Workforce as strategy: Government repositions skills as critical infrastructure for a competitive, resilient economy

The UK government’s £275 million investment in technical training and apprenticeships is pitched as a serious move to reposition skills as core economic infrastructure. While successive governments have linked skills to productivity and growth, this latest framing marks an elevation in tone and intent and signals a shift from skills as an education issue to skills as industrial and economic policy. 

Announced on 21 June, the package will fund new Technical Excellence Colleges, AI and digital manufacturing courses and upgrades to training facilities across England. It follows the TechFirst initiative, also launched this June and reported on Learning News, which committed £187 million to AI and digital skills across schools, universities and adult learning. Taken together, these moves suggest a broader attempt to treat workforce development as a national asset.

However, beyond the shift in tone, the funding can only really be seen as a starting point. The language is positive: Seeing skills as a critical national infrastructure, but £275 million will not go far without long-term commitment and follow-through.

Key Facts

• Strategy framed around resilience, sovereignty, industrial competitiveness.
• £275 million investment in technical training announced on 21 June 2025.
• Funding includes new Technical Excellence Colleges and short courses in AI and digital manufacturing.
• Additional to the TechFirst initiative of £187 million for AI and digital skills, announced earlier in June.
• Priority sectors: engineering, defence, advanced manufacturing, digital technologies.
• Aims to reduce reliance on overseas labour and build UK-based capabilities.

Business Secretary, Jonathan Reynolds: ‘Our modern industrial strategy will be powered by investing in British people. It will help transform our skills system to end the overreliance on foreign labour, and ensure British workers can secure good, well‑paid jobs in the industries of tomorrow and drive growth and investment right across the country.’

Industrial focus underpins the £275 million: The targeted sectors, engineering, defence, advanced manufacturing, and digital, are longstanding priorities in UK skills planning. What’s new is how they are now framed as critical to reducing reliance on imported talent and strengthening sovereign capability. Ministers increasingly use the language of ‘security’, ‘autonomy’ and ‘national strength’ when talking about skills.

Recent data from the Open University’s Business Barometer 2025 adds weight to the government’s diagnosis. It found that 54% of UK employers report a skills shortage, and one in five are not confident they can deliver their AI plans over the next five years. Yet only 46% have a written skills plan, and many cite budget constraints, retention fears, and training access as major barriers. These findings underline why strategic, coordinated investment, not just funding, is essential.

A host of tech and engineering companies have welcomed the announcement.

• Dr Hayaatun Sillem CBE, CEO, Royal Academy of Engineering, welcomed skills packages for tech, engineering, defence.
• John Harrison, General Counsel & Head of Public Affairs, Airbus, welcomed the long‑term vision and skills pipeline.
• David Lockwood OBE, CEO, Babcock International, welcomed defence skills investment.
• Charles Woodburn, CEO, BAE Systems, emphasised workforce and technology investments.
• Darren Hardman, CEO of Microsoft UK explained this is about: ensuring the UK has a highly skilled workforce to take advantage of the AI economy.

Ben Willmott, Head of Public Policy at CIPD, thinks the strategy is too narrowly focused on a few sectors disproportionately located in the south-east and said: ‘The government’s renewed focus on skills and education in its industrial strategy is welcome. However, the strategy remains too narrow and top-down to power economic growth and improve living standards across the UK. We need a much greater focus on boosting skills and supporting productivity in the everyday economy.’

Rob Telfer, Director of Higher Education at D2L, told Learning News: ‘This is a welcome shift, moving skills and AI literacy from a purely educational concern to a national workforce priority. Many graduates leave university with limited hands-on experience. Investing in digital tools that build real understanding is important. Our systems need to prepare people for a future that demands continual learning. Progressive universities and organisations are already embracing this shift, with scalable, flexible approaches like microcredentials gaining traction.’

Implications for L&D

This shift has significant implications for the learning and development sector. For workplace learning professionals, the framing of skills as infrastructure opens up opportunities to align training with newly funded areas and influence delivery. Providers that can deliver short, job-ready programmes in technical and emerging fields may find themselves ready for partnership with the new colleges and government-funded schemes.

The announcement reflects a maturing view of the learning ecosystem. The government is acknowledging that skills development requires a blended, institutionally supported model, where learning is embedded in long-term industrial outcomes.

• For vendors, the message is demonstrate strategic value, deliver measurable impact and speak the language of industrial policy aims.
• For L&D teams, the challenge is to map internal training needs to national priorities and secure executive sponsorship in a climate where skills are now a boardroom concern.

Why learning vendors should speak to industrial policy goals

As the UK signals a shift towards industrial policy with skills positioned as core to economic resilience, learning vendors have a strategic opportunity to frame their value in macroeconomic terms. By adopting the language of productivity, innovation, regional growth and national competitiveness, vendors can:

• Resonate with buyers: As purchasing decisions become guided by strategic outcomes. Aligning with national goals strengthens the case for investment.
• Strengthen positioning in public-private ecosystems: Those who make the case that their platforms, data or content contribute to national goals (e.g. closing the digital skills gap, levelling up regions, accelerating net-zero transitions) are better placed to access long-term funding, shape public tenders and build multi-stakeholder partnerships.
• Support customers under pressure: L&D teams face rising expectations to demonstrate impact. Tools that help map learning to sectoral or regional priorities add practical value.
• Engage in policy-shaping dialogues: Vendors aligned with government goals are better placed to participate in consultations, pilot programmes and funded initiatives.
• Enhance credibility and reach: Using shared language with policymakers, funders and industry bodies helps build trust and influence in the broader skills ecosystem.
• Join in as partners: In a policy-led skills landscape, vendors that align commercially and rhetorically with national priorities are more likely to be seen as strategic partners, rather than just suppliers.

Why L&D teams should align training with national priorities

As the UK government reframes skills as critical infrastructure, the message to employers is workforce capability is now a national competitiveness issue. For L&D teams, this shift presents both a challenge and an opportunity. Aligning internal training needs with national priorities, whether in digital skills, AI, green technologies or advanced manufacturing, helps L&D to:

• Gain executive sponsorship: Framing skills development as a response to national imperatives helps elevate L&D on the corporate agenda, securing leadership attention and investment.
• Access funding and incentives: Aligning with these areas can unlock new resources and extend training budgets.
• Boost talent attraction and retention: Training in nationally recognised skills enhances employee value and career mobility, key drivers of engagement and loyalty.
• Future-proof compliance: Some priority areas may evolve into regulatory requirements. Early alignment mitigates risk and ensures readiness.
• Forge new partnerships: Participating in nationally coordinated skills efforts opens doors to collaboration with government bodies, industry groups and peers shaping the future skills agenda.
• Support performance now and prepare for what’s next: National skills priorities increasingly reflect the realities employers face, digital transformation, regulatory change, evolving job roles. By aligning with these priorities, L&D can strengthen immediate learner performance in critical areas, while equipping the workforce for what’s coming next. It’s not a choice between internal relevance and external alignment, it’s both.

The UK’s workforce strategy is no longer just about filling gaps, it is about building advantage. With global competition intensifying and AI redefining productivity, the capacity to train, retrain and redeploy talent at pace may become the most important lever of national performance as well as organisational performance.

The government’s latest announcement reads as more than a funding story. It is a signal of intent: that investment in skills is now recognised as critical to national resilience and competitiveness, not a discretionary add-on. For those in workplace learning, this is a moment to act not just as educators, but as strategic partners in the UK’s industrial future.