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Training issues facing

Social Economy
Enterprises in
Cambridgeshire

March 2003
CONTENTS

Introduction 3

Methodology 4

Importance of Training 5

Barriers 6

Organisational Capacity to Map Training Needs 7

Organisational Capacity to Deliver/Receive Training 8

Existing County-Wide Provision 9

Paying for Training 10

Accreditation 11

Training Needs 12

Training Materials and Tools 13

Summary and Conclusions 14

Appendices 15

2
INTRODUCTION

In the year 2000, Cambridge CDA (CCDA) undertook a piece of never-before-
done research into the specific training needs of co-operatives and social
firms in Cambridgeshire. Based on its findings, CCDA successfully delivered 2
ESF training projects in 2001 and 2002. More than 11,500 hours of training
and support, including accredited programmes were delivered. Other
outcomes included the development of a dedicated IT training suite.

With the recent level of interest in social enterprises and as part of its ongoing
support to the social economy in Cambridgeshire, Cambridge CDA has been
able to re-visit this earlier research with support from the Learning & Skills
Council’s Local Initiative Fund.

The working definition of ‘Social Enterprise’ currently used by Cambridge CDA
is any enterprise that trades primarily to meet social objectives. This means
that ‘Social Enterprises’ encompass a wide variety of business structures that
includes social firms, co-operatives and community businesses, all of whom
were polled as part of this research.

It is anticipated that this updated research will be used to improve delivery of
training to social enterprises throughout Cambridgeshire.

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METHODOLOGY

As with the initial research conducted by Cambridge CDA in 2000, a
questionnaire was developed. It was circulated to various other relevant
organisations in Cambridgeshire including the Learning and Skills Council,
Business Link and Cambridgeshire Enterprise Services. These organisations
were invited to comment on its design and suggest additional areas of data
capture they required. Appendix A contains the questionnaire and Appendix B
contains the responses from polled social enterprises.

Social enterprises, identified through the Guild’s recent mapping exercise and
Cambridge CDA’s ongoing mapping of the sector, were initially sent the
questionnaire. Individual contact, including visits, from CCDA staff then
followed up specific issues or helped enterprises compile the information
requested.

Desk based research was also undertaken into training issues for mainstream
businesses and voluntary organisations at a national, regional and local level
to enable ‘benchmarking’. This ensured that training issues specific to social
enterprises and those in common with mainstream businesses could be more
clearly identified. A list of all the documents used in this stage of the research
is contained in the bibliography in Appendix C.

Finally, there was also qualitative research undertaken through personal
interviews with training agencies that have some experience of working with
both mainstream businesses and social enterprises. Again, this was to ensure
that training issues specific to this sector could be clearly identified.

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IMPORTANCE OF TRAINING

Training within organisations is a vital regional priority as the East of England
Development Agency (EEDA) and the Learning & Skills Council (LSC) have
determined. This has been further emphasised through the Regional and
Local Development Plans for European Social Fund measures and policies.

Businesses report that as employees participate in training, their productivity
increases. For smaller businesses though, these positive effects are less
evident1.

Productivity issues arise with the existence of skills gaps within any workforce
and many problems encountered by employers are directly caused by gaps in
skills. Particular problems have been found to be poor operating efficiencies,
where management and employment issues are not being addressed, due to
a lack of relevant skills. This is of particular importance to Cambridgeshire
businesses, as 1 in 5 of all adults in this area are recorded as having basic
skills deficiencies2.

Other research into workforce training shows that the better trained someone
is, the more likely they are to be employed. If employed they are more likely to
be offered, and participate in, further training activities3. This does of course
present a paradoxical cycle. If a person is less qualified to begin, they may be
less likely to participate in any training. In turn this reduces their potential for
gaining advancement, re-employment or further qualifications. This should
alert us to a potential downturn in productivity for about 20%4 of the current
workforce unless there are direct strategic interventions to break this cycle.

For social enterprises in particular, training is even more important. This has
been highlighted by the Government through the dti’s report concerning social
enterprises as well as by the fact that they operate in a relatively new ‘sector’
with high growth potential and with specific skills requirements that do not
readily exist in the majority of the workforce.

