 Good morning, everyone, and welcome to the third meeting of 2021 of the economy and fair work committee. I again welcome Maggie Chapman, who is joining us this morning, although not a member of the committee should be attending for the evidence session. Our first item of business is a decision to take items 3 and 4 in private. Do members agree to take those in private? Our second item of business this morning is an evidence session on employment and skills for recovery. I thank you all for joining us today, and I welcome Chris Brody, director of regional skills planning and sector development, and Lisa Patoni, service development manager, Skills Development Scotland. Nora Senior, who is the chair of enterprise and skills strategic board, and Mary Spowage, who is director of the Fraser of Islander Institute. Today's evidence session will enable the committee to consider issues around business recovery with a focus on employment and skills. The evidence today will inform the committee's input to the Scottish Government's budget for 2020-23. In the paper, it says that job-related training in Scotland has declined steadily over the past 15 years, which is reflected in the future of Scotland's skills action plan, which makes the comment. Can Skills Development Scotland talk about the reasons why that has happened and where the responsibility for that decline lies? You are quite right that the levels of indoor training that has been undertaken by employers over the past 15 years have fallen. There are a number of reasons for that. That is primarily a responsibility for employers in relation to upscaling the existing workforce. I would say that, over the past three or four years, we have been talking about the critical importance of training in the workforce as an important part of both businesses' training strategies and Scotland's skills strategy. The pandemic has made it clear that the labour market is going to continue to change at a very fast rate. As a result, people are likely to face multiple career changes throughout their working life. That increased focus on creating the conditions where employers can invest in employees but also where training is available for individuals to upskill is going to be really important. The paper that we have from Skills Development Scotland sets out a number of strategies and action plans. It is just to have confidence that that is going to make the changes that are required. When we have seen a steady decline over that period of time, how can that decline be reversed? Is there enough incentives in there for businesses and employers? Is there enough infrastructure there to support them in retraining and re-skilling and offering opportunities to their workforce? I think that there are three dimensions to that, and I will allow colleagues to come in on a second as well, because at least I know where I am looking to at them to speak. The first is recognising that the primary responsibility for training employees lies with employers, and it is really important that employers recognise the value of that investment to support their own growth. Secondly, there are lots of terrific examples of our college and university system flexing to provide opportunities in work training, particularly in the college sector. That has been one of the hallmarks of work pre-pandemic and, indeed, during the pandemic. The third, as you rightly say, is the availability of training opportunities and upskilling opportunities. Over the past four or five years, we have seen the introduction of the Flexible Workforce Development Fund, which allows employers to pay their apprenticeship by way to reuse some of that resource to upskill employers. First, we have seen the adoption of a transition training fund in the North East in relation to the downturn in oil and gas a number of years ago. That has now been mainstreamed and the Scottish Government has invested in significant resources in transition training, which will allow people to switch careers. It is also important to recognise that the apprenticeship programme in Scotland is used significantly by employers to upskill existing employees. Did Nora Seeniar want to comment on that? Yes, thank you. It was really just to add, from an employer's point of view, businesses in Scotland have traditionally been worse investing in training than international competitors. That has gone on much longer than the 15 years that you have registered there. Where we have continued to invest is in practical skills for employees. Where we haven't and where the fall is happening is around the upskilling and reskilling, as Chris has mentioned, but also in the leadership skills, where we have fallen behind either because businesses or have not recognised the need to enhance management and leadership skills as their businesses grow, or that they do not have the knowledge or resources in digital skills that are right for their business. Those are areas that we need to encourage businesses to invest more in their human capital and their people. We need to be able to incentivise business and give them the opportunity to recognise the benefits of the type of training that would empower their workforce. I will go back to Chris. During the past 18 months that we have had, I had a conversation recently with Open University, which said that there had been an uptake in their courses that they have been quite encouraged by individuals who are looking to retrain and reskill. Have you identified the kind of... I suppose that what you are talking about is businesses reluctant, a lack of recognition of the importance there to invest. I did ask about if the infrastructure around them is enough to support them, but is there also a cultural issue in Scotland around devaluing adult learning and lifelong learning? Have we lost that? From my memory, it was a driving force in the original Parliament when we first established, and that seems to have slipped over the existence of the life term of the Parliament. The importance of whether it is called upskilling, reskilling or lifelong learning has never gone away. I think that what we have all recognised across the skills system over the past five years is that that needs a really strong and renewed focus. The pandemic has caused huge challenges in the labour market and exacerbated some of the trends that were under way prior to the recession. The retail sector has shrunk considerably in a short period of time and may not recover to where it was before. It is really important that we ask ourselves the question of the £1.8 billion that we invest in 2016 education, and that is not including what employers invest. How much of that should we be focusing on upskilling and reskilling? It is not to say that we have got it wrong in the past, but it is about recognising that the challenges that we are facing now and the challenges that we are going to be facing over the next five to ten years are significantly different. We need to ensure that we are constantly calibrating where we invest. I think that investment in upskilling and reskilling is going to be a dominant feature of the conversation in the skills system over the next five years. I apologise if my link breaks up. I have been having problems this morning. Just on the point that we will be speaking about about the Scottish Employer Skills Survey, on the numbers, it suggests that between 2011 and 2017, the number of employers who have been providing training to their staff over the previous 12 months moved from 73 per cent to 71 per cent. We then had a major drop in 2020 to 59 per cent. My initial question would probably be along the lines of, was it Covid-19 that has created that blip in training? If it was not Covid-19, what was it? We have consistently, over a long number of surveys, saw the number of in the evening bouncing round about the 70 per cent mark. As I say, it has dropped substantially in 2020. Is there any underlying reason for it, if it is Covid, or is there another reason that it would be causing that? Maybe you can ask Mari Spoudge, since she is not coming in yet. Hi. It appears to be linked to Covid and a lot of businesses pivoting to looking to survive. Although some of the data is quite interesting, because, obviously, employees and employers have had to adapt their businesses in order to meet the needs of customers in a different way, perhaps, through the period of the pandemic. That may well have included the adoption of new skills on the job, but it is not in a formal training environment. The employer skills survey is interesting, too, because it tells us a bit more about the types of skills that employers feel that are not necessarily being fulfilled by the people who are applying for their roles. Although some of the skills are technical or operational, or are relevant for the job specifically, a huge amount of the issues seem to be on softer skills, such as managing projects, managing your own time or such things. It is certainly a question for all of us in the skills system about how we ensure that young people coming into the labour market have a more rounded set of skills, as well as the qualifications or the technical skills that they need. Looking at that same document, it says that the reasons for not providing training to staff and employers said that all staff are fully proficient and have no need for training, and 22 per cent said that Covid-19 meant that planning training did not happen. The drop-off can be a temporary blip for Sian and Chris, not to comment on them, and then there will be more. I agree with Mari's comment there. What we saw in 2020 was a significant drop in all sorts of activity around training activity in businesses. One would hope and expect that that would be recovered as the economy begins to open up. I think that whether that pick-up is consistent across all sectors is a big question. We also need to consider how we invest behind opportunities that we are seeing in the recovery