• Productivity per hour worked is 11 per cent lower in Britain than in Germany. Poor literacy and numeracy skills account for one quarter of that shortfall.

• 94 per cent of companies in the north-west said that reading and writing skills were important in manual tasks, yet only 61 per cent saw a need to train workers in these skills.

• Many employers are not aware of the dearth of basic skills in the UK’s workforce. Only 4 per cent cite it as a problem.

A brief tour of the primary sources of these statistics is illuminating.

The Cost-to-Industry Statistics

The “cost to industry” statistics and the “4 per cent” figure are taken from questions asked of employers in the Government’s annual Skills Needs surveys in 1994–96, and from a 1992 Gallup survey of 400 companies published by ALBSU in 1993 as “The Cost to Industry: Basic Skills and the UK Workforce.” To quote Peter Robinson (Robinson, 1997)2 “the £5 or £10 billion figure which is sometimes quoted for the cost of poor basic skills to British Industry is one of the least reliable figures in the whole debate.”

He outlines the problem with these statistics as follows. In the Skills Needs surveys, a large sample of employees with over 25 employees were asked if they had a skills gap; that is, if there was a gap between the skills of their current employees and the skills which they needed to meet business objectives. Only 18 per cent of respondents said that there was such a gap; and only 23 per cent of those respondents — that is, 4 per cent of all medium and large employers questioned — felt that that gap was in the area of literacy and numeracy. Nearly three times as many employers complained about the lack of management skills, general communication skills, personal skills such as motivation and computer literacy, as complained about the literacy and numeracy “gap.”

It seems to me that it is worth taking these statistics at face value. If “only four per cent of employers” cited basic skills as a problem within their organisation — then perhaps only four per cent of employers had it as an actual problem. The work to be done with the others is to ensure that they understand the additional benefits to be gained by improving the basic skills of their workers even where there isn’t an actual presenting problem.

Robinson goes on to talk about the Gallop (ALBSU) survey. This was a survey of 400 organisations employing over 50 people, of which again a small proportion, 15 per cent said that some of their own staff had problems with the basic skills they needed to undertake work related tasks effectively. These respondents came up with some estimates of the costs associated with these poor basic skills (for example, loss of customers due to inaccurate orders; cost of recruiting new staff; costs of duplication of work). Despite the fact that less than 15% of respondents had reported staff with basic skills “gaps,” the report then grossed these figures up to £4.8 billion, to represent the costs to 100 per cent of all 400,000 firms employing over 50 people. The figures have since been inflated to £10 billion to reflect the extra costs covered by small businesses, thus providing, as I have already said, a cause for Robinson to doubt the accuracy and veracity of these figures.