Welcome to our second panel of this session on manufacturing skills in transport sectors. Will the panel please introduce themselves?

I am Professor Chris Brace, the executive director of IAAPS, which is an institute at the University of Bath. We focus on propulsion systems across a broad range of technologies and sectors, and work closely with industry through everything that we do.

Good morning. I am Oriel Petry, the senior vice-president for Airbus in the UK, covering all three divisions of our business: commercial aircraft, which is one of a duopoly globally, and we manufacture the vast majority of the wings in the UK; Airbus Defence and Space, whereby we are the largest satellite manufacturer in the UK; and helicopters, whereby we supply the police and air ambulances across the across the country.

I am Dr Ben Silverstone from WMG, a large engineering department at the University of Warwick. All our work is directly applied, and we work closely with industry. I am the head of skills policy and strategy, so I head up all our work around FE collaboration and workforce, electrification and battery skills, and a variety of other transport-related activities.

You were all present for the previous session. To get through all the topics we want to cover, could I ask you to make your answers as brief and to the point as possible? I know that that is easier said than done a lot of the time.

What do you feel are the most acute skills shortfalls in the transport manufacturing industries?

We heard a lot in the earlier session about apprenticeships and skills at most levels in many specialisms, and that is all true. I would like to say that degree-level training, including postgraduate training, is really important for the sector, even more so as we move into new high-technology fields. The technical leadership of the sector cannot be understated. If we do not have the right technical leadership in place, it is going to hold back our competitiveness and prevent us from reaching our goals. To narrow it down to skills, we need two things. First, a distinct technical specialism that is relevant to the future industry, and we heard about many of those earlier. Secondly, a broad understanding of the sector and all factors that affect it. We characterise it as T-shaped skills: an understanding of the context and deep technical specialisms to allow the co-ordination of many specialists to achieve the goals of the sector. That is a specialism of its own and has a long incubation period. It takes a long time to grow those people.

There are two main challenges that Airbus faces. The first is the ramp up—the increase in the production of aircraft. We have a backlog of 8,500 and need to go from about 54 wing sets a week to 75. The challenge there is around industrialisation and delivering at pace. For that, the skills that are sought after in aerospace are AI, digital, science and engineering—so pretty broad—but AI and digital in particular, where there are also demands from different sectors. From the earlier panel, you heard of the challenge for advanced manufacturing to get those skills to come and work in aerospace. The second challenge is a long-term one: the next generation of aircraft. The bestselling aircraft at the moment, which is driving so much growth and jobs here in the UK, was developed 40 years ago. It is about fundamental R&D and changing the way wings are built to make them lighter, more fuel efficient and greener. That is all the way through, so not only fundamental research on how we make the fuel and make the aircraft burn less fuel, but also through to production and how it can be produced at rate. It is the whole spectrum and it is challenging for all that to come together because of the depth and width of skills required and the longevity of the programme. It is not something that is going to deliver next year; it is going to have to deliver over the next 10 or 15 years.

I am going to violently agree with everybody and add a small thing. A lot of work we do is focused on what is going to happen in five to 10 years—these nascent skill needs. They are not pressing right now, but they will be and we need to plan for them. What is certainly emerging is resilience. The simple ability of people, already in work, recognising that the world is changing, recognising that they need to adapt and change and understand how to go about it. That is something we do not directly teach. We just expect people to know how to do it, and that may be a critical shortfall in our education system and something we need to address.

I have a question similar to one asked of the previous panel. Do you think we can make better use of overlapping skills within the transport manufacturing sector and, indeed, other sectors? If so, are there barriers within industry and Government that prevent this from being achieved?

Yes, there are. I once said, “If you can make biscuits, you can make batteries.” It holds true. The core of manufacturing skills is the same whatever sector you are applying them in. If you consider the idea that this sectoral view is almost outdated, and we take a technology-driven view, we can spread it across a number of different sectors. With biscuits to batteries, it is the idea that some roles in making batteries are more akin to being a commercial baker than an engineer because we have a role that is mixing and coating, which is about weights and measures and getting the right mixes into things. We do not need an engineer for that; we need somebody who has that experience. There are two big barriers. We have a system predicated on qualifications and not capability. If I want a battery technician in my factory, I am going to ask for a technician-level qualification in engineering. That is going to put off somebody who might have that ability from another sector but who does not have that qualification. If we are able to work with business and suggest they take a competency-based view on this, we can say, “If you’re a mixing and coating technician, you have 15 of the 20 necessary competencies, so come over from baking and work in batteries. You’re capable of doing that.” The other challenge is that we do not want to do that at the expense of our other industries. If we look at where we have decided to place the Agratas factory, the nearest similar industry is a yoghurt factory. Nobody is going to thank us for taking all the workers from the yoghurt factory and putting them into a battery factory, so we need to look broader. An area we have explored a lot over the past year or so is working with the providers of DWP contracts—things like the Restart scheme and the Work and Health programme. How can we bring people in that we would not necessarily look at otherwise but who might have the abilities we need? We need to look a lot broader. In short, 100% transferable capabilities are everywhere. We just have systemic barriers in place at the moment.

