Train in Vain? Skills, tasks, and training in the UK labour market

Human capital and skills are important for improving the UK’s labour market and economic performance. This note assesses how the skills needed in the UK labour market have changed over past decades, and how well placed our system of training – and particularly on-the-job training – is to help us adapt to these changes. Some of the most fundamental changes in the nature of work has been an increase in the need for social and abstract skills in the workplace, while the employment shares of occupations that are intensive in routine and manual skills have fallen. At the same time, the amount of training done by workers is in decline, with the proportion of workers who have received work-related training falling from 29% in 2002 to 24% in 2020. These low rates of training among the least educated are troubling, given international evidence showing that there are higher returns to adult education for these individuals. In a world of stagnant productivity growth and with an increasing need for wages to keep pace with prices, the improving the UK’s system of training and skills provision could have an enormously beneficial impact. Fortunately, there is a wealth of international evidence that can be drawn upon to design a system that would make post-school training provision work for more of the UK’s labour force. Phase 2 of the Economy 2030 project will advance policy recommendations in this field that can ultimately contribute to higher and more inclusive economic growth for the UK.