WEBVTT 00:00:00.000 --> 00:00:19.940 Unlike Beth and Steve, I'm not a critical thinking expert by any means, but what I want to do in the 10 minutes I've got this afternoon is to try and put the importance of critical thinking skills in the wider context from the perspective of the skills employers and individuals are going to need to succeed in the labour market. 00:00:20.560 --> 00:00:27.500 So first, if I may, I want to start off pretty broadly, probably as broad as you can get, looking at the Global Skills Challenge. 00:00:27.500 --> 00:00:34.640 So I think the Global Skills Challenge has changed beyond recognition over the last 20 00:00:34.631 --> 00:00:37.211 significant social and economic consequences. 00:00:37.771 --> 00:00:40.371 I think there are two main drivers of this radical change. 00:00:40.531 --> 00:00:44.871 First is globalisation, clearly, and the second is technology. 00:00:45.551 --> 00:00:47.131 So first, globalisation. 00:00:47.611 --> 00:00:51.191 Over the past two decades, according to the International Monetary Fund, 00:00:51.191 --> 00:00:57.191 the effective global labour force has risen fourfold 00:00:57.191 --> 00:01:00.411 as China, India, the former Eastern Bloc of countries, 00:01:00.811 --> 00:01:02.271 has entered into the global economy. 00:01:02.271 --> 00:01:09.271 This growing pool of labour is being accessed by advanced economies like the UK through a range of 00:01:09.261 --> 00:01:14.781 of different channels through imports of final goods, offshoring of the production of intermediate 00:01:14.781 --> 00:01:20.541 goods and services, and of course through mass immigration. And while most of the absolute 00:01:20.541 --> 00:01:25.481 increase in the global labour supply over this period has consisted of less educated 00:01:25.481 --> 00:01:31.721 workers, again according to the IMF, the relative supply of workers with higher education has 00:01:31.721 --> 00:01:38.641 increased by about 50% over the last quarter of a century. The second important driver arises 00:01:38.641 --> 00:01:43.901 from technology. This feeds into the way our economies work in two different ways. 00:01:43.892 --> 00:02:03.852 The first is a vast improvement in computing power and communications, coupled with the progressive removal of restrictions on cross-border trade and capital flows, have made it possible for production processes to be unbundled and located further from the final market for a growing range of goods and services. 00:02:04.752 --> 00:02:11.392 Increasingly, the job gets done wherever in the world it can be undertaken most efficiently and at lowest cost. 00:02:11.392 --> 00:02:18.532 Technology has made it possible to integrate the increased pool of global labour and create something 00:02:18.522 --> 00:02:24.762 like a global labour market for it. The other big impact of technological development has been 00:02:24.762 --> 00:02:30.942 on the workforces of developed economies like the UK. This arises from the way that computers and ICT 00:02:30.942 --> 00:02:37.382 act as a substitute for unskilled labour, but tend to complement and improve the performance of 00:02:37.382 --> 00:02:41.922 skilled labour. I think to see what this means in practice, you only have to go around a modern 00:02:41.922 --> 00:02:46.942 factory floor. You'll notice how few workers there are in control of the actual processes 00:02:46.942 --> 00:02:51.102 and the sophisticated equipment which makes it possible for them to get the job done. 00:02:53.153 --> 00:03:00.053 Indeed, I think it's been the improvements in technology even more than the impact of globalisation that have squeezed out unskilled jobs in our economy. 00:03:00.833 --> 00:03:04.173 Our manufacturing sector, for example, has been especially exposed. 00:03:04.913 --> 00:03:11.573 British manufacturing lost a very large number, upwards of a million, of largely unskilled jobs in the 80s and 90s. 00:03:11.573 --> 00:03:16.233 But the productivity of the survivors was, of necessity, radically improved. 00:03:16.233 --> 00:03:19.233 So that in motor vehicle manufacturing, for example, 00:03:19.233 --> 00:03:23.233 we now have some of the most efficient plants in Europe. 