I agree with that. There is a lot of transfer of skills. In a business like ours that covers a number of sectors, from cyber to space, we move people around. I can think of a number of people within the organisation, admittedly mid-career—I have one great example at the moment of a woman who was doing fuel systems in our civil aircraft business and is now moving into our space, business because the foundational skills are the same. The way in which we should think about our apprentices and graduate apprentices is moving them around the business so that, as you say, there is this transfer of experience. They can then see how the fundamental skills can be applied to different parts of the business. At an ecosystem level, that also happens. You get people moving around related industries, a lot between civil and defence aerospace, but there is undoubtedly more we can do on foundational building at an earlier stage so that people have the confidence to apply for things that may not fit beautifully in terms of their direct experience.

I agree with all that. The underpinning skills and digital AI are things that we know are going to affect every industry. Of course, we can share and grow together. The transitions to new technologies in propulsion, as we are seeing now, go across many sectors. Hydrogen is a really good example. On our site, we are working with aviation, marine, automotive and off-highway. All those sectors are looking at hydrogen, and the engineering and discovery requirements are common across them. We have a group of engineers working on projects across all those areas. We do not really make a distinction as to which sector they are from; they are working on hydrogen propulsion. We will see more of that as we get technology changes sweeping across the sector. There is still an important role for people who understand that application. Whichever sector they work in, there are very specific challenges for that sector and we need to retain a core of people who understand that application challenge. So there are two axes there and we have to be good at them both.

Harking back, we used to have industry training boards in many sectors, including transport, which set common competencies. Without suggesting that we wish to recreate that model, do you think there is a greater role for national bodies to set common skills profiles and passports? I know they have been looked at in the North sea oil industry.

Through what was the electrification skills framework, and now ESN, we have done a lot of work on common skill standards, which is going to be critical in setting out what those common skills are that can be transferred across a whole variety of different things. As we heard earlier, transport can draw on lots of different areas. It is not quite a technological singularity, but it is becoming more so. I fear that if we do it by sector then to some extent we will still propagate the idea that you are either automotive or aerospace. If you are an engineer or a technician, if you are good at software or robotics, then you can work in so many different places. We need to free this up a little. We need to break down these sector barriers and look at skill standards by technology and need not by sector.

This is interesting. What you are saying, and Oriel made similar comments, is that you are working cross-sector in a top-down way to make it easier for people to make that switch. Is there work to be done with the actual workforce in having them think that they have transferable skills and could work in different workplaces? I have a biscuit factory in my constituency, and they want to keep their workers; they do not want them to go to the battery factory. Do we have to do both? Do we have to make it clearer to students and workers that they have that flexibility?

Without a doubt, and it goes right the way back to the first question you were asked when you were a kid, “What do you want to be when you grow up?” It seems outdated, doesn’t it? “What are you interested in? Where do you want to work?” We need to start to propagate this idea that what you know can be transferred across different areas. There is a hearts and minds piece early on, without a doubt, but that needs to be coupled with this top-down view of technology spreading across different areas. We have to attack it in these two different ways.

Benjamin, you said that one of the challenges you have when transferring skills between industries is the difference between a recruitment process based on qualifications and one based on competencies. Is that something set in statute or something business could lead the way on and recruit based on the competencies they need rather than the engineering qualifications they might stick on a job application? How much flexibility do you have as a business to do it differently?

Certain areas have qualifications that give people the legal status to do things. If you are going to be a gas engineer, you have to have your certificate saying you can be a gas engineer. If you want to be a doctor, you have to have that. Beyond that, we are in control of our own destinies. It has always been something that is easy, that propagation of like for like: I am an engineer therefore I will search for something that looks and talks like me, so I will look for an engineer rather than something else. We always lead with qualifications. Within job descriptions we are getting better at saying, “These are the capabilities and activities you will do in your day-to-day job.” However, one of your gatekeeping activities may require them to have the right piece of paper. I have a doctorate in engineering, but you would not want me to come and fix your car. If that is what you put on your job advert, I would probably get an interview. We can move in the right direction, and there is space to move in the right direction. There is no reason why we do not. We need to try it, and I know Skills England is keen to look at competency passports. It also needs educators and awarding organisations to be able to say, “Having done this, this person is now capable of doing these things,” which we do not do very well at the moment.

Thank you for humouring me on that; I thought there was something to be said. We have touched on this a little in terms of Government Departments working together to support the skills needed for transport manufacturing. How welcome is the Government’s recent move to share skills policy between the Department for Education and the Department for Work and Pensions instead of just sitting in the Department for Education? Do you have faith that that is going to make it easier for your sector and what you are trying to achieve?

As you would expect from a business, it is about the outcome. The debate with your earlier panel was about the partnership between businesses like ours that need to have the skills to drive UK competitiveness, and the question of whether it should be top down or bottom up. As long as the Government are focused on working with us in partnership to ensure that, from a very young age, the options of a STEM career are encouraged, we are happy to work with whatever interface we have. The reforms of Skills England are welcome. As a business, we can see they are positive. We may come to this later, but there are ways in which they could be improved. One of the challenges to mention here is that Airbus, when it acquires Spirit in Belfast and Prestwick, will be operating across four home nations. As you explored a little with your earlier panel, the fact that skills is devolved has many positive signs, but at the moment the levy for skills is calculated on the national number of people, and we can only spend the skills levy in England. We have a difficult situation where we are paying for 12,500 people but only a portion of that is in England. That is challenging to work out from a Government point of view. I understand that, but for a business it is hugely frustrating because we cannot spend our levy in north Wales, which is where our main wing factory is. These are challenges that we need to work through and business needs the flexibility to say that they are not organised according to Government lines. We are organised as a business in the UK trying to compete on a global stage. How do we work together to make sure that the whole spectrum—schools, further education and catapults—does not have barriers that, from business and political points of view, do not make sense?

