Objectively, there is a market failure in the private sector in maintaining the required levels of skilled personnel necessary to perform critical national and social functions such as construction and engineering. This has resulted in high levels of legal immigration and low levels of domestic capacity. The UK has 1m NEETs and a debilitating drought of skilled labour needed for everything from construction to nursing, social care and nuclear power plant building.
One reason for the market failure is because there is no way to own the benefits of training a person. The benefits accrue to the individual, and to the society as a whole, but not to the organisation that does the training. Firms could hold on to the benefits if they were able to generate sufficient levels of profit on a continuous basis to retain skilled individuals in a competitive market. But highly competitive markets work in the opposite direction, making jobs less constant, and further exaggerated in markets where jobs are large projects.
An alternative could be to situate skills and training in an industry specific, non-enterprise institution. There are two possible locations for this: an organised labor union, or the government. Where private enterprises have been able to adopt and succeed in this role in the past, it is because their work has been backed by government contracts that guarantee a continuous stream of income and profits, such as the defence industry.
As the costs and benefits of a skilled labour force will ultimately accrue to the society, the efficient delivery vehicle is our democratic government. Ultimately, this is a political endeavour, and trade unions may be useful subcontractors in this framework, but it must be owned politically to escape the current failures.
Skills development involves training, but it also relies heavily on real world, practical experience and side-by-side working with those who are already experienced, a.k.a. apprenticeships. This requires that any programme is closely linked to the existing workforce and firms practising in the industry.
Skills Centre Operations
Apprentices and Trainees are full-time employees of the Skills Centre, required to show up at the Centre or at jobs for the hours they are paid. Pay is guaranteed but lower than direct private employment. Each worker in these statuses will have a skills pathway they can follow to complete certifications appropriate for their chosen career. Courses may be provided by local colleges or taught at the Centre.
Local firms, once approved, can access the workers in a Skill Centre by submitting a job request online. Centre workers would then opt in online to work in which they are skilled. Workers and firms rate each other after a job is complete, with the integrity of the relationships overseen by a board of Skills Centre managers, attached workers, and local businesses. The firms pay the Centre directly for all labour at rates fully inclusive of employment and Centre costs. Overtime, anti-social hours and other conditions result in extra charges which are passed through to the workers as higher pay.
This allows workers with the full range of skills and experience to work, learn and develop together, in classes, on jobs, and in the Centre. These Centres genuinely become a centre of jobs, not a benefit disqualification gateway. Assistance with welfare administration is moved from the previous Jobcentre to the new local Service Hub (seeService Hub policy).
The result for firms is flexible and reliable access to skilled labour at published rates and at short notice, without the administrative overhead of direct employment. Society benefits from having the skilled labour required for the economy’s objectives and needs. The individual benefits from a secure pathway into skilled, permanent work, and a flexible source of work outside permanent employment.
