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FSB Education & Skills

FSB top lines: Education and skills

The rising UK skills shortage should be addressed. The rise in the number of vacancies due to

skills shortages[1], despite an increase in further and higher education numbers, suggests that

businesses do not have access to the skills they need.

Young people lack workplace skills required by businesses. The top five skills lacking in young

people, according to FSB members, are all personality traits; general attitude to work,

communication skills, self-management, people skills and literacy[2]; with English and maths

following behind. The majority of businesses undertake informal on-the-job training and

remedial training. The need for remedial training would not be necessary if young people gained

these skills through the education system and welcomes the focus on raising standards in English

and maths. The FSB is supporting Young Enterprise in its efforts to link businesses with students

to provide business experience.

Careers education should be embedded in teaching from an early age. To support this, teachers

need to have the resources and knowledge to deliver this confidently and embed it into their

lessons. High-quality independent careers advice is vitally important, especially as participation

rates in vocational pathways are rising. Schools should promote vocational routes, such as

apprenticeships and traineeships, alongside academic study. This should occur before reaching

the age of 16 to give clear guidance as the participation age rises to 18 by 2015.

Employers should be engaged in the education system. It is widely recognised that business

engagement has positive employment outcomes for young people and the FSB is working to

encourage its members to take on work experience, become school governors, and work with

schools and colleges to inform them of what skills are needed for the modern workplace. 86 per

cent of businesses cited the importance of work experience as a factor in making recruitment

decisions. However, worryingly over 30 per cent of small businesses said they would not engage

with schools and colleges in the future. The biggest reasons cited for this was the lack of

willingness of institutions to engage, time and cost[3].

The FSB supports the Government’s vision for apprenticeships and welcome reform that seeks

to make apprenticeships more employer-led. 60 per cent of small firms have taken on an

apprentice in the last two years but over two thirds have never taken an apprentice on.

Apprenticeships should be valued by employers, be accessible and easy to navigate, and not be

an administrative and financial burden on business. The introduction of a voucher scheme has

been welcomed but there are still uncertainties around the funding mechanism to be introduced

for small businesses. Large firms will be required to contribute through an apprenticeship levy

and the FSB is in discussions with the Government about how this will work and its impact on

small firms.


Employers have a role to play in giving young people the skills they need for the workplace.

The FSB is engaging with the Careers and Enterprise Company, set up in response to Lord

Young’s Enterprise for All[4] report on embedding enterprise into the education system. The

company will be rolling out regional coordinators that will gather networks of volunteer

enterprise advisers to engage with schools. They would like to see the FSB encourage its

members to become advisors.

Lifelong learning

The skills and productivity of business relies on the ability of its workforce to adapt. Despite an

overwhelming majority of businesses recognising the importance of workforce development,

many cannot afford to invest in training. With only around one in ten small firms knowing that

tax relief is available for training, and five per cent of small businesses actually making use of it,

it is clear that advertisement and accessibility needs to be improved [5]. It is imperative that small

businesses understand what support is available to them and be able to access Government

support without it becoming burdensome to do so.

Leadership and management

Effective leadership and management is vital to the success of a business and to addressing the

UK’s productivity deficit. However, the 65 per cent of managers had a skills shortfall in this area [6].

FSB research found that over a quarter of small business owners have never undertaken formal

management training and nearly half of these businesses weren’t sure how training would

support their firm [7]. The lack of management training is impacting on the ability of UK firms to

improve productivity. Growth Hubs can play an important role in guiding business leaders to

appropriate guidance and training but provision and accountability mechanisms are not

universal. Working together Growth Hubs and LEPs should be required to recognise and respond

to the leadership and management capabilities in their region.





1 UKCES, The Labour market story: An overview, July 2014. UKCES, Employer Skills Survey 2013, January 2014.

2 FSB Education and skills survey 2015

3 FSB Education and skills survey 2015

4 Lord Young, Enterprise for all: The relevance of enterprise in education, June 2014.

5 2015 FSB Education and Skills Survey

6 2013 UKCES Employer Skills Survey

7 2015 FSB Education and Skills Survey