Unveiled in June 2025, The UK’s Modern Industrial Strategy, is an attempt to reshape the country’s economic future by focusing on eight high-potential sectors and placing skills and workforce development at the heart of the growth agenda. But does it do enough to help businesses train their future workforce and revamp education? Or is it more of the same?
New rhetoric meets fresh ambition
The strategy is positioned as a clear break from the past’s short-term planning. The government pledges to deliver long-term certainty for business, boost investment, and create 1.1 million skilled jobs by 2035, with a strong emphasis on aligning the education and skills system with what it calls the IS-8 sectors:
- Advanced Manufacturing
- Clean Energy Industries
- Creative Industries
- Defence
- Digital and Technologies
- Financial Services
- Life Sciences
- Professional and Business Services
Key commitments on skills and training
The strategy introduces changes to strengthen the connections uniting education, training, and businesses:
| Technical education expansion | There will be increased provision for 16–19-year-olds, with funding for high-value courses in areas like engineering and digital skills. The government promises to support an additional 65,000 young people into priority occupations by 2028–29, alongside investments in facilities and teacher recruitment. |
| Flexible skills funding | The Growth and Skills Levy will fund shorter, more targeted courses in digital, AI, and engineering, and support foundation apprenticeships. This is intended to help businesses access the specific skills they need more quickly. |
| Lifelong learning entitlement | Launching in 2027, this will allow individuals to access modular courses throughout their careers, supporting upskilling and retraining in line with evolving business needs. |
Sector skills packages
- TechFirst: This investment of £187 million will bring digital skills and AI learning into classrooms across all communities and prepare people of all backgrounds for future careers. The government have also launched partnerships with major tech players, including NVIDIA, Google and Microsoft, to train 7.5 million UK workers in essential AI skills by 2030
- Engineering: Arguably a critical area for investment, this package of £100 million + will be delivered over 3 years to support engineering skills in a transparent and coordinated way.
- Defence: The amount and timings will be detailed when The Defence Industrial Strategy is published.
- Construction: This package delivers £600 million of investment over the next four years to train up to 60.000 new workers for the sector.
Investments and partnerships
There are new investments including £187 million for digital and AI skills, £100 million for engineering, and the creation of Defence Technical Excellence Colleges. These packages are designed to address critical shortages in high-growth industries. There are also plans to encourage closer collaboration between employers and education providers, expand industry placements, and develop skills passports to help workers transfer competencies between sectors.
For actionable insight into the industrial strategy’s plans for skills, get our executive summary.
Is this more of the same?
The strategy’s ambition and breadth mark a step change in tone and scope compared to previous efforts. There is a clear recognition of the need for a more dynamic, responsive skills system, with increased employer involvement and a stronger focus on high-value sectors. The introduction of modular lifelong learning, greater flexibility in funding, and targeted investments in digital and engineering skills are all positive moves that address long-standing criticisms of the UK’s fragmented skills landscape.
What does the workforce expect?
Training should meet not only the needs of organisations working to build a stronger economy, but the expectations of people entering or already part of the workforce. According to the latest Business Barometer from The Open University, 71% of Gen Z believe employers should be responsible for workplace training and upskilling, while 45% of employers believe they should fund employee development.
This gap between the expectation and reality of training crystallises an important idea: Should more employers invest in training solutions to achieve better alignment and ensure people have clear career paths? Should more training programmes be moved inhouse? Are there innovative models for government training initiatives delivered by businesses?
The government wants to promote better coordination and cooperation, but there needs to be more focus on the handover from education and training to the world of work. And, if people expect more training in the workplace, can employers collaborate with the government to deliver programmes in a shorter time frame? Investing in better courses and improved facilities is a good idea, but the rewards will take years to come to fruition.
While the commitments are impressive on paper, the real test will be in delivery. Previous strategies have also promised better alignment between education and business, but have struggled with implementation, bureaucracy, and insufficient employer engagement. The success of this strategy will depend on whether new mechanisms like Skills England’s role in co-designing solutions with business, and the promised simplification of the skills system can overcome well-built barriers.
Final thoughts
The UK’s Modern Industrial Strategy outlines extensive plans to support businesses in training the future workforce. It includes the promise of substantial investments and a more flexible, employer-driven approach to skills. It represents an evolution rather than a continuation of past policies, especially in its focus on the IS-8 and a commitment to lifelong learning. Whether the strategy heralds transformation or becomes another well-intentioned plan will depend on sustained political will, effective delivery, and ongoing partnerships across industries and with businesses. For now, the direction is promising, but we won’t be able to measure its success until a few years have passed.
If you’re looking for more insight and detail on the skills plan outlined in the government’s industrial strategy, get our executive summary.