To be fair, by the sounds of it you are being incredibly kind if you are giving all that money and they are not able to spend it. A lot must sit somewhere in the Treasury.

It has to go back.

You mentioned how we could make Skills England more effective. If you have any comments around that in terms of the changes with DFE and DWP, please feel free to suggest them at this point as they would be welcome.

It would be great to find a way to not be constrained, which I have discussed with many people and I know is really hard because of devolution. The Welsh Government will have their own views on how to spend their money, but it would be great if we could spend our underspend on our amazing fitters in Wales. That would be the first thing. The second is that the banding and levy is allocated on courses based on bands defined in 2017. We have 1,000 apprentices in our commercial business at the moment, spend £129,000 on them over the period, and the levy is £23,000. For some of the more sophisticated and higher-level qualifications, the gap between that and what we are spending is quite big. It would be nice if there was, for instance, recognition from the Government that you have to spend more for graduate apprentices and you can get more support. You discussed a little with the earlier panel large primes like ours. We have a lot of applications, as you can imagine. In our defence business, we had 4,689 applications for 36 early-career positions, so there is a huge disconnect between people wanting to apply. There are ways in which you can use your supply chain, but it is very bureaucratic to pass on the process of these great apprentices who might not be right for us but great for the supply chain. Also, to pass on the underspend in the levy that we might have as Airbus to the supply chain is complicated and costly for a business like ours to work through.

Are you effectively saying that a young person has no passport if they are not successful with one apprenticeship but might have some of the skills for another, and they need to know about the SMEs to be able to apply directly to them? There is no option for them to move around and say, “I have five of the six skills, is there anywhere else?”

It is not even five of the six skills; it is just that they might not have succeeded with us but we still think they are great and should go—

Because of things like GDPR you are not able to share.

Exactly. We are looking at ways to do that with ADS. It is a tricky thing to solve but if we could somehow make it easier—a good idea would perhaps be a clearing house a bit like universities.

I want to open it up to anybody else before I hand back to the Chair.

Anything else to add on Skills England?

My only comment is that we want things to make it easier for industry and universities to partner and deliver a range of these outcomes. All that is good, and it sounds as though it is a step in the right direction, but there is still a lot of complexity.

When Skills England was mooted 18 months ago, we predicted that it would not last in DFE because any time you go for a conversation with DFE, it invariably trickles back to what is happening in schools. That is fine. We saw a whole raft of policy that was basically about schools and not about skills. Perhaps those already at work, or getting back into work, or adults looking at things like Restart and other programmes with DWP, will now have better access to this activity in the skills space. As far as we are concerned, it is a welcome move and well overdue.

I do not know if it is relevant but does this week’s announcement on V-levels change anything in your world?

Only in so far as we were doing this 20 years ago. BTEC alongside an A-level was stock and trade in colleges 20 odd years ago. Again, this is nothing new. We will work closely with Government to get this right, but we are introducing another layer of complication at a time when we do not need it. We are getting rid of our established brands at a time when we do not need it. It is not ideal right now.

Stepping aside from initiatives that you as employers undertake, how good are we generally at attracting young people into manufacturing careers in this country?

We could do better. It starts early on in primary. A lot of children make the decision that STEM is not for them, and it is very difficult to get them back after that. We need a much broader range of skills going forward, not only in STEM, but STEM is a core thing that we can and must do better. In the first session we heard about the huge range of initiatives that we as industry and universities, the whole sector, are trying to apply to make the case as to why you should come and work with us in our sector. Those things are very difficult. From my experience as a trustee of a multi-academy trust, your initiatives are great if, from outside coming in, they try to incentivise, support and inspire, but they are not sticky unless they are rooted in the curriculum schools are working hard to deliver to a high quality. Anything we can do to move the curriculum further into the direction of high-quality provision for STEM, inspiring and motivating children to keep it open as an option and to keep the diversity of learning longer in their school career so that that remains on the table as a choice for them, will increase the pool from which we are fishing. At the moment, we are losing most of that potential audience before they even get to secondary.

It is not that we are not switching them on, we are just switching them off.

Ask primary school kids what they think about maths and science. You can judge early on whether that might be an option for them. In my mind, it is too early to be making that choice.

How good are we at encouraging young people into manufacturing?