00:03:23.233 --> 00:03:27.793 In a recent study by the Department for Business showed that the 00:03:27.783 --> 00:03:34.103 manufacturing workforce, though much reduced in numbers, has a significantly greater proportion 00:03:34.103 --> 00:03:38.423 of skilled workers than it did 10 years ago, including a rise in the absolute number of 00:03:38.423 --> 00:03:43.843 graduates employed. I think one result of all this, and similar changes in other parts 00:03:43.843 --> 00:03:48.863 of the economy, is that there is a very high correlation in the UK between a young person's 00:03:48.863 --> 00:03:53.563 educational achievement and their employment prospects. The Bank of England, for example, 00:03:53.563 --> 00:03:57.863 produced some striking data to illustrate this fact last year. 00:03:57.863 --> 00:04:02.423 In the eight years up to the recession, most of all the new jobs 00:04:02.414 --> 00:04:08.214 created went to people with higher education qualifications. During a period of rising 00:04:08.214 --> 00:04:13.634 employment across the board, the job prospects of young people with no educational qualifications 00:04:13.634 --> 00:04:20.594 actually declined. By 2005, they were five times as likely to be unemployed as their 00:04:20.594 --> 00:04:25.214 more skilled counterparts, one of the highest such ratios in the developed world. 00:04:26.874 --> 00:04:32.074 So globalisation together with skills-based technical change is transforming the composition 00:04:32.074 --> 00:04:33.474 of the labour market. 00:04:33.474 --> 00:04:37.054 If anything, the recent recession has increased the importance of 00:04:37.044 --> 00:04:41.384 educating a large proportion of the population to a much higher standard than in the past, 00:04:41.764 --> 00:04:45.944 ensuring they have the skills to succeed in a continually evolving labour market. 00:04:47.184 --> 00:04:49.424 Now, there's been a long debate about skills in the UK, 00:04:49.764 --> 00:04:53.084 and more particularly about the shortage of skills and how to address that issue. 00:04:53.704 --> 00:04:56.744 Much of the debate has concentrated on technical skills, 00:04:56.744 --> 00:05:01.364 the specific skills that are needed to carry out certain specialist tasks. 00:05:01.844 --> 00:05:05.924 Certainly, we at the CBI continue to highlight the vital importance of science, technology, 00:05:05.924 --> 00:05:11.684 engineering and math skills to our future economic growth but increasingly we're seeing greater 00:05:11.675 --> 00:05:16.015 on the more generic skills individuals need to adapt to this change. 00:05:16.915 --> 00:05:20.575 We consulted a few years ago widely amongst CBI membership 00:05:20.575 --> 00:05:24.755 to define exactly what we meant by these generic employability skills. 00:05:25.375 --> 00:05:30.235 We defined them as self-management, team working, business and customer awareness, 00:05:30.875 --> 00:05:36.035 communication and literacy, application of numeracy, IT and problem solving, 00:05:36.035 --> 00:05:40.535 a core element of critical thinking, which is the focus of today's event. 00:05:41.675 --> 00:05:46.315 Now it's clear that there's an increasing need for a higher proportion of employees 00:05:46.305 --> 00:05:48.705 to have well-developed critical thinking skills. 00:05:49.525 --> 00:05:51.965 Employees, of course, must have a solid foundation 00:05:51.965 --> 00:05:54.765 of basic literacy and computational skills 00:05:54.765 --> 00:05:57.865 necessary for getting, keeping and doing well in a job. 00:05:58.065 --> 00:05:59.465 But simply having the knowledge of 00:05:59.465 --> 00:06:03.305 and the ability to perform these skills is often not enough. 00:06:04.105 --> 00:06:05.945 Workers need the thinking skills vital 00:06:05.945 --> 00:06:08.645 to putting the basic and technical skills to work. 00:06:09.145 --> 00:06:12.065 The ability to think, reason and make sound decisions 00:06:12.065 --> 00:06:15.405 is crucial for employees wanting to do well and advance. 00:06:15.405 --> 00:06:20.945 A person who can think critically, act logically and evaluate situations to make decisions 00:06:20.936 --> 00:06:23.756 and solve problems is a valuable asset in the workplace. 00:06:24.756 --> 00:06:29.516 If other resources, like technology, are to be leveraged to best effect, 00:06:29.816 --> 00:06:33.696 then it is likely that workers will need relatively high-level knowledge and skills. 00:06:34.056 --> 00:06:37.756 They must be able to work with new technologies, make complex deals, 00:06:38.236 --> 00:06:40.636 or offer sophisticated services. 