Universities must do more to attract the 10 million adults in the workforce who could be persuaded to enter higher education, the Government said this week as it unveiled a strategy to boost the nation's higher-level skills.

Expanding the university accreditation of employer training to higher levels, setting targets for more students to take intensive two-year degrees and "empowering" sector skills bodies to increase the number of employer co-funded higher education courses are among the ideas proposed in a consultation document, Higher Education at Work.

The paper says that new measures must be devised to recognise universities that excel at employer engagement and it calls for the development of ways to encourage movement of staff between business and higher education. Universities must also do more to prepare their students for the world of work.

According to the document, research by the Department for Innovation, Universities and Skills suggests that there are four million people with qualifications below Level 4 who are considering, or willing to consider, higher education.

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A further six million could be encouraged to consider it if, for example, it were made easier for them to study from home or at work.

"Higher education providers must become better at attracting those non-traditional students," the paper asserts.

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The document reiterates the Government's plan for universities to work with employers to design new higher education courses for employees and it restates its target of 20,000 new entrants on courses co-funded by employers by 2010-11. It also acknowledges the challenge to universities.

"Setting up a course imposes significant upfront risks and costs on an institution," it says, adding that universities and employers will need to develop "a better, more mature relationship".

According to the paper, the Government expects the market for co-funded places to "grow substantially" after 2011, and promises to test a new "co-purchasing" role for sector skills councils (SSCs) to help achieve this growth.

"Regional consortia of universities and businesses would develop approaches to practice-led teaching and learning with an emphasis on develop[ing] short courses, modular delivery and accreditation of bespoke programmes for employees across sectors. SSCs could then market the courses to their employers," it says.

Another option would be for groups of employers to make a collective contribution towards the costs of the high-level skills training they need.

The Higher Education Funding Council for England will be asked to take account of the SSCs' advice on skills needs in its annual grant letter on university funding.

Other plans include increasing the accreditation of employers' in-house training by higher education institutions.

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The Government will ask Hefce to develop proposals to support the expansion of such training "to higher levels", learning from a scheme run by Foundation Degree Forward that aligns employer training with university standards, allowing employees to gain credits that can contribute to a foundation degree.

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It will also consider setting targets for two-year honours degrees, as pilots have been "encouraging".

There will also be efforts to incentivise demand from academic staff for business secondments, and the policy document says that this is an area where universities might benchmark their performance.

The paper claims that in some sectors there is a mismatch between the needs of business and higher education courses and says that graduate employability needs to improve.

Universities are urged to promote work-experience opportunities for undergraduates, and to help students to find part-time jobs on campus and with local employers.

"We want to see all universities treating student employability as a core part of their mission. So we believe it is reasonable to expect universities to take responsibility for how their students are prepared for the world of work," it says.

According to the paper, some universities fear there is less recognition for excellence in employer engagement than in other areas, and the Government has asked Hefce to examine ways of measuring quality.

University groups responded to the report with caution. The think-tank Million+ warned that complex delivery mechanisms involving bodies such as SSCs were "unlikely to help" universities to work with employers.

The Russell Group said employer satisfaction with its graduates was clear, and added that it was keen to explore the "key issue" around the balance between graduates' essential generic skills and demands for more specific skills which may be less transferable.

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The University and College Union cautioned against business being allowed too great an influence over the content and design of university courses and against target-driven approaches to higher education.

The consultation runs until 7 July.

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