Interestingly, research at the local level showed that not all social enterprises
in Cambridgeshire judge direct relevance to be the most important criteria
when selecting training. This shows that even if improvements are not
discernable in day-to-day trading or activity, then employees’ training and on-
going personal development is still seen as beneficial to the business in non-
quantifiable ways. Mainstream business has also started to identify this as
good practice.

1
74% of large businesses report an increase in productivity where employees engage in
training, compared to 64% of small to medium businesses. Learning & Training at Work, 2002
2
Adult Basic Skills Survey 2000
3
52% of adults without any NVQ-equivalent qualifications are employed against 87% with
NVQ level 4 or equivalent, with similar ratios reflecting participation in training, Annual Local
Area Labour Force Survey 2001.
4
20% of the workforce in Cambridge has basic skills deficiencies. LSC 2000

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BARRIERS

Nationally, regionally and at local levels mainstream businesses identified the
prime barriers to participating in training as being time and cost. This includes
loss of earnings for the business while an employee is engaged in training
rather than in working. The local voluntary sector identified location as an
additional barrier: would-be participants from the voluntary sector are
generally not able to travel far. A significant proportion of the workforce in this
sector would therefore appear to have transport or mobility problems,
particularly those people with disabilities.

Within social enterprises the barriers to accessing training are also time, cost
and location as shown by a regional study. The study, perhaps crucially,
showed that knowledge was also a barrier. Social enterprises have identified
significant gaps in their knowledge of who can develop and deliver training to
meet their needs. This could, in part, be due to the relative ‘newness’ of the
sector and the training needs being very specific in some cases. Perhaps it is
also a reflection that training packages, tailored to social enterprises, still need
to be further developed and made widely available. In addition these gaps in
knowledge may also be symptomatic of difficulties found by training providers
in informing social enterprises of existing provision.

Social enterprises in Cambridgeshire identified the main barriers to accessing
training as time, cost, location and lack of knowledge of existing provision.
This partly mirrors trends within mainstream businesses as well as trends in
local voluntary organisations.

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ORGANISATIONAL CAPACITY TO MAP TRAINING NEEDS

The ability to identify current training needs and to forecast skills shortages is
crucial for the successful development and growth of any business. Not
knowing what skills will be required in future years means a reduced ability to
manage business growth adequately and to capitalise on market
opportunities.

Having a current training plan does not guarantee that future skills shortages
can be identified. However, it does enable employers to start to see what their
existing skills shortages are and to provide a means to begin addressing
them. Nationally 43% of mainstream businesses with training plans identified
skills shortages. Only 24% could identify specific shortages where there was
no plan. Unfortunately, also at a national level, over ¾ of all businesses have
no training plan of any kind5.

Within Cambridgeshire, 38% of all social enterprises have training plans of
some kind, and 80% of those are able to identify skills shortages. Further,
75% of those without training plans were also able to identify specific skills
gaps. All are currently involved in training activity, even the ones with no
training plans. These figures place local social enterprises well ahead of their
counterparts in mainstream business in mapping skills shortages, although it
may be that this high figure of being able to identify skills gaps may be closely
linked to the ‘newness’ of the sector where there are generic skills gaps
common in any new enterprise – this can only been determined with
continued monitoring into the future.

Although over 77% of all local social enterprises were able to identify some
current skills gaps, they are severely limited in their capacity to deliver the
training that is required. Where resources had been committed to developing
a training plan the actual amount of training a social enterprise was able to
deliver fell by over 25%. Given that large resources are not necessarily
needed to develop training plans, we can see how valuable even a small
quantity of support can be in supporting the development and delivery of
social enterprises’ training.

5
Employers Skills Survey 2001

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ORGANISATIONAL CAPACITY TO DELIVER / RECEIVE TRAINING

Nationally 80% of all businesses deliver some form of training to employees
(although this may not include all the employees of a given business).
However, on the whole, smaller businesses are less likely to train employees
than larger ones6. This is a key factor when considering workforce training for
enterprises in Cambridgeshire as the county is dominated by small and
medium sized businesses7. Most employees of Cambridgeshire businesses
should therefore be less likely to engage in training activities.

