Skills for Success: The Reforms Essential to Our Economic Future

01.04.2025

The UK is in the midst of an economic and productivity crisis. Since the turn of the century, our economy has underperformed, while over the last decade it had struggled to regain its pre-financial crisis momentum. Industry is plagued by sluggish growth, stagnant wages, and a widening productivity gap.

The most important asset to any economy is its people. Britain’s economic and productivity crisis can only be solved if we have a highly skilled workforce in place, embedded in the latest technologies and equipped with the skills to use them effectively. Yet, there are currently 55,000 unfilled long-term vacancies in the UK manufacturing sector, costing the economy £6bn in lost output each year. The proposals in this report would pay for themselves if we fix this skills gap.

A robust Industrial Strategy is central to the new government’s growth plan, however, multiple obstacles remain to deliver the UK’s economic and industrial success. Foremost among these is the ‘perfect storm’ facing the manufacturing workforce: Increased early retirement; an ageing workforce; and elevated occupational ill-health have hit our sector hard, alongside an alarming drop in the number of apprenticeship starts, down 42% since the Apprenticeship Levy was introduced seven years ago. 

The result is that demand for skilled workers has increased at the very same time as the pipeline for workers, teachers, and talent, is diminishing. The sector’s skills shortage is now a critical issue for many companies, not just affecting their growth, but their ability to maintain daily operations and to fulfil contracts with customers.

Added to this, technological advances are transforming our economy and society – but again British industry is lagging behind its international competitors. The Prime Minister has committed to making the UK the world leader in the adoption of Artificial Intelligence but despite the UK having the 6th largest economy in the world, we languishing at 24th in the world industrial robot density rankings, in part, because we lack the workforce skills to adopt and apply these cutting edge technologies. 

The lesson from previous technological revolutions is the importance of enabling people to re-skill and upskill in order to succeed in the future economy. As these advances in technology begin to alter businesses and the world of work, adapting our education and skills system to meet our future industrial needs will be of vital importance.

Make UK’s Industrial Strategy Skills Commission report proposes a series of immediate reforms needed fix the foundations of our apprenticeship system as well as a set of longer-term strategic objectives to build for the future and ensure we develop enough skills for the success necessary to support the industrial strategy and economic growth.

Read the Industrial Strategy Skills Commission Report 2025 below.