00:06:41.576 --> 00:06:47.156 And any competitive work environment will be subject to continual and often rapid change. 00:06:47.156 --> 00:06:50.496 The capacity to innovate and respond to these changes 00:06:50.496 --> 00:06:53.156 requires a workforce that is first willing and able 00:06:53.156 --> 00:06:55.576 to continue to acquire new knowledge and skills, 00:06:55.566 --> 00:06:59.826 but crucially have the high-level thinking skills necessary to succeed. 00:07:01.306 --> 00:07:04.726 So all this workplace change has thrown into sharp relief 00:07:04.726 --> 00:07:09.506 the effectiveness of our education system in preparing young people for the world of work. 00:07:10.646 --> 00:07:14.286 I very much doubt whether there's anyone in the room who thinks what I've said so far 00:07:14.286 --> 00:07:18.406 is amazingly insightful or has never heard any of this sort of analysis before. 00:07:18.886 --> 00:07:22.946 It's not new, and these sort of employment trends were recognised years ago. 00:07:22.946 --> 00:07:27.446 But it's also not the case that it's only the modern labour market and the success of 00:07:27.446 --> 00:07:30.206 business that have needed critical thinking skills. 00:07:30.197 --> 00:07:33.697 We've always needed people who can solve problems, innovate and challenge assumptions. 00:07:34.297 --> 00:07:37.997 What we have now is an increasing proportion of jobs that require these skills. 00:07:39.037 --> 00:07:46.057 So the crucial question is whether our education system is preparing all young people, not just some, to be able to be successful. 00:07:47.637 --> 00:07:50.397 There has, of course, been some good progress in recent years. 00:07:50.857 --> 00:07:54.557 Schools are now required to develop personal learning and thinking skills amongst their pupils. 00:07:54.557 --> 00:07:58.337 The quality of work-related learning has certainly improved in recent years. 00:07:58.337 --> 00:08:04.837 new sector specific diplomas for example have the potential to prepare young people better for the world of work 00:08:04.827 --> 00:08:10.267 work. We must also recognise that traditional academic study and the development of critical 00:08:10.267 --> 00:08:17.387 thinking and wider employability skills should not be mutually exclusive at all. But it's 00:08:17.387 --> 00:08:21.687 the business view that the education system needs to catch up faster. Every year the CBI 00:08:21.687 --> 00:08:26.887 runs an employment trends survey of our members which gives us a good picture of employer 00:08:26.887 --> 00:08:33.487 satisfaction with school leavers and graduates' employability skills. Too many firms, 49% 00:08:33.487 --> 00:08:36.387 last year said they were concerned about the lack of 00:08:36.387 --> 00:08:39.467 problem solving skills in the school leaders they recruit. 00:08:39.458 --> 00:08:43.058 This hasn't changed significantly since we started the survey. 00:08:43.938 --> 00:08:51.078 Even in the good times before the recession, we've seen a stubbornly high proportion of young people not in education, employment or training. 00:08:51.938 --> 00:09:01.998 We've got to be clear that young people aren't just competing for jobs with those from other schools and universities on the other side of the country, but now the other side of the world. 00:09:01.998 --> 00:09:08.058 The development of employability skills, including critical thinking, must be 00:09:08.058 --> 00:09:11.998 central to young people's education if they're to have a fulfilling working life. 00:09:11.998 --> 00:09:14.098 Equally important, 00:09:14.088 --> 00:09:18.648 is that they understand that these skills are valuable and relevant to them after school 00:09:18.648 --> 00:09:22.428 and are able to articulate that they have them to potential employers. 00:09:23.588 --> 00:09:29.988 So I hope I've been able to put this debate into a wider context from a business perspective. 00:09:29.988 --> 00:09:36.208 And I guess I recognise I've left the question hanging as to whether business in general 00:09:36.208 --> 00:09:41.388 believes that young people need or should study a particular qualification in critical thinking 00:09:41.388 --> 00:09:45.228 or whether it can be effectively embedded in other studies. 00:09:45.388 --> 00:09:47.168 But I'm sure that's something we'll come on to later.