Mr. Brendan McGinty:

I thank the committee for the opportunity to meet it. The primary focus is on discussing issues of apprenticeships and traineeships which for the most part is about points of entry into a career. Our focus in Skillnet Ireland in working with enterprise is about developing employability skills over the work-life cycle when people have taken up employment.

In that context, human capital is the single greatest asset any nation can possess. Workers, whether they were born in Ireland or attracted from abroad, are the muscle, brainpower, creative force and energy that drives our economy.

In an international context, the IMD’s competitiveness yearbook 2018 ranks Ireland fifth for attracting and retaining talent. The collective talent of our nation is not just the bedrock of our economy today; a well-educated, well-skilled and adaptable workforce has been a core pillar of Ireland’s economic and industrial policy since the 1960s. It is an advantage we must never cede. If we are going to keep that advantage and the promise of opportunity to future generations, we have some work to do.

Our economy is being rapidly reshaped by technology, automation, globalisation, geopolitical shifts, including Brexit, and several other forces. The manifestation of changes being discussed in the debate on the future of work are already with us today and are influencing the way companies operate and how work is organised. This affects job content, skill needs and quality requirements. This transformation is creating opportunity but it is also creating disruption and, with it, insecurity for many businesses and workers. Some of this insecurity can be attributed to two gaps that are preventing our nation from leveraging its talent and our people from realising their full potential. The first is a skills gap. Too many people lack the skills they need to compete for 21st century jobs. The second is a people gap. Too many businesses cannot find the workers with the right skills when and where they need them. Closing both gaps is imperative to our competitiveness.

It is a multifaceted challenge as skills supply is met in various parts through outputs from our higher and further education system, including apprenticeships and traineeships, from employment activation and supports to jobseekers, and from immigration.

However, for the greatest part, the skills that power Ireland’s economy are derived from within employment. For this reason, it is crucial that both businesses and workers are placed at the heart of the response.

Skillnet Ireland is the national agency responsible for the promotion and facilitation of in-employment training. We have deep roots with enterprise in Ireland and we are contracted with more than 50 employer and sectoral groups, regional representative bodies and industry associations. In 2017, approximately 15,000 private firms participated in Skillnet learning networks and more than 50,000 workers were supported by Skillnet-funded training. We are funded from the National Training Fund and as a demand side agency in that we stimulate and support enterprise-led responses through 65 learning networks across a range of sectors and regions. We operate a cost-sharing model where State grants are combined with investments by businesses. As well as offering a subsidy to encourage upskilling, cost-sharing drives firm employer commitment to the training process. In 2017, employers made a total contribution towards training of €15.91 million through Skillnet.

The Skillnet cost-sharing model is also creating significant funding leverage in that every €1 of State investment is matched with €1.14 from employer contributions. This represents a highly efficient use of public moneys and an effective vehicle for State investment in the skills of our workers. For 2019, the annual budget allocation for Skillnet Ireland has been increased to €28 million, equating to approximately 4.5% of total National Training Fund expenditure net of other employer contributions.

Through successive independent evaluations both domestic and international, including the OECD, the European Union and the International Labour Organization, the Skillnet model has consistently been highlighted as an efficient means of addressing skills challenges.