A successful skills system should do two things at once: supply the workforce required for economic growth, and widen access to opportunity for those shut out of it. The UK has consistently struggled to do either.
Employers report acute shortages across industries central to the government’s agenda – construction, health, digital and clean energy – while productivity continues to lag. Routes into stable, well-paid work remain disproportionately shaped by background and geography. Skills reform is repeatedly presented as the bridge between these problems. In practice, it has become the point at which competing priorities collide.
Labour has committed to putting employers “at the heart” of the skills system, reforming apprenticeships, expanding lifelong learning and breaking down barriers to opportunity. These ambitions are tied directly to delivery: building 1.5 million homes, accelerating the green transition, raising productivity and reducing economic inactivity. The question is whether the system now being assembled can meet demand without reproducing the inequalities, failures and oversights that created it.
For Helen Hayes, chair of the Education Select Committee, the answer begins with further education. FE, she argues, is critical to every one of the government’s missions, yet has long been treated as peripheral. Speaking at the New Statesman’s Politics Live event, she said governments “pay lip service” to further education while treating it in policy and budget terms “as if it’s anything but” important.
The committee’s inquiry into further education and skills found a system underinvested for more than a decade and lacking parity of esteem with academic routes. Schools continue to signal that success means university, even though around half of young people will never attend.
One recommendation was structural rather than rhetorical: expanding UCAS beyond higher education, aligning vocational, technical and academic applications on the same timeline. At present, Hayes noted, students submit university applications months before they hear about apprenticeships. The imbalance is baked in early.
Access, however, is only part of the problem. Capacity is another. FE colleges struggle to recruit and retain staff, particularly in technical subjects, because pay lags behind schools, and colleges cannot reclaim VAT. “I don’t know how colleges are expected to recruit and retain the best teachers when they’re paid around 15 per cent less to teach the same subjects,” Hayes said.
Financial disparities are even more visible where responsibility for skills delivery shifts onto employers. Ian Sollom, the Liberal Democrat spokesperson for universities and skills, argued that employer-led reform underestimates the constraints businesses face. “When I talk to SMEs, they really want to take on apprentices,” he said. “They’re worried about skills shortages. But it’s a big burden, and when it doesn’t work out, it can be disastrous.”
Large firms can absorb failed placements as a cost of doing business. Small employers cannot. Yet SMEs employ around two thirds of the workforce. If skills reform depends on employer engagement, supporting smaller firms is structural, not marginal. That same dynamic shapes apprenticeships themselves, often presented as a solution to both skills shortages and social mobility. In theory, they offer paid routes into skilled work without the debt associated with higher education.
In practice, access is uneven.
Sarah Atkinson, chief executive of the Social Mobility Foundation, insisted that skills, growth and opportunity cannot be treated as separate agendas.
“If we’re going to build the skills we need for future growth, and create opportunity for people and communities who’ve been shut out of prosperity, then we have to be intentional about unlocking the potential of everyone,” she said.
Without that intention, inequalities persist. Skills England does not collect socioeconomic background data on apprenticeships, making it difficult to assess who benefits. Around 5 per cent of students starting university degrees were eligible for free school meals.
The proportion entering degree-level apprenticeships from the same background is also around that level, according to research from the Sutton Trust.
“We’re replicating the same barriers in degree apprenticeships that those routes were meant to overcome,” Atkinson said. “If we don’t measure social mobility outcomes, we can’t know whether interventions are working.”
The issue extends beyond technical training. Employers increasingly report that new entrants lack communication, confidence and teamwork. Atkinson prefers a different framing: these are core employability skills, and employers are already investing heavily in them because the education system often does not. “If we focus only on technical skills,” she warned, “we miss what young people actually need to succeed and progress at work.”
Longer-term labour-market change sharpens the challenge. Jude Hillary, co-head of UK policy and practice at the National Foundation for Educational Research and principal investigator for the Skills Imperative 2035, has spent five years examining how jobs are likely to evolve.
While overall employment is expected to grow, most of that growth is focused in higher-skilled professional and technical roles. Mid- and lower-skilled occupations are in long-term decline. Hillary estimates that between one and three million such jobs could disappear by 2035.
At the same time, many workers already in higher-skilled roles report gaps in what Hillary calls essential employment skills. “If nothing is done,” he said, “the number of workers with substantial skills deficiencies could rise to seven million by 2035.”
The risk is a labour market with fewer entry-level jobs and higher thresholds for progression. Without sustained investment in lifelong learning, displacement becomes structural rather than temporary.
Governance matters too. Hayes raised concerns about the independence and capacity of Skills England, particularly its ability to speak candidly about funding needs. Without clear national coordination alongside devolved delivery, she argued, regions risk falling through gaps. Devolution is often presented as the answer, aligning skills systems with local labour markets. But devolving funding without building local capacity can simply relocate dysfunction.
Across these debates runs a common thread: skills reform is being asked to reconcile competing demands within tight constraints. It must be responsive to employers while correcting market failures; support growth without entrenching inequality; and prepare people for jobs that do not yet exist while fixing pathways that already do.
The danger is not a lack of ideas but a lack of coherence. What emerges instead is a system that struggles to answer a basic question: who is it for?
The answer, uncomfortably, is all three: employers, individuals and the state. That is why skills reform remains politically attractive and practically difficult. It sits where trade-offs cannot be avoided.
Success requires confronting those trade-offs directly: investing in FE as infrastructure rather than afterthought, supporting employers where the market fails, and measuring success not only in starts and completions but in who benefits and how.
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