period. We expect to see a continuing growth in the demand for digital skills. The economy is not a reference. We expect that the transition to net zero is going to be a big driver of the demand for skills. As with all big economic labour market shocks, what will follow will not be exactly the same as what we saw prior to the pandemic. I would add to that. The drop-off is partly because in a one-hour business had to shift to an online mode of working, which meant that any investment was really going to be made in digital technology and enabling people to remain connected between themselves and with customers and clients. That is where most of the investment went. What Chris said, it would be different across different sectors. Those who were able to continue training online or digital skills, as I know from the business environment, I would say that there has been probably a greater emphasis on those types of skills related to communication. There will be a fall-off in practical skills because we simply have not been able to gain access to the workplace. I think that that will come back again. It might be useful, Lisa, if you perhaps added some points just around the types of training and the meta-skills area. I am happy to add some remarks. I think that just to follow on from what Mary was saying, we are seeing a marked change in the skills that employers are looking for, really in response to the Covid pandemic but also in response to industry 4.0 and the advent and emergence of new and emerging technologies. Employers are looking away, to some extent, from traditional qualifications towards meta-skills and the kind of adaptive expertise that cuts across every occupational area. That has been seen not only in Scotland but in the UK and internationally. They are saying that they value meta-skills like team-working, problem-solving, communication and creativity. Those wider bundles of capabilities and behaviours are the ones that we need to prioritise within the education and skills system and preparing young people for jobs of the future to have those skills alongside the higher-level skills that we need for the digital era. That is critical for young people entering the labour market but also for adults as they move through the labour market and as industries and occupations emerge and change. What we are saying is that hybrid roles, adjacent occupations and individuals all have to be able to have a level of flexibility and to recognise that the skills that they have at their disposal can be used across the different contexts that they find themselves in. With the upskilling piece, everyone is very proficient, but what we are seeing overall in the literature is that we need to develop a new mindset towards upskilling and reskilling that increases the importance of all learning through life. My final question is that you have highlighted that a lot of businesses had to move on line to survive. We already knew that in Scotland, the UK and the EU, there were already 150,000 IT job vacancies that have existed for a long number of years, but has there been any other impact of Covid on the labour market that we have not touched on? Mary, do you want to come in on that? I think that, to a certain extent, we still do not know what the overall impacts will be on the labour market from Covid. With the furlough scheme coming to an end at the end of this month, there is obviously going to be a sizable proportion of people who are still being on furlough throughout the summer, who will then potentially be released. It might be that some of the shortages that we are seeing in the hospitality industry could be sorted out by the correction of some labour being released, but we just do not know yet. I suspect that some of the wider structural challenges in our labour market, in terms of supply of labour with the right skills for posts or just overall supply in general, are still going to be challenges. The demographic issues that we have in Scotland, the outlook for the working-age population, perhaps the interruption to what would be more normal migration flows because of the UK's exit from the EU. All of those things are still to play out in our labour market as it adjusts to the post-pandemic new normal that we are all waiting for. I just do not think that we quite know yet what the impact will be, but particularly in certain parts of Scotland there are huge challenges around supply of labour and supply of labour with the right skills for the roads. I was proposing to move to Jamie Halcro Johnston as Jamie has some questions that link to the discussion that was just happening with Mary, so I will hand over to Jamie, if that is okay. Thanks very much, Camila. Good morning to the panel. Just on that point, I think that Chris wanted to come in. The second part of my question will be on the impact on the availability of labour. As Mary mentioned, furlough is going to end. It has been extremely important. I think that everybody will accept that, but it will end this autumn. That causes concern for some, but speaking to businesses, there are some that have felt that labour shortages have been increased because people are still on furlough and their jobs are being protected, but there are obviously shortages elsewhere. I think that Mary covered that from her side, but I was wondering if Chris and Nora would like to comment on both the importance of furlough and how it might be impacting on labour shortages at the moment. You are right that the coronavirus drug retention scheme has been hugely significant as an intervention that has protected jobs at its peak more than almost three quarters of a million people in Scotland were on some form of furlough. The latest figures show that that number has dropped significantly as the economies began to open up. Around 141,000 people on furlough are on some form of flexible furlough, so they are doing some kind of form of work. We would anticipate just looking at how the numbers have fallen over the summer months, and that number will continue to fall. Although it is hard to be clear on specific numbers, it is clear that some people will not go back to their jobs when the furlough scheme ends. I have concerns that we might lose connection with Chris, so I think that you might want to comment on that point. I will bring Nora in. The impact on people being released from furlough will show that there will be skills shortages perhaps in certain localities or regions of Scotland where there are job vacancies, but the people will not be in the right locations for where those vacancies are or present an opportunity. That might be one of the key areas to look at. The opportunity that will come at the end of furlough will be for those people who perhaps live in rural areas. There is an opportunity with the use of technology because we have become more used to dealing with online forms of conducting business. However, for those in rural areas, remote working becomes more of a possibility, and that is an area that needs to be explored. Businesses have got use to flexible working and online working. Therefore, there will be more of a mindset by business to look at different types of ways of working that will present possibilities that they will probably not be explored before. However, the main thing for me is that people coming out of furlough vacancies will be in the wrong places for where people where the demographic is based. Thanks very much for that. I think that we have seen some of the problems with remote working highlighted today. I have to say that, as somebody who is joining from Orkney, I am always terrified that it is me who has lost collection. I have a few sympathy with you, Chris, and I am glad to see you back. I will maybe bring you back in, Chris, and you can either finish what you want to or maybe answer this. What has been raised is this issue around the need for change and what that means, as we go forward. Actually, the first question that I was going to ask has been fully answered now. I suppose that taking into the issues around skills, both what we need and whether it is in the right place, but also making sure that those people with the skills are accessible via the ability to work from home and work online. What do we need to see the Scottish Government doing to meet that demand? How does the Scottish Government better facilitate working from home and making sure that skills are in the right place and that we are encouraging people into retraining where we need to? If I can come to Chris Moore and then maybe marry on that, it would be very helpful. If I can begin just by finishing where I was cut off a moment ago, if that is okay, I was making the point that not everyone will go back into the job that they had when they were in furlough. There will be a number of reasons underpinning that. I think that we have seen lots of evidence of people taking decisions to leave a labour market. The phrase is the Great Retail. It may be that the business does not open up and the job is not there to return to. It could also be through choice that individuals have decided to either change career or find another job. It is important to note that the labour market that people will be looking to go back into at the end of furlough at the end of this month is much stronger than it would have been at the end of 18 months ago. In respect to the question of what we need to do to respond to the circumstances, it is a very trite point, but there is no single answer. We have heard some of the responses today. For me, there are four or five big areas of policy that we need to focus on. What is it continuing to focus on young people and their transitions into the labour market and equipping them with the skills for the economy and the future and the economy of the past? The second bit is about ensuring that we have the right measures that allow people to either upscale within their jobs or to switch careers. The adoption of the national transition