regional
Priority Statements.1
Figure 1. Sector priorities for regional development
Number of regional development agencies (RDAs) that prioritised the sector
Food and drink
Creative industries
Customer services
Tourism, hospitality and leisure
Financial, business and professional services
Life sciences
Digital and creative
Low carbon
Advanced manufacturing
0 1 2 3 4 5 6 7
In defining the high-growth opportunities, each region has begun to differentiate
subsectors within the broadly defined New Industry, New Jobs sectors. The main regional
dimensions for economic and job growth are summarised on page 12 in Table 2.
1 Links to the Regional Priority Statements can be found in Annex B.
10 Skills for economic growth – An overview of priority sectorsWhile the precise skills required to support high growth in the sectors identified will depend
on the regional context and the current geographical distribution of skills, the Regional
Priority Statements produced by the RDAs reveal several key themes which align with the
important skills areas highlighted on page 6. These key themes include:
Increased demand for:
– Management and leadership skills;
– Science, technology, engineering and mathematics (STEM) related occupations
at all levels; and
– Multidisciplinary knowledge and multi-skilling in management and technical
occupations in order to meet the need for improved IT, business development and
improvement, and customer service skills within occupations.
Skills inflation resulting in an increased demand for level 3 and 4 qualifications across
many occupational areas, including technicians and managers, identifying a need to
support progression to higher levels through promotion of level 2 and 3 pathways.
A need for improved business and entrepreneurial skills to increase innovation and drive
up enterprise.
Close to labour market interventions for unemployed people, incorporating programmes
that enable progressive skills development and employability skills.
Skills for economic growth – An overview of priority sectors 11Table 2: Priority sectors for the nine regional development agencies in England2 3
Priority sector East of England East Midlands London3 North East North-west
Advanced Micro and Aerospace, Plastic electronics Aerospace
manufacturing nanotechnology automotive and Micro-technology
Plastic rail manufacture Advanced
electronics engineering
Composites Industrial
Industrial biotechnology
biotechnology
Business and Relating to
professional key sectors for
services growth
Digital and Digital Transport IT
creative Creative technologies, infrastructure
industries including space
and global
navigation
satellite systems
Life sciences Life sciences
Low carbon Offshore wind Sustainable Construction Low-carbon Nuclear
Nuclear energy construction vehicles technologies
Low-carbon Application of Offshore wind Renewable
vehicles current strength Decarbonising energy
Low-carbon in energy the industries Low-carbon
buildings and building Energy from products and
Environmental technologies to waste services
technologies low carbon Carbon capture Retrofitting
and storage buildings
Marine energy Ultra
Green low-carbon/
construction electronic
vehicles
Other Customer Food and drink Retailing
services preparation, Tourism,
(especially in the packaging and hospitality
retail sectors) innovation and leisure
Tourism, production
hospitality and science
leisure
Health and care
2 These priorities have been identified from the Regional Priority statements (please see Annex B for links to the
Regional Priority Statements). Draft Regional Priority Statements for 2010–11 have been produced by all regional
development agencies, with the exception of the London Development Agency, and scheduled to be refreshed
by October 2010. For 2010–11, the London Development Agency priorities are aligned to those defined in the
London Skills and Employment Board Strategy.
3 For 2010-11, the London Development Agency priorities are aligned to those defined in the London Skills and
Employment Board Strategy. The LDA is currently undertaking research to identify employment forecasts across
sectors and occupations specific to London.
12 Skills for economic growth – An overview of priority sectorsPriority sector South-east South-west West Midlands Yorkshire and the Humber
Advanced Advanced Composites High technology Industrial
manufacturing engineering and Micro and manufacturing biotechnology
marine nontechnology Micro and
Aerospace and Advanced nano-technology
defence engineering Additive manufacturing
Industrial
biotechnology
Business and Financial and Financial services
professional professional services Business services
services (public and private)
Digital and ICT and digital Informatics ICT, including
creative technologies ICT security,
informatics,
photonics and
radio frequency
identification
Life sciences Life science Medical
Health technologies technologies
Low carbon Environmental and Renewable Environmental Carbon capture and
energy technologies technologies technologies, storage
Machine energy including building Civil nuclear
Offshore wind technologies Offshore wind
Civil nuclear
Environmental
technologies
Other Food and drink Retailing
Tourism, hospitality Construction
and leisure Wholesaling
Health and care
Tourism
Distribution and
logistics
Skills for economic growth – An overview of priority sectors 133. Priority sectors
In order to increase the supply of skills, providers must engage with employers, and should
understand how their curriculum offer is meeting the needs of employers. This section of
the report considers each of the priority sectors identified above. It is intended to help
providers understand the scope of each sector and the opportunities that may exist for the
development of new provision, or the expansion of existing provision.
