LEEDS CITY REGION LABOUR MARKET ANALYSIS 2018: OVERVIEW OF KEY MESSAGES

Transcription

1 LEEDS CITY REGION LABOUR MARKET ANALYSIS 2018: OVERVIEW OF KEY MESSAGES

2 Pipeline of Talent How we re closing the skills gap WORKFORCE DEVELOPMENT: West Yorkshire Consortium of Colleges Skills Service supports SMEs to upskill staff. APPRENTICESHIPS: work with FE and HE to increase higher and degree apprenticeships; support businesses post reforms; and provide Apprenticeship Grants for Employers who employ their first apprentice. ATTRACTING TALENT: Discover Digital campaign which promotes digital careers in the Leeds City Region. LABOUR MARKET INFORMATION: Share LMI with training providers, FE, HE to direct provision and support curriculum development. ENTERPRISE IN EDUCATION: support strategic links between employers and secondary schools to increase employer engagement and raise aspirations of future workplace opportunities. IN-WORK PROGRESSION: Career Learning Pilot and ESIF funded provision to support and address low pay and in-work progression. CAREER CHANGES: [re]boot initiative to support people to retrain and access careers in key sectors including digital. DELIVERY AGREEMENTS: Unique partnership with West Yorkshire colleges to realign 56m pa of Adult Education Budget spend with economic priorities. CAREERS CAMPAIGNS: #futuregoals campaign to raise awareness of careers within key sectors, inspiring careers choices and school resources.

3 Outline of the presentation Background to the labour market analysis Context: why skills are important Selected key messages around: Demand for skills Supply of skills Mismatches Conclusions

4 Why do we analyse the labour market? Support strategy and policy development, address market failure; measure progress against our priorities Demonstrate to sponsors the evidence base for our interventions Influence local learning provision in line with labour market demand Inform careers choice by providing information on labour market opportunities Inform action by local employers to address the skill needs of business.

5 CONTEXT: WHY SKILLS ARE IMPORTANT TO THE LOCAL ECONOMY

6 The City Region has seen a widening productivity gap with the UK average Figure: Nominal output (GVA) per hour worked ( ) Productivity in the City Region is only 86% of UK average, as compared with 91% a decade previously UNITED KINGDOM less Extra Regio Leeds City Region Source: ONS, Sub regional Productivity

7 There is a strong correlation between skills and productivity performance at LEP level Figure: High level qualifications and productivity by LEP area % of working age population qualified level 4+ 60% 50% 40% 30% 20% Leeds City Region West of England Buckinghamshire Thames Valley Cheshire and Warrington London Thames Valley Berkshire Greater Manchester Greater Birmingham and Solihull Sheffield City Region Liverpool City Region Tees Valley Black Country 10% 0% GVA per hour worked ( ) Source: Annual Population Survey; ONS LEP level estimates of productivity

8 Lower proportions of workers in high skilled occupations in important sectors helps to explain low levels of productivity in City Region Figure: Proportion of the sectoral workforce in higher skilled occupations 70% 60% 50% 40% 30% 20% 10% 0% Leeds City Region England Source: Annual Population Survey, workplace analysis, Jan Dec 2017 Note: Higher skilled occupations are SOC major groups 1 3; managers, professionals and associates professional / technical

9 23 per cent of jobs pay below the LWF Living Wage across the City Region Figure: % of employee jobs paying below the living wage (as defined by the LWF), 2017 Kirklees 31% Craven 28% Barnsley 26% Selby 26% Bradford Wakefield 25% 24% 2017 LWF Living Wage rate: 8.45 York 22% Calderdale 21% Harrogate 20% Leeds 19% Leeds City Region 23% Source: Annual Survey of Hours and Earnings 2017 Note: Workplace based

10 Skills deprivation is most prevalent in Barnsley, Bradford and Wakefield Figure: Proportion of neighbourhoods in 10% most deprived nationally by domain of deprivation 35% 30% 25% 20% Leeds City Region is ranked fifth out of 39 LEP areas in terms of % of neighbourhoods that fall among most deprived nationally on education training and skills 15% 10% 5% 0% Overall deprivation Employment deprivation Income deprivation Education, training and skills deprivation Source: Department of Communities and Local Government, Index of Multiple Deprivation Note: The Education, Skills and Training Domain measures the lack of attainment and skills in the local population.

