Annex A. Low-skilled workers and their learning patterns in England, United Kingdom

Who are England’s low-skilled workers?

Low-skilled workers can be found in sectors across England, ranging from manufacturing and construction to retail and health care services. They are more present in small companies. A lack of basic skills can have a generational effect, as children born into families with low basic skills are at an additional disadvantage.

More than five million (one in five) working adults in England have low basic skills

The potential economic and social benefits of raising the skills of low-skilled workers are substantial for England, because so many workers lack basic skills.

According to the OECD Survey of Adult Skills, a product of the Programme for the International Assessment of Adult Competencies (PIAAC), more than five million working adults in England (one in five) have low literacy and/or numeracy skills. Most of England’s low-skilled adults (almost three in five) are in work, a slightly higher share than the OECD average (Kuczera, Field and Windisch, 2016[1]). This assessment is in line with national estimations from the Skills for Life 2011 Survey, which identified figures slightly higher for the equivalent levels (see Table 1.1). 28% of adults are below UK Literacy Entry Level 3 and/or UK Numeracy Entry Level 2 (Department for Business, Innovation and Skills, 2012[2]). In terms of digital skills, over 9 million people (20%) in England and about 10% among the employed in the United Kingdom are without basic digital skills (Ipsos MORI, 2018[3]).

Weak numeracy represents a particularly important challenge in England. About 90% of England’s low-skilled adults have low numeracy skills (only 10% are low skilled in literacy only), according to the OECD Survey of Adult Skills (PIAAC). According to workplace surveys in the hospitality and health sectors provided by National Numeracy, almost 90% of employees had below UK Level 2 (National Numeracy, n.d.[4]). Furthermore, according to the OECD/INFE International Survey of Adult Financial Literacy Competencies, the United Kingdom ranked 14th among 18 countries in terms of financial knowledge, attitudes and behaviour (e.g. the ability to apply numeracy skills in a financial context) (OECD, 2016[5]). An analysis by Pro Bono Economics suggests that 17 million adults – 49% of the working-age population of England – have the numeracy level of primary school children (Entry Level 3 and below), costing the UK economy a total of GBP 20 billion a year (1.3% of GDP) (Pro Bono Economics, 2014[6]).

Low basic skills in England are closely tied to adults’ socio-economic backgrounds

In England, preventing and remediating low skills in adulthood will be a contribution not only to economic prosperity, but also to equity and social cohesion.

Adults’ skill levels in England are closely tied to their socio-economic backgrounds, making basic skills development integral to England’s goals for equity and inclusion. For example, the OECD Survey of Adult Skills (PIAAC) showed that in England adults who are foreign born or whose mother tongue is not English were 26 percentage points more likely to be low-skilled than adults who are native born or are native English speakers, even after adjusting for the effects of other factors like age, gender, education and parents’ educational attainment (OECD, 2016[7]). Similarly, adults whose parents' did not attain upper secondary education were 23 percentage points more likely to be low-skilled than adults with at least one parent who attained tertiary education, even after adjusting for other factors (OECD, 2016[7]). These associations were stronger in England than in all, and all but one, other PIAAC countries respectively.

While outside the immediate scope of this project, improving the skills of students and young adults (especially those from disadvantaged backgrounds) will be critical if England is to reduce the prevalence of low skills among workers. Young adults in England (aged 16-24) had lower average literacy proficiency levels than young adults in most PIAAC countries. Furthermore, the socio-economic gradient of basic skills proficiency 1 for young adults (aged 16-24) in England was one of the steepest among OECD countries. That is, young adults born into households where neither parent attained at least upper-secondary education faced inherent disadvantages in basic skills performance – and consequently in accessing quality education and labour market opportunities – compared to households where at least one parent attained upper-secondary or above (OECD, 2017[8]).

Only a small share of low-skilled workers in England are actually low-educated

For England, identifying and supporting low-skilled workers is not as simple as targeting workers with low educational attainment. According to PIAAC, about 4 in 5 low-skilled workers in England have already attained a Level 1 qualification or above (for example, a foundation diploma; General Certificate of Secondary Education (GCSE) (grade 3-1/D-G); or Level 1 award, certificate, diploma, ESOL, essential skills, functional skills, national vocational qualification (NVQ); or above). Most low-skilled workers in England (54%) had a mid-level qualification, such as a diploma or national vocational qualifications at the ISCED 3 Level (qualification Level 1- 3). A relatively high share of low-skilled workers had no formal qualifications (15%), but over 10% have a tertiary degree (Figure A A.1). Furthermore, not all low-educated workers in England are low-skilled. About 40% of workers with no formal qualifications in England actually had medium/high levels of literacy/numeracy.

