An ambitious plan to get more Londoners into jobs is already showing signs of helping employers address skills shortages, according to the latest progress update on the government-backed London Local Skills Improvement Plan (LSIP).
Led by BusinessLDN, in partnership with the Federation of Small Businesses London, London Chamber of Commerce and Industry (LCCI) and CBI London, the LSIP was published last August following extensive engagement with more than a thousand employers, training providers and wider stakeholders.
A year on, its progress report highlights how the plan is improving joint working between educators, policymakers and employers, with more firms working with further education colleges, delivering apprenticeships and co-creating new courses in areas such as digital and green skills.
Other LSIP milestones include the creation of the Grow London Local support hub to help small firms trying to navigate the fragmented skills landscape and the Greater London Authority (GLA) pledging to fund placements for 4,500 16 – 19-year-olds by March 2025.
Muniya Barua, Deputy Chief Executive at BusinessLDN, said: “It’s encouraging to see the Local Skills Improvement Plan starting to shift the dial on getting more Londoners into the labour market in just 12 months since its launch. This shows the benefits of collaboration between employers, education providers and London government. But with a third of firms in the capital still reporting skills and capacity gaps within their workforce, there is still more work to do, particularly in areas such as addressing the digital skills gap. The partnership approach embodied by the LSIP will help the new Skills England body to really hit the ground running and accelerate the changes needed to put the capital in pole position to create the jobs and growth the country needs.”
Other key findings in the progress update include:
- A survey of 1,200 London business leaders and HR Managers conducted by Survation shows over a quarter of employers (27%) are now working with FE colleges, up four percentage points on the same period in 2023 when the LSIP was still in development, and the number delivering apprenticeships is now close to a third (30%), up three percentage points over the same period.
- A separate survey of training providers shows the majority have increased capital investment, created new courses in key areas like digital and green skills and/or partnered with employers to co-design aspects of their offerings in support of the LSIP. Most of these survey participants (86%) reported that the LSIP is having a positive impact on meeting employers’ skills needs and getting more Londoners into jobs.
- The progress report also highlights areas where work is still needed to develop skills provision across London, with the same Survation survey showing that half of firms are struggling to recruit the right staff to fill vacancies (49%) and more than a third (38%) reporting gaps in skills and capacity within their existing workforces.
The focus of the LSIP over the coming year will be on growing the partnerships it has developed to tackle skills shortages and publishing new analysis of how to best meet employers’ advanced digital skills needs whilst feeding into the Mayor of London’s new Growth Plan and working with Skills England.
The Rt. Hon. Baroness Smith of Malvern, Minister for Skills, said: “I welcome the publication of the Local Skills Improvement Plan Progress Report for London. These reports set out progress made on meeting the skills needs of local employers. As well as being a valuable source of information for local skills deliverers, employers and stakeholders, the reports along with the LSIPs themselves, will provide important intelligence for the newly established Skills England.”
Howard Dawber, Deputy Mayor for Business and Growth said: “London needs more employers to support skills training to help drive growth across the city and ensure Londoners can benefit from the job opportunities this brings. I welcome the publication of this report and I am pleased to see the LSIP is starting to make a difference to our skills system, as we continue working together for a better and fairer London.”
Matthew Jaffa, Senior External Affairs Manager at the Federation of Small Businesses London, said: “This LSIP progress report shows the importance of businesses being an integral part of the skills system. Many small firms across the capital continue to struggle to access the skills needed. Our recent FSB small business index shows that a quarter of small businesses view a lack of appropriately skilled staff as the greatest perceived barrier over the next twelve months. The LSIP will continue to make a difference in supporting small businesses looking to invest in their workforce – and we hope that Skills England will continue to nurture these strengthening partnerships between Providers, Employers and London Government.”
Anneka Hendrick, CBI London & South East Director, said: “Just twelve months since its launch, we are pleased to see this Local Skills Improvement plan already bearing fruit by helping to alleviate skills shortages in the capital – as this progress report reveals. It is encouraging to see what has been achieved through the combined efforts of employers, education providers and London government. By tackling shortages of green and digital skills in particular, this partnership is helping to future proof the capital’s economy, while supporting the acute needs of its business community. We look forward to continuing this collaboration that will help to ensure the ambitious plans of this LSIP are realised.”
Karim Fatehi, CEO of the London Chamber of Commerce and Industry, said: “The LSIP is a bold and ambitious plan to drive growth in the capital by tackling the root cause of skills shortages. We are delighted that this report highlights the encouraging progress in collaboration between businesses and FE colleges as well as an increase in capital engagement and the number of apprenticeships being delivered. Thriving businesses are crucial for UK economic growth and collaborative efforts like the LSIP will enable greater access to skilled workers to drive this forward. We look forward to seeing the positive impact of the LSIP grow.”