Report summary: Skill Needs in Electronics

A study for EMTA

In January 2001, the National Training Organisation for Engineering Manufacture (EMTA), commissioned the Institute for Employment Studies to identify the current and future skill needs of the electronics sector and the barriers to meeting those needs in order to undertake action to alleviate the problems.

The study had three elements:

• a limited review of existing literature and secondary data sources
• a series of preliminary ‘informant’ interviews with a range of employers and employer and sector bodies, and
• a fieldwork stage involving some 70 interviews with electronics employers.

The main findings of the study are reported below.

Business trends

There are a number of largely world-wide trends affecting the sector including:

• the pervasive nature of electronics: electronics are used in an increasingly wider range of settings which not only expands the size of the market but also means a growing variety and complexity of systems
• rapid technological change: is endemic with a convergence of computing and telecommunications and more recently a convergence of software and hardware technologies. ‘What is hard and what is soft is becoming blurred into a grey area’, explained one interviewee
• the cyclical nature of the sector: with the component elements of the sector not necessarily moving together
• globalisation of the supply chain: increasingly major final product producers source their components and their design and manufacturing requirements from around the world
• shorter product life-cycles: product life cycles are becoming shorter, although similar components may be used in new or revised applications
• intensification of competition: and the concentration of ownership among larger foreign-owned organisations.

Strategic response

In response the companies have adopted a number of not necessarily exclusive strategies including:

• searching for added value: ie focusing more on the higher value ends of the market, whether it be in design, the manufacture of more complex goods or working closer with customers and offering a higher level of service
• batch rather than mass production: producing fewer more bespoke products with less emphasis on high volume manufacturing
• disintegration: with a clearer split emerging in some parts of the sector between designing and marketing products and producing them
• automation of production: to increase efficiency and to cope with shorter production runs and complex specification changes.

All of which have implications for the numbers employed and the skills required.

The demand for skills

The macro-level data show that overall numbers of employees in the sector have been falling in recent years and are expected to continue to decline for the rest of this decade, with the main brunt of the reductions affecting skilled and semi-skilled employees. The numbers of professional and managerial employees is forecast to increase over the coming ten years. The balance between the relative skill levels of the workforce has changed significantly and is expected to continue to rise in the future with increasing demand for technicians and higher-level engineers.

Crucial skills

Our telephone interviewees identified six key roles, as being crucial to the future development of their business. They were all technical roles, in the most cases at professional engineering level. Management and sales and marketing were mentioned in a few cases but they were the minority. The key roles were:

• design engineers: by far the most commonly identified role, indicated by almost half our respondents
• electronic engineers: thought to be crucial to around one in seven of the sample
• software engineers: most important to around one in ten of our interviewees
• production engineers: also cited by about ten per cent of the sample
• other engineers: including control, application, project and process engineers, in total identified by around a fifth of the sample
• skilled operatives: identified by only a few (three) respondents.

Summary of crucial skills in electronics

Source: IES telephone interviews, 2001

Employers’ resourcing strategies

Our sample of electronics companies deployed a range of strategies to meet their need for skilled people. Most took one or more of the following routes:

• recruiting experienced staff: particularly for key positions was the approach preferred by the majority of companies. However, because of the specialist nature of the sector, many recognised that experienced recruits were hard to come by. Companies tried to overcome this difficulty by poaching staff from rival companies; active recruitment strategies, eg using agencies to recruit people from the UK and from abroad (Asia or Eastern Europe) and recruiting people with transferable skills from related sectors.
• graduate recruitment: over half of the sample looked to recruit graduates on a regular basis, mainly the larger employers. For some, this was a new policy to combat the shortage of experienced employees.
• training: while most companies interviewed provided job-specific training, fewer provided more longer-term development programmes to enable less skilled people to develop into a higher role. However, some were working with local colleges to provide tailor-made courses including fast-track HNCs.

Resourcing difficulties

Most of the companies reported recruitment difficulties, although a minority (either fairly small stable organisations, larger employers with a strong reputation, or companies with a larger proportion of less skilled employees) did not.

Companies faced two forms of difficulties: for some it was a problem of quantity (ie not enough people); for others it was a problem of quality (ie not enough good people).

Lack of quantity

A lack of applicants with the right skills or experience was the most commonly cited reason for the resourcing difficulties faced by our sample of employers, particularly for the difficulties in recruiting to higher level posts. Technical skills in particularly short supply included: testing and quality control; analogue integrated circuit and control design; radio frequency, and magnetics design. Most employers who employed operatives tended to report fewer skill difficulties.