Sections 3.1 to 3.9 contain a summary of the current and predicted future demand for
skills in the following sectors:
Advanced manufacturing;
Low carbon;
Life sciences;
Digital economy and creative industries;
Engineering construction;
Business and professional services;
Care;
Retailing; and
Tourism, hospitality and leisure.
A table showing a summary of the nine sectors and their subsectors is at Annex E.
14 Skills for economic growth – An overview of priority sectors3.1 Advanced manufacturing
3.1.1 Definition and associated subsectors
Advanced manufacturing describes industries and businesses that use a high level of
design or scientific skills to produce technologically complex products and processes. The
specialist requirements involved in Advanced manufacturing technologies are associated
with goods and services of high value.
The Advanced Manufacturing Cluster Report (www.semta.org.uk/public_bodies/research/
advanced_manufacturing_cluster.aspx) identifies six major subsectors for the advanced
manufacturing sector:
Aerospace;
Plastic/printed electronics;
Silicon electronics;
Industrial biotechnology;
Composites; and
Nanotechnology;
The most important element of current and future skills demand is high-level technical
skills including science, technology, engineering and mathematics (STEM) graduates,
postgraduates and technicians with an understanding of the specific technology or of the
underlying sciences.
To ensure the effective exploitation of the advanced manufacturing technologies,
expertise in the technology itself is required but, this needs to be augmented by
capable and competent technical support staff and also personnel skilled in the areas
of intellectual property (IP) management, new product and process development and
implementation, production and manufacturing engineering, and also marketing.
Whilst the advanced manufacturing sector activity is primarily focused on research and
development, advances in the technology associated with this sector will require an
increase in skilled technicians capable of running complex equipment. The requirement
for technicians will increase as the technology is applied to production, along with
management and commercialisation skills.
For each of the six advanced manufacturing subsectors, the current and future skills
requirements are summarised below.4
4 Unless otherwise stated, all figures and statistics quoted are taken from The Advanced Manufacturing
Cluster Report (www.semta.org.uk/public_bodies/research/advanced_manufacturing_cluster.aspx) and the
references contained therein.
Skills for economic growth – An overview of priority sectors 153.1.2 Aerospace industry
Aerospace supplies three main markets: civil, defence and space. Each product area is
also at the centre of a set of service activities including maintenance, repair and overhaul.
Table 4 summarises the current employment profile and skills requirements.
Table 4: Summary of current employment profile and skills requirement for the
aerospace industry
Current employment profile and skills Current skills mismatches
requirement
Management, professional and Skills associated with:
technician occupations now make up
54 per cent of the workforce, compared – Management and leadership
to 41 per cent 10 years ago. – Productivity and competitiveness
– Technical workforce development
Demand remains consistently – Strategic workforce planning.
positive for engineers in the satellite,
defence, unmanned aerial vehicle and
consultancy sectors, specifically for
knowledge of composites.
Electricians, radio frequency technicians
and surface mount technology operators
(aerospace electronics), are needed on a
permanent and subcontract basis.
An increase in the complexity of
the electronic systems on modern
aircraft, require a greater need for IT
skills support development, build and
maintenance activity.
Likely future skills requirement
The aerospace market is forecast to grow by 25 per cent in real terms over the next
20 years to $250 billion per year worldwide. Increasing fuel prices will also increase
demand for orders for new fuel-efficient aircraft. However, overall, aerospace employment
is likely to decrease in the future due to movement up the value chain, productivity
improvements and supply chain rationalisation.
Eight per cent of the current workforce is aged 60 plus. Taking into account the
replacement demand due to retirement, over the next five years there will be a net
requirement for 8,000 new entrants (1,600 people a year) in management and technical
occupations into aerospace in England. Expected demand is for 1,600 managers,
1,900 professionals, 1,300 technicians, 1,600 craft workers and 1,500 operators.