Figure A A.1. Most low-skilled workers in England (UK) have mid-level qualifications

Low-skilled workers are quite concentrated in smaller enterprises

Identifying and supporting low-skilled workers in England will require effective outreach to and engagement of SMEs predominantly, but also implicate many large enterprises as well.

Approximately 3.6 million low-skilled workers worked in SMEs in England, according to PIAAC. About 53% of low-skilled workers worked in small enterprises (fewer than 50 employees), while about 75% worked in small and medium-sized enterprises (fewer than 250 employees) (Figure A A.2). In contrast, only 30% and 44% respectively of all employees work in these enterprises in England (ONS, 2019[10]).2 However, the concentration of low-skilled workers in SMEs in England was low by international standards. England had the lowest share of low-skilled workers in SMEs in the OECD, as in other OECD countries SMEs employed from 79% to 93% of low-skilled workers.

Figure A A.2. Low-skilled workers are more common in small companies

Low-skilled workers are also concentrated in certain sectors and occupations

Identifying and supporting basic skills development in England will require targeted outreach to and engagement of workers, employers and trade unions in the specific sectors and occupations in which low-skilled workers are highly concentrated. Ultimately, however, all economic sectors will be implicated in raising basic skills.

England’s low-skilled workers worked across all economic sectors, but were relatively concentrated in a few of them. Over half of England’s low-skilled workers work in just four sectors - wholesale and retail trade (16.4% of all low-skilled workers), human health and social work activities (15.8%), manufacturing (12.1%), and transportation and storage (10.8%) (Figure A A.3). However, certain smaller sectors had particularly high shares of low-skilled workers. For example, 37% of workers in the transportation and storage sector were low-skilled. The share of workers who were low-skilled also exceeded 30% in the water supply and waste management; accommodation and food services; and agriculture, forestry and fishing sectors (Figure A A.4).

Figure A A.3. About half of England’s (UK) low-skilled workers work in just four economic sectors

Figure A A.4. Transportation and a few other sectors have high shares of low-skilled workers

More than half of England’s low-skilled workers worked in just two occupation groups – service and sales; and elementary occupations (such as cleaners) (Figure A A.5). Plant and machine operators, assemblers, clerk and craft and related trades workers were also common jobs, adding up to another 30%.

Figure A A.5. Half of England’s (UK) low-skilled workers work in just two occupation groups

Low-skilled workers and employers are not highly engaged in basic skills development

Across OECD countries, low-skilled workers generally participate less in adult education and training courses that fully or partially target basic skills and this is also the case in England. Low-skilled workers participate less both in formal and informal learning programmes and participation in basic skills programmes has been declining.

About half of low-skilled workers in England do not participate in education or training

Both internationally comparable and national data on low-skilled workers’ participation in basic skills development in England are limited. As much as possible this study has sought to focus its analysis on participation in learning: a) that explicitly targets basic skills; b) by working adults; c) with low-levels of basic skills; and d) in England. Data are often available that satisfy two, or sometimes three of these criteria, but not all of them.

Yet the OECD Survey of Adult Skills (PIAAC) suggests that only about half of England’s low-skilled workers participated in formal and/or non-formal education and training in 2011-12. Adult participation in basic skills courses has drastically declined in England in the last five years, in line with broader declines in adult learning in the country. Despite the fact that most employers of low-educated workers in England offer training, it appears that relatively little of this training targets basic skills (Booth, 2017[11]).