trading fund and the green jobs law enforcement caribbean are all important moves in that direction. We also need to be thinking quite hard about how we reconnect people who are not working with opportunities. We are seeing some significant skills shortages at the moment, but there are around three quarters of million people in Scotland who are economically inactive. Many of those people could get back into the work with the right support from the state and also from employers. The final kind of element for me that I know that we are thinking about, but I think that it is going to become really important, is around the whole agenda of talent attraction. We absolutely want to ensure that people in Scotland are getting the right skills for jobs in Scotland. We need to think hard about how we are bringing people in to the country to fill jobs, not just at the bottom end of the labour market but also highly skilled jobs in the digital technology sector, financial services sector, so that becomes an important part as well. Nora, senior, did you want to come in? I think that Jamie has suggested that you might want to come in. I was just going to add a couple of practical suggestions. Given that we have seen the fragility of our technology in this morning, investment in 5G and making sure that we have robust technology that will handle the type of online contacts that we need, housing to move people from those areas where they are currently to the areas where jobs are, and infrastructure in transport to get people from or move around the country so that, where there are vacancies, we can easily either get them to jobs or to colleges or universities where they can access the type of upskilling, re-skilling and training that they need. I think that Marri probably wanted to comment as well. Marri, would you like to come in? Then I will move to Colin Smyth's questions. I absolutely agree with the things that Nora was saying. The sort of infrastructure investments in order to facilitate people being in the right places or being able to have full roles is really important. Housing in a chitly and rural area is a massive issue in terms of economic resilience and being able to keep young people in an area, so that is definitely a really important policy area. A couple of further reflections. I have a bit of a concern about the experience that young people have had at both the school and at university in the past couple of years. Alongside, obviously, achieving qualifications, we are trying to get young people ready for the labour market of the future, as Chris has said. There are some issues around maybe the human capital development that might be a little bit more lacking through a disruptive period of learning and the experience of things like university and college. There might be a wider point about that and the sort of softer skills that young people who are entering the labour market are maybe not getting the same sort of experience on graduate programmes and apprenticeships as they might have got in the past. That might be something to look at in terms of how we support people to develop that human capital. Finally, there is an issue here about employability services as well. They are linked up with the skills system. Obviously, Scotland has got more powers now around employability, which the Scottish Government will be seeking to use. How does that link up with ensuring that some of those people are the inactive people that Chris was talking about? How do they link up with the skills system so that they can retrain and employability services can find them a suitable role? The link between skills and employability is really important. I will follow up on a point that Nora Seynder touched on earlier. I will direct the question to her first. Are there particular geographical parts of Scotland that face skills shortages? What are those areas? To what extent is that due to the fact that we imported or, until recently, imported a lot of those skills? Can Nora Seynder's mic be switched on, please? If you start again, Nora, sorry, we missed the beginning. Sorry. Suratism in hospitality, particularly in the north of Scotland, there are construction in certain areas of the country. I believe that Gary Gillespie, as the chief economist, has produced a very useful piece of research around demographics and the changing patterns of where work is and how people have moved during the pandemic, so that might be a useful area or reference for the panel to look at. I think that both Brexit and Covid have impacted certain sectors, the ones that I have mentioned. I think that one of the areas where we are open or more exposed is perhaps on digital skills, where a lot of design companies, for instance, or comms companies, because we are now more used to working online. It actually opens up the competition, if you like, from international markets for pieces of work to be undertaken anywhere in the world. The focus on digital skills for me is one of those areas in which we are still lagging some of our international competitors. That goes across the whole of Scotland, but it is not police specific. Some of the other areas where there are deficits, if you like, or a lack of employment are sector specific around tourism, hospitality and agriculture. I am sure that my colleagues will mention other areas. Can I ask Chris or Lisa if they have anything to add to that? What are they picking up? I know that we have covered a number of the key points that we are going to make when we are seeing significant recruitment difficulties in hospitality, chefs and service staff, particularly in rural areas. Food and drink sectors are facing some significant challenges at the moment. While that is in agricultural, it is around meat processing and the shortage of high skills. We know that there are college sectors facing significant challenges partly down to Brexit and the construction sector. We are seeing continuation of some pre-COVID issues, as Nora has mentioned, in the shape of recruitment difficulties in health and social care and digital economy. The point that I would make is that there is no single reason for why there is a labour shortage emerging in particular sectors. In some cases, it is down to an age in workforce. Those were sectors that were facing some recruitment difficulties prior to the pandemic. In many cases, those are sectors that were more reliant or more reliant than average in using EU Labour to support the workforce. I think that the approach that we are taking to this with the SDS—I have a team of sector managers who work across 14, 15 different industry sectors in Scotland—is picking up information on where those specific skills shortages are. We are looking to work with industry about how we shorten recruitment chains and sharing chains into the industry. I am keenly aware of some of the challenges in rural areas. I have been part of the team south of Scotland's senior officers group who meet on a weekly basis on a Tuesday morning to understand both what is happening in terms of the south of Scotland economy and the south of Scotland labour market. What is really interesting is that we are seeing some quite bold moves from employers to bring people into their workforces. They are offering different terms of conditions and better wages. They are offering golden hallows and loyalty bonuses. I think that what we will see over the immediate future is access to moves from employers to try and secure the supply chains and their staff as well. That is really interesting. I will not abuse my position by pursuing the south of Scotland one today, but I will come back to that, Chris. I raise the same point with Mary, but I also ask her whether the geographical areas that are affected by the skills and labour shortages are the same areas that may have been disproportionately impacted by the pandemic. I know that, at an early stage, the Fraser Valander Institute carried out some work on the disproportionate impact of the pandemic on rural areas. Are those areas facing a double whammy of being hit by the pandemic and, obviously, now facing some of the skills shortage issues? Or has that changed since that early piece of work was done, because I know that it was some time ago? I mean, we have continued to look at this partly through the lens of ambitions around levelling up and the impacts of the pandemic, so we have continued to look at it. No, it has not really changed. It is the case that, given tourism and hospitality, capacity has hit so hard during the pandemic and continues to—maybe I operate at a reduced capacity even now, even though a lot of restrictions have been removed—it is still the case, therefore, that those areas that are more dependent on that are likely to have been hit much harder. Although we are getting more information all the time, I think that once we see what happens when furlough ends, we will get a better understanding of the long-term impacts of productive capacity in different parts of Scotland. In rural areas, tourism and hospitality businesses were more dependent on things such as EU labour to help fill vacancies. In a way, there is that kind of double whammy, as both businesses may have been hit harder. Also, as things open up and get better, it might mean that they have less capacity to grow as we would like them to in order to support the economy, because they cannot get the supply of labour that they need now due to us leaving the EU. Social care is another one that is particularly dependent on EU labour. Obviously, that is in the news for lots of reasons in the last couple of days on funding social care appropriately. A big issue around that is, obviously, about the terms of conditions, salaries and so on in social care, but some of it is also just about the supply of people with the appropriate skills who wish to work in that industry, which, again, we have plugged in the past through EU labour. It is a bit of a double whammy for those