16 Skills for economic growth – An overview of priority sectorsTable 5: Summary of future skills requirement for the aerospace industry
Future skills requirement
41 per cent of the workforce qualified to NVQ level 4 plus but the sector target of
50 per cent by 2022 is not currently achievable by focusing on graduates alone.
Increased need for improved technical skills achieved through alternative routes to
higher education, including, for example higher apprenticeship in engineering.
New skills associated with the introduction of new technologies or equipment,
development of new products and services, new legislative or regulatory requirements
and introduction of new working practices.
Existing hard-to-fill vacancies and skills gaps, particularly within the licensed mechanic
occupation will be further impacted by the loss of skills due to an ageing workforce.
3.1.3 Plastic electronics industry
The term plastic electronics, also known as printed electronics, is used to describe
electronics based on semiconducting organic polymer materials. Plastic electronics is a
new sector, very much at the start of its development, but with recognised potential for
growth, in which the UK could play a leading part. Table 6 shows the different types of
plastic electronics and associated applications.
Table 6: Examples of possible applications of plastic electronics
Plastic electronics Examples of applications
Energy efficient lighting Lighting, signage, displays
Smart fabrics and intelligent textiles Illuminated safety clothing
Flexible displays Roll-up displays
Sensors Intelligent packaging for the
pharmaceutical and food industries – labels
that change colour if food items go outside
their recommended sell-by date
Photovoltaic cells Off-grid solutions including self-charging
mobile phones
Electronic circuitry Hand-held and mobile equipment
Consistent with the early status of the development of the plastic electronics, the
current skills required are mainly research and development skills at postgraduate and
post-doctoral level.
Skills for economic growth – An overview of priority sectors 17Table 7: Summary of current employment profile and skills requirement for the
plastic electronics industry
Current employment profile and skills requirement
Multidisciplinary skilled teams to lead development including expertise in:
– Electronic engineering, optics and nanotechnology;
– Printing and ink technology;
– Materials science;
– Chemistry; and
– Physics.
Support roles including:
– Designers to work across the sectors of electronics, printing, textiles and other
materials design to generate attractive products to develop the markets;
– Materials scientists to develop the substrates for printing on, including polymers,
and to develop the inks for use in plastic electronics and the methods by which the
inks can be applied; and
– Skills within the current manufacturers of printers, particularly in the development
of inkjet printers, to print the electronic components more effectively.
Likely future skills requirement
Table 8: Summary of future skills requirement for the plastic electronics industry
Future skills requirement
As products are developed in the laboratory and go into production, there will be a
greater need for technicians skilled in testing, prototyping, design implementation
and optimisation of products and manufacturing processes. As the markets develop,
these will be needed in increasing numbers within the next three to five years.
New product development and implementation skills will be required to ensure the
rapid transfer of technology to the market place.
Quality control skills.
Lean manufacturing techniques, particularly Six Sigma and quality, cost and
delivery measurement.
Development of printer technology and printer equipment manufacturing.
18 Skills for economic growth – An overview of priority sectors3.1.4 Silicon electronics industry
Silicon electronics is the design, development and manufacture of extremely small
electronic devices on wafers of single-crystal silicon that consume very little power.
The UK is a centre for global electronics development companies with major research and
development or manufacturing bases. For example, 40 per cent of Europe’s semiconductor
design houses are based in the UK, and almost 80 per cent of the activity relating to
semiconductors comes from foreign inward investment.
Table 9: Summary of current and future skills requirement for the
silicon electronics industry
Current and future employment profile and skills requirement
Regular upskilling of employees to respond to rapidly changing technology.
Technicians and craft level workers to be competent in fundamental electronics
knowledge, which can be applied across a number of applications.
Skills in circuit design, control systems, embedded software design, mathematical
modelling and simulation, systems design and engineering skills for use in advanced
manufacturing and quality control are most important.
The Semta and Institute for Employment Research forecasting model shows that
there will be a replacement demand for 16,400 employees between 2010 and
2014 in the electronics sector, which places a greater demand for STEM entrants,
particularly within electronic and electrical engineering.
3.1.5 Industrial biotechnology industry
The key market sectors for the application of industrial biotechnology (IB) are strongly
linked to advances in life science research and development. The IB subsector includes
the pharmaceuticals and other health care products sectors, including vaccine production.
However, IB also lends itself to the manufacture of chemical products and in particular
products which rely on the use of oil as their stock material.
