By Max Clarke

Richard Lambert, CBI Director-General, today said that businesses will need to do more to support and encourage young people if the new higher education funding legislation is approved by Parliament today.

In a letter to CBI members covering small and large businesses across the country, Mr Lambert said:

“The Government’s proposed higher education legislation will lead to a steep and unwelcome decline in public funding for human capital. But from a business perspective, the consequences of it failing to get the votes at this stage would be too grim to contemplate.

“At one extreme, there would be a steep cut in student numbers as universities adjusted to a much lower revenue base. At the other, the Government’s fiscal plans would be badly damaged.

“If the legislation does go through in its current form, business will have to play a much more active role than it has in the past in informing students about its likely future needs.

“It will need to help them to choose the right subjects to study, to offer relevant work experience, and where appropriate to work with universities to develop courses that will provide attractive employment for graduates.

“In a demand-led system, employers will have an interest in helping to shape the choices made by the most talented students, rather than waiting until their university career is almost over.”

Many businesses and CBI members are already widely involved in supporting students in higher education, but under the expected new student loan structure companies will need to do even more:

· Students will need much higher quality information, advice and guidance than they have today about the type of job and salary that will come with success in a particular course at a particular university
· Employers will need to do more to articulate their future needs from employees, and to spell out potential career prospects.
· Companies need to engage with potential future employees at an earlier stage in their studies than they typically do today, perhaps by providing support in the form of bursaries or other forms of sponsorship, or by offering relevant work experience, including the rebooting of much valued ‘sandwich courses’ along the way.
· Some businesses will also want to rethink their relationships with universities, as well as with individual students. If they are looking for a particular set of skills, companies may find it makes sense to work more closely with those institutions that are best able to develop relevant courses.
· Some employers will also look to universities to meet company-specific training needs for their existing staff, as part of their professional development.

Many CBI members are already involved in helping students improve their careers, some case study examples of what they are doing are as follows:

1. Articulating future skills needs and supporting students in choosing what to study

AstraZeneca worked with the Office of Life Sciences to shape the Government’s Blueprint for Life Sciences in the UK, to identify priority skills areas where there is a need to encourage students to study. AstraZeneca is also working with Trade Associations such as the Association of British Pharmaceutical Industry (ABPI) to ensure current and future skills needs for their sector are clearly communicated - and for students to have easy access to careers information.

2. Engaging with potential employees at an earlier stage — student sponsorship and work placements

Centrica’s graduate team is working on the 2011 Summer Placement campaign with a target of 80 work experience opportunities to be filled, and ten undergraduates are being sponsored in the 2010 academic year in partnership with seven universities. The company also created an MBA work placement programme in 2010 and delivered 14 work experience placements. The success of the first intake has seen an increased appetite across the business for these students and an intake of 20 is planned for 2011.

3. Designing and advising on business-relevant degree courses

BP and the University of Birmingham have launched a new degree programme in Mechanical Engineering which features new Design and Professional Skills modules in years 1, 2 and 3. BP supports workshop training in year 1, where undergraduates gain hands-on experience turning a design concept into a finished, functional item using a variety of metalworking and joining techniques in a fully equipped workshop. In year 2, visiting speakers from BP deliver a series of engaging lectures within the department on a range of topics, selected in partnership with the University module coordinators. In year 3, the students are required to identify a market need, develop a novel solution to the problem and prepare and present a business case to compete for an all expenses paid trip to a BP operating site somewhere in the UK.

4. Working with universities to identify and meet high-level, company-specific training needs

McDonald’s recently launched a two-year foundation degree course in Managing Business Operations, accredited by Manchester Metropolitan University. The degree is a customised version of Manchester Metropolitan University's management development programme and will be taught by a combination of classroom study, e-learning and training in the workplace.

9 December, 2010

Notes to Editors:
The CBI is the UK's leading business organisation, speaking for some 240,000 businesses that together employ around a third of the private sector workforce. With offices across the UK as well as representation in Brussels, Washington, Beijing and Delhi the CBI communicates the British business voice around the world.