This assessment is to some extent vindicated by national figures which show
that 1/3 of all employees have never been offered training by their employer 8.
Research in the voluntary sector at a local level shows a similar percentage of
organisations being unable to meet their staff’s current training needs9.

The training tools and methods used by mainstream business are often used
by social enterprises. At a regional level, social enterprises have been found
to use many systems common in mainstream businesses to deliver training.
These include external courses, appraisals, on-the-job training and induction.
This was also found at local level in Cambridgeshire, by recent research.

At a local level, a greater engagement with training activity was found to
distinguish social enterprises from mainstream businesses. This is highly
significant given that both types of organisation were found to employ an
average of eleven people. Thus making them less prone to engage in training
than larger organisations by national trends. This difference is most likely to
be due to the values and objectives of social enterprises. Their aims are often
more focussed on the welfare of employees than on generating profits or
surpluses. They are more willing to invest resources in the development of
their workforce than mainstream businesses might be.

6
Learning and Training at Work 2002
7
90% of businesses in Cambridgeshire employ less than 20 people. LSC
8
Extent and Nature of Work-Based Learning 2002
9
An Overview of Skills Development…, COVER 2002

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EXISTING COUNTY-WIDE TRAINING PROVISION

Throughout Cambridgeshire there are a wealth of training agencies and
opportunities that social enterprises can benefit from:
Anglia Polytechnic University are delivering a distance learning diploma
specifically on issues in social enterprises;
Social Firms Eastern Region are delivering a distance learning course
specifically on management in social firms;
Cambridge Co-operative Development Agency is constantly developing
and delivering tailored training activities;
Business Links run an ongoing programme of business training courses;
Cambridgeshire Chamber of Commerce has an annual training
programme;
Other programmes are being constantly developed as part of a regional
initiative, SSEER (Supporting the Social Economy in the Eastern Region);
there are also numerous private trainers.

As noted already, a key barrier to social enterprises’ engaging with training,
particularly with external training bodies, is a lack of knowledge of provision
currently available. This highlights the pressing need for trainers and support
agencies to identify and target social enterprises in order to better support
their needs. Social enterprises also need to be encouraged to use training
and development networks to raise their awareness of relevant opportunities
as they arise.

Many local social enterprises already access support from a wide variety of
training agencies to help them receive, access and develop training. This is
despite their self-identified lack of knowledge of provision in the area10. The
regional colleges, Business Links and private training agencies all play their
part as they are all already used to varying degrees by social enterprises in
the area. However, research found that the most frequently used agency by
local social enterprises was CCDA. It was also found that CCDA was their
most preferred agency.

10
38% of social enterprises report that they are unaware of all the current training provision
available to them; in effect, they know what they do not know

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PAYING FOR TRAINING

Nationally payment for staff training comes from a variety of sources: 68%
comes from the businesses itself; employee’s pay for 17% and the remaining
15% is sourced from local grants or the LSC11. Similarly at a local level 86%
of employee’s training costs are met by their employer, 11% pay for
themselves and only 3% are funded from such sources as grants12.

Although over 80% of all business nationally have no formal training budget,
those that do spend an average of £19,000 per year. This equates to an
average of 2% of each business’ turnover13.

Regionally, social enterprises have been found more active at setting training
budgets than mainstream businesses. Over half of the social enterprises in
the region have a formal training budget14 compared with only 2/5 of
mainstream business15.

At local level a similar proportion of social enterprises have a formal budget
for training. Their training budgets, where they exist, are also 2% of turnover,
on average, per organisation - identical to that of mainstream business. Given
that social enterprises’ aims are not primarily concerned with the pursuit of
financial profits, the costs of their training budget will therefore be more keenly
felt throughout the organisation. This fact shows the importance that social
enterprises place on training. Although they will not generate profits in the
same way or to the same extent as mainstream businesses, they are just as
committed, if not more so, to delivering workforce training.

11
Extent and Nature of Work Based Learning 2002
12
Cambridgeshire Learning Partnership 2000
13
Employer Skills Survey 2001
14
Making @ Living, The Guild 2002
15
Learning & Training at Work 2002

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ACCREDITATION

Nationally 1/3 of all mainstream businesses offer accredited training courses,
with similar figures representing businesses within the eastern region16.