Skills for economic growth – An overview of priority sectors 19Table 10: Summary of current employment profile and skills requirement for the
industrial biotechnology industry
Current employment profile and skills requirement
As with other advanced technology areas, higher degree qualifications focused with a
specialism in industrial biotechnology are required to meet the employment need.
The Working Futures 2007-2017 (UKCES, 2008) projections suggest that intake to the
chemicals sector is likely to be about 1,800 graduates a year. However, 25 per cent of
graduates are initially employed in occupations below NVQ level 4.
While the technology has become well established within both the pharmaceutical
and biotechnology sectors, the use of the technology is still in its infancy in the
chemicals sector, and as such there is a requirement for research and development
personnel in these areas to develop new skill sets.
Likely demand for skills in requirement
The continued research and development focus of this industry requires higher level skills,
at levels 4, 5 and 6 to meet the future needs, particularly to ensure translation of the
technology to the chemical sector. Table 11 summarises the skills required to support the
growth of the IB industry.
Table 11: Summary of future skills requirement for the industrial biotechnology industry
Future skills requirement
Graduates and postgraduates with multidisciplinary experience wherever possible
as IB crosses the boundaries between such areas as biology, genetics, microbiology,
chemistry and chemical engineering.
The applied nature of IB research and development activity will require more
graduates and postgraduates with practical working skills, together with project
management skills to drive business development of new products to generate
products from the research being done in IB.
Team working skills to ensure that researchers can work effectively with bioprocess
engineers in the scaling up of benchtop products to commercial scales
Technicians with the skills from level two to three will be required to run equipment
associated with the development of the technology (for example, biofermentation
pilot plants). Skills will also be needed to develop and control more efficient
production operations.
20 Skills for economic growth – An overview of priority sectors3.1.6 Composites
Composites comprise a mixture of two or more discrete materials which, when physically
combined, give a material with superior mechanical properties. The significant energy
savings both in production and operation means composites find application in many
manufacturing sectors, including:
Automotive;
Aerospace;
Marine;
Construction;
Domestic appliances;
Medical devices; and
Wind turbines.
Composites are receiving significant government research and development funding,
with £64 million allocated over an eight-year period. However, public sector research and
development is increasingly under pressure due to the recession and efficiency savings.
Table 12: Summary of current employment profile and skills requirement for the
composites industry
Current employment profile and skills requirement
The composites industries require researchers, innovators, technologists, designers
and highly skilled processing technicians with skills in the areas of manufacture,
assembly, disposal and maintenance, repair and overhaul.
The skills required vary according to the specific industries:
– Automotive: Greater competence in computer aided design engineering, ‘crash’
durability and cost modelling skills, prototype development, project management
skills, and tooling and jigging skills.
– Aerospace: Materials and process structures design, materials and process
engineers, design and stress engineers for composite structures, and people with
large scale processing experience.
– Marine: Carbon fibre specialists, laminators and knowledge of product and
process techniques.
Skills for economic growth – An overview of priority sectors 21Likely future skills requirement
The UK has a strong postgraduate focus on composite materials. The industry will
continue to need to recruit graduate chemists, physicists and biologists, to work closely
with and alongside engineers and mathematicians. Short, medium and long-term skills
requirements have been identified to meet future demand; these skills are summarised
in Table 13.
Table 13: Summary of future skills requirement for the composite industry
Future skills requirement
Short-term: Processing techniques of hand laminating, infusion (vacuum forming)
and pre-preg lay-up require training support.
Medium-term: The more advanced industries will have to be trained for automation
whereas the lower tech companies will adopt infusion/pre-preg processing techniques.
Long-term: All industries will have to adopt automation processes and the skills
associated with them.
The higher-skilled workforce will need to be supported by lower-level skills:
In addition to postgraduate specialist skills, highly qualified technical support will be
required to realise the benefits of composite industry.
3.1.7 Nanotechnology
Nanotechnology is a collective term for a set of technologies, techniques and processes,
rather than a specific area of science or engineering. It represents an entirely new
manufacturing process, with the industry still largely based on research and development
activity, requiring engineering and science-related higher levels skills at NQF levels 5 and 6.
Table 14: Summary of current and future skills requirement for the
nanotechnology industry
Current and future employment profile and skills requirement
Multidisciplinary experience is highly beneficial, both currently and in the future,
as nanotechnology crosses the boundaries between such areas as natural sciences
and engineering.
