The Innovation Caucus has just published a report for The Productivity Institute exploring the role of the Further Education sector in the UK’s innovation landscape. The report takes a wide ranging view of this often misunderstood and undervalued sector, looking at literature that addresses the history of the sector in the UK, and how it compares with its international counterparts, before suggesting viable ways for the Further Education sector to strengthen its position as a supplier of skills to meet the needs of UK businesses. We are very grateful to the project partners at The Productivity Institute and UKRI for their input into this research. Download the full report here.
Many members of the eight Regional Productivity Forums in The Productivity Institute report that skill mismatches are a key factor in inhibiting productivity growth in their areas. An intensive local and regional collaboration of FE colleges (FECs) with business and other education institutions (including HE institutions) will contribute to resolving this. Various initiatives have been proposed to connect Further Education colleges (FECs) and employers to fill this gap and accelerate place-based innovation but more needs to be done to understand their broader role in innovation ecosystems.
With the rising challenges of labour shortages across a wide range of occupations, the need for developing the right skills, for the right occupations and industries, and at the right time is even more critical to tackling the UK’s productivity shortfall. Our question in this analysis is how to address the challenge of improving the match between vocational skill needs by businesses and the mechanisms that FECs in the UK currently use to provide them. Our report is the first phase in a larger project to better understand how the mismatch between supply and demand of vocational skills arises at the regional and local level, and to design and experiment with models to enhance the role of FECs in regional and local ecosystems to improve the match. In the first phase of our research, we review the literature on FECs in the UK and internationally and their role in skills provision to the local and regional economy. This review explores what FECs are and how they have emerged as one of the focal points for ecosystem development. It then focuses on what they do and highlights the main pathways through which they contribute to the skills profiles of their regions.
We have found that FECs are not a homogeneous group and should perhaps be differentiated in future research in terms of their actual and potential roles in innovation ecosystems. We hypothesise that the environment within which an FEC is embedded is a fundamental factor in shaping College management decisions about course and programme offering for maximum competitive advantage – and that this varies greatly geographically within the UK.
We propose a conceptual framework to structure an analysis of FEC strategies and opportunity sets. We consider how policy objectives might be aligned with FEC incentive structures, and advocate a more thorough understanding of how the policy environment (sometimes described as cacophonous) impacts FEC strategies. In this study, we identify four key areas of questioning to analyse the position of FECs as innovators:
- Aligning policy objectives and FEC incentive structures: what are the tradeoffs that FECs must consider given competing policy demands, and all relative to available public and internal resources?
- Inspiring innovation and empowering FECs: to what degree are the FECs engaged in organisational innovation? It is necessary to understand the internal factors that enable FECs to change the ways that they operate, institute new programmes and practices, and think about their own organisational evolution if they are to service public policy objectives.
- Selecting the right tools for the job: It is not clear which programmes, mechanisms, types of engagement, etc., are most likely to achieve the objective of reducing skills mismatches. Should all FECs be attempting all types of engagement?
- Measuring inputs and outcomes: Getting more and more appropriate data is fundamental to many of the above research agendas. On the input side, more detail about employer skills needs, spatial trends, and programmes will help to better conceptualise alignment issues. Effectively measuring outcomes to determine impact is also crucial to refining strategies.
We found when reviewing the literature on FECs that evidence of innovative practice within the FEC sector is thin, but know that is not because innovation engagement is not happening. We hope that the insights from this and subsequent phases of the project will lead to recommendations to strengthen the position of a sector that has for decades been known as the ‘Cinderella sector’ – despite its importance as a key vocational skills provider for productivity and growth.