Annex H
INNOVATION, UNIVERSITIES AND SKILLS COMMITTEE
INQUIRY INTO ENGINEERING
WRITTEN EVIDENCE FROM UK TRADE & INVESTMENT
EXECUTIVE SUMMARY
The State of the Engineering Skills Base in the
UK, Including the Supply of Engineers and Issues of Diversity
1. Anecdotal evidence, collected from face-to-face
visits, email and telephone conversations with inward investors,
highlights issues these companies are facing when doing business
in the UK. Based on the total number of occurrences, skills is
repeatedly one of the concerns most frequently raised by inward
investors. Of those raised, availability of engineers account
for over one third of issues relating to skills. These issues
are raised by companies in a wide variety of sectors, from financial
services to automotive, and in regions and nations across the
UK. The volume of engineers required, and the range of disciplines
sought by inward investors is substantial, as are the consequences
of these companies in not being able to fulfil their needs. These
consequences include lost productivity, delays in expansion and
the possibility of relocating outside the UK.
The Role of Engineering and Engineers in UK's
Innovation Drive
2. Anecdotal evidence from business people
suggests the UK's reputation for academic excellence and producing
high quality engineering graduates is a key element in its overall
reputation in international markets as a potential partner for
advanced engineering trade and investment. It is vitally important
that this reputation is maintained and enhanced. UKTI is working
to highlight UK excellence in advanced engineering (aerospace,
automotive and engineering) in global markets, particularly high
growth markets.
Submission
The State of the Engineering Skills Base in the
UK, Including the Supply of Engineers and Issues of Diversity
Source of evidence about skills concerns of inward
investors:
3. The evidence presented is taken from
UKTI visit reports and includes issues raised by inward investors
between May 2006 and February 2008. Whilst the total numbers of
companies involved is small, and therefore not necessarily statistically
robust, this anecdotal evidence does present themes and facts
which will help inform the enquiry.
Themes and findings:
4. Of the issues raised, relating to skills,
during the period May 2006 to February 2008, over one third of
skills issues related specifically to difficulties in recruiting
or retaining engineers.
5. The issues relating to the recruitment
and retention of engineers occurred across a wide variety of sectors.
Issues were not limited to sectors traditionally associated with
engineering skills, such as automotive and mechanical and process
engineering, but also occurred in financial services, food and
drink and software and consumer services. Table A shows the full
range of sectors from which individual companies highlighted issues
in recruiting and retaining engineers.
Table A
PERCENTAGE OF ISSUES RAISED BY INWARD INVESTORS,
BY SECTOR
|
| %
|
|
| Automotive | 12.3
|
| Mechanical Electrical and Process Engineering
| 12.3 |
| Electronics and IT Hardware | 11.0
|
| Software and Consumer Services Business to Business (B2B)
| 11.0 |
| Chemicals | 9.6
|
| Biotechnology and Pharmaceuticals | 6.8
|
| Construction | 6.8
|
| Food and Drink | 5.5
|
| Aerospace (Civil) | 4.1
|
| Business (and Consumer) Services | 4.1
|
| Fire, Police and Security | 4.1
|
| Communications | 2.7
|
| Power | 2.7
|
| Creative and Media | 1.4
|
| Financial Services | 1.4
|
| Oil and Gas | 1.4
|
| Railways | 1.4
|
| Water | 1.4
|
|
Range of engineering disciplines:
6. Although inward investors were not specifically requested
to provide detail, many did specify that their businesses needed
specific engineering disciplines. Companies required personnel
from a wide variety of engineering disciplines, and whilst the
majority of the evidence simply states a requirement for "engineers",
many stated that they were specifically searching for skilled
engineers, ie those with industrial experience. This means that
although links have been brokered with training organisations
and higher education institutions, the majority of companies are
aiming to recruit skilled and experienced engineers, who require
no additional training. There were, however, a few companies looking
to establish apprenticeship programmes.
7. In addition to requiring skilled, experienced engineers,
companies were often stating a requirement for a range of engineering
disciplines, the need to recruit multiple staff and the requirement
of additional skills, such as leadership and language skills.
8. Of the inward investors who raised an issue relating
to the availability of engineers, over 90% were seeking to recruit
more than one individual, and several were aiming to recruit more
than 10, with the highest requirement being 100, across a range
of engineering disciplines.
9. The range of engineering disciplines stated as being
required included: software engineers, electrical engineers, mechanical
engineers, chemical engineers, design engineers, electronic engineers,
systems engineers, stress engineers, field service engineers,
production engineers and refrigeration engineers, with many companies
stating a need to recruit from more than one discipline.
Geographical scope:
10. Issues relating to the shortage of skilled engineers
were raised from inward investors in seven English regions and
Scotland, showing that this is a UK wide issue. The greatest number
of issues were raised from companies based in the North West,
South East and Yorkshire and the Humber.
Reasons for skills shortage:
11. A number of companies have suggested reasons for
the lack of available engineers. These included: increased demand
from companies as their skilled engineering population approaches
retirement, fewer young people willing to enter the industry because
of their perception of engineering as an undesirable occupation,
and young people seeking the instant gratification of the salary
from alternative employment, such as call centres, rather than
the potential lifetime earnings a career in engineering can offer.
