Meeting the future skills imperative

This blog was first published in the Association of College’s Think Further magazine on the 27th November 2025.

New research from NFER examines how new technologies, coupled with major demographic and environmental changes, are re-shaping the labour market, changing the jobs that exist and the skills needed to do those jobs, with implications for the FE sector and young people, as well as adults already in work.  

In the final report from The Skills Imperative 2035, we elaborate on the challenge now and ahead as well as the collective response needed to this challenge. In this paper, we outline the system of lifelong learning that is needed to nurture the development of individuals’ skills throughout early childhood, education and work.  

The labour market is changing at an accelerating rate

Previous research for The Skills Imperative 2035 showed that AI and automation, coupled with other changes, will continue to disrupt the labour market, impacting the jobs that exist and the skills needed to do these jobs.  

Based on our employment projections, we previously suggested over a million jobs in declining occupations could be lost between 2021 and 2035. But actual employment changes since 2021 show this decline is happening faster than we previously projected, by as much as three times for some groups. If this trend continues through to 2035, there could be between one and three million fewer jobs in these ‘high-risk’ occupations (e.g., administrative, secretarial, customer service and machine operators).   

Changes in jobs and skills create both opportunities and threats for young people

Higher skilled, generally better paid occupations (e.g., professionals and associate professionals such as science, engineering and legal roles) are growing, while most low- and mid-skilled occupations (e.g., administrators and sales) are declining. This trend is not new, but it is now occurring at a rate not seen before. This creates more opportunities for highly qualified and skilled young people to access well-paid work, but it also carries threats, not only for workers in declining occupations, but also for young people who leave education without the skills and qualifications typically required by employers in high-skilled growth occupations. This may be one reason why the rate of young people not in education, employment or training is increasing. Without action, this situation could get worse, and broader inequalities in society may also widen. 

Skills requirements are evolving too

Across the labour market, some skills are becoming more important, while others are declining. A set of skills already heavily utilised today will become even more vital across the whole economy over the next decade. We call these Essential Employment Skills (EES), and they are: collaboration; communication; creative thinking; information literacy; organising, planning and prioritising; and problem solving and decision making. 

Meeting the skills imperative

Government, employers, the education system, and individuals all play a role in influencing the direction and pace of change. Greater focus is needed not just on supporting more existing workers in high-risk occupations to reskill and change careers, but also on ensuring more young people leave education with the qualifications and skills they need to compete for entry-level roles in high growth areas of the economy.  

Emphasis is needed on ensuring: 

1. All young people must leave FE with a strong base of the EES needed in both work and life.
   While some colleges already integrate EES into curricula, syllabuses and schemes of work, others feel these skills are ‘squeezed out’ of post-16 qualifications requirements. These skills must be explicitly recognised, consciously developed by educators, and learned through the application of knowledge to real-life situations that require planning, problem solving, communication and collaboration. For its part, the government needs to signal to educators, in the FE sector and beyond, that these skills are valued and promote a common skills framework that can be used to benchmark and track students’ progress against clearly defined expectations. 

2. More young people should be equipped with the EES and other technical skills typically required by employers in growth occupations.   
   Workers in growing, predominantly professional and associate professional jobs (such as science, engineering and legal roles), typically have higher levels of EES, as well as other skills and qualifications. Tertiary education should offer a clear and coherent network of learning pathways into growth occupations, especially for disadvantaged students, including well-recognised Level 4/5 pathways that colleges are equipped and resourced to deliver; effective bridging courses to Level 3 and beyond for those that need a little longer; and sufficient options for lower attainers to progress into lower-skilled but growing occupations like social care work which do not require higher education.

3. The adult skills system must be reinvigorated to help support lifelong learning. The FE sector plays a vital role in this.  Public and private investment in adult learning has fallen sharply since 2010, leaving adult skills education and skills systems underfunded and fragmented. Reinvigorating adult skills should be a national priority, with public funding restored closer to early 2010s levels. Government should explicitly signal that it expects employers to invest more, while offering direct, targeted incentives to priority sectors, and recognising existing investment and best practice. 

4. National frameworks and incentives must incentivise closer cooperation between educators, government and employers, especially in tertiary education.
   Clearer pathways into growth occupations require a more integrated tertiary education system, with strong coordination between FE, HE and employers. Government has already signalled a desire for greater coordination and collaboration in the recent post-16 strategy, but this needs to be backed up with national frameworks and incentives that promote bottom-up collaboration. For example, these could include a national (or regional) tertiary education coordination body to set strategy and manage shared funding; a unified qualifications framework with integrated quality assurance system; and a funding model that rewards collaboration between FE and HE providers. 

A system of lifelong learning is needed to provide the essential skills for tomorrow's workforce. The FE sector plays a pivotal role in this system by equipping young people with a strong base of the EES they’ll need for work and life, giving them the technical skills typically required in growth occupations, and supporting workers in declining occupations to reskill or upskill and change careers.