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UKCES Employer Investment Fund

Policy Instrument

UKCES Employer Investment Fund

UKCES (UK Commission for Employment and Skills) Employer Investment Fund
United Kingdom

Description

Timespan

The Employer Investment Fund (EIF) was launched in March 2011, and there were 3 rounds of EIF up to 2013.

Stage

No longer operational

UKCES closed in March 2017, so the instrument is no longer being run/funded.

Foundations

Policy area

The overall goal of the instrument was to boost economic growth and productivity in the UK through increased investment in skills by promoting change in how employers engaged with, and invested in skills in order to raise skills levels, improve access to and deployment of skills, and raise business performance.

Policy goal

The instrument was developed in response to growing evidence that UK skills policy had not always met the needs of employers, and that levels of investment in skills development was insufficient to drive business and economic growth. The rationale for the intervention (which was also found to be in line with the beneficiaries' motivations in the 2015 Survey) was to: improve the ability of employees to do their job, to acquire the skills needed to grow businesses, and to increase understanding of the skills or training needs of employees.

Mismatch

Explicitly designed to address skill mismatch

The instrument aimed to encourage employer leadership and investment in economically valuable skills through the funds provided, with funds being limited to skills and employment infrastructure that had limited or no participation funding available to tackle mismatch/skills shortage.

Administrative level

National

Main responsible body

UK Commission for Employment and Skills (UKCES)

Stakeholders

Stakeholders include: learning providers from private sector, Further Education (FE), Higher Education Institutions (HEIs), local authorities, employer associations, trade unions, professional bodies, schools and other contractors. A number of key stakeholders were involved in the set up and delivery of the programme, such as:
- UKCES: overall responsibility for running the application process and selecting projects for funding, and managed the investment processes and commissioned the programme evaluation.
- Delivery Partners: bidders for funding and had responsibility for delivering projects, either through using their own staff or other intermediaries, training providers or stakeholders.
- Sector Skills Councils (SSCs): applications to EIF were restricted solely to SSCs.
- Other intermediaries and stakeholders: helped to deliver aspects of projects in partnership with the Delivery Partners and provided expert insight and support through representation on project boards and working groups.
- Training providers: worked collaboratively with Delivery Partners and employers to establish infrastructure, including new courses, accreditation or certification.
- Employers: contributed to the development of EIF products and services, through design and application processes, market testing and product development, and project management and governance. Employers were beneficiaries of the programme, and made use of the skills solutions delivered.

Funding

Public investment in EIF over three phases totalled £70.3 million, which was matched with £53.9 million of private investment. No further funds will be committed through the instrument.

Intended beneficiaries

Employers were the intended beneficiaries of EIF, and they were invited to submit proposals for funds to cover training. The main proposed beneficial outcomes of EIF were: improved business outcomes (by increasing training investments EIF would also lead to greater investment in training to improve staff retention and staff proficiency, and therefore reduce overall recruitment costs); increased training demand among employers; and an increase in the productive capacity of workers through their acquisition of new skills and the development of new training infrastructure.

Processes

Use of labour market intelligence

The data draws very much on employers views about what needs to be done. It is very much their understanding of the issues that need to be addressed and how they should be addressed that drove the initiative.

Financial schemes

The programme invited applicants to submit proposals for time-limited investments to cover training. The funds were intended to pump-prime the building of infrastructure that would develop solutions to address needs in a specific area or sector. The application for funds was deliberately non-prescriptive and gave no direction about the nature of problems or solutions selected for investment. The programmes sought and assessed project bids that were to be demand-led and innovative, with significant co-investment from employers.

Frequency of updates

The delivery of the training under EIF was updated on a case-by-case basis, as the programme was flexible and tailored to the specific needs of the beneficiary. Some of the delivery mechanisms under EIF include: Apprenticeship brokerage; Employment brokerage; Skills diagnostics; and Training brokerage. These are essentially concerned with connecting employers to relevant services, hence the reference to brokerage.

Development

No changes to the instrument were made, however, some beneficiaries adapted their approaches throughout the programming period. For example, one Delivery Partner from the 2015 Survey adapted its SME engagement strategy to align it more closely with SME concerns, and piggybacked on existing events aimed at broader industry issues rather than skills themes, while another provided more opportunities for employer input at the project governance level.

Barriers

There were no named barriers. However, challenges were faced in measuring the instruments' impact on business behaviour and outcome in the short-term, and consequently it was noted in the final report that a longer timeframe would be required for evaluations of skills infrastructure.

Success factors

EIF was successful in encouraging employers to be more involved in the design and set-up of their training activity, as well as supporting employers to collaborate on skills solutions (to reduce cost, encourage resource sharing, etc). This led to greater impact and greater quality of the targeted training provision.

Monitoring

EIF was evaluated over three years, including a quantitative impact assessment, detailed qualitative case studies and an analysis of management information. Additionally, a survey of 1,980 employer beneficiaries was carried out to assess EIF based on the following areas: the characteristics of employer beneficiaries, their motivations for participating, and self-reported impacts to provide insight into whether the programme was meeting its objectives.

Innovativeness

Slightly innovative

Rather than being directly innovative, EIF encouraged employers to adopt innovative training infrastructure solutions that more effectively met their skills needs, and took innovation into account when granting funds through the instrument. However, project performance data from the 2015 survey suggested that performance did not depend on projects being highly innovative. Employers pointed to the importance of adaptive and context innovation to adjust products and services to meet their needs and preferences (e.g. taking well-established approaches to Apprenticeship and Employment Brokerage and applying them to a new sector, geography or occupation).

Sustainability

Evidence of effectiveness

The active engagement of a core group of employers in the early stages of the programme was critical in confirming initial employer appetite, and in shaping and verifying that the scope of the product/solution provided through EIF was appropriate. As projects were delivered, testing them with a larger group of employers helped to ensure the quality of the product/service being offered was adequate and provided the flexibility to make adjustments, addressing emerging or nuanced employer requirements. Another positive impact to recruitment activities occurred. From the final report, evidence was found to show that Apprenticeship Brokerage (i.e. finding apprenticeship places) activities had eased recruitment activities for those employers that have used them, contributing to a decline in apprenticeship vacancies that were hard-to-fill. Benefits have been lower than expected, but this has been attributed to needing more time to understand and evaluate the long-term changes promoted through the instrument (such as promoting behavioural change in sectors or sub-groups of employers who are used to the government taking responsibility for training supply). Although not explicitly a cost, the over-representation of large employers and those in the charity/voluntary sector made it difficult to assess the overall success/impact of the instrument, as these employers were typically more likely than average to provide training to their employees in the first place. Most of the EIF beneficiaries from the 2015 survey (87%) had already arranged or funded training or development for their staff in the previous 12 months, which at the time was higher than the UK population as a whole. This made it difficult to assess the training outcomes of EIF, especially in the short to medium-term, since the large majority of employer beneficiaries were already delivering training to their employees prior to their involvement in the programme.

Engagement of stakeholders

Stakeholder feedback was a key element of the qualitative evaluations of EIF. Two waves of qualitative interviews with key national stakeholders took place to investigate the full range of activities developed and delivered by them. Interviews were also conducted with 56 employer beneficiaries in wave 1 and 52 employer beneficiaries in wave 2.

Transferability

Easily transferable

Could be easily transferred if funds were available, but there is a need to ensure that projects are innovative in how they approach issues to be addressed.

Sustainability

Will not continue, as UKCES has since closed.