English workforce failings could sink post-Brexit economy, study warns





Press release

Embargo date: from 05.00 a.m. Monday 6 November 2017

English workforce failings could sink post-Brexit economy, study warns

The country’s future national prosperity is imperilled because a toxic cocktail of threats - including Brexit, automation and a shrinking skills base - risks squeezing the supply of native workers trained to do tomorrow’s jobs – a report from Localis has today warned.

In a paper published today entitled 'In place of work – influencing local labour markets’ the study authors estimated that just under half of England’s local labour markets have an above-average level of jobs risk due to a post-Brexit migration squeeze; around half have an above average risk to the increased automation of jobs; and just more than half have an above-average risk arising from a low skills base.

Research undertaken by Localis indicated a staggering gulf in the strength of England’s local labour markets, with the bulk of investment – both public and private, infrastructure, research and development and foreign investment – being channelled into London and the space which occupies the golden triangle between it, Oxford and Cambridge.

The analysis also revealed that rural county areas account for nine-out-of-10 locations most at risk from the toxic cocktail of future threats to local labour markets. Report sponsors the County Councils Network (CCN), which represents 37 county councils in England, argued the report makes a clear case for devolving powers to its members so they can devise local labour strategies.

However, the findings do not support the traditional view of ‘north-south’ divide in wealth and economic outcomes, but instead outlined there are greater differences within regions, with labour markets of the South East, in places like Kent and Essex, needing support just as much as certain parts of the North East.

Co-author of the report and chief executive of Localis, Liam Booth-Smith, said: “As the country slowly gets to grips with the broader implications, both positive and negative, of Brexit, it strikes us that the biggest threat to our future prosperity won’t come from Brussels, but from our own people.

“Simply put, our population is too low-skilled for the high-paying industries we are developing.”

Co-author, Localis researcher Joe Fyans, said: “While national government can and should set the policy framework for reshaping the country's labour market to meet future economic needs, local areas must be empowered to respond to their different circumstances. Government must empower England's strategic authorities to positively influence their local labour markets.

“We would like to see devolved powers in apprenticeships and further education, to coordinate the needs of local enterprise and the local population. We place a particular emphasis on the beneficial role this could play in helping disabled people achieve sustained employment and in preventing the premature exit from the jobs market of people aged over 50.”

Chairman of the County Councils Network (CCN), Cllr Paul Carter, said: “Counties have intimate knowledge of their local economies, both public and private sectors, but have been hamstrung by a ‘one size fits’ all skills agenda. Government must hone and unleash this potential in rural areas by creating strategic authorities, led by the county authority.

“County authorities have the ambition, size, and expertise to engineer real change in their local skills market, but are shackled by a lack of powers. Let’s embrace the art of the possible – this new approach would be good for business and good for residents.

“This report by Localis sets out a deliverable framework to develop local labour market strategies. By devolving significant skills budgets and adult education powers, we can begin to create make a difference locally and a more prosperous country nationally.”

ENDS


Press enquiries:

Jonathan Werran, Head of News and Events, Localis
0870 448 1530 / 07967 100328 / [email protected]

Notes to Editors:

1. The report is being launched at the County All Party Parliamentary Group (APPG) Autumn Reception on Monday 6 November from 4.00 p.m. to 6.00 p.m. – limited press places are available upon request.

2. A full copy of the report can be downloaded here: ‘In Place Of Work – influencing local labour markets’


3. The 10 main report recommendations are as follows:

Recommendations

  1. Government should formally recognise the status of England’s remaining strategic authorities without a devolution deal by instituting an Industrial Compact, as recommended in the previous Localis report The Making of an Industrial Strategy, thus creating the devolved bases upon which new local labour market strategies and powers can be developed and utilised.
  2. As part of every new local industrial strategy, every local area should develop a local labour market influencing strategy which highlights at risk industries and businesses.
  3. Government should devolve control of the Adult Education Budget to all strategic authorities in England and empower them to convene local colleges, training providers and businesses in order to set the priorities for their local labour market strategies.
  4. Local public sector organisations, most pressingly it would be sensible for the NHS and local government to collaborate, should explore what options are available to pool their apprenticeship levy within a strategic authority area. In particular this should be seen as a priority in areas where the health and social care workforce is dependent on a significant amount of migrant labour.
  5. Government should accelerate the current 18-month time limit for moving funds held in an apprenticeship levy account down an organisation’s supply chain.
  6. Government should create the option to allow employers to passport their apprenticeship levy funds to a strategic authority for local skills development activity. This would need to be ring fenced and the priorities for development established before a strategic authority could accept the funds.
  7. Government should empower and fund strategic authorities to raise the profile of apprenticeships and the wider state support offered for in work training. The most successful and advanced strategic authorities should be legally allowed to set ‘start quotas’ for apprenticeships in their areas.
  8. In local areas where industry collaboration is weak and relationships with the strategic authority need formalising, strategic authorities should establish employer guilds. These guilds would work with the strategic authority to help shape labour market policy, thus ensuring a steady supply of qualified labour for their future business requirements.
  9. As in the previous Localis report A Sector Deal for Disability we reiterate the recommendation for the Department for Work and Pensions to establish and chair a new working group on skills, access and employability for people with disabilities to support the sharing of best practice amongst councils, CCGs, schools and colleges locally. Preferably this should utilise existing professional networks.
  10. Government should take a top slice of 5% from apprenticeship levy accounts nationally in order to create a Local Skills Development Fund which can be devolved and focused on supporting strategic authorities’ efforts to raise the employment level of key low activity groups, in particular disabled people and the over 50’s.