There is more that we can do. A business like ours has the bandwidth to do big projects. We have developed programmes with local schools in our areas and the results are pretty impressive. Out of our site in Stevenage we have been running something we call We Build It Better. We go into primary schools and talk about the satellites we are building, and get them to build little flying machines and this sort of thing. That has had an effect on truancy and interest in the subject. It has seen a 60% election of STEM subjects at GCSEs, which was much lower before. It is the same on the civil side as we do a lot around our sites in Broughton in north Wales and in Filton. These programmes are transformational, but not every business can do it and is focused on their areas as you would expect them to be. Generally, we need to do more. If I may, I will give you a tiny anecdote. We took two female apprentices to a co-ed school near our site in north Wales three years ago. We entered this room of boys and asked the teacher why there were only boys in the room. The teacher said, “Well, it is engineering so I did not think the girls would be interested.” That is just one anecdote, but I can see it in my son’s school as well. I do not know why my eight-year-old is more interested in STEM than the girl in his class. It is something deep-seated in our society. This is where the partnership between businesses like ours and Government at all levels remains critical if we are going to scale the challenge together.

I believe one of my colleagues will come back to gender balance in a moment. Benjamin, you said you would not want to fix my car, but you might have been able to fix my tractor at some point in your past career. Clearly, losing Massey to the French was unhelpful in encouraging automotive careers in Coventry, but are we good at this sort of stuff, that example notwithstanding?

As we have heard all morning, some fantastic initiatives are being run by business, but you are ramming up against a headwind from the education system. I will unashamedly give you some anecdotes. I live in Staffordshire, where every 10-year-old will go to a mining museum because that is Staffordshire’s heritage. None of them will go to an advanced manufacturing facility because that is not part of what they do. I was making notes for this last night, sat next to my partner who was preparing a lesson on a 30-year-old science curriculum about cracking crude oil. GCSE mark schemes make young people say that wind power is unreliable and ugly. My daughter is not doing engineering at GCSE because the school decided to put the naughty boys into that class to get them off their statistics. As universities and employers, we can do whatever we want, but our one message is lost among hundreds and thousands of hours of tradition. This review of the national curriculum cannot come soon enough, and it has to be done in conjunction with industry. It has to be done in conjunction with awarding organisations that use real-world examples. There is a lot going on. By the time you get to the point where you are thinking about what you want to do for a job, you have been roundly switched off by the whole system. So you are right, it is not about switching people on: it is about trying to avoid switching them off in the first place. It is very easy to get young people in primary school excited and interested in this kind of stuff because of the way they do thematic learning. They then hit the secondary system, which makes them more difficult to work with.

You alluded to the Staffordshire example; are there any initiatives that help to showcase careers in transport manufacturing in particular? It sounds like transport museums might be one, but is there anything else that helps to showcase careers in transport?

Transport museums are great, but they show what we used to do rather than what we are going to do. We are part of the High Value Manufacturing Catapult and are working on the idea that rather than giving a man a fish, we are teaching a man to fish. Rather than doing lots of STEM engagement, we are engaging with those who do STEM engagement and saying, “This is exciting stuff about advanced manufacturing. Come and have a look at the facilities we use. Come and see the things we’re doing. Engage with our engineers and spend time.” We have an outreach group go and do that and it is very successful in Coventry. As part of that wider network, and as WMG, we are doing our best to promote these opportunities.

Can I pick up from my question to the previous panel? The two of you are academics. We have all seen the initiatives for young people and they are lovely, but who is measuring what actually makes a difference? From a primary child who went on that visit, or secondary children who had a specialist manufacturing day, how many of them went into those careers, as against those that did not get those opportunities? I speak as a failed parent: I tried to get my eldest into engineering but he got a humanities degree, with a £50,000 debt, and a job that does not require a humanities degree. We have learning from other countries. What learning do we have in the UK that we should bring into our education skills sector?

I might need to follow up—

Could you dig out stuff?

I can point you in the right direction.

I will follow up with some written stuff.

Within the Catapult Network, CPI in the north-east has done a longitudinal study of STEM engagement. That is the only longitudinal study I know of. Everybody else has—

Do send it. That is the word I was struggling for: longitudinal study on actual outcomes as opposed to lovely days and weeks.

Yes.

We have a real challenge across society, but advanced manufacturing seems to make it even more extreme. As I said, these are pretty intractable and challenging societal issues. To give you one example—although not an example to say how wonderful Airbus is—a few years ago we thought we should have more than 1% of women as aircraft wing fitters in our Broughton factory, so we came up with a way to change that. Our aim was to go from 1% to 10%. We worked with a consultancy, and it was an interesting study in how much you needed to do. We needed to win the hearts and minds of the young women in the area, and they needed to see that they were part of a continuum. Our factory in Broughton stems back to the second world war when, because the men were at the front, women manufactured the Wellington bomber. We had to start by telling the historical story of the role women had played in advanced manufacturing in the region. We then needed to think about shift flexibility—shifts are very rigid, which women often do not want for lots of reasons. The workwear was either not for their stature or tailored in the way they wanted, so we had to look at that. The mandatory skills test was based on the ergonomics of a man, not the ergonomics of a woman. As you and I know, everything is made for a different build than ours. We then had to make sure they had the support to encourage them to go through their apprenticeship to be a fitter in the wing. In the factory in Broughton, we went from 1% to 18%. I give this illustration, and break it down in this way, to show how multifaceted the approach is that we are going to have to take. Going back to my earlier point, Airbus has the resources and the responsibility to do this. There are lots of smaller companies in the supply chain that have more constraints and are not able to do this. It is going to have to start with us thinking about society in a different way and role modelling women. Our most senior woman in Airbus, other than me, started as an apprentice, as did the head of our Broughton site. There are ways that we can do it, but it is stubborn and really tough.