Three explanations were put forward for the numerical lack of technical skills:

• the specialist and changing nature of the work and the implications for both the breadth and depth of skills from technological change.
• pay and conditions: others felt the lack of applicants was to do with the relatively low pay and hard working conditions (eg in terms of 24-hour production etc.) in the sector itself.
• the main reason put forward on this side of the argument, was the insufficient numbers of people interested and capable of working in skilled jobs in the sector. This was widely attributed to the image of the sector, which was associated with traditional ‘heavy’ engineering and did not reflect the actual clean ‘high-tech’ nature of the sector, coupled to a relative lack of interest in science and mathematics at school. Analysis of ‘A’ level and graduate data show that although numbers of mathematics, physics and engineering students are rising, they are not increasing as fast as students in other subjects. Computer science graduates are rising fast from a low base. There are fewer than 4,000 graduates a year in electronics. Perhaps as a result of the low numbers employers recruit graduates from a wide range of disciplines, but are increasingly looking for technical expertise that can be gained only from a science degree.

Lack of quality

The alternative view, put forward by a slightly smaller proportion of the sample, was that it was not a problem of numbers per se but that people seeking to enter the sector lacked sufficient skills. Apart from the lack of experience, the main concerns were about the quality of recruits, particularly those recently graduated. The issues raised centred on:

• inconsistent standards and an apparent variability in the quality of degrees, with a ‘huge range’ between the best universities (normally felt to be the longer established institutions) and the worst.
• technical deficiencies and a lack of specialist knowledge (whether it be C++ or analogue electronics or radio frequencies).
• an inability (or inexperience) to apply the academic knowledge acquired in a practical environment.
• lack of important generic skills such as problem-solving (‘a difficult one to train’) communications and commercial awareness.

More fundamentally, a number of respondents felt that the basic education their applicants received, particularly in mathematics and science, even at ‘A’ level, gave them an insufficient grounding in the ‘basics’.

Interviewees most concerned about the graduates’ technical ability, came predominately from companies focusing on high level design, such as semi-conductors or electronics software.

A new emerging skill set

The combination of high level technical skills and advanced commercial awareness could be seen as a new skill set crucial to the development of the sector, combining high level technical skills and the ability to apply them in practice with business acumen.

Overcoming the difficulties

Companies attempt to overcome their skill difficulties by:

• aggressive market behaviour: adopted by those who explicitly looked to ‘poach’ skilled staff from others and sought to offer a competitive remuneration package.
• closer links to supply: eg by sponsoring students at established courses, or by working with universities or colleges to develop tailor made programmes.
• grow your own: finally, there are those who were making more concerted efforts to meet their skill needs from within their own internal labour market.

We found little evidence of companies making concerted efforts to tap into a wider range of sources of supply (eg older workers and women).

Conclusion

In conclusion, the study has found that skill deficits seem to appear at a number of levels:

• in leading edge areas of technological development: where there will, by definition, almost always be a skills deficit as education and training provision lags behind technological change
• among design engineers: clearly identified by this study as a crucial role to many UK electronics companies
• among electronics engineers more widely: as the role changes
• in the development of new hybrid skills sets: that combine ‘hard’ technical skills, with ‘softer ’generic and business-related skills
• in the production area: as automation and bespoke manufacture drives up skill levels among operatives and increases demand for intermediate ‘technician-level’.

Turning to solutions, our interviewees felt that action needed to be taken at a number of levels mainly to improve both the volume and particularly the quality of labour supply, based around:

• more work with younger children in primary schools and elsewhere to improve the image of the sector
• raising the quality of, and interest in, technology and science at GCSE level
• developing stronger links between the sector and relevant higher education departments to improve the relevance and structure of courses including:
  
  • increasing the number of placements for electronics engineers
  • even closer collaboration between employers and higher education institutions for instance including sharing of equipment to allow universities to keep pace with technological change
  • introducing a greater number of short course or fast track HNCs, and
  • the development of more modular degrees, perhaps with a two year foundation and more work-based linked specialism in the third year.
• lastly, smaller organisations in the sector needed to be encouraged to improve both the amount of training they provided and their links with other elements of the supply chain.

It was generally felt that what was needed was a co-ordinated approach, with all the main stakeholders pushing in the same direction for a considerable length of time if the situation was going to change significantly.

The report

Skill Needs in Electronics, Hillage J, Cummings J, Lain D, Jagger N. RR142, EMTA, The National Training Organisation for Engineering Manufacturing, 2002.

Bound copy: £50.00