11 Neighbourhoods with the worst overall deprivation tend to also face skills deprivation Neighbourhoods falling into 10% most deprived nationally in City Region Overall deprivation Source: Department of Communities and Local Government, Index of Multiple Deprivation Education, skills and training

12 WHAT SKILLS ARE NEEDED, NOW AND IN THE FUTURE?

13 Overall demand for labour continues to strengthen Figure: Trend in employment level and rate (% of working age population) Leeds City Region 1,450,000 75% 74% 1,400,000 1,350,000 1,300,000 1,250,000 73% 72% 71% 70% 69% 68% 67% 66% 65% 1,200,000 64% Level (LH axis) Rate (RH axis) Source: Annual Population Survey

14 Main sources of demand are higher skilled occupations and lower skilled caring occupations Figure: Trends in occupational employment, Leeds City Region 25 Corporate managers 20 Teaching, educational prof.s Science, research, eng., technol. profs Business, media, public service prof.s Gross median pay, full time jobs Secretarial Science, eng., technol. assoc. profs Process, plant, machine operatives Protective service Skilled agricultural trades Customer service Sales Other managers, proprietors Elementary administration and service 5 Skilled metal, electrical, electronic trades Skilled construction, building trades Transport, mobile machine drivers, operatives Administrative Elementary trades Health professionals Business and public service assoc. profs Textiles, printing, other skilled trades Leisure, travel, related personal service Health, social care assoc. profs Culture, media and sports Caring personal service 0 4% 3% 2% 1% 0% 1% 2% 3% 4% 5% Average employment growth rate (%), Source: Annual Population Survey and Annual Survey Hours and Earnings, 2017 Note: Pay data is for Yorkshire and the Humber; bubble size reflects employment level in each occupation

15 Variety of occupational areas represented among jobs with greatest recruitment need Figure: Top occupations in greatest demand overall, Leeds City Region, August 2017 to July 2018 Software Developer / Engineer Registered General Nurse (RGN) Project Manager Lawyer Sales Manager Web Developer Computer Support Specialist Accountant Data / Data Mining Analyst Primary School Teacher 2,000 4,000 6,000 8,000 10,000 12,000 14,000 16, / /17 Source: Labour Insight Note: Analysis limited to management, professional and associate professional occupations

16 Communication is the most widespread baseline skill requirement Figure: Top baseline skill types in greatest demand in three priority areas, Leeds City Region, August 2017 to July 2018 Source: Labour Insight Note: Analysis limited to management, professional and associate professional occupations

17 Online job postings suggest that demand is greatest for digital workers Figure: Top occupations in greatest demand in three priority skill areas, Leeds City Region, August 2017 to July 2018 Engineering Manager Engineering & manufacturing Construction Chartered architectural technologists and town planning Construction Manager Quantity surveyors Civil Engineer Validation Engineer Electrical Engineer Production Worker Maintenance Technician Mechanical Engineer Software QA Engineer / Tester Systems Analyst Digital Computer Support Specialist Web Developer Software Developer / Engineer Source: Labour Insight Note: Analysis limited to management, professional and associate professional occupations 2,000 4,000 6,000 8,000 10,000 12,000 14,000

18 Skills like project management and teamwork / collaboration feature alongside core technical skills as the most in-demand Figure: Top specialised skill types in greatest demand in three priority areas, Leeds City Region, August 2017 to July 2018 Revit Engineering & manufacturing Construction Project Management Budgeting Civil Engineering AutoCAD Project Management Quality Management Mechanical Engineering Teamwork / Collaboration Quality Assurance and Control.NET Software Development Digital Microsoft C# JavaScript SQL 0 1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000 9,000 Source: Labour Insight Note: Analysis limited to management, professional and associate professional occupations

19 Priority skill areas have differing exposure to automation % of employment at high risk of automation by priority skill area, Leeds City Region 120% Estimates based on Frey and Osborne analysis, 34 per cent of jobs in City Region are at high risk over next 20 years, similar to national average equates to 430,000 jobs 100% 80% 60% 40% High Medium Low 20% 0% All jobs in LCR Construction occupations in LCR Digital occupations in LCR Source: LEP estimates based on Frey and Osborne (2013) and EMSI Engineering and manufacturing occupations in LCR