Let me set out a different facet to the same challenge. It is not as diverse a sector as we would like it to be, and propulsion systems is even less diverse than engineering as a whole. To keep doing what we have done in the past, from a technological perspective let alone a diversity perspective, will not work in the future. As I said earlier, we need a transdisciplinary approach to understand all the context. Why this kind of propulsion? What is the route challenge that we are trying to fix? You need a wider range of skills to fix these large problems, and that will give you the opportunity to draw from a more diverse pool of, in our case, graduates. The centre for doctoral training that we run is transdisciplinary in nature. It is focused on propulsion systems, but we recruit from pretty much all sciences, so from psychology, policy and management—a wide range of people in addition to what you might expect in terms of engineering graduates. That group is focused on how we are going to achieve sustainable mobility, working together across all the discipline boundaries. I will not say accidental because we expected it, but it had the additional benefit, if you measure diversity in terms of female participation, of an increase in female participation from 15% to 30%. We would love to see it more than that, but were pleased. As a proxy for diversity of all types it was a good outcome for us. Those people see the societal benefit that they can contribute. If we are reliant on finding people who already have a narrow interest in a specific technology, it is a narrow pool of people and is not diverse. If we can articulate the wider societal contribution that they are making, we stand a much better chance of attracting a larger group of people.

I agree with Oriel. I had the honour of being the only male panel member at Bosch’s Women in Engineering event, which was interesting. You are right: it is a multifaceted societal thing. There are lots of engineering businesses that are still family run and have unwritten policies of not employing women of childbearing age and things like that, because they do not want interruptions. Working particularly with our FE partners, we have seen that there is something in a name. By drawing from different areas, we have seen that you can give a job a different name and change the spread and make-up of those applying. Call for a systems engineer and you get mostly men. Call for a projects-related role and you get a greater balance, even though it is exactly the same job. We are going to have to get smart and do things directly, but also do more subliminal activities.

Yes, and we need new skills for that—for example, in digital engineering and AI. We see a greater likelihood of attracting a diverse workforce into those new skillsets, and they are fundamental to what we need to do in propulsion in transport more generally. That is hopeful. We need to make sure we are delivering careers that are fulfilling and retain people because, in addition to having a shallower pool of applicants than we would like, we also have a leakier pipeline of people progressing through it, women especially. We need to have the mechanisms to retain and allow them to re-enter the workforce without friction after career breaks. That does not just benefit women; it benefits all people in our sector. All these things need work, but there are some signs of hope.

There is a changing social contract with work, isn’t there? People coming into the workplace want to do good, not just do a job, and we see that particularly in areas around net zero and green skills. That opportunity to be seen to be doing good is a different aspect and is increasing diversity without a doubt.

We have touched on this already, but do you think the changes to post-16 qualifications—for example, the introduction of T-levels in 2020—will help to address some of the skill shortages we have been exploring in transport manufacturing?

On T-levels, no. I was involved in the design of the engineering T-level and, to reinforce earlier comments, it has a whole unit on the history of engineering and nothing about the future of it. It has already set off on a journey of being behind the times. The first T-levels were introduced six years ago and have not yet been reviewed for curriculum currency. Six years is a very long time in terms of the way things are going at the moment, so that introduces a challenge. We have seen the uptake of T-levels being a lot lower than we wanted, with nearly £700 million in underspend being handed back to Treasury, particularly in the engineering space, due to the lack of maths in engineering T-levels. It is very difficult for those learners to progress to higher learning because they simply cannot go places, so that reform has been a difficult one. We see the potential in the growth in the skills levy as being huge. As we saw earlier, the opportunity to spend it on training other than apprenticeships is going to be hugely valuable. There is the potential that it will reduce the number of apprenticeships, because lots of employers use apprenticeships as they are the only route they have to recoup the money. We will see. While difficult, levy transfer is thankfully alive and well. They have transferred something like £40 million across the midlands and supported thousands of apprenticeships across the region using it. That may well go down if levy payers are able to spend their money on other things as well. I do not think we are seeing some of these changes in qualifications as helping, because we are losing things that have been good. BTECs in engineering needed updating, I am not going to lie, but why did we not do that five years ago rather than create something new? We could have used that and had a lot of real value. It is a difficult space at the moment and some new things coming in are not delivering now, and might not deliver what we need to see coming through in three to five to 10 years’ time.

I agree with that and have nothing to add.

I would only say let us not take our eye off the ball in terms of higher-level skills while rightly considering apprenticeships and so on. As I said earlier, we need partnerships with industry to deliver the right kind of graduates who are able to contribute to the businesses that we have now, and postgraduates to give the technical leadership we will need in the future. We have to keep the focus on that. It is a long pipeline to get those people, and the challenges we are dealing with are so radical compared with anything the industry has dealt with in our lifetimes that we must do them. There is a perception that it is not the problem of smaller businesses. It is their problem. It is going to be their problem increasingly as we move to a more digital future. For example, it is no longer enough for suppliers to sell a component further up the chain; they have to sell the digital twin, the data that supports it. They have to be able to interface the whole package, the tier 1 and OEM, in a way that is more complex technically than they have done in the past. They are going to need skilled people, at all levels in the supply chain, to a higher level than they have perhaps needed in the past, and we are going to see an increasing shortage of those people, so let us focus across the range.

