Skills ‘vital’ to sustainable recovery says John Lewis supremo

THE chairman of the John Lewis Partnership has warned that the current uplift in the economic growth may only be a “cyclical rebound” rather than a sustainable recovery.

Speaking at the CBI annual dinner ‘Retail Therapy’ at Imperial War Museum North near Manchester, Sir Charlie Mayfield said there is a growing skills gap, and that businesses need to take a lead to ensure that we don’t have “growth without jobs”.

“If we get the labour market working properly, the prospects are exciting. Employers have to step up to this challenge to help people get into work and build their skills. It’s not just about being nice, but it’s vital to our future.”

The former army officer, who chairs the government’s Commission for Employment and Skills, said in his business the foundations for success were about embracing  “structural changes in the way we shop” – but argued that every business need to adapt to change and address skills needs for the next generation.

“Over the last couple of decades there has been a steady decline in demand for entry-level jobs – which is why there is such a problem with youth unemployment. At the same time there is greater demand for the jobs at the top of the skills ladder, so there is no simple and easy solution.”

He said businesses had to get better at getting people into jobs at the “lower rungs of the ladder”.

To achieve this Sir Charlie said there needs to be “better porosity” between business and education.

“There is work to do for the government to encourage this, but I think it has to happen locally, between employers and schools – we have some great examples with UTCs (University Technical Colleges), where we have employers working really well with schools, but there are not enough of them.”

Another solution is to reinvent work experience, which he said is not just about a two week stint for young people with a business, but about real experience and earning.

“There has been an extraordinary decline in the number of people taking Saturday jobs – and there is a lot of evidence which shows that when kids get experience with work their prospects for employment are much better.”

In the mid-tier jobs market – the big space between entry-level and top level – he said employers had to help people move from the bottom upwards.

“Qualifications must not be the tail that wags the dog, and must be set by business for business.”

He said the Commission for Employment and Skills was pressing the government to do more to support businesses which offer apprenticeships – as currently just one in six do. Sir Charlie said he is “hopeful” there will be some news in next month’s Autumn Statement as the commission has been lobbying for a tax incentive.
 
CBI deputy director Neil Bentley told the audience that a number of national goals needed to be achieved to ensure the “long and slow recovery” continues to gather pace.

Challenges remain around infrastructure investment, supporting key sectors such as aerospace and automotive so they remain globally competitive, and also growing exports.

He warned too that businesses need to address “reputational issues”, based around the quality of goods and services offered.

The CBI “Retail Therapy” event was sponsored by business advisers KPMG and Royal Bank of Scotland.