However, research undertaken by the Cambridgeshire Learning Partnership
found that only 8% of all training activity within the local workforce is
accredited. Given that Cambridgeshire has higher than average adult
qualifications compared with both national and regional figures17, employees
are therefore more highly qualified before they begin work. The paradoxical
cycle referred to in the earlier section on the importance of training (the more
qualified a person is, the more likely they are to be employed), therefore starts
at an earlier stage. Further, as most workforce training is not accredited then
those made redundant will be at a disadvantage in the labour market unless
they had much higher levels of qualifications before they started work than is
currently average for the area.

The low figure for accredited training also means that much training activity is
not likely to be ‘captured’. Many employers do not believe training has taken
place unless it is externally accredited: workplace training such as induction,
supervision or introduction of new working practices is unlikely to be reported.
The Annual Local Labour Force Survey in 2001 states that:
“Administrative sources on education grossly underestimate the amount of
learning taking place because a great deal of useful learning goes on
outside the formal education system.”.
Training providers in the area validate these assertions from their experience
of working with social enterprises and mainstream businesses. Interviews with
training providers show that, as they understand it, employees of social
enterprises are more concerned with gaining vocational skills than gaining
accreditation. Being able to do the job seems to be more important than
having a certificate to show that training has been done. This contrasted with
their experience of mainstream businesses. The trainers interviewed reported
that in mainstream business people are much more keen for training activity
to be accredited.

Research of the voluntary sector locally has found that the majority of training
undertaken is not accredited which further backs this assertion. However, the
recent research into local social enterprises found that 1/3 of all of them offer
accredited training programmes, placing them much more in line with the
norms for national mainstream businesses. This is most likely due to the
values of these enterprises already referred to on page 6.

16
Learning & Training at Work 2002
17
English Local Labour Force Survey 2001

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TRAINING NEEDS

At national level, the main training needs of businesses primarily relate to IT.
This is mirrored in local mainstream businesses with additional needs being
identified such as management and marketing.

However, research into the local voluntary sector shows that IT skills are not
such a high priority. Training that has been identified as being of high priority
includes much more ‘basic’ operational issues such as: first aid, fundraising,
health & safety, accounts, management, marketing, personnel18.

For social enterprises in the region the 2 main training needs identified were
understanding the culture of social enterprises and business management 19.
Locally, the priorities for social enterprises are more in-line with those of
mainstream business: business finances, business management and health &
safety issues. This difference in priorities between regional and local levels in
the importance of understanding the culture of social enterprise may have
much to do with the existence of Cambridge CDA. Research has found that
wherever Co-operative Support Organisations (CSOs) exist, clusters of co-
operatives, social firms and social enterprises will develop around them and
begin networking20 to share experience and culture. The culture of social
enterprises are often best leant through social enterprises sharing
experiences with others like themselves, ideally through being in close regular
contact and proximity with each other, and often facilitated through
participation in joint activities organised by a CSO.

18
An Overview of Skills Development…,COVER 2002
19
Making @ Living, The Guild 2002
20
East of England Mutual & Co-operative Council 10 year strategy

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TRAINING MATERIALS AND TOOLS

In mainstream business tutor support is the preferred training method. Books
and ICT methods (Information Communication Technologies: the internet and
CD-ROMs)21 follow.

Locally, research shows a similar pattern with employees of social
enterprises. However, the preference for tutor support is even more
pronounced and there is less enthusiasm for ICT materials. This may again
be due in part to the relative ‘newness’ of the sector and so people working
within it are seeking to engage not only directly in the training activity but also
to have an opportunity to network with people from other social enterprises in
order to share examples of best practice. This is a theme Cambridge CDA
noted often in the delivery of its ESF funded training programmes that
targeted social enterprises in Cambridgeshire.

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Cambridgeshire Learning Partnership

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SUMMARY AND CONCLUSIONS

Local social enterprises are very similar to mainstream businesses:
they need to be financially viable and employ skilled staff. Further, both
groups identify similar training needs and similar barriers to accessing
training.