In support of what Chris said, your degree, if you graduate tomorrow, was contrived at least five to seven years ago to meet the demands of the day five to seven years ago. We have a demand-led education system where you cannot create a new course until you can prove there is a demand for it, and by the time there is a demand it is too late. We know all these things. In the world I live in, and looking in five years’ time, the gold standard would be to be able to say, “Welcome to my engineering degree. Here is year one. Year two is not fully formed yet. Year three, I will tell you when we get there because the world is evolving and changing.” What has not helped in the matter is the CMA and its involvement in higher education. The idea that once a customer has signed up to a degree, in order to change it you have to get everybody’s permission and do certain things. Universities are getting slaps on the wrist by the CMA for changing assignment types. In that environment it is unhelpful, but it is what we are seeing. There are still changes to be made, but we can do that. We can reform the HE space to make us more responsive as well.

Can I ask the former engineering academic to come in very quickly?

I was slightly misleading when I said I was an engineer. In fact, I was an academic, so not a proper engineer. There was always tension because employers wanted—not always—graduates who had the skills so they could be delivering from day one. We all see the role of universities as providing the underlying understanding and theory that would see them through changes in technology. I get what you are saying about the context changing. In Scotland, it is a five-year degree at MEng. What you are doing is giving them a baseload of education that is going to see them through their whole career and not just getting them started for those two or three years. That is the tension, is it not?

Yes, and I would argue there are two parts to that. First, if I am an employer and have a hole in my bucket, I will come and tell you I need a new bucket. As universities, our role is to ask if you need a bucket or a wheelbarrow. That is part of our role. We are not just responding to that need, we should be consulting and doing that work. Secondly, and this might be unpopular with the trade associations that spoke earlier, we almost have a sense of learned helplessness seeping through the system, where employers are going, “I want the oven-ready product on day one out of university.” When have any of us ever started a job where, on day one, we walk in and go, “It’s fine, just point me at the coffee machine and I’ll get going?” There has to be a transition period, and we need to look at how we close that transition period. There is a role in all education and training to say there needs to be some funding directed into businesses so that that training piece does not end the day they start with you. Maybe we need a six-month transitionary period of additional funded support to make that happen. There is that tension. We are an applied engineering department; we do not do pure stuff but the core always has to be there.

I will build on that quickly. The way we do that has to be in partnership with industry. In my view, the sooner that partnership starts, the better. I was the product of the old thin sandwich scheme that some may be old enough to remember. I started at the company before I started university, and I went to the company for six months in every year. I was work ready on day one because I had been doing the job six months a year for four years. The industry had to put a lot of time and resource into doing that, but it got a higher quality of graduate earlier than it would have otherwise. We need to do more of that. We do a placement year at the moment and it is a valuable tool. I would like to see deeper engagement with industry over the whole of the degree period.

Which goes back to the issue that top-level companies can invest in that but SMEs struggle with the resources it requires.

There is obviously a growing push towards work experience post-16. We all suffer from the invitations to do that and have to figure out how to have year 10s follow us around, let alone 18-year-olds. To what extent do you think manufacturing companies and colleges are able to provide post-16 students with useful and meaningful work experience? It touches on what you have said, but there is obviously a freebie aspect to work experience, which is vital for people applying for jobs but a huge burden on employers. What do you think about that?

What you describe is still the case now. One reason we are developing and growing our graduate apprentices programmes is so that our graduate apprentices are ready from day one. Sometimes it is quite challenging for us to take students who have only done an academic qualification at university. That is more challenging for us. We do it as we want the mix, exactly for the reasons you say but, from our point of view, it is easier sometimes if we have younger people. It is a mix of formal learning and working with us.

It was about post-16. There is a push from the Government that every child should be getting it, which obviously puts a huge expectation both on schools and businesses to provide the placement.

Yes, it is a bit of a live issue. It is a legacy of covid that we now do virtual work experience, which is actually pretty good. If you want to send your children to the Airbus virtual experience—my oldest son has done it—it is excellent. The business does not formally have a programme for internships at the moment, and businesses get a bit nervous around safeguarding issues.

It is not an internship either. It is five days and then they go, so it is different.

We have covered apprenticeships quite a lot. Is there anything else you wanted to ask that we have not covered yet?

We are all supportive of apprenticeships and everyone speaks highly of them, but we still have a massive skills shortage. How effective have they been and why have we still got this shortage, given that lots of companies still have apprenticeships and have had for so many decades?

