Poor utilisation of skills undermining UK productivity, study finds

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Written by Seun Robert-Edomi on 26 February 2014 in News
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Businesses encouraged to take the high road of innovation, efficiency and higher skills

The poor understanding of how to best utitlise skills in the workplace is undermining the UK's productivity, according to new research from The Chartered Institute of Personnel and Development. 

The report, Industrial Strategy and the Future of UK Skills Policy, produced for the CIPD by the Centre on Skills, Knowledge and Organisational Performance (SKOPE), encourages businesses to take the high road of innovation, efficiency and higher skills.

According to the study, there is too much focus on increasing the supply of skills and neglecting the need to increase demand among employers meaning the UK has the second highest level of what the OECD refer to as 'over qualification'. 30 per cent of workers believe they are over-qualified for their jobs and there are far fewer graduate jobs than graduates, meaning that too many people's skills are being under-utilised in the economy.

The problem of low skilled jobs and under utilisation of the higher skills workers are major factors in the UK's poor productivity levels. Productivity is the key to increasing real wages above the rate of inflation, the study states. 

The CIPD believes that a forum or Workplace Commission is needed to coordinate policy development relating to work, the workforce and the workplace across government and with employers and employee representative bodies. The proposed Workplace Commission must also redress three decades of misaligned skills policy.

Peter Cheese, CIPD chief executive, said: "Unless we address the demand side of the skills equation, we will fail to improve our poor productivity or to achieve the sustainable increases in real wages that have become such a dominant feature of the current media and political narrative.

"We've been down the road of simply increasing the supply of skills without increasing UK productivity or the number of skilled jobs in the economy We now need to improve skills utilisation and stimulate demand for higher level skills through increasing the number of higher skilled roles available.

"To do this, we need to encourage more employer investment in building productive working environments, with investment in skills growth and the management and leadership skills needed to deliver high performance workplaces which are more likely to compete through innovation, continuous improvement and quality."

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