areas, which were particularly dependent on tourism and hospitality in their economies. Good morning. I want to look ahead to cover just transition, but also demography and labour issues. On just transition, it was very welcome to see the Scottish Government's response to the just transition commission that was published yesterday. Obviously, there is a big challenge in making sure that we have the skills that we need and that we have that transition. I was very pleased to see that there was a skills guarantee agreement that there would be a just transition response. That is good, but my concern is how do we at scale ensure that we have the appropriate skills needed for what is required? From your point of view, Nora, if you can consider the aspects of working with employers, industrial training boards and our skills provision, who is taking responsibility for the mapping of existing skills that many of our energy workers have to move into the new sector? Is there a sense of ownership of that, or to what extent is it being left as a free market operation? What changes are needed to deliver that in the future? One of the things that the Enterprise and Skills Board did was look at the role of the industry leadership groups in reinvigorating their role within the whole enterprise and skills system. The reason for that was that one of the tasks that we wanted to give them was to map out the assets, if you like, in their sector, so that they had an understanding of the types of companies, the number of companies, the location of companies and the capability of those companies. I think that ILGs in a new invigorated role can play a bigger role in being able to not only identify the kind of skills shortages but also use business to business contacts across that whole infrastructure or framework of ILGs. We look at business creating its own training programmes and being able to feed into colleges and universities to support and enable the types of skills that need to be generated. Chris and Lisa would also be a good answer on that question, having done a lot around the climate emergency and how they see the skills mapping coming forward. One of the areas that we need to look at is how we use existing structures, such as the enterprise agency and the industry leadership groups, to facilitate and map out the types of skills that we need. By cross-referencing the knowledge from each of those groups being able to create, with private sector led—I do not think that that all has to be government led or public money led—we need to rely on industry to be able to fend for itself in many of those areas, supported by the education system or higher education system. That is mainly what I would say. Use the existing infrastructure and framework to identify skills and work with colleges, universities and private sector training providers in order to map out a route map to the skills that we need for the future, which are going to change and evolve on a non-home basis. Chris and Lisa might like to add to that in terms of the work that you have done on CSAP. Chris. Thank you. Good morning. In terms of the transition to net zero, it is going to be the single dominant economic driver in Scotland over the next 15 years. It is a 15-year programme of work. I think that what we have got is a clear direction where the economic investment is going to flow in the first five years of that transition. It is around the decarbonisation of energy, it is around decarbonisation of transport, it is around making our homes and houses and buildings energy efficient. The approach that we have taken in the climate emergency skills action plan is to focus on that opportunity. Those are not the only opportunities. To say that we have a clear understanding of what the specific demand for skills is going to be to support that transition. Secondly, do we know whether we are currently investing in the right place in support of that? I work with the climate emergency skills action plan implementation steering group that is chaired by Professor Dave Ray from Edinburgh University, including representation from Scotland's colleges, Scotland's universities, the funding council ourselves, the enterprise agencies through unions. That group is wrestling with those key questions. Do we understand where the demand for skills is likely to impact? It is important to recognise that the transition to net zero will drive demand for skills in a number of ways. There will be jobs that we already have that will need more people trained up in those disciplines, whether they are town planners or engineers. There will be jobs that will be affected by the transition to net zero. The classic example is a heating engineer who will have to move from firing gas boilers to firing heat pumps. There will be jobs that we do not know exist yet. Technologies will emerge over the piece. The point that I would make is that that effort is beyond just industry, beyond just government, colleges and universities. That collaboration, both to understand where jobs are going to be and where skills are going to be required and to ensure that things are in place, will be critical over the next five years and beyond. Can I follow that up by saying that we might not know what some of those future jobs are, but we certainly know what some of the more immediate ones are? Who is taking responsibility for the mapping of the existing skills that, for example, oil and gas workers have that could then be translated into the future of renewable energies? Who is taking ownership of making sure that that happened? In terms of retrofitting, you referred to that as well. We do not need to ask the questions of what will be required. We know what will be required. Again, who is taking responsibility for ensuring that not only have we got the skill base but also the volume of workers that we will need to deliver what was in the programme for government yesterday? That responsibility in terms of the demand side is pretty dispersed. We are working with colleagues in a petal in the north-east looking specifically at the skillsets that workers in the on-gas sector may have that can be redeployed. We are working with Glasgow City Council looking at some of the specific build requirements that flow from their retrofitting programme. We have got a programme of work underway across SDS and SFC to look at what we know and critically what we do not know. There is a strong commitment from Government and its agencies to ensure that we have that demand side in place. In terms of the response for ensuring that those skills are met, I would argue that that is a dispersed response that is required. The funding council and SDS are deploying national transition training fund activity. We have also launched a range of workforce academy that identifies media opportunities as well as media training opportunities. There is a bank responsibility in our college and university sector and I am not laying that responsibility on them. They recognise that that is there and that is why they are active around the climate emergency skills action plan to ensure that the training opportunities that are available match the opportunities that we are seeing in the labour market. If I could move on to issues around demography and differentiating between labour shortages as opposed to skills shortages, and maybe for Mary Spowage from Fraser Ballander Institute, what analysis have you taken of Scotland's pre-existing, pre-pandemic demographic challenges and what you are forecasting for the future in terms of actual labour availability and to what extent are we focusing on skills when we should be focusing on actual labour issues? I mean that there are both issues for the Scottish labour market in the future. We know pre-pandemic that there was a skills mismatch in terms of what we need and what we actually have in the country. Research would suggest that that can be one of the reasons for poor or sluggish productivity growth. We know that that was an issue already, so the labour that we have here did not have the skills that employers needed. There was a mismatch, but the outlook for demography is also a concern. We will have a following working-age population as we go forward. Some of that is due to the outlook for migration prior to Brexit. Even then, it was not good. Now that that has happened, and there has been a disruption in migration flows. The outlook is even worse, and that particularly impacts on certain parts of Scotland. The outlook, for example, for Edinburgh and the Surrounds, is for that population to continue to increase, even at working-age population, whereas for the west of Scotland and rural Scotland, the outlook is pretty poor. However, it is worth saying that those are projections of previous trends. That is what we have seen over the past 10 years or so in terms of movement in the population within Scotland. Obviously, policy makers can think about how they can introduce policies that may help to reverse that decline, such as in areas of housing that we have already discussed. The current projections that have been produced by the UNS and national records of Scotland are not great for Scotland. Those do not take account of the policy disruption that was by Brexit, so the outlook is likely to be worse than that. It is particularly bad for certain parts of Scotland. I should clear an interest. I represent the most populist constituency in the whole of Scotland. I have more constituency than MDL, but I am very concerned about the demographic outlook. Perhaps the final word to Nora, in terms of employers looking at the future investment and the position of Scotland as an attractive place for cutting-edge companies to come and do business in terms of future proposition. What is your outlook on that, both from a demographic point of view but also in that skills way? Could you have overview for the future that you might want to share with us, Nora? Scotland is an attractive place to