Scientists and engineers will require management skills in areas such as finance,
technology management and technology strategy, high-tech marketing, intellectual
property strategy and in science and technology policy, if they are to successfully
commercialise their research findings and establish high-performing companies.
In the food industry, the skills requirements for nanotechnology will be focused on the
need for higher skilled food scientists to develop anti-microbial activity to ensure food
safety and security.
22 Skills for economic growth – An overview of priority sectors3.1.8 Geographical context of the advanced manufacturing industry and
associated subsectors
Regional expertise and growth potential in the specialist industries included within the
advanced manufacturing sector are distributed across a number of English regions.
For example:
Aerospace activity is regionally concentrated in the north-west, south-west,
East Midlands and south-east.
Silicon electronics employment is greatest in the east of England, the south-west and
the south-east.
The chemical production sector is distributed throughout the UK but has four major
clusters found in the north-east, the north-west, and Yorkshire and the Humber and
south-east regions.
Industrial biotechnology tends to be distributed throughout the regions, clustered
around the presence of higher education institutions to exploit and commercialise
industry and innovation.
Specific skills requirements associated with priorities identified within each region’s
statement of priorities are summarised below:
East of England
While the skills requirement has yet to be defined, plastic electronics, micro and
nanotechnology, industrial biotechnology and composites are all identified as high growth
opportunities within the east of England Regional Priority Statement.
East Midlands
The chemical and polymer industries are characterised by small and medium-sized
enterprises (SMEs) and form the largest employment base in the East Midlands
employing 11,300 and 22,300 respectively. The pharmaceuticals industry accounts for
approximately 3,300 employees in the region.
North-east
The north-east is home to the national plastics electronics prototyping centre (PETeC),
although the extent and availability of skill sets required are currently unknown due to the
early state of technology development.
North-west
The north-west is the largest manufacturing region in England. The regional priority
statement identifies skills priorities above national average for technical, practical,
job-specific skills, problem-solving, and customer handling and management skills.
Skills for economic growth – An overview of priority sectors 23The region’s chemicals manufacturing and processing industry accounts for 21 per cent
of total UK employment in the sector. There are currently shortages of technical and
engineering skills such as technicians, fitters and operators. An ageing workforce will mean
more apprentices are required to meet replacement demand.
The use of composite components in both civil and military aircraft is growing rapidly,
particularly requiring systems engineering training and greater understanding of
supply chain needs.
South-west
The national composites centre is based in the south-west of England and aims to develop
internationally significant technology to support many sectors. Technical skills at level 3
and above are required to support the growth of the region’s composite industry. However,
some level 2 skills are required, including skills in composite familiarisation.
Yorkshire and the Humber
The chemical and polymer industries form the largest employment base in the
region employing 11,700 and 18,800 people respectively, and the pharmaceuticals
industry accounts for approximately 4,100 employees in the region (Cogent 2009).
www.sscalliance.org/nmsruntime/saveasdialog.aspx?lID=949&sID=1858)
The regional statement of priorities identifies the requirement of skills at levels 3 and 4 to
support regional growth in advanced manufacturing industry, coupled with a growth in
level 2 to 4 learner starts in a range of technical NVQs.
24 Skills for economic growth – An overview of priority sectors3.2 Low carbon
3.2.1 Definition and associated subsectors
The low carbon agenda spans a range of sectors within the economy. The Low Carbon
Cluster Report (2009)5 states that the low carbon agenda should be considered under
four broad headings which represent significant sources of carbon production. These four
headings are:
Decarbonising the power industry;
Decarbonising industry;
Decarbonising transport; and
Decarbonising buildings.
Table 15 below summarises the sectors that are considered to be in scope under each of
the four headings highlighted above.
Table 15. A summary of the sectors that form the low-carbon agenda
Decarbonising the Decarbonising industry Decarbonising the Decarbonising the
power Industry transport sector buildings
Large-scale Energy efficiency Low carbon Zero-carbon homes
renewable management
New nuclear energy Alternative energy Fuel efficiency Micro renewable
Carbon capture and Reduced emissions Air traffic Retrofitting existing
retrofitting and wastage management buildings
Energy from waste Low-carbon Hybrid vehicles Retrofitting
processing commercial
buildings
Land management Modal shift
and natural
environment
Substantial opportunities for UK economic growth exist within this sector through more
efficient use of energy within the economy but also developments in low carbon energy
generation including wind, marine, micro generation, nuclear, and carbon capture and
storage. These opportunities are, in part, due to a number of advantages that benefit
the UK including abundant wind and marine resources as well as large potential sites for
carbon capture and storage (CCS).