4.National Scorecard of Labour Market Risk

Localis has produced a scorecard ranking 47 Strategic Authority areas of the country most at risk from the automation of jobs (see below for definition).

What is a Strategic Authority?

A Strategic Authority is the recognised body which leads the industrial strategy in a local area. It would most commonly be a formal collaboration of local authorities across a geographic area. This would be different to a (non-mayoral) combined authority because of a) the requirement for an additional level of democratic mandate and b) the new suite of powers it would wield.

To become a strategic authority an area must first have in place;

  • A formal collaborative arrangement of local councils across a geography. (Our previous report, The Making of an Industrial Strategy, introduced the concept and this report includes a map indicating the breakdown of strategic authorities in England[1].)
  • Democratic legitimacy in the form of either a) a directly elected mayor, b) a strategic authority wide elected assembly led by a chair voted for by the assembly or c) in areas where the formal collaborative agreement consists of a county and its districts or a sole unitary county, the county could become the strategic authority (with agreement from partner councils where appropriate).

The rankings indicate Berkshire and Brighton and Hove are joint best-placed to cope with labour market change, and Lincolnshire is the Strategic Authority most at risk from the combined threats of: -

  • i)restricted post-Brexit migration;
  • ii)increased automation of jobs;
  • iii)low skills bases;
  • iv)demographics.

Strategic Authority

Av. Rank

Automation

Score

Rank

Migration Score

Rank

Skills Score

Rank

Demographics

Score

Rank

Total

1

Berkshire

2.333

134

4

138

1

225

2

104

13

497

1

Brighton and Hove

2.333

157

1

131

5

254

1

122

1

542

3

Surrey

3.667

136

3

136

2

185

6

101

20

457

4

West of England

5.333

126

7

132

4

189

5

111

3

447

5

Oxfordshire

5.667

131

6

126

8

210

3

106

6

467

6

London

6.667

151

2

120

14

201

4

116

2

472

7

Gloucestershire

12.333

110

15

125

11

127

11

100

24

362

8

Hampshire & Isle of Wight

13

107

17

121

13

135

9

97

31

363

9

Dorset

14

124

8

112

20

124

14

84

47

360

10

Cambridgeshire & Peterborough

15

102

21

133

3

100

21

105

8

335

10

Hertfordshire

15

97

27

130

6

126

12

104

13

353

12

Devon

16.667

116

9

98

27

124

14

93

43

338

12

Swindon and Wiltshire

16.667

100

22

113

18

134

10

100

24

347

14

Buckinghamshire & Milton Keynes

17

95

30

120

14

153

7

102

16

368

15

East Sussex

17.333

133

5

122

12

67

35

90

46

322

16

Tees Valley

18.667

114

12

126

8

63

36

102

16

303

17

Tyne and Wear

20.333

111

14

119

16

71

31

108

4

301

18

Essex

22.333

105

19

113

18

72

30

99

29

290

19

Sheffield City Region

23

99

25

128

7

59

37

106

6

286

20

Greater Manchester

24

100

22

99

26

81

24

107

5

280

21

Cheshire & Warrington

24.667

100

22

91

32

102

20

100

24

293

22

Kent

25.333

95

30

108

23

82

23

99

29

285

23

Shropshire

26

108

16

86

35

75

27

96

33

269

24

Bedfordshire

26.25

72

41

109

22

68

34

105

8

249

25

Cornwall

26.667

116

9

42

47

81

24

93

43

239

25

Lancashire

26.667

98

26

98

27

75

27

100

24

271

25

Liverpool City Region

26.667

112

13

101

25

45

42

105

8

258

28

North Yorkshire

27

106

18

49

45

110

18

94

39

265

28

Somerset

27

94

32

77

37

126

12

92

45

297

30

Northumberland

27.333

115

11

92

31

50

40

96

33

257

31

Leeds City Region

28.333

97

27

112

20

57

38

105

8

266

31

West Sussex

28.333

82

36

91

32

115

17

94

39

288

33

County Durham

29

97

27

116

17

42

43

104

13

255

33

Norfolk

29

103

20

105

24

42

43

94

39

250

35

West Midlands

29.333

90

33

126

8

-6

47

105

8

210

36

Leicestershire

29.667

66

45

81

36

152

8

102

16

299

37

Warwickshire

30.667

68

43

95

30

105

19

100

24

268

37

Worcestershire

30.667

70

42

88

34

120

16

97

31

278

39

Nottinghamshire

31.667

86

34

97

29

70

32

101

20

253

40

Derbyshire

34.333

73

40

70

41

89

22

101

20

232

41

Cumbria

34.667

86

34

48

46

81

24

96

33

215

42

Staffordshire

37

67

44

74

38

74

29

101

20

215

43

Herefordshire, County of

38.333

82

36

71

40

53

39

95

38

206

44

Hull City Region

40.333

54

46

62

42

69

33

96

33

185

45

Northamptonshire

42

49

47

72

39

50

40

102

16

171

45

Suffolk

42

80

38

60

43

37

45

94

39

177

47

Lincolnshire

43

77

39

51

44

27

46

96

33

155

Press release distributed by Pressat on behalf of Localis, on Monday 6 November, 2017. For more information subscribe and follow http://www.pressat.co.uk/


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