There are a couple of bits to that. We are a big apprenticeship provider and one of the biggest engagers with the apprenticeship system more broadly. We have seen this decline in engineering and manufacturing apprenticeships, not because of demand from young people or the opportunity for providers to provide but because the standards are not actually meeting what the employers need. It happens in a couple of different ways. One is that they become outdated. For example, the automotive technician apprenticeship is now 10 years old and has not been looked at, so it is really outdated, and that is a struggle. The other is the large company dominance of the trailblazer activity. While it is not transport, British Gas, for example, dominates the plumbing apprenticeship trailblazer. Now every plumbing apprentice has to do gas because all British Gas’s plumbers are gasfitters. If I’m a local SME down the road that fits bathrooms, I do not need my apprentices to be gasfitters. I cannot take an apprentice and fulfil that, so I will not take an apprentice. We have those issues that are causing gaps across the piece. We also have what we like to consider the difference between, “Is it more of the same or something different?” We have heard about pipefitters and welders. That is not a mystery to us; we just need more of them. It is a capacity issue: do we have enough employers providing these apprenticeships? Do we have enough spaces in the providers that can then actually deliver those apprenticeships to young people versus the new skills and things that are completely different? There are a number of different things at play here that are an issue and we are seeing this decline in apprenticeships. I have been speaking to providers this week who say, “We can provide more apprenticeships in engineering and manufacturing, but the employers we work with cannot do it.”

Because they want those skills now and in the next few years.

They want the skills but are seeing that apprenticeships are not the route anymore, whether it is because they do not want to be sat at their computer all day on the digital apprenticeship service, whether it is national insurance or time to invest in that young person. It is not meeting the needs of these smaller businesses where for every one employee in an OEM, there are five in the supply chain as a rule of thumb. That is where those apprenticeships need to be.

Regarding the new things that you are talking about, I would add that the skills gap in things like cryogenic engineering and hydrogen has bubbled up quite quickly, much more quickly than the typical cadence of designing new schemes, and you need a more dynamic approach. We are working with local FE colleges and industry to allow access to the infrastructure and engineering teams that we have that are delivering this work. They did not start off as hydrogen and cryogenic engineers; they have transitioned in their own careers. If we can help to provide training with FE colleges to apprentices and so on, that is one way of shortening the time lag between understanding that there is a gap and having a provision in place. It is not easy, but we need a more flexible approach where we have these emerging skill gaps. That also plays into mid-career retraining. At all levels—including engineering professionals—we need to be able to boost the skills of those people and help them transition to new technologies. It is what we did an awful lot of in the automotive industry when electrification came in. For most people doing electrified propulsion in automotive, the early part of their career was in conventional combustion engine technology. They have had to transition and we have had to help them to do that. WMG has done an awful lot of that as well. That partnership is the thread that runs through all that.

I want to pick up the issue about routes into manufacturing for people who are older and further along in their careers. I would appreciate any comments on what particularly Government can do to make that easier. What policies ought to be in place to make that more possible, particularly as we think about the mass of people who are out of work and possibly have lower skills levels?

It is a big challenging area unless you already know about it. There is that knowledge—that hearts and minds piece—where people are in a job but may be underemployed: how do we reach those people and communicate the opportunities to them? I actually think that in this space, this is where Government can play a huge role. We do not see a lot of PR activity with Government really selling these things. Where we have seen it in the past, it has been quite successful, and I feel like that is the opportunity. We want the direction for the skills system to be set and then Government to get out of the way, if you like, but then to help us with the societal aspect of encouraging, promoting, showing where these opportunities are, and then making sure that if support is needed, it is available. Things like LLE are great. I can take out a loan, but that is limited to education levels 4 to 6. Let us not run down a level 3 technician type role because they are extremely qualified and skilled people. If I want to go into that role and am over the age of about 24, unless I am going to put my own hand in my pocket, there is nothing. Let us call this week’s post-16 strategy the 16-to-19 strategy, because for anyone post-16, there is not a fat lot in there, so we need to look at that. There is that balance as well of what the Government, employers and individuals should be responsible for in terms of funding. Those are the different areas that we need to look at. I am fed up working here; I want to go and work there, and yes maybe I should have some skin in that game, but that should be matched if I am going to say, “Yes, I want support,” “Yeah, my employer did it; I put up 25% and someone else will pay a bit.” At least you get the skin in the game. Government create those routes to facilitate this, and then with all due respect, get out of the way and let the specialists enable it.

I would agree with that. To me, it looks like the move to DWP can really help with that. The marketing piece is really important and we discussed it a lot at the trade association. To Professor Brace’s point, a bit like the diversity with women, it is about encouraging people. It is not just about the cryogenic detail that advanced manufacturing or transport needs; it is a whole plethora of skills that we need to be competitive and there needs to be an understanding of what competencies we need from both the people who apply and want to put skin in the game and the employers like us. Some will be relevant and some less relevant.

Do you have any comments on the Government’s advanced manufacturing sector plan? Does the transport sector need its own manufacturing plan?

We welcomed the advanced manufacturing sector plan because of its breadth and because it recognised that it is not just aerospace or space. It reads across to work that we are doing with the Department for Transport as well, particularly around sustainable aviation fuel and the whole work that is happening there. There is some read across on skills going into the energy mix and hydrogen. It could probably be strengthened, but there are links between the two.

Being bigger than transport is a good thing because it brings in biscuit manufacturing, for example.

As far as I am concerned, after years of not having anything, actually having a plan is a revolutionary thing. We are back and have an industrial strategy and an advanced manufacturing sector plan. We actually have something to point out and say, “This is where we’re going.” All the changes in the automotive sector are actually driven by a mandate. Somebody has actually turned around and said, “You must do this by then,” and actually having these plans gives us that mandate to make change.

