The UK is still struggling with what economists call the “productivity conundrum”. Since the 2008 global financial crisis, growth in output per worker has been sluggish compared to international competitors such as the United States, Germany and France. Weak productivity holds back wages, dampens economic growth and limits our ability to finance vital public services.
The government has rightly recognized the need to stimulate growth. The industrial strategy identified eight key sectors with the highest potential, from clean energy to life sciences. More recently, the creation of Skills England signals a renewed national effort to promote technical and sectoral expertise. These steps are important, but they are only one piece of the puzzle.
An argument for further training
Jules Bennington – Senior Policy Officer, Chartered Management Institute, explains that a dynamic economy depends on a workforce that can adapt, learn and innovate. But employers’ investment in training has struggled, falling by 28% since 2005, even as demand for employability skills continues to rise. Without decisive action to close skills gaps, the UK risks missing its growth ambitions.
What is crucial is that the challenge is not just about technical know-how. The National Foundation for Educational Research (NFER) has shown that essential professional skills such as collaboration, communication, organization, problem-solving and decision-making are fundamental to future success. These are precisely the skills that make it possible to apply technical knowledge most effectively and achieve productivity gains in all sectors.
Core competencies: The basis for good management
These essential skills reflect the characteristics of effective managers and leaders. They are enshrined in the Chartered Management Institute (CMI) Professional Standard for Management and Leadership, which sets out the behaviours, skills and competencies required to lead teams, drive innovation and manage change.
Strong management is not a “nice to have”. CMI analysis shows there are 8.4 million managers in the UK – around one in four workers. But most have never received any training. Our Better Managers study found the following:
- 82 percent were promoted without formal training and became “accidental managers.”
- Half have no management or leadership qualifications.
- One in three managers – including a quarter of senior managers – have never received formal management training.
International comparisons highlight the costs of this gap. The analysis shows the UK lags behind countries such as the US, Germany and Sweden in management practices – a deficit linked to lower productivity.
Why management skills are important for everyone
Management and leadership skills are consistently identified as skills in high demand in Skills England’s assessment of where the need lies in the priority sectors. The benefits of these capabilities extend across the economy – from advanced manufacturing to health and social care.
But good management is not just about achieving growth goals; it’s also about doing good work. CMI research shows that a supportive manager is the most influential factor in making employees feel valued and included. Effective managers are key to workforce development, employee retention, adoption of new technologies like AI, and coordination of complex supply chains.
Wherever people work together, basic professional skills and good management are the glue that transforms technical knowledge into tangible results.
Shared responsibility for action
Employers have a crucial role to play, but they cannot fill this gap alone. The sharp decline in employer-sponsored training highlights the need for strong public policy. At the same time, companies are demanding higher skills, especially in management and leadership.
This is why CMI is calling on the Government to keep transferable core skills at the forefront as the Apprenticeship Levy evolves into a wider Growth and Skills Levy. We need a system that gives employers access to high quality, modular and accredited training – flexible enough to meet immediate business needs and rigorous enough to raise national standards.
A skills agenda for growth
Technical expertise will always be crucial to economic progress. But without the essential employability and management skills identified by NFER and enshrined in CMI’s Professional Standard, technical skills alone cannot deliver the productivity boost the UK needs.
If we want an economy that is globally competitive, resilient and inclusive, we must invest not only in people’s technical knowledge, but also in the way they work together to apply that knowledge. Now is the time to ensure that core competencies are recognized as the foundation for productivity and good work.
NFER’s final report on the Skills Imperative 2035 program will be published on Tuesday 25 November.
