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The government has launched its promised new training initiative called Skills England which will be chaired by former Co-op boss Richard Pennycook.

In a statement, the Department for Education said: “Skills England will bring together central and local government, businesses, training providers and unions to meet the skills needs of the next decade across all regions, providing strategic oversight of the post-16 skills system aligned to the Government’s Industrial Strategy.”

It said that between 2017 and 2022 skills shortages in this country doubled to more than half a million, and now account for 36% of job vacancies.

Prime minister Keir Starmer said: ”Our skills system is in a mess, which is why we are transforming our approach to meet skills needs over the coming decades.

“From construction to IT, healthcare to engineering, our success as a country depends on delivering highly skilled workforces for the long-term. Skills England will put in place the framework needed to achieve that goal while reducing our reliance on workers from overseas.”

The organisation will identify the training for which the growth and skills levy will be accessible – a reform, the government said, which will give businesses more flexibility to spend levy funds on training for the skills they need.

Skills England will be established in phases over the next nine to 12 months with this week’s Skills England Bill intended to transfer functions from the Institute for Apprenticeships and Technical Education to the new group.

Starmer’s government has pledged to build 1.5m homes over the next five years.

However, there has been concern in the industry that a lack of skilled labour may hinder the government’s housing and infrastructure goals.

Patricia Moore, managing director at Turner & Townsend, writing for Building today, said: “The biggest risk to the government’s agenda is that construction may lack the necessary capacity.

“What we are seeing as a business is that not only do we need more people in the sector, we need them to have a broader range of skills than ever before.”

Noble Francis, economics director at the Construction Products Association last week said the availability of skilled construction labour, along with production manufacturing capacity, could be a ‘key constraint’ on the government’s ability to hit the homes target.

He said: ”As housebuilding recovers over the next few years, these may emerge as the key constraints given that a significant rise in UK skilled labour and product manufacturing requires upfront investment (time and money) for a long-term return.”

Shazia Ejaz, director of campaigns and research at the The Recruitment and Employment Confederation, said: “By working with the Migration Advisory Committee, Skills England can help reduce reliance on overseas workers.

“But public policy must find a balance between helping domestic talent to shine while accepting that takes time. So along with today’s announcement we want to hear more from the government on how they will create a fair and flexible immigration system to meet the needs of business.”