There are some cross-cutting themes that emerge in relation to the skills requirements of
the industries that form the low-carbon agenda.
5 Unless otherwise stated, all figures and statistics quoted are taken from The Low Carbon Cluster
Report (www.sscalliance.org/nmsruntime/saveasdialog.aspx?lID=974&sID=1858) and the references
contained therein.
Skills for economic growth – An overview of priority sectors 25 Science, technology, engineering and mathematics (STEM) related skills feature
heavily in terms of what is required by employers as well as the need for generic skills
such as management and leadership, technology transfer skills, general business
acumen and entrepreneurial skills.
The ageing workforce will impact the sector and exacerbate current or future skills
requirements. For example conventional, renewable and nuclear power generation
are all forecasting large percentages of their workforce retiring over the course of the
next 10 to 15 years.
Summarised below are some of the key issues related to sectors defined as part of the low
carbon agenda and also the current and future skills requirements (where this information
was available).
It is very difficult to anticipate future demand for skills in the low-carbon sector. The
expansion of sectors (e.g. wind and marine) is linked to a range of unpredictable factors
such as successful planning applications that make it difficult to accurately predict the
extent and location of future skills needs.
On 1 April 2010, BIS and the Department of Energy and Climate Change (DECC)
launched a consultation on the skills needed to ensure UK businesses are equipped to take
advantage of low carbon opportunities. This consultation set out the government’s key
skills priorities, and the challenges which must be met if we are to:
Enable British workers and businesses to take advantage of the opportunities in those
sectors that are key to reducing our carbon emissions; and
Embed the necessary skills across all sectors to move the UK to a low-carbon and
resource-efficient economy.
26 Skills for economic growth – An overview of priority sectors3.2.2 Decarbonising the power industry
Decarbonising the power industry has been defined to include renewable power
generation (including wind, hydroelectric, biomass and marine energy), nuclear energy,
generating energy from waste, and carbon recapture and storage. The current employer
profile and skills requirements for decarbonising the power industry are summarised in
this section.
Table 16: Summary of current employment profile and skills requirements related to
decarbonisation of the power industry
Current employment profile and skills requirement
Wind industry: The wind industry involves utilising wind energy to drive turbines and
generate electricity. This is a growing sector with skill requirements including turbine
technicians, project managers and electrical engineers. There is a shortage of trainers
and some difficulty recruiting staff to remote employment regions.
Hydroelectric: Hydroelectric involves using the natural flow of inland water to drive
turbines and generate electricity. The sector does not currently seem to have high
levels of concern in terms of skills deficiencies.
Biomass: Biomass uses various fuel sources (e.g. waste, crops and other sustainable
natural sources) which are either incinerated in order to produce heat or power or they
can be digested to produce biogas. The sector does not currently seem to have high
levels of concern in terms of skills deficiencies.
Marine energy: Marine energy utilises the natural motion of tides and waves to drive
various technologies which result in the generation of electricity. The demand for
skills is being driven largely by the need for skilled marine, mechanical and electrical
engineers to assist in design and testing of the new technology.
Nuclear Energy: The nuclear energy sector employs approximately 44,000 people
and has a requirement to recruit in excess of 1,000 new workers each year, mainly
as new apprentices and graduates in the following areas: project and programme
managers, safety case authors, design engineers, control and instrumentation
engineers and high integrity pipe welders.
Energy from waste: Waste can be used to generate energy through combustion
of solid fuels and via anaerobic digestion of wet food and agricultural waste
which could significantly reduce the amount of waste that is land filled in the
UK. The sector requires engineering, design and construction skills to develop the
necessary infrastructure.
Carbon capture and storage (CCS): CCS describes the technology and process
whereby the carbon dioxide (CO2) emissions of power generating plants to generate
electricity, are captured and prevented from being released into the atmosphere. This
technology can be fitted to both new build and existing power generating plants.
Experience in the oil and gas sectors is critical because storage of CO2 demands
similar engineering skills.