work. We should remember that our skills system is still looked upon by competitor countries. If not excellent, it is certainly best in class in a number of areas. We have a workforce that has more qualifications than most other competitor countries. We have a highly skilled workforce and its ability to be able to flex into other areas that will provide the incentive for potential inward investors to look at Scotland as a potential place to come and stay. I think that there is more work that could be done with SDI in partnership with VisitScotland to promote Scotland as an attractive place to live and work. I think that there is more that we should be doing on setting or for government to give an indication of its ambition around certain areas, say net zero, so that by or around life sciences, for instance, if we have a strategy that can identify priorities, then business feels much more confident in investing in those particular sectors and those particular places where they feel that the Government is fully supportive. That de-risks for business its investment and its focus. Those would be some of the comments that I would make on the response. I will now bring in Colin Beattie to be followed by Alexander Burnett. I would like to take you back to those sunlit days before Covid and Brexit. Skill shortages are not a new thing. Back in that period, there were perhaps a number of sectors that were under pressure and IT is perhaps one of the most obvious. If we compare the skill shortages and the skill shortages that we have at the moment, are there new sectors that have come under pressure because of skill shortages? Is it possible to identify whether Brexit or Covid has been the cause of that? Maybe I could ask Chris Mew to comment on that. It is a great question and it is a very difficult one to answer definitively. One of the features of what has happened over the past 18 months has been the interplay between Covid and Brexit. It has amplified each other in some respects and not too many places cancelled each other out. In terms of the specific question around are the places where we are seeing skill shortages largely the same as where we were before. By and large, it is in similar places. The hospitality sector struggled to recruit. The food and drink sector struggled to recruit. Road haulage issues have been an issue that I know the industry has been concerned about for a long time prior to the pandemic. I think that what we are seeing is a concerting of recruitment activity and change in the labour market that you normally expect to see over five years taking place in a very short period of time. I think that some of the labour shortages that we are seeing at the moment are down to burns reopening quickly and being hungry for labour. Partly, they are down to lots of evidence to suggest that lots of Indian nationals may have gone home during the pandemic to their home country and have not been able to return. We are also beginning to see emerging skill shortages that are as a result of change in the demand for skills in the wider economy that are not related to either Brexit or Covid. You can argue with some justification that some of the pressures that we are seeing around the next year are transitioning about a change in the economy rather than either of those two external shocks. From what you are saying there, Brexit and Covid have perhaps accelerated some of the changes so that the skills shortages that we are seeing now would have come anyway but maybe further down the line or more gently. Would that be correct? I think that what I am saying is what Brexit and Covid in particular has done has driven a pace of change in the economy that nobody anticipated prior to the pandemic. The fall-off in high-street retail, for example, on the growth of online, retail was expected to take place over a five to 10-year period that has happened in 18 months. I think that the challenge around labour shortages is a complex one, skill shortages is a complex one. Some of it is down to workforce demographics, some of it is down to how attractive or otherwise those sectors are for people to move into and some of it is down to the core effects. I hate to say this but it is a phrase that a colleague of mine uses all the time. It is called the labour market for a reason and what we are seeing is that mismatch between both skills that people have but the availability of people and how hungry some businesses are for staff at this moment in time. Perhaps I can invite Nora Sr to comment. Yes, I am just adding to that. One of the main areas where we previously and still have a deficit is around the whole software, digital and technology skills area and that is partly because we do not have the teachers or lecturers who have the input in great enough numbers that can teach those type of skills to the generations that are coming through or upskilling and reskilling. That, for me, is a significant challenge. Anyone who has software engineering skills is immediately snapped up by industry rather than move into an education environment, which means that there is always a lapse for those who perhaps are teaching those skills in an academic situation are perhaps teaching technologies that are more redundant or outdated than what our employers and industries are using at the moment. There is a disconnect without a sink in terms of the knowledge exchange that is coming through to our younger people moving through the education system. That is something that, unless we address and probably incentivise how we get more teachers to bring software engineering technology skills into education at a much earlier stage, then we are always going to be challenged by lagging behind some of our international counterparts. Just on that specific point, are we behind other countries in Europe or the rest of the UK? Is Scotland a problem-specific or is it a common issue that everybody is struggling with? I would probably pass that to Mari to have a think about from an employer's point of view. I sometimes look to Hong Kong and China to carry out digital pieces of work that I know I am not going to—or sometimes even Ukraine and Eastern Europe, because they seem to be further ahead, both in the speed of their technologies, many having 5G of MD installed and because of the technical competence of some of the talent that I can find out there. It usually comes at a cheaper price than we can do it, because we have a skilled shortage in both Scotland and the UK. Those sectors can charge premium rates, so we are already challenging ourselves, if you like, or missing opportunities, because other countries can do that faster and more cost effectively. Do you think that that is just a problem that is endemic to Scotland? It is probably not, but Mari would probably have a better perspective on that on me. It is not unique to Scotland in terms of the skills that are in high demand across the globe. One of the issues that is different now following our exit from the transition period is perhaps some of the policy solutions that we relied on before that are now not there as an option in terms of being able to attract people seamlessly from the EU. Obviously, there is much greater scope for people to move around within the EU now on the continent. Some of the solutions that we have found in the past, which you could call stick-and-plasters in terms of making sure that we have a domestic labour market that is meeting the needs of the businesses here, are not open to us any more, or it is likely that there will be more friction, or it will not be as easy for people to relocate here as it was in the past, particularly from the EU. I do not think that those challenges are unique to Scotland, but the challenges, particularly in rural areas, are just particularly pertinent for Scotland, I suppose, given our large rural population, large rural landmass and our reliance on hospitality and tourism, for example. I would like to invite Lisa. Just to make one comment, building on what Fiona Hyslop said earlier, will the lack of homegrown skills here in Scotland impact on investment into the economy in general? Is it likely that that will happen? Obviously, people rely on us here in Scotland having the skills to be being a highly skilled nation and being at the high end of it. It does not sound like we are there with this. Lisa? I added just a couple of remarks with regard to whether Scotland is alone in facing some of those challenges. I do not think that we are, just to follow on from what my colleagues were saying, but common to most post-industrial economies there is the issue of responsiveness of the skill system and, inevitably, when there is technological advancement that is happening as rapidly as we have seen over the course of the past year, accelerated by the pandemic, there is inevitably a bit of a lag within the education and skill system. Providing and embedding responsiveness into the education and skill system is a common challenge across the globe. However, in aligning our skill system to the accelerating trends that we are seeing in work, we have a lot of advantages and strengths to build out from, particularly, within our work-based learning provision. In that regard, there are innovations in work-based learning where individuals are learning in work and the realities of where that technology is being advanced. Therefore, we are able to continually develop and refine our skins that are in alignment with what employers require. To follow on from a previous point that was made around meta-skills being critically important and being a central feature of what all world economies are looking for going forward, we are also in quite a strong position in Scotland with regard to that, because we have been piloting approaches to embedding meta-skills within our apprenticeship system and the assessment and certification of those, which has been highlighted by the OECD as a significant strength of our system. In terms of