The Government should expand higher education further to encourage institutions to enter the potentially lucrative workforce development market, a report says this week.

The present aim to get half of 18 to 30-year-olds into higher education should be subsumed into a more ambitious target for the whole of the UK workforce to take courses that could lead to a degree-level qualification, the report from the Council for Industry and Higher Education says.

Setting such a target is one of a range of measures the CIHE says is needed to give universities and colleges an incentive to be more active in workforce development and continuing professional development, which is estimated to be worth about ?4 billion a year.

The report, Workforce Development and Higher Education , says pre-1992 universities, in particular, have made few inroads into this market.

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Neither universities nor the Government can afford for this to continue, it says, as workforce development is key to economic growth and offers institutions a much-needed chance to increase and diversify their income.

"Upgrading the skills of the workforce at higher levels and helping organisations to identify their needs and find appropriate provision is too important and urgent a task to be left to a number of uncoordinated initiatives from a few higher education institutions and further education colleges and programmes," the report says. "The issue should be at the heart of the Government's economic competitiveness strategy."

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The CIHE calls on universities to be more flexible to help employers find suitable courses for employees, for more to be done to explain the business benefits of workforce development and for the introduction of a national credit-based system for courses and their funding.