Skills shortages
When I ask Steve Holliday what keeps him awake at night, his answer is clear: talent. With 87,000 people needed annually to meet demand in the UK’s engineering sector over the next decade – and only 51,000 currently joining the profession each year – the National Grid chief executive’s problem is certainly palpable.
What drives Holliday is long-term planning for the future of the sector and helping to ensure enough science, technology, engineering and maths (STEM) skills are being developed for the years to come.
And as the UK’s wider skills shortages remain a familiar theme in the news and political arena, Holliday is also calling on businesses to help address the broader agenda of the ‘mismatch’ between the jobs available, the number of unemployed young people and the kind of skills they possess.
“We’re not training people for the work that we have,” he asserts. “We [business leaders] need to stop moaning and take some collaborative action. The responsibility lies with employers to be realistic with young people about where jobs will be in the future, so they can make informed career choices.”
Plugging the talent pipeline
A £29 billion business, National Grid owns the UK’s electricity network and gas pipes that supply 11 million homes across the UK.
Employing 12,000 people nationally and a further 16,000 in the US, the organisation recruits about 700 people per year in the UK – a large portion of whom are engineers. And while Holliday is impressed with the quality of current hires, his real concern lies with the availability of future skills several years from now.
The UK Commission for Employment and Skills has said that of the nearly two million new jobs created between 2007 and 2017, 58% will require STEM skills. And two in five companies that need employees with STEM skills have difficulties recruiting staff.
National Grid has already had to reach out to other countries to find people with advanced skills in areas such as power systems, since they are not available in the UK.
“Our business model is backed by investors with confidence,” says Holliday. “But the risk of executing our strategy is having people with the capability and competency to lead and deliver in the future.”
And with an average employee age of 47, Holliday knows that National Grid will be facing a mass exodus of workers in the next 10 years. So, with increasing skills deficits and hiring needs set to rise exponentially in both the UK and US, it’s no surprise that he is ramping up his efforts to inspire young people into STEM careers with ‘increasing effort and passion’.
An unattractive career
Holliday is concerned that children are not favouring engineering as a career choice, instead following other seemingly ‘more desirable’ routes. He puts this down to a number of factors – but fundamentally that society does not understand enough about what engineering involves.
“If you ask kids today if they’d like to work in the media industry, they’ll say ‘yes, that’s really exciting,’” explains Holliday.
“But a huge number of engineers work in the media industry, people just don’t realise it. People think engineering is building a bridge or fixing a washing machine. There’s a massive information void about what people need to be skilled in to do certain jobs.”
However, Holliday himself admits he ‘fell into’ engineering rather than aspiring to it. “I happened to be good at science and maths, so the careers advice I got was: ‘you should be a doctor’,” he recalls. But after a last-minute change of heart he decided to apply for mining engineering and subsequently joined the oil industry, spending much of his early career at Esso (now Exxon).
He joined National Grid group as board director for the UK and Europe in March 2001, and was appointed chief executive in 2007. In his capacity as National Grid CEO and chair of Business in the Community’s talent & skills leadership team for the past 3.5 years, Holliday hopes to bring together schools, parents and businesses – all of whom, he believes, have a substantial influence on young people’s career decisions. Yet, for Holliday, a joined up way of collaborating efforts is still needed to inspire young people.
Challenging perceptions
To find out more about attitudes to engineering, in 2009 National Grid commissioned the ‘Engineering our Future’ report, carrying out more than 1,500 interviews with young people aged 14-19, their parents and teachers.
It found the general attitude was that engineering is ‘all about dirty, male, low-paid jobs that are predominantly ‘up north’ and ‘isn’t the north dying?’.
Six out of 10 respondents could not name a recent engineering achievement, and girls were found to be 10 times less likely than boys to pursue a career in engineering.
“When asked how they would feel if their daughter became an engineer, one parent said: ‘I’d hope she would have done something better with her life, like become a doctor or a lawyer’,” adds Holliday.
The research found that many of the biases were actually being propagated in primary schools, so in 2011 National Grid launched ‘School Power’ – a range of classroom resources to support teachers in teaching STEM subjects, and a specialist website that teachers, parents and pupils can access.
The organisation’s employees regularly visit primary schools with a programme of activities to stimulate interest and excitement around energy, forces and climate change.
The aim is to get pupils to understand how engineering links to the future economy. “These are mega issues for society,” comments Holliday. “We want to inspire young people to come and do a job that can make a real difference to the planet and to our way of life in the future.”
Other initiatives to try and positively affect perceptions towards engineering include the National Grid Work Experience programme, where 100 14-15 year olds identified as high-potential in STEM subjects are invited to the organisation’s training centre in Newark, Nottinghamshire. Pupils spend a week discussing what engineering means, and National Grid immerses them in real-world examples such as visiting power stations gas compression sites, and getting close-up to high-voltage substations, lines and cables.
Female participation - inspiring young minds
Another topic firmly on Holliday’s agenda is increasing female participation in the sector. At present, girls are under-represented in areas of skills shortages, particularly STEM.
Engineering UK found that among STEM educators, 44% of those who said engineering was an undesirable career for their students believed it is seen as a career for men. Even among women engineers, 75% felt engineering is regarded as a ‘male career’.
Participation at school is also poor. About half of all state secondary schools in the UK do not have a single girl doing A-level physics, which for Holliday is ‘extraordinary’.
National Grid is intensifying its labours to encourage girls into the industry and showcase positive role models. “We ensure our residential course takes an equal number of girls and boys, even though we get many more boys applying,” he says. “We take our female employees into schools to get them to break down girls’ perceptions about what they can and can’t do.”
