LEEDS CITY REGION LABOUR MARKET AND SKILLS REPORT 2016 EMERGING FINDINGS REGIONAL ECONOMIC INTELLIGENCE UNIT
Contents 1. Strategic context 2. Skills and the economic challenge 3. Emerging messages on skills: Supply Demand Mismatch 4. Conclusions 5. Next steps
LCR strategic context Strategic Economic Plan Plan to transform the Leeds City Region economy, creating billions of pounds of additional growth and thousands of extra jobs. Skills Plan Sets out how the LEP will work with our partners to create more, better quality jobs and develop the workforce to meet the needs of a modern and growing economy Highlights key sectors digital, engineering & manufacturing and infrastructure/ construction Annual Labour Market analysis Highlighting supply and demand issues and areas of skills mismatch.
SKILLS AND THE ECONOMIC CHALLENGE
GVA per head ( ) 30,000 Prosperity gap is widening GVA per head England and City Region 25,000 20,000 15,000 10,000 5,000-1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Leeds City Region UK Source: Office for National Statistics
Employment rate (%) Underperformance on productivity and employment Employment rate and productivity performance of LEPs relative to UK average 85 Oxfordshire 80 York, North Yorkshire and East Riding Hertfordshire Buckinghamshire Thames Valley Enterprise M3 Thames Valley Berkshire West of England 75 South East Cheshire and Warrington 70 65 Sheffield City Region Liverpool City Region Black Country Leeds City RegionUNITED KINGDOM Humber Greater Manchester Greater Birmingham and Solihull London 60 20 25 30 35 40 45 Productivity Source: Office for National Statistics
Unemployment rate (%) Unemployment rate (%) Although labour market has improved significantly Unemployment rates by age, Leeds City Region and England 30 Leeds City Region 30 England 25 25 20 20 15 15 10 10 5 5 0 0 16-24 25-49 16-24 25-49 Source: Office for National Statistics
EMERGING MESSAGES: SUPPLY
Source: Mid-year Population Estimates and Subnational Population Projections, Office for National Statistics Working age population is expected to grow more slowly while number of young people is expected to decline 14% 12% 10% 8% 6% 4% 2% Actual and projected growth in working age population 0% -2% Leeds City Region Yorkshire and the Humber England Leeds City Region Yorkshire and the Humber England -4% -6% 16-64 16-24 2004-2014 2014-2024 2024-2034
Labour force is becoming better qualified but still lags behind England average 40% Change in highest qualification held by working age population 35% 30% 25% 20% 15% 10% 5% 0% 2005 2015 2005 2015 Leeds City Region England % with NVQ4+ % with NVQ3 % with NVQ2 % with NVQ1 % with no qualifications (NVQ) Source: Annual Population Survey, Jan-Dec 2015
Some differences in profile of learning and market demand Comparison of profile of LCR learning achievements versus projected job openings in related occupations Agriculture, Horticulture and Animal Care Arts, Media and Publishing Business, Administration and Law Construction, Planning and the Built Environment Education and Training Engineering and Manufacturing Technologies Health, Public Services and Care Information and Communication Technology Includes ICT user provision Leisure, Travel and Tourism Retail and Commercial Enterprise 0% 5% 10% 15% 20% 25% 30% 35% % education and training achievements % apprenticeship achievements % job openings Source: LEP calculations based on SFA data (2014/15) and Working Futures
In HE business courses most popular, sciences under-represented Profile of HE qualifiers by subject in LCR and UK, 2013/14 Business & administrative studies Social studies Subjects allied to medicine Education Biological sciences Creative arts & design Languages Historical & philosophical studies Engineering & technology Physical sciences Law Computer science Mass communications & documentation Medicine & dentistry Architecture, building & planning Mathematical sciences Agriculture & related subjects Combined Science subjects as % of total: UK 41% LCR 37% 0% 2% 4% 6% 8% 10% 12% 14% 16% 18% 20% UK Leeds City Region Source: Higher Education Statistics Agency
Many employers would like to invest more Training equilibrium summary, Leeds City Region 67% Train 33% Don t train 46% wanted to train more 52% do sufficient training Don t know 2% All employers 27% wanted to train more 73% no training needed 59% in training equilibrium 41% wanted to undertake more training Source: Employer Skills Survey 2015. Base: all establishments in Leeds City Region (4,049)
EMERGING MESSAGES: DEMAND
Net growth expected to be concentrated in services but overall recruitment need more broadly based Projected job openings, 2014-2024, Leeds City Region Wholesale and retail trade Health and social work Education Support services Professional services Accommodation and food Transport and storage Construction Manufacturing Public admin. and defence Finance and insurance Arts and entertainment Other services Information technology Real estate Media Water and sewerage Electricity and gas Agriculture Mining and quarrying Source: Working Futures -40-20 0 20 40 60 80 100 120 000s of job openings Expansion demand Net requirement