inward investment in people looking to Scotland as having a skilled population, there are some firm foundations that we can build out from, but I will pass on, as Chris is looking to come in on inward investment specifically. Thanks, Lisa. You are right to point out that Scotland's skill space is very attractive to inward investors and Scotland's record in terms of attracting inward investment over 15 years has been exceptional. I think that there are a number of things that we do differently in Scotland. I am afraid that we have lost Chris on the connection. Do you have any other questions? No, thank you. I will now bring in Alexander Burnett. Thank you, convener. Members of my registered interest as an employer across a number of sectors. My first question was for Chris. I don't know if he's back or not. If you would be able to add the question to Lisa, who is also here from Skilled Development Scotland, and if Chris comes back in, we can... Yeah, thank you. It's really just for my clarification around your remit. Mary's touched on the care service. One of the biggest shortages that we have is nearly 5,000 nurses across Scotland. Nearly 10 per cent of those are in NHS Crampian. I'm just wondering whether your regional and sector hats on what your remit is in tackling that particular shortage. If you don't have a direct role in that, what interaction do you have with those bodies that do, just to make sure that you're not sort of competing and what a bit of joined-up thinking? I did manage to catch that. Apologies for the connectivity issues that I'm out with my control. It's a great question, and I answer it in relation to engagement in the north-east as well as engagement with the health and social care sector. In SDS, our work is about working with partners on a regional and sectoral basis. I was one of the authors of our regional skills strategy in the north-east about three years ago, and one of the issues that that highlighted were challenges in relation to recruitment across a whole range of sectors in the north-east that didn't pay the premium of oil and gas sector, including care and health and social care. I've got a sector manager colleague who works directly with Public Health Scotland and NHS education for Scotland, as was. What we do is similar to other industry sectors is to look at how the demand for skills within those sectors is changing and growing. That insight is then fed into our apprenticeship demand assessment. It's also shared with colleagues in the college and university sector. As we work closely with colleagues in the funding council to ensure that we've got the volume of provision aligned against where we see needs emerging, the issue in the north-east is a complex one. There's people dynamics and housing dynamics there, so actually very often one of the reasons that there are labour shortages in some sectors is that, historically, there have been labour shortages in the north-east is that people at the lower end of the labour market often can't afford to buy property and live in the north-east. It's a complex picture. We work in partnership. The point that we make is that not every skill shortage has a skills issue necessarily at its root. I have a second question. On the furlough coming to an end, I know that it's been answered to some extent already. A lot of the answers have been hypothetical about whether that might happen or we're expecting this. What actual work or mapping has been done with those currently on furlough who will be leaving furlough at the end of the month, or is it a case of we just have to wait and see what happens when the next unemployment figures turn up? In fairness, I think that, again, Gareth Gillespie and Mari's team has been helping on this mapping where furlough is in which sectors have been affected. To some extent, this is going to be down to individual businesses to look at what their business projections are going forward and how they manage to survive or grow or not within the pandemic. I couldn't say across the board that business hand on heart has a handle on itself as to what its own business cases are going to be going forward. It is a case of waiting and seeing. Employers are trying to hang on to their people as best they can, but the financial pressure on PNLs is such that it will come down to individual businesses making decisions about how much they can sustain and what they need to do to make sure that they have a viable concern going forward. Mari might have something to add to that in terms of mapping. I mean that the largest sector that is still using furlough is accommodation and food services. It was at the end of June in the latest statistics that we have. Obviously, throughout July and August, more employer contributions have been expected, so we would expect a sharp fall-off as we go into July, but we still see a significant number of people in the accommodation food services or arts, recreation and culture, where some of those sorts of businesses might be classified. However, there are still significant numbers on furlough in businesses such as construction and other things. As Chris Scott said, some of those are flexible furlough, but in terms of what might happen when the furlough scheme comes to an end, it is difficult to say that we are seeing shortages in construction, in hospitality, in certain parts of the country, when people are still on furlough. It is really only after we see how that shakes out and whether some people are then released from their employment and able to seek other employment, which may deal with some of the shortages. They will really know what their long-term impacts might be. Thank you. My final question is, hopefully, not straying too much from the skills shortage, but it has been touched on already, the labour shortage. A question to Mairi. You have already mentioned productivity. We have spoken before about cheap imported labour as it has prevented or suppressed wage increases, but it has also been a substitute for investment in automation. It seems pre-Covid almost or, certainly, a long time since we have seen prototypes of robots picking raspberries, but I wonder what you have seen in the last year in terms of investment in automation to address some of those problems. In terms of what businesses are telling us, it is obviously different in different sectors, but there has been a huge amount of investment in different ways of working, as we are doing at the moment, from businesses pretty much across the board. Other adaptations that businesses have made have been about how they deal with their workforce and the flexibility that they give them and such things, which are important. They are less tangible on investments, but they are also important for improving productivity in the workforce in terms of the impact that management practice can have on people's productivity. The focus has mostly been on that. There is some evidence from this year, particularly after the budget, when the chancellor announced the super-deductor for plant and machinery investment. That has driven some investment in different businesses, but it is too early to say what the impact of that might be. Obviously, the UK Government in this case may look for other incentives to allow businesses to invest in R&D or other types of investment to develop new technologies or new products and services for their customers. It is a bit early to say what the impact of that investment might be and how much impact it might have on productivity in the long run. Good morning to everybody. I have a couple of questions that I will run together for all of you. Picking up from Colin's question earlier regarding international skills, has either the Fraser of Allander Institute or Skills Development Scotland undertaken specific recent analysis comparing Scotland's skills system to those of our major trading nations set out in Scotland at a trading nation? In other words, how do we know that, nor has comment, our skills system is looked upon as best in class is actually true? That is my first question. My second question is, I hold a personal view that international benchmarking for Scotland's skills system is necessary. Do you agree with my personal view and, if not, why not? We have not done any analysis on comparing the skills systems or anything like that. One of the key benchmarks that is looked at when comparing across Europe or across the world is the qualification skill level in the population. Scotland always does very well on that measure. We have a highly skilled population in terms of qualifications that people achieve and the presenters, for example, achieve in tertiary education. Whether that means that the workforce has the skills that are required by the labour market is a different issue, and we have the skills mismatches that we have already discussed. The given Nora said the thing about being best in class. I will let her cover why that is. When the Enterprise and Skills Board was first set up, we carried out a piece of work into comparators from off Scotland against OECD countries. The reason for doing that was to move us from the fourth quartile where we sit in many things to the upper quartile or the first top quartile. One of the gaps that we—or productivity—is one of the areas that we looked at, along with a number of other indicators. However, where Scotland came out high was on the higher level of qualifications that our workforce has. The conundrum for us was that, if we have such high levels of qualifications and skilled people, why do we have lower productivity? That is partly under utilisation. The under utilisation and looking at productivity, people taking jobs that they are over-skilled for, is partly because the jobs are not there in the areas where the qualifications come through. That goes back to Lisa's point about meta-skills—the importance of meta-skills—and being able to flex and transfer those higher-level qualifications into new types of jobs