Social enterprises’ primary aims are about the needs and well being of
employees and their communities. This leads to their being more active
in wanting to deliver workforce training. This distinguishes them from
mainstream businesses where primary aims will include the generation
of financial profits, and a tendency to have a lower engagement with
training.

Although social enterprises are often grouped with the voluntary sector,
in many respects their training needs differ significantly.

Training and support agencies need to continue to develop their ability
to better inform social enterprises about existing training provisions and
to work to help remove other identified barriers to that training namely
time, cost and location. There is a need to offer social enterprises
opportunities to meet each other to share their experiences and to help
build a more sustainable self-supporting sector.

The largest obstacle in conducting this research has been the lack of
appropriate benchmarking. The only specific research done locally into the
needs of social enterprises was part of an initial mapping project in 2000. It
has not been possible to locate any similar research projects from other parts
of the country focusing exclusively on this sector at a county-wide level only.
Mainstream businesses have therefore been used as the benchmark, to give
a context to the findings. The voluntary sector has also been used as a
benchmark, given that social enterprises are often grouped together with
them. Hopefully this research will be revisited on a regular basis to map the
developing training issues within this part of the local social economy sector.

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APPENDIX A

QUESTIONNAIRE

Cambridge CDA research into training issues facing social
enterprises
Please fill in your responses as completely as possible and return
in the pre-paid envelope to Cambridge CDA, Alex Wood Hall,
Norfolk Street, Cambridge CB1 2LD by January 17th 2003

1. Contact details
1.1 Name of enterprise

1.2 Address

1.3 Tel:
1.4 Fax:
1.5 Email:
1.6 Web:
1.7 Contact person re: training

2. About the organisation
2.1 Type of business:
(please tick all that apply)
worker co-op
housing co-op
employee owned business
company limited by guarantee
partnership
Industrial & Provident Society
Unincorporated
Other
Charity

2.2 General details
Year established
Annual turnover (and how much sales, grants, donations?)

Business or other activity undertaken:

2.3 Do you undertake work:
Locally
Regionally
Nationally
Internationally
2.4 Staffing details
How many f/t staff (with/without support needs)

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How many p/t staff (with/without support needs)
How many volunteers
How many people on training placements
If a co-op, how many members

3. Training
3.1 Are you able to identify your current and future training needs?

If so, what process do you use?

If not, what support would you need to be able to do so?

3.2 If you are able to identify them, what are your current training needs?
(please tick all that apply)
Management accounts / book-keeping
Marketing
Business planning
Business management
Personnel
Health & Safety
Food Hygiene
Understanding social economy / co-ops
IT
Financing (applying for loans or grants)
Other:

Of those chosen, which are the 4 most urgent?

3.3 Does anyone currently receive training?

3.4 If so, is it:
In-house
External
By other staff of the organisation
Accredited
Part of an on-going training plan
Other

3.5 What type of training is preferred by your organisation:
In-house
External
By other staff of the organisation
Specific, one-off activities
Other
Computer-based (e.g. CD-ROM, Internet)

And what sorts of materials are preferred in receiving training?
(i.e. presentations/books/CD-ROM?)

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And why are these types preferred?
Cost
Time
Availability (or lack of) relevant trainers
Other:

3.6 Do you have a formal training budget? If so, how much is it? (Who pays for the
training?: Company/Individual/External funder)

3.7 Do you have a formal training plan for your organisation or employees? If so, please
give details

3.8 Please list training activity undertaken within the last 12 months by people within your
organisation
Training In-house External By staff Other Training
activity provider
e.g. book- X Enterprise
keeping Services

3.9 Which training agencies do you rank most highly? (please list in order of preference:
1 = excellent, 5 = would never use; for example Business Link, CDA, Anglia
University)
Training Agency Last used Not used Reason for
preference
1
2
3

3.10 What criteria do you use when selecting training? (please rank in order of importance,
1 = highest priority)
Price
Relevance
Location
Trainer
Timing (when training is available compared with the needs of the business)

3.11 What barriers do you encounter when developing or engaging with training?

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Knowledge of trainers and training courses
Lack of available finance to pay for the training
Lack of staff time to engage with training
Other:

3.12 Do you have any other experiences of training that you have not been able to
record in answering the previous questions?