Skills for economic growth – An overview of priority sectors 27Likely future skills requirement
A summary of likely future skills requirements is presented below (where information
was available).
Table 17: Summary of future skills requirement related to decarbonisation of the
power industry
Future skills requirement
Wind industry: The sector provides around 4,000 jobs with potential to create 40,000
by 2020. The skills required will be at level 3 and mostly level 4 including project
managers, business development managers, electrical engineers, turbine technicians,
geologists and aeronautical engineers. The government also announced recently the
co-funding of up to 2,500 apprenticeships in the wind energy industry.
Marine energy: The sector is small but has potential for long term economic growth
and the creation of several thousand jobs. The marine sector is reliant on high
level STEM including civil engineers, electrical engineers, mechanical engineers and
structural engineers.
Carbon capture and refitting: STEM skills and offshore engineering skills and
knowledge of depleted oil and gas fields in the UK will be invaluable to the
development of the CCS industry. There may also be a need, particularly within the
carbon capture and storage subsector, for professional services advice such as legal
and financial services and climate change economists.
Nuclear energy: accounts for approximately 44,000 jobs (20,000 in the supply chain).
Employment will fall as plants are decommissioned but this will be cushioned by the
commissioning of new nuclear plants. The workforce is highly skilled with a significant
proportion engaged in professional and technical roles. The sector is currently lacking
one-third of the workforce it requires qualified to levels 2 and 3. The government has
made a commitment to co-fund up to 1,000 apprentices in the nuclear sector if the
demand from industry is confirmed.
28 Skills for economic growth – An overview of priority sectors3.2.3 Decarbonising industry
Decarbonising industry has been defined to include increasing energy efficiency, reducing
carbon emissions and wastage, use of alternative fuels and low carbon processing.
The current employer profile and skills requirements for decarbonising the industry is
summarised in this section.
Table 18: Summary of current employment profile and skills requirements related to
decarbonising industry
Current employment profile and skills requirement
Energy efficiency: This is essentially about using less energy to produce the same level
of service / output. Investment in research and development and global competition are
driving the demand for skills. The sector requires technical skills such as mathematical
modelling, rapid prototyping and computer simulation. In addition skills related
to areas such as corporate social responsibility, environmental product analysis and
legislative compliance are also needed.
Reduced emissions and wastage: Reduced energy use, emissions and wastage is
central to the development of a low carbon economy. Current skill requirements include
leadership and management, process control and improvement, and materials, supply
chain and product design which will require high level STEM skills.
Alternative fuels: Alternative fuels are typically non-carbon (such as hydrogen).
Primarily, skills are needed in the engineering construction aspect of the alternative
fuel industry. This includes: project management, technological understanding,
environmental compliance and design standards. The adaptation of skills is possible
from existing installation and construction practices.
Low-carbon processing: The emerging field of industrial biotechnology provides the
possibility of developing original processes that reduce energy demand, typically in
areas such as pharmaceuticals and high value, low volume speciality chemicals. Skills
requirements are at all levels and include high level interdisciplinary skills, with the
ability to integrate laboratory practice with industrial scale production. A wide range of
specialisms are required, from the cultivation of feed stocks and land management to
the operation, control and maintenance of industrial plants.
Land management: Management of the natural environment can mitigate the
impact of climate change. For example carbon sequestration involves capturing and
storing carbon naturally in soils and vegetation. Skills related to the preparation
of environmental impact assessments, sustainability, soil management and land
management are required. Knowledge in areas such as soil science, organic chemistry
and efficient resource management is also required.
Likely future skills requirement
Decarbonising industry will require the development of technical skills across a number
of sectors, particularly manufacturing, to support the development of the UK as a global
leader in low carbon technologies.
Skills for economic growth – An overview of priority sectors 293.2.4 Decarbonising the transport sector
Decarbonising transport includes the development of low carbon engines, fuel efficiency,
air traffic management, hybrid vehicles and a modal shift to utilise forms of transport that
reduce C02 emissions. With transport representing 21 per cent of the total UK domestic
carbon emissions, decarbonising transport is expected to be an integral part of the low
carbon solution. A summary of the current employer profile and skill requirements is
presented over the page:
Table 19: Summary of current employment profile and skills requirements related to
decarbonising the transport sector
Current employment profile and skills requirement
Low carbon engines: The sector is driven at least in part by government investment
including £400 million of support to encourage development and uptake of ultra-low
emission vehicles. A range of skills are required including manufacturing, design, ICT,
mathematical modelling and simulation, systems design and engineering skills for use
in advanced manufacturing and quality control.
