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CFE was commissioned by The Higher Education Funding Council for England (HEFCE) to undertake an assessment of the higher level skills needs of employers in England.

The report, 'Using demand to shape supply: An assessment of the higher level skills needs of employers in England', is the final in a series of CFE studies aimed at developing a more sophisticated understanding of the higher level skills needs of employers.

Using demand to shape supply, aggregates the findings from three regional surveys (based on the responses of some 1,332 businesses), a series of ten focus groups and refers to the findings of similar studies such as the CBI’s Stepping Higher report.

Through our research, we have identified a number of key lessons for HE providers in the process of developing their higher level skills offer to employers:

• Invest in market research: The days of ‘if we build it, they will come’ should be consigned to history. To be effective, any higher level skills ‘offer’ must be based on solid market research (ideally conducted at an institutional level), an iterative process of product development and responsive delivery;
  
  
• Play to your strengths: Universities (and further education colleges that choose to do so with Foundation Degrees) are in the unique position of being able to design and award higher level qualifications and should capitalise on the demand for this provision identified through our research;
  
  
• Ensure delivery is responsive to the needs of employers: Universities must deliver to the same standard as private training providers and differentiate on the basis of brand, quality and qualification. Higher education institutions (HEIs) have the potential to grow their market share by embracing credit accumulation and transfer, and delivering bite-sized learning;
  
  
• Build on your significant market share: there has been a general acceptance in policy circles for some time that universities in particular have yet to significantly penetrate the market for delivering higher level skills training to employers. Our research does not support this view; in fact, universities have a higher market share than any other provider type;
  
  
• ...but focus on the professional and vocational training markets: while universities dominate the market for academic qualifications, they enjoy less success in the professional and vocational markets. Universities in particular need to tackle the widely-held perception that they only deliver ‘traditional’ academic qualifications in a ‘traditional’ way;
  
  
• Accept that not all businesses will invest in higher level skills: The presence (or absence) of a clear business case is the primary driver to investing in higher level skills. Businesses with a well-developed strategy, of which training forms a part, are likely to prove most receptive to an approach from an HEI or further education (FE) college. Where the business case does not exist, improved marketing or increased financial support are unlikely to change the training patterns of these employers;
  
  
• Understand the role of cost: Our research suggests that there is already a culture of co-funding amongst employers that invest in higher level skills. Most businesses are prepared to meet some of the costs of higher level skills training but believe this responsibility should be shared with government. Only 5% of businesses that had not undertaken higher level skills training reported that reducing costs would make them more likely to train.

The further challenge for universities is to develop sustainable approaches to delivering higher level skills training to employers. The main risk (and one that often accompanies public funding) is that it is viewed both internally and externally as just another project. In the current economic climate, it is unlikely that the safety net of additional funding will be provided to institutions that are unable to develop a sustainable model of delivery.

The full report 'Using demand to shape supply: An assessment of the higher level skills needs of employers in England', can be found here.

^{July 2009}

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