Additional reasons included a lack of local talent, salary expectations
of skilled, qualified engineers are too high and there was also
a perception from a few companies that the quality of UK qualified
engineers was poor, with a number of companies stating that the
quality of applicants for advertised positions was disappointing.
12. Some companies are also struggling to retain staff,
as the demand for skilled engineers increases and people seek
alternative opportunities in other companies. One company stated
that poaching staff was commonplace.
Consequences of not filling vacancies:
13. Some of the companies that raised issues relating
to the shortage of engineers stated the consequences of not being
able to recruit suitable personnel. These included: needing staff
to enable the company to move within the UK; having to bring people
in from the parent company to fix maintenance and process problems;
unable to develop further capability; impact on site efficiency;
constraint on expansion and technical base of one company having
to relocate outside the UK.
The Role of Engineering and Engineers in UK's Innovation Drive
UK Trade & Investment's role:
14. UK Trade & Investment (UKTI) is the Government
organisation that helps UK based companies succeed in international
markets. We assist overseas companies to bring high quality investment
to the UK's vibrant economy.
UK Trade & Investment's strategy:
15. In the midst of the biggest industrial and economic
restructuring the world has ever seen, the UK's prosperity depends
on harnessing the best knowledge and skills from around the world
and marketing our business strengths effectively overseas. Central
to UK Trade & Investment's strategy[18]
is the world-class marketing of the UK's business strengths-both
its strengths as a place for overseas businesses to invest and
the strengths of existing UK businesses as trade or investment
partners.
16. UKTI has developed overarching messages[19]
on the distinctive strengths that best present UK business to
our target customers. During 2008-09, UKTI will develop a global
marketing strategy for the UK advanced engineering sector. Supported
by high quality marketing materials, the strategy will target
specific overseas business sectors and individual companies on
the basis of core messages about relevant UK strengths, and to
assist UK companies in selling themselves overseas. This strategy
will include specific targets on investment and trade, to be set
by March 2009.
17. The UK strategy will: identify the sector's key strengths;
clarify the international opportunities available; and create,
in partnership with business and other stakeholders, a compelling
proposition that sells UK business expertise in advanced engineering
to the world. The process to develop the strategy will be a wide
ranging UK strategy taking contributions from business, academia
and all relevant parts of Government, including the regions, the
Devolved Administrations other parts of Whitehall. The strategy
will be overseen by the business-led Advanced Engineering Sector
Advisory Board.[20]
The Advanced Engineering Sector Advisory Board and links with
innovation and skills:
18. Membership of the Advanced Engineering Sector Advisory
Board has evolved to ensure that a broad spectrum of interests
and views contribute to the strategic direction that it sets for
UKTI. EEF and the CBI have been members from the outset (created
in March 2007 from sector-specific Groups covering aerospace,
automotive and engineering) and in November 2007, the Professor
and Head of Engineering and Technology at the University of Wolverhampton
joined the Board to provide a better understanding of the link
between business and academia in this area.
19. A major strand of UKTI's work is to enhance the reputation
of UK business capability across the world. A key element of the
UK's reputation lies in the abilities of the engineers working
in the sector and the strength of the academic institutions and
their degree courses. UKTI already has a range of relationships
with universities but Lord Digby Jones has recently commissioned
a project looking at UKTI's collaboration with universities and
seeking to enhance the value that each organisation can provide
to the other.
20. Within Advanced Engineering, UKTI looks to exploit
opportunities to promote the excellence both of the capability
of the UK sector and of the importance of skilled engineers to
the future wellbeing of the sector.
21. One example of this is UKTI's plans for the Farnborough
International Airshow. Farnborough is a truly world class biennial
event held in the UK, attracting around 1,500 exhibitors from
some 35 countries. The final trade day of the show is branded
International Youth Day at which the organisers have arranged
for around 500 hand selected students aged 15-23 to be given a
structured programme of events introducing them to the aerospace
sector and giving them an insight into career opportunities.
22. Given this opportunity, UKTI's international trade,
inward investment and Skills Specialists are planning to hold
a series of seminars to outline the national perspective of what
the UK offers on skills and training and a regional perspective,
including a business case study and a recently employed graduate
or apprentice who has been taken on as part of a skills and training
initiative.
The UK's international Reputation for Advanced Engineering Innovation
and Skills:
23. In advance of the UK strategy, the Advanced Engineering
Sector Advisory Board has been overseeing a marketing drive focussed
on India that has involved taking the view of UK business about
Indian perceptions of the UK as a potential trade and investment
partner. Anecdotal evidence from business people on the Board
and in a wider focus group suggests that the UK's reputation for
academic excellence and producing high quality graduates is a
key element in its overall reputation in international markets.
24. UKTI's Sectors Group team for advanced engineering
has already produced material on the UK's strengths[21]
and is producing a DVD on advanced engineering in support of its
India marketing initiative.
25. UKTI is fully aware of the importance of this issue.
In both its inward investment and trade development activities,
we are seeking ways to highlight globally our academic excellence
and our well established but innovative engineering base.
March 2008
18
Prosperity in a Changing World, July 2006. Back
19
The UK's Compelling Message a Springboard for Global Growth,
March 2008. Back
20
www.uktradeinvest.gov.uk
follow links want to export from the UK sectors mechanical electrical
& process engineering. Back
21
"UK Aerospace Capability"; "UK Engineering-World-Class
Capability"; "Motorsport Valley-The Business of Winning". Back
| 
