Future skills: The UK’s greatest challenge and biggest opportunity

What will you be doing in a decade’s time? Who knows? A whopping 85% of the jobs that will exist in 2030 haven’t been invented yet, according to a report published by Dell Technologies and the Institute for the Future in 2018. Although that statement has been blown out of the water by many since it was published, it highlighted how fast the world is moving and how seismic the impact of technology continues to be.

The thought of doing a job that hasn’t been invented yet could be either exciting or worrying, depending on which seat you’re sitting in. The jobs could be pioneering; chances are a decade ago no one had heard of a ‘blockchain engineer’ or a ‘cloud services specialist’, but these people today can have really well-paid careers. They are using skills in ways that no one could have imagined 20 years ago.

But here lies the worry. When many educational programmes and places of learning were created, we didn’t know what skills would be needed today, and many people don’t have them. As new jobs replace the old, people with more traditional skillsets will find themselves out of work. The UK has a significant skills gap that, if not plugged soon, could create a damp future for the country’s younger generations and an increasingly unequal society.

We have an enormous opportunity ahead of us. If we upskill across the board now, creating the opportunities for young people to explore these new skills, we can continue to produce world-leading jobs and industries. If we don’t, there is a risk that many people will find themselves out of work and companies will look elsewhere for the skills they need.

New jobs, new sectors
Self-driving cars, 3D immersive story books, solar panels hidden in a pane of glass – the technologies and creations that we could soon all be using and experiencing push our imagination to the limits. Technologies such as artificial intelligence and industries that create these types of inventions are growing quickly.

McKinsey’s The Future of Work in Europe report suggested that STEM-related – science, technology, engineering and maths – organisations could grow by more than 20% in the coming decade. Similarly, across Europe the number of jobs in sectors such as financial services, real estate, telecommunications and education has been growing.

These industries broadly fall into what is known as the ‘knowledge economy’, the generally-accepted definition of the economic era we live where production is fuelled by knowledge rather than physical labour. The growth of jobs in these sectors is massive; research from LinkedIn shows that job postings for data scientists and advanced analysts – data scientists, data engineers, biostatisticians, financial quantitative analysts, economists, statisticians – increased by 231% between 2013 and 2018.

In contrast, jobs in more manual sectors such as agriculture and manufacturing could decline as automation – the robots, we could say – takes over. Artificial intelligence is delivering machines that can do what a person used to, whether that’s picking strawberries or creating car parts via 3D printing.

The loss of jobs in these sectors could hit people with more basic skills hard. McKinsey flagged that people with only secondary education are three times as likely to be in roles with high potential for automation. While the strongest job growth over the last few years has been enjoyed by the most highly skilled individuals, middle-skill or low-skill workers have had far fewer opportunities.

The skills required
When we talk about skills, our minds generally conjure up a physical skill. Increasingly, today’s physical is digital. Computer skills are vital in today’s world, and we’re talking about more than just the ability to hold a Zoom call or make a spreadsheet, as vital as these skills are. To sequence a genome to find a cure for cancer or develop a way to generate energy from manure requires a high level of computing.

However, the skills required to power our growing knowledge economy are not just related to technology and are just one fraction of the skills that we need to equip young people with today. Research released in 2019 by the University of Pennsylvania into the role of empathy showed that empathy facilitates cooperation, which is critical for teams to function effectively. Global innovative foundation Nesta described how “tomorrow’s model will need to educate a broader generational spectrum across a wider range of skills from cognitive, vocational, to interpersonal”.

Taking the need for interpersonal skills further, McKinsey predicted that jobs that require socioemotional skills will grow by 30% in the next ten years. As more and more jobs become automated, with people replaced by machines, the roles that remain will fall into categories such as caregiving, teaching and training. We need to ensure that people can do these jobs effectively.

The cost of the skills shortage today
So how far away are we from providing people with the skills they need both now and over the coming decades? Pretty far, it seems. It is already possible to quantify quite how much a skills gap is damaging the UK.

Organisations are currently spending an enormous £3.4 billion more than they should due to not being able to find workers with the right skills, reported the Open University Business Barameter Report 2019. CBI research found that 80% of UK companies surveyed believe a lack of skills is damaging the country’s competitiveness – 40% of workers don’t have the right qualifications for their job. Even more worryingly, less than half of the UK’s working population has the numeracy level expected of primary school children.

Talk to the Industrial Strategy Council and you’ll find that the situation is going to get worse. The council published a bleak-sounding report called UK Skills Mismatch in 2030, which explored how the UK’s increasing demand for skills is up against a constrained supply. It found that by 2030, 7 million workers could be underskilled for their job requirements – that’s 20% of the workforce. In short, “reskilling the existing workforce will be the major challenge between now and 2030”.

An imminent supply shortage can also be attributed to aging populations across Europe, as well as increasing urbanisation. McKinsey’s The Future of Work in Europe report says that Europe’s working-age population is likely to shrink by 13.5 million people due to aging by 2030 – that’s 4% of the workforce. Without enough young, skilled people filling the ranks, companies could start grinding to a halt. At the same time, the trend over the last few years of young people moving to urban areas has created real skills-shortages in more rural areas or smaller cities.

We can rewrite the future
But this is still all conjecture – people’s futures are not carved into stone. It is within our power to start changing how and what people are taught today to deliver the skills that organisations already need, urgently.

Nesta is blunt with its recommendations for governments and decision makers about how to tackle the skills shortage: “The central task for policy in the next few decade is to make the knowledge economy radically more inclusive.” Young people in every walk of life need to be equipped with the skills needed for the new world of work as more traditional jobs start to vanish; not just technological skills, but education that “develops character, mindset and non-cognitive as well as cognitive skills”.

And this is where it gets exciting: Nesta emphasises how the skill of having an open mind is just as important as the skill of coding a new piece of ingenious software. Students need to be able to “imagine ways in which their knowledge can be applied”, not just understand the nuts and bolts of how to get something done. The tools we have at our fingertips today – namely, ever-faster computers – will soon be able to do things we can’t imagine yet, but knowing what to ask them to do requires trying to imagine it.

We need to cooperate
To get to that point where we can train people for the right skills, the UK’s educational institutions need to start helping industry now. HR managers across the country are pulling their hair out at their inability to find the right candidates for jobs. A 2020 McKinsey survey found that while most respondents say it is a priority to address skills shortages, few say their organisation know how to equip their workforce with the skills they need most.

Cooperation is what is needed, between employers, government and educational institutions to reskill and upskill the existing workforce. Learning shouldn’t stop when a person reaches 18 and can leave school because the world won’t stop evolving. The Industrial Strategy Council’s paper argued that “an urgent shift to a new norm of lifelong learning in the UK workforce is required”.

This is particularly important as we face an aging population. Workers that have been in their professions for years or even decades are unlikely to have formally learned the skills needed today. As automation changes how things are done – even takes some jobs away – retraining will be essential. We need to prepare workers of all ages for new jobs that require more sophisticated skills.

The challenge facing the UK is real and it can be scary, but it is also exciting. Training people for the right skills today will open up a whole world up new jobs, new inventions and unimagined ways of living. In a world where blue sky thinking is encouraged, we need to train people to see it.