Lord Digby Jones: better education system will ease SME recruitment woes

Former CBI boss says an illiterate and innumerate workforce is an “obscenity” for small businesses in the UK

Lord Digby Jones: better education system will ease SME recruitment woes

The “obscene” deficiencies in the British education system are to blame for the recruitment troubles of SMEs in the UK. That’s the damning verdict of Lord Digby Jones, the former CBI boss and government trade ambassador.

Speaking today at the Elite Business National Conference and Exhibition, Lord Digby said that whilst companies have a responsibility to provide adequate training for employees, they cannot be held accountable for a young workforce that is sorely lacking in basic literacy and numeracy skills. 

“If you’re a small business and you put an ad in your local paper or the internet and say you want one more apprentice, you’ll get 250 applications. Half of them can’t read; most of them can’t even spell your company’s name correctly,” said Lord Digby.

“This summer, 48% of the kids at 16 will not get grade C or above at English or Maths at GCSE – so they won’t be able to read an instruction manual. Half the kids are functionally not fit for purpose in a globalised economy, in the 21st century, in the fifth biggest economy on earth. 

“It is an obscenity that we can all be giving each other a hard time about how we skill people up once they’re with us – and I do believe that small businesses have to do a lot more on training and growing and developing people – but we are not responsible for them coming in through the door and not being able to read or count.”

Lord Digby said the “mood music” of the country has to shift if the needs of business are to be met. “You have got to get teachers and kids understanding that wealth creation is the most important part of society,” he added. “I don’t think educationists, environmentalists, trade unionists, politicians and a lot of journalists get it. They think it grows on trees. They talk about spending; nobody ever talks about earning. You have got to get that mood music to change.”

He went on to say that businesses can’t rely on the government to improve their chances of securing bank finance. “The bond of trust between banks and small businesses is never going to be same again,” he commented. “When you have got banks constantly being asked to make more money, put more on reserve and behave in a completely different way, they are not going to try and be pawnbrokers. They are not going to say ‘I will lend it to you on the basis that I can turf you out of your house if you can’t pay it back’. 

“Banks are facilitators, they sell you money, they are not investors. And we need a load more innovative ways of getting investment into small businesses, which do not involve lending them money at rapacious rates of interest to satisfy the modern agenda. That is not critical of banks – it is more critical of the environment in which we are now operating and within which banks fall apart.”

He claimed it would be “marvellous” if the tender process in government procurement projects was made easier for small businesses and urged others to follow his lead when negotiating payment terms with larger firms. “I have a little rule in my business. I pay them by return. I pay everybody by return. I find it disgraceful when big companies say 60 days and then they just decide unilaterally it will be 90 days. That can break a small business.” 

Adam Pescod
Adam Pescod

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