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London’s combination of a world-class financial industry and a maturing start up sector puts it in an ideal position to lead the next wave of tech innovation, completing the transition to a knowledge economy. That position could be under threat, however, as growth in the tech sector moves away from apps and platforms, and towards more complex systems, from machine learning to big data, requiring an entirely different set of skills from its workforce.
The 2021 Kalifa Review has identified serious concerns about a skills shortage in the UK threating to impact the UK’s position as a tech and fintech leader.
My own sector, fintech, saw a small transformation during the pandemic. Technologies like machine learning in consumer finance were critical, as banking services went almost fully remote for the first time. Automated customer support, predictive analytics, cost-efficient decision-making; all of these upgrades were made possible by the development of disruptive technologies, which required a skilled workforce to develop and implement. These innovations rely on systems that can quickly assimilate global knowledge in order to adapt their settings to local necessities.
The Kalifa Review highlights the clear tie-up between access to skills and the successful growth of businesses, particularly in fintech. As a serial company founder, in the UK and overseas, I know how hard it can be to build teams with the right balance of skills. A problem we often face though, is that it’s difficult for governments to develop a workforce that anticipates the needs of the future. Policy makers in developed economies have long recognised that we are transitioning from industrial economies to knowledge economies, but the challenge is to predict what skills that transition will require.
Recently, the government was criticised for an ad campaign encouraging bright children to develop tech skills. It showed a young girl putting on ballet shoes, under the headline ‘Fatima’s next job could be in cyber (she just doesn’t know it yet)’. Critics argued that we shouldn’t neglect the arts over more ‘economically useful’ skills. The question that struck me, though, was: what exactly are ‘cyber’ skills, and how do we know they’ll be useful in ten years’ time?
My educational background is in finance, but programming and so called ‘tech skills’ were the things I did on the side. I was one of the first students to complete the advanced track on Andrew Ng’s machine learning course from Stanford University on the Coursera platform. More than four million users have since enrolled. Online courses can supplement a traditional education to allow people to make lateral steps in their career, and adapt to a changing environment.
There is a lesson here for the wider economy and the UK’s skills strategy. In a knowledge economy powered by transformational technologies, rapid change can quickly render skills and experience obsolete. That means that all careers will benefit from continuous learning, responding to a changing environment by developing new skills.
Remember Fatima and her ballet shoes? A recent project saw Google work with London choreographer Wane McGregor on a machine learning dance project called the ‘Living Archive’. If she wants to get ahead in ballet, perhaps she should indeed ‘learn to code’. Because emerging technologies will permeate the knowledge economy, even those who are highly skilled in a different field will need some familiarity with the technologies driving change.
If the UK’s skills strategy is to meet the high expectations of a technology driven knowledge economy, all advanced training and education should have a tech element. Children must be given foundational skills in maths, problem solving and computer literacy. Tech should permeate school curriculums from art and drama to history and language learning.
Of course, not all skills are home grown. Fintech attracts talent from all over the world to London. It is estimated that more than 40% of the fintech workforce in the UK is made up of individuals from overseas. We can’t afford to lose them and we need to keep attracting them. The more developed the international market for highly skilled labour, the more the UK can afford to take risks with its own skills strategy. Highly skilled individuals from the UK will be better able to find employment, and UK business will be able to find workers with the skills they need for the future. For such a market to work, immigration policies should be handled with caution.
There’s a bright future ahead for the UK’s tech and fintech sectors. The Kalifa Review is right, though, to say that “positive growth projections are being threatened by a potential skills deficit. The barriers span both domestic skills shortages and the need to access foreign talent seamlessly”. To address those barriers, we need to make sure that the next generation of tech professionals aren’t only programmers, but experts in a whole range of different fields, working across the economy with the flexibility to acquire new skills.
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