Blunkett targets skills shortages

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A Government task force to combat skills shortages hampering key British industries will be announced when business leaders meet in Birmingham tomorrow.

David Blunkett, Secretary of State for Education and Employment, will outline the initiative in a move designed to highlight the scale of industry's skills problems.

Mr Blunkett, who will address the Confederation of British Industry's annual conference, plans to appoint senior figures to an internal skills unit within his department. The membership has yet to be decided.

The move follows the decision by the Bank of England to cite the skills shortage as one of the factors which influenced last week's interest rate rise.

In its press notice explaining the hike, the Bank commented that the "Labour market has tightened further with skills shortages increasingly reported". The fear is that this is putting upward pressure on wages of skilled workers and adding to inflationary worries.

Mr Blunkett is expected to refer to the Bank's reasoning in his speech, and ministers believe that the recognition of a link between skills shortages and interest rates will push the issue up the political agenda. Improving education and training was one of Labour's central general election commitments.

Mr Blunkett's unit will be designed to initiate prompt action. Its immediate objective will be to identify the sectors, occupations and areas of the country where there are skills gaps. It will ensure that information about skills development and shortages is disseminated throughout government and the business sector.

The team will also aim to identify areas where skills shortages are likely to hinder British industry, and to devise methods of heading them off.