Every few months a new report warns that the UK has another skills shortage. Employers cannot recruit, colleges need more funding, and young people are leaving education without the qualifications businesses need. Government responds with another strategy, another funding stream or another organisation designed to solve the problem. Yet despite years of reform, many of the same challenges remain.
Having spent the past years researching labour market governance and skills policy, I have found that England does not only have a skills problem, but it also has a coordination problem.
Over the past decade, governments have introduced Industrial Strategies, Local Skills Improvement Plans, Skills England, the Lifelong Learning Entitlement and a growing number of devolved skills responsibilities. Each initiative has addressed a genuine policy challenge, but they have rarely been designed as part of a single workforce system.
Skills policy has become one of the most fragmented areas of public policy. Responsibility is spread across central government, mayoral combined authorities, local authorities, employers, colleges, universities, private providers, voluntary organisations and careers services. Each organisation performs an important function, yet no institution is responsible for ensuring the whole system works seamlessly from education into employment.
The consequence is not a lack of activity, but a lack of integration. Employers are consulted repeatedly through different initiatives. Colleges respond to multiple funding priorities. Young people navigate careers advice, training, employment support and welfare through separate systems with different eligibility rules and objectives. We have built an impressive collection of programmes, but not always a coherent workforce system.
Why the West Midlands matters
Few places illustrate both the opportunities and the weaknesses of England’s workforce system more clearly than the West Midlands.
The region contributes around £160 billion to the UK economy and is home to globally competitive industries including advanced manufacturing, automotive, life sciences, professional services, clean energy and rapidly expanding digital businesses. It is also central to the Government’s Industrial Strategy, particularly through advanced manufacturing, electric vehicles and clean growth.
Yet these strengths coexist with stubborn labour market challenges. Employers continue to report recruitment difficulties, while many communities experience high levels of economic inactivity, particularly among young people. This is not simply a skills gap; it is a disconnect between people, education and employment.
The West Midlands Combined Authority has already recognised that these challenges cannot be solved through education policy alone. Its devolved Adult Education Budget, Local Skills Improvement Plans, Youth Guarantee Trailblazer, Careers Hub network and Local Growth Plan all point towards a more integrated approach. Increasingly, skills are being considered alongside employment support, business growth, transport, economic development and labour market intelligence rather than as separate policy areas.
This represents a significant shift in thinking. Instead of asking, “How do we deliver more training?”, the question is becoming, “How do we help people move successfully into good work?”
That is exactly the right question.
The next challenge
However, there is still an opportunity to go further.
Much of the current system remains programme-led rather than person-centred. Labour market intelligence, careers guidance, employment support and education planning continue to be commissioned, funded and evaluated separately. Employers are often asked to engage with multiple organisations rather than through a single coordinated relationship. Success is frequently measured by qualifications delivered or programme participation rather than sustained employment, career progression or productivity.
The West Midlands is uniquely placed to change this.
Rather than building additional programmes, it could become the UK’s leading example of an integrated labour market governance, one that connects labour market forecasting, employer demand, education providers, careers services, health, employment support and local economic strategy through shared data, shared objectives and shared accountability.
That means shifting from reactive skills provision towards proactive workforce planning. It means using real-time labour market intelligence to shape education provision. This ensures career guidance reflects future employment opportunities, supporting people throughout their working lives rather than at fixed transition points, and measuring success by whether people enter and remain in good-quality work.
This is particularly important as artificial intelligence, automation, demographic change and the transition to a greener economy reshape the labour market. Future prosperity will depend less on how many individual skills programmes we create and more on how effectively we connect the institutions responsible for preparing people for work.
The West Midlands already has many of the building blocks. The next step is to join them together.
This is a personal blog post. Any opinions, findings, and conclusion or recommendations expressed in this article are those of the authors and do not necessarily reflect the view of the Centre for the New Midlands or any of our associated organisations/individuals.
ABOUT OUR AUTHOR:
Dr. Hilda Ragnarsdóttir is a post-doctoral fellow at the University of Warwick. Her research area is public policy with a particular focus on Industrial, Skills and Education policy, the impact of new technology on jobs and skills, and the alignment of education and training with labour market needs.
Hilda has participated in various research projects on labour market affairs. They include country-based case studies on how to use labour market information systems to inform policy, commissioned by the DfE, how to improve labour market data for ONS and Skills England in collaboration with The Gatsby Foundation, and how to support workers with musculoskeletal condition (MSK) to increase labour market participation, commissioned by the Orthopaedic Research UK. She is currently working on Labour Market Projections 2025-2035, commissioned by Skills England.