Three forms of learning – formal, non-formal and informal 3 – contribute to skills development in different ways and have different learning objectives. Self-guided practice outside of formal learning environments is also an important driver of improvements in literacy (Grotlüschen et al., 2016[12]; Carpentieri, 2014[13]; Reder, 2015[14]). Analysis based on the OECD Survey of Adult Skills (PIAAC) shows significant, positive relationships between participation in informal learning and both earnings and workplace productivity (Fialho, Quintini and Vandeweyer, 2019[15]). As in other OECD countries, low-skilled workers in England participate less in both formal and non-formal learning than higher-skilled workers (Figure A A.6). According to the OECD Survey of Adult Skills (PIAAC), while almost 70% of medium and high-skilled workers participated in any form of learning in 12 months preceding the survey, only about half of low-skilled workers participated (2011/12). The gap is wider in non-formal learning than in formal learning.

Figure A A.6. England’s (UK) low-skilled workers participate less in learning than higher-skilled workers

On the other hand, a high share of workers of all skill levels (not just low-skilled) participate in informal learning. According to Adult Education Survey 2016 (Department for Education, 2018[16]), 69% of full-time employed adults in England participated in informal learning in the last 12 months, while 57% and 15% respectively participated in non-formal and formal learning.

Participation in basic skills programmes is declining, in line with broader training trends

Adults’ participation in basic skills education in England has declined drastically: by half between 2012 and 2019, from 1.8 million to 0.9 million (Figure A A.7). The largest fall is in the UK Level 1 English and mathematics, about a 75% decrease. This was in a context of significantly declining participation in government-funded education and training programmes overall during the past decade, falling from 4 million adult learners in 2005 to about 2.1 million in 2018 (Belfield, Farquharson and Sibieta, 2018[17]).4

Figure A A.7. Participation in basic skills courses has drastically declined in England (UK)

Overall, workers’ participation in adult learning has declined by a greater amount in the United Kingdom than in any other OECD country over the last decade, except Denmark and Slovenia (Figure A A.8). According to Eurostat data based on labour force surveys, the participation rate of adult learning among working adults in the United Kingdom declined by about 6 percentage points between 2010 and 2019, while the rate in many European Union countries remained at a similar level or increased.

Figure A A.8. The United Kingdom saw one of the largest falls in adult learning among working adults

The most common type of training for low-educated workers in England is job-related, often in the workplace (Henseke et al., 2018[20]). The potential for apprenticeships to raise the skills of low-skilled workers is not being realised. England’s apprenticeship sector has expanded rapidly in recent decades, due in large part to growth in adult apprenticeships. Today, around 62% of England’s apprentices are incumbent workers (the others are new, typically younger, recruits)5 (Thornton et al., 2018[21]). Apprenticeships are concentrated in many of the economic sectors with high numbers of low-skilled adults – wholesale and retail, health and manufacturing. However, the number of low-skilled adults starting apprenticeships has declined drastically more recently. Starts in the lowest level apprenticeships (“intermediate”, which are equivalent to GCSE) have roughly halved in these sectors over the last two years. In contrast, starts in higher apprenticeships – most suitable for higher-skilled workers – have increased (Figure A A.9).

Figure A A.9. The number of adults starting low-level apprenticeships has declined in England (UK)

England’s employers are not highly engaged in developing the basic skills of workers

While most employers of low-skilled workers in England offer training, by and large this training does not target basic skills. Employers are the largest investors in adult learning in England (Gloster et al., 2016[23]). However, employers tend to focus more on firm- or occupational-specific technical skills training rather than in general, basic skills training. Data on employer support for basic skills development are scarce, but surveys undertaken by the Behavioural Insights Team and the Federation of Small Business provide insight in this regard. Only about 15% of UK employers provide any form of training in literacy or numeracy (Booth, 2017[11]) and only 4-6% of small business owners and staff had undertaken basic skills training compared to almost half of all owners who took training for technical and job-specific skills (Figure A A.10).

Figure A A.10. Basic skills training is the least common type of training provided by small firms in England (UK)

Why is participation and engagement of low-skilled workers and their employers in basic skills so low?

A range of factors likely hinder low-skilled workers (and their employers) in England from engaging in basic skills development. Underlying these are low levels of motivation and willingness – most low-skilled workers and employers report that they have no need for training. The structure of England’s labour market and economy also dampens to some extent workers’ and employers’ demand for basic skills.

Low-skilled workers and their employers lack motivation for or face barriers to learning

Many low-skilled workers lack motivation to participate in any learning activity. Half of low-skilled workers in England neither wanted to nor did participate in education and training in 2011 (Figure A A.11). Among those low-skilled workers who are motivated, one-third of them face barriers that prevent them from participating in education and training (Figure A A.12). While these results are not as dire as in many other OECD countries, the barriers to participation are nonetheless a major challenge for raising the skills of low-skilled adults in England.