Linking education & employment
For many, the issue of skills shortages across the UK is partly the fault of an education system which tends to focus on exam results and fails to give young people an opportunity to see what the world of work is like. Indeed, McKinsey’s Education to Employment report found that ‘educators and employers operate in parallel universes’ and Holliday agrees. “We need to start linking these things up,” he declares.
Holliday has, by his own admission, been very critical of the lack of careers advice in schools in recent years. Yet he acknowledges that in a world where today’s CEOs struggle to articulate what jobs will be available in their own organisations in five years’ time, it’s unreasonable to expect teachers or careers advisers in schools to keep up with what industry needs.
For Holliday, there’s a real onus on business and industry to be honest with young people about where the economy needs skills in the future, so they can make informed choices now.
Putting the onus on business – Careers Lab
To that end, National Grid is launching ‘Careers Lab’ which Holliday hopes will begin the journey towards providing a co-ordinated way of businesses taking responsibility for the agenda. The pilot scheme, which begins in January 2014, will see businesses and schools working together on a progression of careers advice programmes for young people from the age of 11 to 16.
“We want to inspire kids, in the hope that they will aspire to different careers,” says Holliday. “We’re hoping this will act as a facilitation layer for schools to tap into businesses so they can have conversations about work, business and the skills required for the future.”
With input from teachers, four modules have been designed to be delivered to different age groups to bring the reality of the jobs market alive and inspire young people into industry. Holliday has also enlisted a number of other big employers such as Whitbread, Capgemini and Costain.
The plan is to trial the scheme across six schools in the Midlands region in 2014, before rolling it out across the rest of the country.
Measurables
When it comes to government involvement, Holliday is sceptical about imposing new legislation, but suggests more could be done to encourage schools to focus less on how many people go to university and more on how many people go into work through vocational paths such as traineeships and apprenticeships.
“There’s an old adage in business – if something isn’t going well and you put metrics around it, things will start to happen,” he says.
“In the education sector, if the key measurements are around: ‘how many people are going to university?’ guess what output you’re likely to focus on.”
With the onus now on universities to provide statistics on the activities of graduates after they leave higher education, Holliday argues that if schools were obliged to do the same, there would be more visibility over the future talent pipeline. He says: “The question for schools is: ‘how many people have we set up for life with some degree of success?’, as opposed to: ‘I got this lot off to uni, so the other lot is on the scrapheap’.”
Vocational education
Holliday also highlights his concern over the attitudes towards vocational education. “I wish we could banish that term,” he says. For him, there’s an assumption among some parents that people who take vocational courses are ‘not that smart’.
“The qualifications you come out with are A-levels,” he asserts. “People just learn in a different way – with a mixture of practical and academic learning – that is more suited to them.”
Holliday would like to see a world with at least three different career pathways for young people: a route through university to work, another through apprenticeship/ traineeship, and one which is vocational/technical. “All three routes could end up sitting in this [the CEO’s] chair,” he says. “As a society we are biased in thinking the only way to success is university, which is just not true.”
Tapping into talent
The BITC talent and skills leadership team consists of a group of senior executives who represent organisations that collectively employ over half a million people. Together, they work to identify ways in which businesses can make a difference in the talent and skills agenda.
Against the backdrop of record youth unemployment in 2013, this leadership team have now focused on taking direct, targeted action to address youth unemployment.
One major initiative is ‘Generation Talent’ – which invites businesses to positively subscribe to ensuring that a percentage of their recruits are aged 16-24. Since launching in November 2013, so far over 90 employers have committed to making more than 40,000 vacancies visible to unemployed people through Jobcentre Plus.
“Some businesses initially thought they should just hire anyone as long as they are aged 16-24,” explains Holliday. “On the contrary – we want people to hire for the skills they need, but just ensure that talent pool is one of those they fish in.”
Part of the scheme is to provide a ‘health check’ for recruitment functions, to identify any unconscious biases in the hiring process. Some companies found they were automatically sifting out people who’d had a period of unemployment, in order to reduce the selection pool.
National Grid has committed to widening the net to ensure everyone who could be suitable for roles at the gas and utility giant can now access them. This has involved looking at job adverts to ensure they are worded in the right way, explains Holliday.
Generation Talent also sees roles being advertised through Jobcentre Plus, who can help provide companies with access to top talent. But like any diversity initiative, is there a danger of this becoming a tick-box exercise?
“It’s not about dropping standards,” he insists. “It’s about giving young people opportunity. If we don’t do something, they will fall out of the mainstream job market.”
In the boardroom
When it comes to boardroom agendas, Holliday is positive. Future talent, he says, is much more of a live debate today than it was five years ago. “It all comes down to succession. Do we have the right talent coming through to deliver and execute our strategy?” he asks. “It’s an issue for all businesses, but sometimes you only face up to it when there’s a crisis.”
But despite increasing efforts by business, school and government to address skills shortages, Holliday believes a lot of initiatives are competing – which is counter-productive.
“There’s no need to cajole people to do more, but it’s so badly co-ordinated people are tripping over each other. We need to rationalise the space, but it’s a huge challenge,” he suggests.
An energised future
As for the engineering sector, Holliday believes it’s reached a tipping point. To compete on a global scale, the UK needs smart, innovative minds to navigate out of recession and spur the economy forward.
“How can we enjoy the standard of living we want, at a level we can afford, and do it while caring about the planet for the future?” he asks. “We need smart, creative people to work through those problems and the technical issues that sit behind them.
“Lots of young people are concerned about the environment and the society they live in – which is fantastic. But we need to make sure young people understand that if you want to contribute to the solution, these are the industries you need to work in, and these are the skills you need.”
Calling on employers for help, Holliday says: “We’ve got to be honest with kids about where the jobs are – so we’re linking education and skills training with an economic strategy for the country. It’s bizarre that we don’t do this already. They co-exist in different universes, and that’s got to change.”