Upskilling to build back better

How can we improve adult upskilling to help the UK build back better? An Economics Observatory guide

Since its launch in June 2020, the Economics Observatory has addressed numerous questions on the themes of skills, education, training and realigning the UK labour market. Here is a summary of the answers

Charlie Meyrick

Improving adult training and job placement will be a key element of the UK’s COVID-19 recovery process. Policymakers face the challenge of identifying which groups, sectors and vocations are most in need of additional support in the aftermath of the pandemic.

Since its launch in June 2020, the Economics Observatory (ECO) has explored the themes of skills, education, training and the labour market through a range of briefings that are summarised below. Articles evaluating the effect of the pandemic on literacy gaps, lifetime earnings of graduates, older workers, the future of apprenticeships and the self-employed provide a broad backdrop for the upcoming roundtable event on UK skills mismatches and how to address them, co-hosted by ECO and the International Public Policy Observatory.

To meet current challenges, it is important that researchers and policymakers assess how different interventions can limit the harmful effects of the past year. For example, it may be that unemployment ‘scarring’ effects for younger workers can be addressed through local policies or national incentives to remain in education. At the same time, the rise of automation may present an additional obstacle for workers if previous skills and experiences cease to be valued.

Improving skills and job allocation processes are crucial components of the COVID-19 recovery. They will also form part of the answer to the question: what kind of economy do people want as societies around the world try to ‘build back better’?

The Economics Observatory’s answers to 10 key questions

What’s the future for apprenticeships after the pandemic?

COVID-19 and the ensuing economic uncertainty are causing interruptions to apprenticeship training. This is putting the future of apprenticeships at risk, just at the time when they will be most needed to protect employment and sustain the recovery. (Full answer here)

How can we protect young people from being scarred by the COVID-19 crisis?

Crises such as the COVID-19 pandemic can have long-term effects on young people, from reduced future wages and unstable unemployment prospects to poorer mental health. Policies to limit the damage should be targeted on keeping young people in education or apprenticeships, or directly matching them to relevant employment opportunities. (Full answer here)

… and how can local policies in particular limit the scarring of young people?

The COVID-19 crisis has led to rising youth unemployment and the threat of longer-term ‘scarring’ effects. Policies at the local level can make a difference to young people’s lives by sharing information about support programmes, encouraging take-up and coordinating local networks. (Full answer here)

How will COVID-19 affect the lifetime earnings of new graduates?

Graduating into an economic downturn can have negative consequences for young people in terms of pay and career progression throughout their lives. In response to the COVID-19 recession, many from wealthier backgrounds may opt to stay in education longer, further exacerbating inequality. (Full answer here)

How are robots affecting jobs and pay?

Decades of growing wage inequality have raised concerns about the impact of technology on the US labour market. New analysis of ‘task displacement’ distinguishes contrasting effects of automation on workers. Not all robots are created equal: some do more harm than good. (Full answer here)

What may happen to firm-level productivity in the UK after COVID-19?

Many businesses have responded to the pandemic by adopting new technologies and working practices. These may lead to productivity improvements. But other factors are important too, including the impact that damage to supply chains could have on the most productive ‘frontier firms’. (Full answer here)

How might COVID-19 affect older workers?

Recent years have seen considerable efforts to encourage older people to stay in the labour market for longer. With the health risks from COVID-19 rising with age, the pandemic and the economic downturn may affect both their ability and desire to do so. (Full answer here)

Update: How is COVID-19 affecting the self-employed?

A year into the crisis, it is widely recognised that the UK’s self-employed workers have been among the hardest hit. Survey evidence shows the latest lockdown is once again leaving the self-employed with lower incomes and substantially reduced hours. (Full answer here)

How can we tackle the widening gaps in literacy skills?

School closures in response to COVID-19 are expected to widen gaps in educational attainment, including literacy, for disadvantaged children. One way to mitigate this risk is through high-quality reading programmes. But how do schools know which interventions will be most effective? (Full answer here)

What kind of economy do people want if we are to ‘build back better’?

Many people are debating whether COVID-19 offers an opportunity to return to something better than ‘normal’ – in particular, moving away from using GDP growth as the sole indicator of progress. Developing greater economic and social resilience should be central to ‘building back better’. (Full answer here)

Charlie Meyrick is the Economics Observatory Centre Manager. If you would like to submit a question, visit the ECO website here