20 Routine and lower-skilled occupations are at greatest risk of automation in City Region % of employment at high risk of automation by occupational category, Leeds City Region 250, , , ,000 50,000 Low Medium High Source: LEP estimates based on Frey and Osborne (2013) and EMSI

21 Across wider economy agriculture, hospitality, distribution and manufacturing at greatest risk % of employment at high risk of automation by industry sector, Leeds City Region 80% 70% 60% 50% 40% 30% 20% 10% 0% 250, , , ,000 50,000 % of employment at high risk of automation (LH axis) Employment in sector (RH axis) Source: LEP estimates based on Frey and Osborne (2013) and EMSI

22 WHAT SKILLS ARE AVAILABLE AND WHAT IS BEING PROVIDED THROUGH THE LOCAL LEARNING SYSTEM?

23 2017 saw an improvement in % qualified at level 4 and above Profile of highest qualification held by working age (16-64) population by district, Leeds City Region residents 40% 35% 30% 25% 20% 15% 10% 5% 0% Level 4+ Level 3 Level 2 Level 1 No qualifications Source: Annual Population Survey, Jan Dec 2017

24 Qualification profile is highly variable at district level Profile of highest qualification held by working age (16-64) population by district, Leeds City Region residents 49% 42% 26% 31% 28% 28% 28% 32% 25% 33% 29% 34% 24% 36% 25% 38% 22% 19% 19% 14% Bradford Selby Wakefield Barnsley Kirklees Calderdale Leeds England Harrogate York Level 4+ Below level 2 Source: Annual Population Survey, Jan Dec 2017

25 Participation in FE and Skills programmes continues to fall Participation on FE and Skills programmes, Leeds City Region 250, , , ,000 50, / / / / / /17 Participation Achievements Source: Department for Education

26 Apprenticeship starts declined by 4 per cent in 2016/17 following two years of growth Figure: Trend in apprenticeship starts, Leeds City Region 35,000 30,000 25,000 20,000 15,000 10,000 5, / / / / / /17 Intermediate Advanced Higher Source: Education and Skills Funding Agency

27 Intermediate and young (<25 years) apprenticeship starts fell Figure: change in apprenticeship starts between 2015/16 and 2016/17 by type, Leeds City Region 1, ,000 1,500 2,000 2,500 Intermediate Advanced Higher Under Level Age Source: Education and Skills Funding Agency

28 Engineer and construction starts fell but ICT remained steady Figure: Trend in apprenticeship starts, Leeds City Region Business, Administration and Law Health, Public Services and Care Engineering and Manufacturing Technologies Retail and Commercial Enterprise Construction, Planning and the Built Environment Leisure, Travel and Tourism Information and Communication Technology Education and Training Agriculture, Horticulture and Animal Care Arts, Media and Publishing Science and Mathematics / / /17 Source: Education and Skills Funding Agency

29 Apprenticeship achievement rates remain similar to national average but with variations between apprenticeship types Figure: Overall achievement rates by apprenticeship type, 2016/17 80% 70% 60% 50% 72% 68% 68% 69% 70% 70% 66% 67% 65% 67% 71% 69% 63% 62% 72% 69% 50% 75% 71% 68% 69% 66% 40% 30% 20% 10% 0% Overall Intermediate Advanced Higher General FE Other Public Funded Private Sector Public Funded Specialist college Age Level Type of provider Leeds City Region 2016/17 England Source: Education and Skills Funding Agency

30 Disadvantaged pupils are less likely to participate in apprenticeships Figure: % of pupils entering apprenticeships following completion of key stage 4 16% 14% 14% 12% 11% 11% 10% 9% 9% 8% 7% 8% 8% 7% 7% 8% 8% 7% 7% 6% 6% 5% 5% 5% 5% 4% 4% 4% 2% 0% 0% Barnsley Bradford Calderdale Craven Kirklees Leeds North Yorkshire FSM pupils All other pupils Selby Wakefield York England Source: Department for Education. 2015/16 destinations for the 2014/15 cohort (state funded mainstream schools)