as well as existing jobs. However, we have a higher-qualified workforce, so that is not the problem in terms of giving people education and qualifications. It is in using those qualifications in a way that we can become—or productivity is increased. I would also mention that business investment in innovation and automation. That, again, was one of the indicators where Scotland performed much more poorly than we see in other countries. Business investment in innovation partly comes from—I go back to what I was saying and part of my very first comment—enhancing management and leadership. Where we sometimes struggle is in the ability and capability of our managers and leaders to be able to scale up businesses, we are trained technically in the knowledge of the product or service that the company is selling, but not necessarily in how to scale up a business around creating bigger teams, knowing where to invest, knowing where to go to look for the types of innovation that might help their company and looking at other good models of workplace practice around fair work. Although we have higher levels of skill and qualifications, what we need to do is increase the ability and capabilities of our talent, management and leadership, and then we should be able to see a greater leap in productivity. I do not know if anyone else wants to come in on those first two questions before we move on. I think that I would just add here that we have, particularly for the skill system and the apprenticeship system, we have received a number of—we have been engaging with the OECD to look at how we can strengthen the skill system in Scotland and they outline some of the kind of impressive developments that we have undertaken within the Scottish apprenticeship system over the past decade, in particular the good labour market outcomes for learners and employee satisfaction. That is all really positive. We have increased our apprenticeship numbers and, similarly, we have introduced foundation and graduate apprenticeships in the skill system, which we know are being well utilised in the education system. One of the successes is that those opportunities enable us to open up higher levels of skill development to people from increasingly diverse backgrounds. The apprenticeship system could be considered as high-performing, particularly with the new innovations that we have undertaken over the past week while. That is really important because, as you know, apprenticeships are developed in partnership and significantly with employers. We have developed a new model in which we are developing apprenticeship standards with employees and employers together to ensure that the realities of the jobs that people are going to be undertaking are represented within the learning components that they undertake, but that also has a view to the future and how the future of that occupation might be. That innovation in itself has been heralded, and that is really important. That is based on our research and interactions with other more mature apprenticeship systems across OECD countries, such as Switzerland, for example, who helped us to develop that kind of approach. I suppose that what I would say is an agreement with Nora's that there are some significant strengths within our education and skill system. I forgot the second question. Apologies, Michelle. There was a long one to get. I nearly expressed a view that international benchmarking could be desirable, particularly going back to Nora's comment about digital and the threat of competition from digital. We might choose not to internationally benchmark across every sector, but we have already discussed the emerging sectors. It was just to see whether you agreed with that view in principle that international benchmarking is a good thing. I think that, Lisa, you probably must have guessed what my second area that I wanted to explore was about. That, funnily enough, is about modern apprenticeships. Looking at SDS's most recently quarter, the report on modern apprenticeships, a theme that I have been looking at since joining the Parliament is a different consideration given to the role of women, whether it is in business or skills and so on. I worked out that, in the first quarter of 2019 to 2020 and then 2021 to 2022, there has been a decline from 47 per cent of female enrolments to 45 per cent. I then, of course, looked in my own area, which is Falkirk, a more dramatic fall in Falkirk from 45 per cent to 35 per cent of females. That led me to consider what might be the gaps in terms of how we are going about this for women and getting them enrolled. I wonder if you had any thoughts about the reasons for this, either, Chris or Lisa. I am happy to make some remarks about that. The first thing to say is that apprenticeships are offering flexible and experiential learning experiences. As I was saying before, it does open up opportunities to people from a range of different backgrounds, including, particularly in the case of graduate apprenticeships, older adults and those from under-represented groups. By virtue of catering for different learning styles, apprenticeships really can play an important role in supporting an increasingly diverse workforce. What I would say in terms of recruitment into apprenticeships is that that is primarily the responsibility of the employer. The uptake of apprenticeships tends to reflect the demographics of the wider workforce that exists within each sector. For our own part, within SDS, we have produced equalities action plans for apprenticeships and for our career information advice and guidance services and others. We are taking action to ensure that we have greater engagement between providers and employers, particularly in relation to inclusive recruitment. We have a stronger partnership working with schools to promote and encourage the recruitment of equality groups. We are improving the thing and posting of resources for those that might require any additional support that needs to be taken kick nice and soft, either for learners, employers and staff too. I suppose that there are improvements that can certainly be made and that we have an eye to them. However, I would not want to miss the point to say that apprenticeships, as we know from research across the globe, in countries such as Germany, Switzerland and Austria, can provide not just a pathway for individual skill development, but can be a really useful and positive driver of economic growth and social equality. As I said, we have such things in place to ensure that we are advancing on where we have got to so far. Chris may want to make some additional remarks. I do not think that we can see Chris on the screen. I think that perhaps he has dropped again. No, we are just picking up on that before we move in. Lisa's comment about its employers will drive the take-up of modern apprenticeships and therefore they have a role in those figures that have outlined for women. I mean, we know that we both encounter systemic issues in the role of women in business in various sectors and so on, but I wondered if you had any final reflections on this point before we move on. You are on silent, Laura. Sorry, that is going to be the thing that we all remember about, you know, you are on mute, is it not? The catchphrase of the pandemic. I really just agree with the comments that Lisa made. I think that where employers are concerned, there is still work that needs to be done around women in business, around women's start-up, around apprenticeships. I think that the whole diversity issue where it is being addressed but it needs to be accelerated. Perhaps one of the benefits of the pandemic is the attitude of most businesses towards both flexible working and remote working and that leads to opportunities for more inclusion in women in business and for new women's enterprises to start up. That is where some of the focus of business support needs to go for that, you know, to stimulate that particular sector of society. Okay, thank you. Just the last wee question for yourself, Nora, and then a general question for you all, and I will run them together again. Nora, you and I would both agree that competitiveness in business is really important. The recent Cumberford little report commission for the Scottish Government emphasised a shift towards excellence in skills rather than a focus on competence that we have at the moment. I am wondering to what extent you agree with your statements in your report. To SDS, what is your view on how to best keep the knowledge and skills of Government agencies current in the light of the huge global challenges and changes in Brexit and Covid and so on? Has SDS, for example, instigated your own programme of change around your skills based as we emerge from Brexit and Covid? So, two separate areas but I am aware of time. Do you want to respond first? Excellent in skills. I mean, I have been great administration for the Cumberford little report. I think that they talk to a lot of common sense. I think that, you know, in terms of excellence in skills, what they are aiming for was the inclusion and co-production and co-design of courses by employers, which would mean that there would be a more rounded individual able to slot more seamlessly into the types of employment that were available. So, I think that that is a good aspiration to try and work towards and attain. I think that their ideas of having employer hubs where businesses can be much more integrated into the whole college and university framework, particularly on a regional economic basis, is to be welcome. So, yes, I do support that. Okay, thank you. And the last question, a slightly cheeky one, I appreciate to SDS, but a bit of fun to wind up the session. Chris or Lisa is fine. Oh, Chris, you're on silent as well. Apologies. Apologies again. I'm having dreadful connectivity issues. It's a great question. So, what are we doing to ensure that our staff's health space is keeping up to date in