Lib Dem Survey Shows UK Businesses Losing faith in UK Plc

7.05.00am GMT Mon 14th Nov 2005

Ahead of 'Enterprise week', the Liberal Democrats today published the findings of their UK competitiveness survey which examines some of the main issues affecting the ability of businesses to compete in the global market place.

Key findings of the survey include:

· Over 73% of respondents currently felt the UK is either an average or above average place in which to locate business. But only 49% of respondents feel that by 2010 the same will be true.

· 71% of respondents stated that insufficient numbers of skilled workers had some or a significant negative impact on their company's competitiveness.

· 65% of Small and Medium Enterprises (SMEs) stated that insufficient unskilled workers had a significant negative impact on their competitiveness (compared to 41% for large businesses).

· 76% of SMEs stated that low numeracy and reading ability amongst school leavers had a significant negative impact on their competitiveness (compared to 53% for large businesses).

· Over 80% responded that Government support in the form of procurement policies, R&D grants, communication of trends or consultancy offered limited or no help to their business.

· Over 70% of responses to our survey disagreed with the assertion that the UK regulatory environment is currently about right.

Commenting, Liberal Democrat Shadow Trade and Industry Secretary, Norman Lamb MP said:

"Whilst the Government this week is looking to encourage the development of enterprising skills among our young people, it is clear that there is still a significant gulf of expectation between the skills we are currently developing in our work force and that needed by UK businesses.

"There is a sense of chaos and confusion over responsibility for closing the skills gaps - Two Government departments and a vast number of agencies all meddling but without an effective focus. For instance, it ought to be possible for an individual and employers to register interest for an apprenticeship on a central system, on a similar basis to that currently available for higher education opportunities."

"The big imperative in enhancing productivity in the UK is to improve education and training outcomes. The Government is spending billions of pounds on skills but without any significant impact."

"The Government owes it to employers, potential employees and young people to ensure that it closes the skills gap and ensures that the UK is able to compete in the global market over the long-term."

ENDS

Notes to Editors:

Main Survey Results

At present, the education system does not provide the quality or breadth of skills needed for the opportunities that exist in the UK. 71% of respondents to our survey stated that insufficient skilled workers had some impact or a significant impact on their company's competitiveness.

The differential responses between SME and large sized businesses[1][1] were particularly marked in responses concerning shortages of unskilled workers and low numeracy and reading ability in school leavers. 65% of SMEs stated that insufficient unskilled workers had a significant impact on their competitiveness (compared to 41% for large businesses). 76% of SMEs stated that low numeracy and reading ability in school leavers had a significant impact on their competitiveness (compared to 53% for large businesses).

In terms of current Government support, over 80% of all businesses responded that Government support in the form of procurement policies, R&D grants, communication of trends or consultancy offered limited or no help to their business.

Over 70% of responses to our survey disagreed with the assertion that the UK regulatory environment is currently about right.

Survey was issued to 655 companies and responses received from over 135 companies.

Context of Results

Taking into account each of the Learning and Skills Councils, RDAs, Sector Skills Councils there are over 80 Government bodies that dapple in the delivery of skills. However there are concerns that despite the amount of money being spent that there is not sufficient focus by either Department of Trade and Industry or Department of Education and sills for effective delivery.

An estimated 3.5 million people currently go to work each day without being able to read well.[2][2]

One in five establishments (20%) reported skills gaps in their workforce, and some 1.5 million workers were described by employers as not being fully proficient. This represents 7 % of the total workforce in England.[3][3]

Skills gaps are most likely to occur among sales and customer service positions (approaching a third of a million such staff lack proficiency) and elementary positions (approaching a quarter of a million such staff have a skills gap). The density of skills gaps is also highest among these occupations (along with plant and machine operatives). In these three occupational groups 9% of staff were described as lacking in skills [4][4]

New data for 2004 continues to show the UK's productivity performance, on a Gross Domestic Product (GDP) per worker basis, is lower than that of France and the USA, similar to that of Germany, and above that of Japan.. Up to a fifth of this productivity gap with France is as a direct result of lower skills levels in the UK. [5][5]

The UK economy has slipped down in a global league table of competitiveness due to the burden of tax and red tape and the low educational attainment of Britain's workers according to World Economic Forum.

CBI has voiced concerns over the levels of literacy and numeracy among school leavers. It calculated that the effect of poor basic skills on the UK's economy was some £10bn a year.[6][6]

[1][1] See Section 1.9 for further SME facts

[2][2] Learning and Skills Council - Press release 12 October Union Learning Fund to train thousands more people

[3][3] National Employers Skills Survey 2004.(Published 2005) Produced by Learning and Skills Council (LSC) in collaboration with the Department for Education and Skills (DfES) and the Sector Skills Development Agency (SSDA)

[4][4] As per 2

[5][5] Office of National Statistics

[6][6] Guardian 25 October 2005