31 There has been a reduction in HE qualifiers in priority subjects Figure: Number of qualifiers by subject area from Leeds City Region HEIs Medicine and dentistry Subjects allied to medicine Biological sciences Agriculture & related subjects Physical sciences Mathematical sciences Computer science Engineering and technology Architecture, building and planning Social studies Law Business and administrative studies Mass communications and documentation Languages Historical and philosophical studies Creative arts and design Education Engineering and technology saw growth in qualifiers but computer science and built environment subjects both declined Source: Source: Higher Education Statistics Agency Note: UK domiciled students only 1,000 2,000 3,000 4,000 5,000 6, / / /17

32 Disadvantaged pupils less likely to participate in higher education Figure: % of pupils entering higher education by free school meal status 50% 45% 40% 40% 42% 41% 39% 39% 44% 41% 45% 42% 47% 44% 41% 38% 35% 30% 25% 30% 26% 32% 30% 35% 29% 27% 27% 24% 20% 15% 14% 16% 17% 16% 10% 9% 5% 0% Barnsley Wakefield Leeds Bradford York Kirklees North Yorkshire Calderdale England FSM Non FSM All Source: Department for Education

33 Many employers would like to invest more in skills Figure: Training equilibrium summary, Leeds City Region 65% Train 35% Don t train 41% wanted to train more 54% do sufficient training Don t know 5% All employers 28% wanted to train more 72% no training needed 59% in training equilibrium 41% wanted to undertake more training Source: Employer Skills Survey Base: all establishments in Leeds City Region (3,943)

34 WHAT ARE THE AREAS OF SKILLS MISMATCH

35 Shortages most acute in primary, construction and manufacturing Figure: Density of skill shortage vacancies by industry sector, Leeds City Region Primary Sector & Utilities Manufacturing Construction Wholesale & Retail Hotels & restaurants Transport & Storage Information & Communications Financial Services Business Services Public admin. Education Health & social work Arts & Other Services 0% 5% 10% 15% 20% 25% 30% 35% 40% Source: Employer Skills Survey 2017 Note: Density measure shows skill shortage vacancies as a proportion of all vacancies

36 And in professional, skilled trades and machine operative occupations Figure: Density of skill shortage vacancies by occupational major group, Leeds City Region Managers Professionals Associate professionals Administrative/clerical staff Skilled trades occupations Caring, leisure and other services staff Sales and customer services staff Machine operatives Elementary staff 0% 5% 10% 15% 20% 25% 30% 35% 40% 45% Leeds City Region England Source: Employer Skills Survey 2017 Note: Density measure shows skill shortage vacancies as a proportion of all vacancies

37 Digital and engineering professionals face acute shortages Figure: Occupational minor groups with highest density of skill shortage vacancies, Yorkshire and the Humber Nursing and midwifery professionals Assoc. prof. Professional Skilled trades Information technology and telecommunications professionals Engineering professionals Business, finance and related associate professionals Metal machining, fitting and instrument making trades Construction and building trades Food preparation and hospitality trades Electrical and electronic trades Vehicle trades 0% 10% 20% 30% 40% 50% 60% 70% Source: Employer Skills Survey 2017 Note: Density measure shows skill shortage vacancies as a proportion of all vacancies

38 Admin and sales and customer service staff most prone to skills gaps but managers also affected Figure: Incidence of skills gaps by occupational major group Managers Professionals Associate professionals Administrative/clerical staff Skilled trades Caring, leisure and other services staff Sales and customer service staff Machine operatives Elementary staff 0% 5% 10% 15% 20% 25% 30% England Leeds City Region Source: Employer Skills Survey 2017 Note: incidence measure shows the % of employers skills gap(s) who report a gap in a given occupation.

