Economy

Business at the

heart of skills reform

The Secretary of State for Education has told businesses in Coventry and Warwickshire that they will be at the heart of the reform of the skills system.

Nadhim Zahawi made the pledge to members of the Coventry and Warwickshire Chamber of Commerce at the latest event organised as part of its PolicyHour series.

The MP for Stratford-on-Avon said his Skills Bill, which is currently making its way through the Parliament, was high up on the Government’s list of priorities.

Mr Zahawi said: “We have a very ambitious agenda for skills in my department, as well as in Government, and what we are going to do is to usher in the era of a skills economy where businesses are at the heart of everything we do.

“Through the Skills Bill we are going to see the opportunity for Chambers of Commerce and business representative organisations to help us on this journey because the local skills plans that we are trialling and how we can build those bottom-up plans for a region is an incredibly important element.”

As part of the reform of the skills system, Mr Zahawi said it was important that educators understood and promoted the value of apprenticeships and new T-Level qualifications to learners if businesses were to be provided with an appropriately skilled pipeline of employees for the next generation.

“I also want to see more entrepreneurial ways of businesses engaging with educators,” he said.

“My first visit after taking on this job was to Barnet and Southgate College where they are working with their local authorities and their local Chamber of Commerce to host a business hub, through which all SMEs have to go if they have a question about their business rates or a grant application, and that gives them access to a steady pipeline of businesses that they can better engage with.

“As a result, the college has classrooms full of electricians and scientists because it was through their engagement with businesses that they worked out that as a country we’re going to need many more to carry out the conversion work towards getting to net zero.

“This hub is an excellent example of an entrepreneurial way in which the college is engaging with its business community to provide huge opportunities.”

Sean Rose, head of policy at the Coventry and Warwickshire Chamber of Commerce, said: “It’s key to the success of our economy that we have an appropriately skilled workforce and the commitment in the Budget of a funding increase of 42 per cent to be spent on increasing skills provision was welcome news.

“With the Skills Bill getting its second reading in the House of Commons only last week, this was a timely opportunity for our members to hear directly from Nadhim Zahawi, who is at the heart of this, and for them to be able to speak directly to him with their views on how and where that money should be spent.”

“Through the Skills Bill we are going to see the opportunity for Chambers of Commerce and business representative organisations to help us on this journey because the local skills plans that we are trialling and how we can build those bottom-up plans for a region is an incredibly important element.”

New support package welcomed

Business leaders in Coventry and Warwickshire have welcomed a new support package for the leisure and hospitality sector.

The Chancellor Rishi Sunak has announced new measures to support those business hardest hit by the latest guidance in reducing the spread of Covid-19.

Businesses in the hospitality and leisure sectors in England will be eligible for one-off grants of up to £6,000 per premises, plus more than £100 million discretionary funding will be made available for local authorities to support other businesses.

Government will also cover the cost of Statutory Sick Pay for Covid-related absences for small and medium-sized employers across the UK.

A further £30 million of funding will be made available through the Culture Recovery Fund, enabling more cultural organisations in England to apply for support during the winter.

Sean Rose, head of policy at the Coventry and Warwickshire Chamber of Commerce, said: “The latest round of Covid-19 restrictions and guidance have been different to previous waves, as they have not seen Government forcing businesses to close at this stage.

“However, it is clear that the guidance and rise in cases is hitting confidence and, therefore, the leisure and hospitality sector is being adversely affected.

“We welcome this new support package and, as before, it’s vitally important that the money is easy to access and gets out to those businesses that need it most as quickly as possible. This could be a lifeline at what should be their busiest time of year.

“It’s not clear if there are going to be further restrictions in the coming days and weeks but it’s vitally important that, whatever happens, the Government is ready to support businesses even further to help them through this difficult period.”

Shevaun Haviland, Director General of the British Chambers of Commerce, said: “These measures will provide some welcome respite to many of those businesses who have been hit hardest by the latest Covid measures.

“The Chancellor and his team have engaged with us in talks over the past week, considered the experiences of Chamber business communities and the proposals we put to them.

“We are pleased that the Chancellor heard our call for additional grant funding for hospitality and leisure businesses, which will provide some much-needed support in the face of this increasingly difficult trading period. Clarity and speed will be needed to ensure that these grants are paid out swiftly to help these hard-pressed firms weather the next few weeks.

“Whilst these measures are a positive starting point, if restrictions persist or are tightened further, then we would need to see a wider support package, equal to the scale of any new measures, put in place.”

“We welcome this new support package and, as before, it’s vitally important that the money is easy to access and gets out to those businesses that need it most as quickly as possible. This could be a lifeline at what should be their busiest time of year."

Firms still facing recruitment issues as unemployment falls

Business leaders in Coventry and Warwickshire say falling unemployment does not disguise issues firms across the region are facing as they look to grow.

The unemployment rate fell to 4.2 per cent in the latest figures from the Office for National Statistics while job vacancies rose to 1.22 million.

Sean Rose, policy officer at the Coventry and Warwickshire Chamber of Commerce, said: “The continuing drop in unemployment has been a real success story for the economy.

“Forecasts suggested the rate could double, particularly when the furlough scheme ended in October, but it is now edging back towards prepandemic levels.

“However, while it is a relief that it has not hit those heights, businesses across our patch are still facing a range of issues that are stifling growth.

“Obviously, there is concern around the rising levels of Coronavirus and the new guidance that was announced last week.

“There also big issues around recruitment and finding the right skills to help companies grow and, also, the rise in costs and supply chain problems.

“Businesses across the patch need a solution to those issues if they are to achieve their growth ambitions in 2022.”

British Chambers of Commerce Head of Economics, SurenThiru, said: “Rising payroll employment and falling unemployment confirm that the UK jobs market has continued to rebound strongly despite a slowing recovery and the end of furlough.

“Record vacancies underscore the severe recruitment crunch facing businesses. Although the changes to Covid self-isolation rules are welcome, with coronavirus and Brexit driving a structural decline in available labour, staff shortages may persistently constrain economic activity.

“Although labour demand remains robust, Plan B may damage the jobs recovery by squeezing hiring intentions in those sectors most exposed to the new measures, including hospitality and retail, by diminishing their cashflow and dampening customer demand.

“While current labour market trends provide no barrier to raising interest rates, uncertainty over the economic impact of the Omicron variant means a December rate hike is unlikely. Interest rates may start rising from February 2022, but only if concerns over the new variant have faded.

“More support is urgently needed to aid those firms worst effected by Plan B, including returning VAT for hospitality and tourism back to its emergency rate of 5 per cent, reinstating full business rates relief for these firms and making additional grant funding available.”