Recruitment need greatest in high skilled and service roles Recruitment need by occupation, 2014-2024, Leeds City Region Caring personal service Administrative Elementary administration & service Business & public service associate professionals Corporate managers & directors Business, media & public service professionals Teaching & educational professionals Health professionals Sales Transport & mobile machine drivers & operatives Science, research, eng. & technol. professionals Other managers & proprietors Skilled construction & building trades Customer service Elementary trades & related Leisure, travel & related personal service Culture, media & sports Skilled metal, electrical & electronic trades Skilled agricultural & related trades Health & social care associate professionals Science, eng. & technol. assoc. professionals Textiles, printing & other skilled trades Process, plant & machine operatives Secretarial & related Protective service Net requirement Net change -20 0 20 40 60 80 000s of job openings Source: Working Futures
Recruitment need greatest in high skilled and service roles Recruitment need by occupation, 2014-2024, Leeds City Region Managers, directors and senior officials Professional Associate professional and technical Administrative and secretarial Skilled trades Caring, leisure and other service Sales and customer service Process, plant and machine operatives Elementary -40-20 0 20 40 60 80 100 120 140 160 Net change Net requirement 000s of job openings Source: Working Futures
Current demand strong for digital, health and business roles Top 10 occupations by volume of job postings, Leeds City Region, June 2015 to May 2016 Programmers and software development professionals Other administrative occupations n.e.c. Nurses Business sales executives Web design and development professionals IT business analysts, architects and systems designers Sales accounts and business development managers Customer service occupations n.e.c. Care workers and home carers Management consultants and business analysts - 2,000 4,000 6,000 8,000 10,000 12,000 14,000 16,000 Source: Labour Insight 000s of job postings
Demand in manufacturing for both technical and business roles Top 10 occupations by volume of job postings, Leeds City Region, June 2015 to May 2016 Production managers and directors in manufacturing Engineering technicians Business sales executives Design and development engineers Sales accounts and business development managers Welding trades Other administrative occupations n.e.c. Metal working production and maintenance fitters Programmers and software development professionals Managers and proprietors in other services n.e.c. Source: Labour Insight 0 100 200 300 400 500 600 700 800 900 1000
Specialist digital skills key to local economy Top 10 specialist skill types by volume of job postings, LCR, June 2015 to May 2016 Sales JavaScript Business Management Mathematics SQL Business Development Microsoft C# Repair.NET Programming Digital skills highlighted in purple SQL Server Source: Labour Insight - 2,000 4,000 6,000 8,000 10,000 12,000 14,000
EMERGING MESSAGES: MISMATCH
60,000 50,000 40,000 Skill shortages are increasing Volume of vacancies and skill shortage vacancies, Leeds City Region SSV density: 25% 30,000 SSV density: 17% 20,000 10,000-2013 2015 Vacancies Skill shortage vacancies Source: Employer Skills Survey. Base: all vacancies.
Gaps and shortages are distributed differently Incidence of skill shortages and skills gaps by occupation, Leeds City Region 25% Skills shortage vacancies 30% Skills gaps 20% 25% 20% 15% 15% 10% 10% 5% 5% 0% 0% Source: Employer Skills Survey 2015. Base: all employers with skill shortages (306); all employers with skills gaps (903)
Under-utilisation of skills is a widespread issue Proportion of employers with any staff whose skills / qualifications are under-used 32% 32% 32% 32% 31% 28% 26% 25% 32% 30% Source: Employer Skills Survey 2015. Base: all employers.
Skills demand Evidence suggests low skills equilibrium overall Analysis of LEP skills performance using OECD diagnostic tool 3 Thames Valley Berkshire Skills shortages and gaps 2.5 2 1.5 High skills equilibrium London Buckinghamshire Thames Valley Enterprise M3 1 South East Midlands Liverpool City Region Black Country Greater Birmingham and Solihull 0-4 -3-2 -1 0 1 2 3 Low skills equilibrium Greater Manchester Leeds City Region Humber North Eastern Sheffield City Region York, North Yorkshire and East Riding Source: Adapted from Green, A. (2012), Skills for Competitiveness: Country Report for United Kingdom, OECD 0.5-0.5-1 -1.5 Skills supply -2 Skills surplus
Conclusions Supply: publicly-funded provision falling with changing subject profile plus evidence of under-investment by employers Demand: growth concentrated in service activities, accompanied by occupational polarisation Mismatch:. skill shortages increasing but also issues around deficiency of demand
Next steps Complete the analysis, including further work using data cube Main LMA report to be published later this summer Develop additional outputs for specific audiences / uses e.g. for careers purposes