39 Operational, analytical and operational skills need to be improved to address technical skills gaps Figure: Technical / practical skills that need improving in occupations with skills gaps Knowledge of products / services of organisation Specialist skills or knowledge needed to perform role Knowledge of how your organisation works Solving complex problems Reading, understanding instructions, guidelines, etc Adapting to new equipment or materials Computer literacy / basic IT skills Basic numerical skills and understanding Writing instructions, guidelines, manuals or reports More complex numerical or statistical skills Advanced or specialist IT skills Communicating in a foreign language Manual dexterity DIGITAL SKILLS COMPLEX ANALYTICAL SKILLS OPERATIONAL SKILLS Source: Employer Skills Survey 2017 Base: All skills gaps followed up 0% 10% 20% 30% 40% 50% 60% 70%

40 Operational, analytical and operational skills need to be improved to address technical skills gaps Figure: Soft / people skills that need improving in occupations with skills gaps Ability to manage own time and prioritise own tasks Team working Customer handling skills Managing their own feelings, or handling the feelings of others Persuading or influencing others Managing or motivating other staff Instructing, teaching or training people Sales skills Setting objectives for others and planning human, financial resources Making speeches or presentations SELF-MANAGEMENT SKILLS MANAGEMENT AND LEADERSHIP SKILLS SALES AND CUSTOMER SKILLS Source: Employer Skills Survey 2017 Base: All skills gaps followed up 0% 10% 20% 30% 40% 50% 60% 70% 80%

41 Financial services prone to skills gaps in City Region Figure: Density of skills gaps by industry sector Financial Services Hotels & restaurants Wholesale & Retail Manufacturing Arts & Other Services Education Business Services Construction Health & social work Information & Communications Primary Sector & Utilities Public admin. Transport & Storage 0% 1% 2% 3% 4% 5% 6% 7% 8% Leeds City Region England Source: Employer Skills Survey 2017 Note: density measure shows skills gaps as proportion of total employment in each sector.

42 Mismatches in profile of HE and local market demand Figure: Comparison of profile of HE achievements versus projected job openings in related occupations, Leeds City Region Medicine and subjects allied to medicine Agriculture & related subjects Computer science Science, engineering & technology Architecture, building & planning Social studies Law Business & administrative studies Mass communications & documentation Creative arts & design Education 0% 5% 10% 15% 20% 25% 30% 35% % qualifiers % job openings in higher skilled jobs Source: HESA achievements data for 2016/17; Working Futures

43 Nonetheless many workers in medium / lower skilled roles are notionally over-qualified for their job Figure: Medium and lower-skilled occupations with the greatest proportion of workers (aged 25+) qualified at level 4+; Yorkshire and the Humber Administrative occupations Customer service occupations Sales occupations Skilled agricultural and related trades Textiles, printing and other skilled trades Secretarial and related occupations Caring personal service occupations Leisure, travel personal service occupations Skilled metal, electrical and electronic trades Elementary administration and service occupations Elementary trades and related occupations Process, plant and machine operatives Transport and mobile machine drivers and 11% of workers in region are high qualified but employed in medium / lower skilled occupations Skilled construction and building trades 0% 5% 10% 15% 20% 25% 30% 35% Source: Labour Force Survey, Oct Dec 2017

44 Brexit poses potential labour supply challenges Figure: Occupations with the highest level of EU migrant employment, Yorkshire and the Humber 20,000 50% 18,000 45% 16,000 40% 14,000 35% 12,000 30% 10,000 25% 8,000 20% 6,000 15% 4,000 10% 2,000 5% Elementary Process Plant Occupations Elementary Storage Occupations Other Elementary Services Occupations Process Operatives Elementary Cleaning Occupations Sales Assistants and Retail Cashiers Assemblers and Routine Operatives Food Preparation and Hospitality Trades Road Transport Drivers Caring Personal Services 0% Level of employment % of total employment Source: Labour Force Survey, Oct Dec 2017

45 Conclusions 1 Priorities Digital, engineering / manufacturing and construction confirmed as skills priorities Project management, team working and collaboration and budget management skills important General need to maintain supply of people with high level skills across most areas including health, business etc but less evidence of market failure Management skills gaps a key priority in view of business performance and productivity context Considerable recruitment need for care roles less about skills deficit than general attractiveness of these roles Replacement need across all occupations, some of which face acute shortages currently but what are longer term prospects for young people?

46 Conclusions 2 Issues Higher apprenticeships key element of response to rapidly changing higher level skill needs but current availability is limited Does local skills system have capacity to respond to reskilling challenge presented by automation? Impact of Brexit on labour supply could also stimulate demand for workforce development support Progress on graduate retention relies on increase in demand for high level skills in the local economy Ensuring that investment in high level skills generates best economic returns Improved outreach mechanisms key to increasing the contribution of skills development to inclusive growth