I have tended to focus more on the technology road maps that groups like APC and ATI lay out for particular sectors to give us a really good guide as to the kind of technologies that we will need to introduce, and the skills and manufacturing implications associated with those. That is a tried-and-tested route and it is good. There is an opportunity to draw better links between those. For example, hydrogen is cross-sector; it is an energy transition, not a new technology. It needs a much more joined-up approach with much larger levels of funding if we are going to be successful in making that transition. It will involve ATI and APC. We need to avoid siloing it; we need a cross-sector approach.

Could it be strengthened?

Yes.

Anything in particular?

Those were really good points.

My questions are about how transport manufacturers are concentrated in different parts of the UK and what different levels of government can do to support that. How important do you think regional clusters are when it comes to transport manufacturing skills? What are the benefits in terms of prosperity for local communities as well as the benefits to the transport manufacturing sector more broadly?

In the south-west we are really fortunate to be right in the heart of a really strong aviation cluster. Almost all the global aviation businesses are represented strongly in our region. We have a mayoral combined authority that really understands that, and it is a really big part of its programme for growth to reinforce the clean growth strategy, skills and local prosperity as a result of that. The combined authority has played a really important role in convening, bringing people together, understanding common challenges that can be addressed at regional level, supporting that with targeted funding, and really local understanding of the issues and opportunities. It is very important in our region and the same is true of other clusters elsewhere.

That is good to hear at a combined authority level. Do you think there is more that central Government could be doing to support that combined authority?

The superficial answer is more funding devolved to that level because the local need is understood very well locally. Bringing all the power of Government to align it with those needs—where it affects local questions—would be useful. What I mean by that is that where there are localised elements of the respective responsibilities of DBT, DFT and so on, we should attempt to bring those together to reinforce local geographical clusters like that. Strategic investments in R&D infrastructure, for example, are very difficult to justify in terms of a Green Book approach that looks at jobs and growth in a relatively short timescale. We are talking about multi-decade investments because they are tackling multi-decade problems. You have to get all the parts of Government focused on aerospace; I am talking about aerospace because that is where I am from. Aerospace Challenge has introduced things like sustainable propulsion. We need some really big infrastructure investments to make sure that work is done in the UK—specifically the south-west, to be selfish—rather than elsewhere around the world. Other parts of the world are doing that investment. We need to keep pace with it and bring all the power of Government into the region to make that happen.

Ms Petry, do you have any comments on regional clusters and the type of support that they get from central or local government?

The UK’s competitiveness in aerospace is its stickiness to regions. The clusters that we have at the moment are ones that go back decades and the skills have been passed from generation to generation, just to underline the importance of clusters for our national competitiveness. Although it is a bit of a false example because it is a very good example, over the last 15 years the Government in aerospace have been pretty good at recognising that. I am thinking in particular around setting up the National Composites Centre down in Bristol, where the research on composites is very close to the companies that are going to apply it. Also, near our site in Broughton in north Wales, the High Value Manufacturing Catapult has a whole digital and robotics centre that is actually developing robotics for Airbus. From a business point of view, as long as it is happening that focus on the cluster is really important because the HVMC—High Value Manufacturing Catapult—in north Wales was actually funded by the Welsh Government. From our point of view, it is a recognition at every layer of government that these are really powerful clusters that drive competitiveness and that they should be invested in. There is quite a lot of work that we are doing with all layers of government—national, devolved and regional—to try to come up with partnerships that deal with skills but also other challenges.

In my area of Greater Manchester, we have seen the Greater Manchester Combined Authority play a really good, important role when it comes to galvanising support for something called the Atom Valley cluster, which is partly in my constituency, and that will specialise in advanced manufacturing. I suppose this one may be for you, Dr Silverstone. Are devolved authorities sufficiently empowered to support transport manufacturing in local areas?

Again, we have a great combined authority in the west midlands and a focus on automotive manufacturing. We are moving in the right direction with empowerment. Something that we have always been really clear on is that we are looking at a nationally conceived, regionally contextualised and locally delivered approach to skills, because it has to take in those three layers. I will give you an example. In the midlands, we have the EV cluster, which has five priority areas. We went away and worked with providers to say, “These are the five priority areas that the regional investment team is going to go away and try to get investment in. Can we demonstrate we have the skills and infrastructure so that we can show that off?” Essentially, we do not have the sausages yet, but we have the machines to make the sausages. That is what we want to show that we can do. That is one meeting in a room for an afternoon to get all that sorted out. That is the real power that they have. We would love to see more devolution of skills funding but it has to be aligned to a national strategy. My biggest concern is that you would end up getting the west midlands diploma in manufacturing or the Greater Manchester diploma, which would be different and not transferable. There has to be that level of oversight so that it is nationally conceived, regionally contextualised and locally delivered. That is the way of flowing that through in that devolved way, and we have been clear around electrification to make sure that it works for the past five years.

I am going to have to bring it to a close. I would like to thank all our witnesses for their evidence. There is always more that could be said that we did not have time for, so all witnesses are welcome to send in anything in writing—obviously specific to transport, please, for this inquiry. We look forward to holding the second and final evidence session on this inquiry in two weeks’ time. That concludes today’s meeting.