Figure A A.11. About half of England’s (UK) low-skilled workers neither wanted to participate in learning, nor participated

Figure A A.12. A third of low-skilled workers in England (UK) wanted to participate in learning but did not participate

The high number of low-skilled jobs in England dampens demand for upskilling

A major structural factor dampening the demand for basic skills development in England is the prevalence of low-skilled jobs. According to the OECD Survey of Adult Skills (PIAAC), 29% of jobs in England in 2011/12 required only lower-secondary education or less, which was very high by international standards (Figure A A.13). Large companies and service sectors employ relatively more low-skilled workers, also when comparing with the EU average (EIB, 2018[25]). This skills structure is due, in part, to the fact that many UK employers continue to seek competitive advantage through low-value added strategies using a predominantly low-skilled, low-wage workforce. These employers may perceive that the costs and risks of investing in training to improve employees’ basic skills exceed the benefits (Payne and Keep, 2011[26]). Even for businesses that could potentially benefit from upskilling their employees, the benefits are not immediately apparent insofar as they compare to the time and resource costs that would need to be invested.

Figure A A.13. Jobs requiring only low levels of skills are relatively common in England (UK)

Non-standard forms of work may mean lower access to training for low-skilled workers

Across the OECD there are concerns over people in non-standard forms of work gaining little access to training (OECD, 2019[27]; OECD, 2019[28]). These people often face challenges such as lack of training leave, inflexible working hours and unpredictable hours or shift work – all of which can make it difficult to schedule time to prepare for or complete adult learning (OECD, 2019[29]). As new forms of work become more common – including temporary employment and zero-hour contracts – employers may have less incentive to provide training. In 2011 in England, about one in four low-skilled workers did not have an indefinite contract, above the rate for highly-skilled workers (Figure A A.14).

Figure A A.14. Low-skilled workers are more likely to be in non-standard forms of work

More recently in the United Kingdom, nearly 3% of people in employment said that they were on a zero-hour contract between 2016 and 2018 (ONS, 2019[30]). About 30% of these worked in elementary (i.e. low-skilled) occupations and about 14% want a new or additional job (ONS, 2019[30]). Workers on zero-hour contracts may not be incentivised to learn if they do not expect it to lead to more stable employment. Likewise, their employers may not be incentivised to provide training because the worker can be easily replaced.

Notes

← 1. The socio-economic gradient refers to the impact of socio-economic status on basic skills proficiency. The slope is based on the trend line connecting mean scores of literacy and numeracy for each level of parents' educational attainment (neither parent attained upper secondary, at least one parent attained upper-secondary, and at least one parent attained tertiary).

← 2. This is 2018 data (published in 2019), but to be more precise, the PIAAC data on company size should be compared with 2011 data.

← 3. Formal learning: learning through a programme of instruction in an educational institution, adult training centre or in the workplace which is generally recognised in a qualification or certificate. Non-formal learning: learning through a programme or training course that is not usually evaluated and does not lead to certification, for example: courses through open and distance education; organised sessions for on-the-job training or training by supervisors or co-workers; seminars, workshops or private lessons. Informal learning: learning, typically unstructured, resulting from daily work-related, family or leisure activities, for example: learning by doing a task, learning from colleagues and supervisors or the need to learn new things to keep up with one’s occupation.

← 4. Labour Force Surveys show that the share of the UK population aged 25 to 64 participating in formal and non-formal education and training in the last 4 weeks has decreased from 16.3% in 2012 to 14.6% in 2018 (Eurostat trng_lfse_01). While participation in formal education in the past 12 months has decreased from 14.8% in 2011 to 11.9% in 2016, participation in non-formal education has increased from 24.3% to 47.5%, according to Adult Education Surveys (Eurostat trng_aes_100).

← 5. In 2019/20, under 19 years old account for 32.3% (40 700), 19 to 24-year-olds account for 29.3% (36 800), and those aged 25 and over account for 38.4%% (48 300). Those aged 25 and over have consistently had the highest share of starts each year over the period 2014/15 to 2018/19.

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