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Skills Strategy Impacts Energy & Utilities Sector Ahead of its First Anniversary

09 Feb 2018

Employers from UK gas, power, water and waste management companies can look back on a series of landmark achievements that have been initiated by the Energy and Utilities Workforce Renewal & Skills Strategy during its inaugural year.

Skills Strategy Impacts Energy & Utilities Sector Ahead of its First Anniversary photograph

The Skills Strategy has stimulated increased investment in skills, taken targeted action to address skills shortages* and driven collaboration on a digital platform to appeal to new demographics.

Published on 9 February 2017, the Skills Strategy documents how the energy and utilities sector will support UK infrastructure by developing a resilient and sustainable workforce.** The sector combined accounts for the greatest share of the Government's National Infrastructure Pipeline.

The Skills Strategy was developed by the Energy & Utilities Skills Partnership, a collaboration of 29 leading sector employers which formed in summer 2016. This predated the Government's plans to drive skills reform through pan-sector employer groups.***

Nick Ellins, Chief Executive of Energy & Utility Skills, was a driving force behind the formation of the Skills Partnership. He said: "The importance of the infrastructure sector generally, the skilled people needed to deliver it, the ageing workforce and need for greater inclusivity are all important themes in our Skills Strategy.* The developments we have seen, with Ofwat and the Industrial Strategy White Paper, have followed on from recommendations in the Skills Strategy that prioritise growth and productivity . The Skills Strategy has stimulated initiatives that are building sustainability and workforce resilience."

- The Energy & Utilities Independent Assessment Service (EUIAS), gives sector apprentices the opportunity to demonstrate competence to work in safety-critical industries. EUIAS provides high-quality end-point assessment services for nine of the 11 new English standards in this sector.

Over 2,000 apprentices are currently undertaking an apprenticeship within energy and utilities organisations. A further 220 have already passed through the EUIAS end-point assessment service and taken up employment in the sector with leading companies such as E.ON, Electricity North West, Morrison Utility Services, Scottish & Southern Electricity Networks, Severn Trent Water and UK Power Networks.

- The Skills Accord initiative is promoting structured and sustained investment in the technical and operational skills the sector needs most, through commitments in procurement practices.

It has been rolled out after a successful year-long pilot, during which lead partners - Skills Partnership members Amey, National Grid, SSE, Thames Water and UK Power Networks - cascaded the Skills Accord's aims through their delivery partners and supply chain. The 26 companies that originally pledged to its commitments in the pilot year has now grown to 40 in its first year.

- Through Talent Source Network, 20 of the Skills Partnership employers are offering hundreds of vacancies, including apprenticeships, on a shared online platform, alongside careers guidance and case study features on a diverse mix of new starters, recent recruits and senior professionals. Leveraging social media and targeted campaigns, TSN is engaging more diverse audiences and clearly showing achievable routes to progress from entry level roles all the way up to senior management. The 3,500 candidates registered on TSN include a higher proportion of women (33%) than the current workforce (20%).

The Skills Strategy's calls to build sustainability and workforce resilience in the sector have since been recognised in policy:

- Ofwat: Its Resilience in the Round publication (September 2017) recognises the skills an organisation needs to run its infrastructure are a vital part of resilience and states that 'resilience in the round for the long term is a key focus in the 2019 price review.'

- Infrastructure has been retained in the changes from the 10 Key Pillars in the Industrial Strategy Green Paper to the five 'Foundations of Productivity' in the companion White Paper. Skills is now contained within the People Foundation, increasing the share of the Industrial Strategy occupied by the issues raised within the Skills Strategy.

- The White paper has also expanded its remit in addressing an ageing workforce, which is one of the key asks of the Skills Strategy. The Skills Strategy's call for "explicit recognition of the importance of strategic workforce renewal," was among its recommendations to central Government and regulators following its omission from the Green Paper.

Many leading organisations have supported the Skills Strategy, including:****
- Ofgem, Ofwat, The Drinking Water Inspectorate and Health and Safety Executive
- GMB, Prospect, UNISON and Unite unions
- Energy UK, the Energy Networks Association, Water UK, British Water and Future Water
- IGEM, The Institute of Water and the Chartered Institute of Waste Management

CBI Scotland referenced The Skills Partnership's positive action to address the skills challenge in its Pursuing Prosperity report. The Skills Partnership was invited by the Scottish government to offer external support and challenge to its STEM Strategy for Education and Training.

Basil Scarsella, Chief Executive, UK Power Networks and Chair of the Skills Partnership, said: "It is vitally important to develop a sustainable workforce in an industry that is essential to meet people's everyday needs ... Every company is only as good as its employees.

"We are delighted to be part of the Energy and Utility Skills Partnership to encourage collaborative work, and address the findings of the Workforce Renewal and Skills Strategy which aims to raise the profile of exciting job opportunities."

Nick Ellins concluded: "We are proud of the progress that the Skills Partnership has made within the first year, but we are not content to rest on our laurels. More political and policy focus should be given to sectors like ours that contribute most to the UK's productivity and economy.

"We are continuing to work with regulators, government ministers and other key stakeholders: the sector needs their support to ensure we grow the sector talent pool, enable the transferability of skills and reduce individual employer costs by working collaboratively.
"It is vital that this sector, which is of strategic importance to national productivity, receives the investment it needs to address the challenges it faces. This will stimulate good outcomes for our customers, colleagues, companies and communities, so it can only be good for the UK economy."

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* Across energy and utilities, 36% of all vacancies are due to skills shortages - the highest proportion of any sector. The national average is 23%.

** The Skills Strategy reported that the sector will need to fill close to 221,000 roles by 2027. This is because 100,000 of the sector's near-500,000 UK workforce will retire; also that around 90,000 people will move to other roles and 31,000 new jobs will be created. The failure to source competent replacements in these safety critical industries could have major implications for the 65 million people who rely on these services every day.

The Skills Strategy also found that the sector's workforce:
- is overwhelmingly male:
o Gas: 86%
o Power: 78%
o Waste Management: 83%
o Water: 73%

- employs low proportions of people from Black, Asian and other minority groups:
o Gas: 4%
o Power: 5%
o Waste Management: 5%
o Water: 5%

*** This announcement was made in November 2017 during the Skills Summit by then-Education Secretary Justine Greening.

**** All of the quotes supporting the Skills Strategy are available at euskills.co.uk/key-documents

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