relation to the challenges that we've seen in the pandemic? One of the teams that I run is responsible, along with Lisa's team for generating insight and intelligence on where the economy and the labour market is now. That's primarily my job. Lisa's team is about understanding the factors that are going to impact on the economy and the labour market going forward. We've got a huge commitment to actually, that information doesn't sit in my head, and Lisa said, we cascade that through our front-line staff and across all of our teams. We were recently assessed by EFQM, which is an international benchmarking organisation, looking at cultural organisation. We were, I believe, the first organisation to get a seven-star EFQM rating in Scotland. What struck the assessors was the commitment that we've got to both everybody's leadership in addition to that staff development. Lisa, I don't know if you want to add any more detail from your side of the world. Yeah, just at one point. I think that the intelligence and the insights that you've talked about there are critical and we're engaging, and it will be the basis for which we think about how do we develop our next strategic plan, and we're in the process of engaging and using that kind of force act to think about the future, for generally of Scotland, Scotland's economy, and us, in the future of work as a organisation, and we're arranging a number of, we're engaging all staff really in that discourse that we're thinking about. What does that mean not just for our products and services, what does it mean for us as our people and for us as individuals? I think that that's really critical and we will be engaging of course with our partners and our key stakeholders across Scotland in developing that strategic plan, because we really are committed to making sure that the future of work is at the front and centre of making sure that we're at the front and centre of public service delivery. Okay, thank you very much. Thank you. I just have time to bring Maggie Chapman in for a question. Thanks very much, convener. Thank you to the panel for all of your contributions so far this morning. We've covered a wide range of issues, and I just want to pick up on a couple of things, and maybe it follows on actually from some of Michelle Thomson's questioning. We've talked about how a labour shortage is not the same as a skills shortage, and we've talked about some of the analysis around that, around house prices, rural versus urban splits, those kinds of things. There's been a discussion around T-shaped versus I-shaped in employees and how we support and how we generate that kind of approach. There's discussion, and quite a few of you have used the phrase, you know, we need to adopt a new mindset, and that goes for employers as well as employees. And I suppose my question is quite a lot of the responses that we've heard focus on what is it that we need to do to get the right skills, training, the right skills development, the right infrastructure in place. What we haven't heard so much about is the cultural aspect, because employers and employees are people, and I'm wondering what research has been done or what analysis you have got that allows us to better understand how we actually, you know, how we take people with us on this. We can't just say, you need to adopt a new mindset here. We need work around how we do that. From that information, if you have anything in that space, what is it that the Scottish Parliament or the Scottish Government needs to be prioritising in how we look at this? I suppose particularly around the clear economic and, I would argue, moral drivers for having a diverse workforce that acknowledges the breadth of experience and skills that we can bring to our economy. I don't know maybe to start off with Chris, and then I'd be interested to hear from Mary as well. Thanks. It's a great series of questions. There's quite a lot in there, so I will pick on a couple of aspects of that and allow colleagues to pick up. That notion of the mindset needed to be a cultural shift is really important for individuals. I think that for a long time, almost since our inception in the SDS, we've been talking about the need for people to develop asset skills from an early age that allows them, that supports them to navigate and adapt to a change in the labour market. We just recently embarked to the request of Scottish Government on a review of our career service and the support that it offers. I would be sad it's not because it's broken, it's highly recognised as a very valuable service. Our challenge is how can we make it even stronger? We're focusing on how we can deliver careers, skills, not just to those young people who make the transition into the labour market, but to people who are in work and who may be looking at a career change. That career review will come out with recommendations at the end of this year. It's looking at issues that we've heard a lot about this morning. How do you embed that culture within individuals from 16 through to 60? How do you ensure that they've got access to advice that helps them to navigate the labour market? How do you ensure that they've got access to training for upskilling and reskilling? So, a long-winded way of agreeing with the premise of your question. I think that the mindset shift and the impact on productivity of things like management practice and the softer side of things, there's been quite a lot of research done on the importance of that now, and there's more and more focusing on that, rather than just the more traditional measures that we look at to try and judge whether we're making progress on the drivers of productivity. It is really important, the kind of mindset and the focus on the things that actually make a difference. Part of that as well is about having the data and understanding of what does make a difference, what works and achieving the outcomes that we're looking to achieve. I mean that Nora can maybe chat a bit more about this and on some sort of research that the Enterprise and Skills Stewards Board have commissioned on trying to understand what different interventions in a young person's life and maybe the qualifications they achieve or whatever, what sort of wage premium they give you and what impact that that can have on your whole life. I think that the evidence and evaluation of policy interventions is really important and has to be invested in, and it might not give us answers straight away, because obviously in terms of the impact that an intervention has on someone's life, it's by definition going to take a while to get those answers, but investment in data, appraisal and evaluation of policy across the whole system is really important to understand what actually works and what most efficiently I suppose achieves the outcomes that we're looking to achieve. Okay, thank you. Nora? Thank you. I have a really good question on culture change, and by a really good question that's usually my code for, I really don't have an answer for that, so here's my personal take on it. Culture change, I would give an example of women on boards. Women on boards, as we know, hugely underrepresented. It was not mandatory. Industry had to take this on as a voluntary adoption, if you like, that they would have more women represented on boards, particularly amongst footsie 100 countries or footsie 250 companies. Has it improved enough? No. So the debate still remains is self-regulation enough, and if you don't reach those targets, then should targets be set and should they be mandated? The debate is still out on that, obviously, but it still impacts on what you said about culture change. In terms of the enterprise and sales skills system, within SOCI, for example, it's now a condition of anyone who obtains business support, business grants, that they will have fair work and a commitment to fair work, and also for those companies that are in specific sectors or larger or are able, that they will provide mentoring to other companies who are trying to grow or who are in their supply chain, so that there is hope by adding in that conditionality that it then sets a precedent for that type of adoption of fair work and mentoring practices that then becomes business as usual rather than being set as something that is in that condition. Culture change has to be set, there has to be leadership shown, but there also has to be a bit of carrot and stick, and which follows which. A really good question, and if you have a solution to culture change, I would love to hear it. Thank you, Maggie Chapman. I'm just going to bring Colin Smyth in for a brief question before we close the session. Can I just briefly follow up on a point that the noticing you made there, you referred to the fact that South Scotland Enterprise Agency now have that conditionality around fair work, so why is that not rolled out across Scottish Enterprise, Highlands and Islands Enterprise, because some ways you've kind of got a competitive disadvantage and not a level playing field that one agency is doing one thing, but the rest are not doing the same? Would you have the agencies in front of us next week, but if Nora does want to comment on that, she's welcome to come in. Sorry, I was just waiting to be unmuted. Sorry, yes, I should have said because society is leading on it and actually they wanted to get the I suppose they were the pilot for what type of words do we use, what does business understand about fair work, how you define it, so actually they've been used as the guinea pig if you like to look at best practice and then it will be rolled out across the other enterprise agencies. I'm sure that that's an issue that we'll come back to next week, but I'd like to thank the panel very much for their contributions this morning. It's been very valuable to hear your views on the skills and employability agenda, so thank you. I'll now bring this part of the meeting to an end and we'll move into private session.