If there are any questions which you do not feel able to answer, or do not
feel able to answer in the way the form is set out, please feel free to contact
Cambridge CDA directly.

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APPENDIX B

FULL ANALYSIS OF RETURNS
Total number of questionnaires returned: 13 (35%)

Average number of employees per enterprise: 11
Average number of trainees per enterprise: 15

Number of enterprises identifying current training needs: Yes 77%
No 23%

Methods used to determine training needs: appraisal 90%
other 10%

Most urgent training need: accounts, financing, health & safety, business
management

All training needs (in order of demand) –
Business planning/marketing 19%
Health & safety 17%
IT 15%
Business management 13%
Understanding the social economy/accounts 9%
Financing/personnel 6%
Food hygiene 4%

Enterprises currently training = 100%
In-house = 54%
External = 85%
Accredited = 38%
As part of an on-going training plan = 38%

Enterprises’ training preferences:
In-house = 38%
External = 62%
IT-based = 23%

Enterprises’ preferences for type of training materials
Workshops/seminars = 46%
CD-ROM = 8%
Books= 23%
No preference = 21%

Reasons for preference of materials:
Time = 54%
Cost = 38%
Trainer = 38%

Enterprises with a training budget: Yes 54%
No 46%
Training budget supplied by: company 63%
other sources 37%
Average training budget per enterprise that has one: £9,286

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Enterprises with training plans: Yes 15%
No 85%

Recent training activities, in order of incidence:
IT 24%
First-aid 16%
Nvq-related training trainers 10%
Accounts/health & safety/management 8%
Financing/food hygiene/mediation/marketing 5%
Personnel 3%

Recent training activities undertaken: in-house 14%
externally 86%

Current or recent training providers used, in order of incidence:
CCDA 24%
Huntingdon regional College 20%
NHS/social services 15%
Cambridge Regional College 12%
Private training agencies 3.3% each
Learndirect/county council/business link 3% each

Preferred training agencies, in order of preference:
CCDA 38%
Cambridge Regional College 15%
Anglia Polytechnic University 8%
Business Link 8%
Cambridgeshire Chamber of Commerce 8%
Huntingdon Regional College 8%
Learndirect 8%
Social Services 8%

Reasons for preference of training agency:
Cost 45%
Locality 45%
Ongoing partnership 10%

Criteria for selecting training, in order with 1 being the best
Relevance 1.2
Price 2.8
Location 2.9
Timing 3.3
Trainer 3.7

Barriers to accessing training:
Knowledge 38%
Funding 62%
Time 54%

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APPENDIX C

BIBLIOGRAPHY

Adult Basic Skills Survey 2000

An Overview of Skills Development Opportunities & Training needs within the
Community and Voluntary Sector in the East of England,
COVER, 2002

Annual Local Area Labour Force Survey 2001

Cambridgeshire & Peterborough Learners Survey 2000,
Cambridgeshire Learning Partnership

Co-operatives Research Project,
Cambridge CDA 2000

East of England Mutual & Co-operative Council 10 year strategy, 2002

Eastern Region Regional Development Plan

EEDA Regional economic Strategy

Emerging Social Firms Research Project,
Cambridge CDA 2000

Employer Skills Survey 2001,
Dept for Education & Skills

English local labour force survey mar 00 – feb 01

Extent, Causes, and Implications of Skills Deficiencies,
Dept for Education & Skills 1999

Extent and Nature of Work Based Learning,
Dept for Education & Skills 2002

Greater Cambridgeshire Partnership Annual Conference Report 2002

Learning and Training at Work 2002,
Dept for Education & Skills 2002

Making @ Living: For the Community,
The Guild 2002

Social Enterprise: A Strategy for Success,
dti 2002

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APPENDIX D

TRAINERS CONTACTED AND INTERVIEWED

Mark Granger, Mark Granger Training – January 2002

Clare Benton, CB Horizons – January 2002

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Alex Wood Hall, Norfolk Street, Cambridge, CB1 2LD
T: 01223 360977 F: 01223 509040

E: Cambridgecda@connectfree.co.uk
W :www.colc.co.uk/cambridge/ccda
Cambridge Co-operative Development Agency Ltd. Registered in England No. 1853517

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