Fuel efficiency: The sector relates to reducing the amount of fuel it takes to perform
a specific task. In the logistics sector there are two main areas of skills needs. First,
warehouse operatives need to ensure that goods are delivered efficiently and in good
condition, reducing transport costs. Second, effective management skills are required
to ensure that the practices are followed.
Air traffic management: The government’s objective to lower CO2 levels and the
desire of businesses to lower costs and improve efficiency has driven the demand for
skills in this area. Employees with transport planning skills are required to help plan
the most efficient routes for aircraft.
Hybrid vehicles: Hybrid vehicles reduce the output of harmful pollutants. Different
types of engineering and installation skills may be required when new vehicles enter
service, as well as additional training and upskilling for maintenance and repair of
hybrid vehicles.
Modal shift: More research needs to be done on mode of transport and the related
impact, including the impact of utilising multimodal transport, including rail and
sea transport, as a solution for a lower carbon economy. With companies accessing
revenue support from the government to embrace multimodal transport, strong
management skills that involve putting together business plans for funding, and
knowledge of sustainable solutions will be required.
30 Skills for economic growth – An overview of priority sectorsLikely future skills requirement
This section also includes a summary of likely future skills requirements related to
decarbonising the transport sector (where information is available).
Table 20: Summary of future skills requirement related to decarbonising the
transport sector
Future skills requirement
Low carbon engines: There are likely to be roles for people involved in developing and
producing prototypes using software to virtually test and explore new vehicle designs.
In addition, roles may emerge for people with a background in, and understanding of,
alternative sources of power generation such as batteries and low carbon fuels.
Fuel efficiency: With the Department for Transport’s suggestion of making
eco-driving a mandatory part of the European Union driver certificate of professional
competence (CPC), this would mean that 312,000 HGV drivers and up to
202,000 van drivers would need to complete the training. Further information can be
found in the Low Carbon Cluster Report.
Air traffic management: Carbon emission restrictions and higher flight prices have
the potential to lead to fewer flights, which will have implications for skills and
employment demand.
Hybrid vehicles: Different types of engineering and installation skills may be required
when new vehicles enter service, as well as additional training and upskilling for
maintenance and repair of hybrid vehicles.
Modal shift: Traffic congestion is set to rise considerably by 2025, costing the UK
economy £22 billion every year and impacting on the environment and the logistics
sector, where the majority (68 per cent) of freight is moved by road. Congestion
can have serious consequences for businesses. Companies will look for alternative
solutions like multimodal transport.
Skills for economic growth – An overview of priority sectors 313.2.5 Decarbonising buildings
Decarbonising buildings has been defined to include retrofitting existing buildings,
developing zero-carbon homes, commercial buildings and the micro renewable sector. The
current employer profile and skills requirements for decarbonising buildings is summarised
in this section.
Table 21: Summary of current employment profile and skills requirements related to
decarbonising buildings
Current employment profile and skills requirement
Retrofitting existing buildings: Involves renovating existing homes and buildings to
be more energy efficient. Legislation is an important driver here. Skill requirements are
related to improving the building fabric, for example walls, windows, lofts etc. While
the skills issues for loft and cavity wall insulation are addressed, there is a need to
ramp up skills in relation to aspects of fabric such as solid wall insulation and hard to
treat properties.
Zero-carbon homes: Zero-carbon housing is a new concept and tends to relate to new
builds. It is difficult to predict current skill needs as the ‘potential’ demand for firms
to adopt skills and capacity building are not yet creating ‘effective’ demand from
the market.
Commercial buildings: Communities and Local government (CLG) introduced
measures in England and Wales to improve the energy efficiency of our buildings
which have created employment opportunities in aspects such as commercial energy
assessors, air condition system inspectors and display energy certificate providers.
Micro-renewable: Includes solar power technologies, micro turbines and
heat generation techniques. The current skill requirements are graduates and
postgraduates with a multidisciplinary experience in nanotechnology and
effective research and development skills and technicians capable of running the
complex equipment.
Likely future skills requirement
This section also includes a summary of likely future skills requirements related to
decarbonising buildings (where information is available).
32 Skills for economic growth – An overview of priority sectorsYou can also read
