Achieving Inclusive Growth in the North East

5th June 2013

Structure of the Presentation

• Context

• The Inclusive Growth Research

• The North East Economy and the IER

• Achieving Inclusive Growth

• Introduction to the Discussion Sessions

Context

Context- Next programme of European Structural Funds - Focussed on 3 pillars – smart growth, sustainable

growth and inclusive growth-Inclusive growth – better connectivity between

opportunities and people- Represents a significant opportunity for the North East

- Next programme of European Structural Funds - Focussed on 3 pillars – smart growth, sustainable

growth and inclusive growth-Inclusive growth – better connectivity between

opportunities and people- Represents a significant opportunity for the North East

BackgroundBackground

-Promoting employment and supporting labour mobility-Promoting social inclusion and combating poverty-Investing in education, skills and lifelong learning

-Promoting employment and supporting labour mobility-Promoting social inclusion and combating poverty-Investing in education, skills and lifelong learning

Three skills and inclusion priorities

Three skills and inclusion priorities

The Inclusive Growth Research

Research Questions

1. Which groups or areas experience lower outcomes or are at

risk of becoming disengaged with employment or entrepreneurial

opportunities?

2. Which groups experience barriers or are under-represented

in key growth areas, such as low carbon, creative and digital,

research and innovation and advanced manufacturing

opportunities?

3. What has been successful in improving aspirations and

outcomes for less engaged groups?

4. Does the current skills and employability infrastructure

address barriers to employment or enterprise opportunities?

5. What opportunities are there for expanding engagement in

STEM subjects, innovation and manufacturing skills amongst

under-represented groups and communities?

1. Which groups or areas experience lower outcomes or are at

risk of becoming disengaged with employment or entrepreneurial

opportunities?

2. Which groups experience barriers or are under-represented

in key growth areas, such as low carbon, creative and digital,

research and innovation and advanced manufacturing

opportunities?

3. What has been successful in improving aspirations and

outcomes for less engaged groups?

4. Does the current skills and employability infrastructure

address barriers to employment or enterprise opportunities?

5. What opportunities are there for expanding engagement in

STEM subjects, innovation and manufacturing skills amongst

under-represented groups and communities?

Study Method- Review of labour market position of

disadvantaged groups / areas- Analysis of what works in supporting groups /

areas- Assessment of existing skills and employability

infrastructure

- Review of labour market position of

disadvantaged groups / areas- Analysis of what works in supporting groups /

areas- Assessment of existing skills and employability

infrastructure

Review of LiteratureReview of Literature

- Consultations with third sector organisations,

skills agencies, representatives from business

community, sector experts and individuals from

disadvantaged groups

- Consultations with third sector organisations,

skills agencies, representatives from business

community, sector experts and individuals from

disadvantaged groups

Gap fillingGap filling

Study Method

Testing and refiningTesting and refining

Purpose of workshop-Draw on the expertise of those with knowledge of

the North East economy and of under-

represented groups to answer key questions and

make recommendations for the LEP’s approach to

inclusive growth

Purpose of workshop-Draw on the expertise of those with knowledge of

the North East economy and of under-

represented groups to answer key questions and

make recommendations for the LEP’s approach to

inclusive growth

The North East Economy and the Independent Economic Review

Strong employment growth in the last economic cycle: 67,000 jobs added

Employment Change in LEP AreasEmployment Change

1998 2008 Net %

West of England 451,797 522,342 70,545 16%

North East 702,108 769,514 67,406 10%

Leeds City Region 1,176,266 1,283,769 107,503 9%

Sheffield City Region 620,633 676,521 55,888 9%

Greater Manchester 1,072,086 1,161,801 89,715 8%

Liverpool City Region 551,131 584,357 33,226 6%

Derby, Derbys. Nott. and

Notts 831,095860,743

29,648 4%

Gtr Birmingham and Solihull 815,042 842,726 27,684 3%Source: Annual Business Inquiry

Changing nature of the North East economy

• On-going decline of manufacturing sector and growth of

service sector (often low added value)

• Growth of highly skilled professional and associate

professional and technical occupations

• Decline in skilled trades, process, plant and machine

operative and admin and secretarial roles

• A growing business base and increasing skills levels

But still a significant gap with the national* average in a number of areas

* Minus London, Source: Annual Population Survey, Regional Accounts, Annual Business Inquiry

The NE Independent Economic Review

Overview

• Provides an independent economic assessment of the

economy

• Identifies priority actions to stimulate growth and

productivity

• Focussed on creating more and better jobs

Key finding

• A shortage of private sector employment

• 60,000 additional private sector jobs required

Where will growth come from?

• Low carbon (energy and offshore renewable)

• Creative and digital

• Advanced manufacturing

• Research and innovation

• Pharmaceuticals

• Tourism

NB - Many of these sectors will require non-specialist roles, e.g.

marketing, back office functions etc

• Still significant employment opportunities in other

sectors – e.g. Care , Retail

Potential Sources of Additional Employment

Sector Number of JobsExporting 8,000Innovation 5,000Financial and professional services 10,000Business services 15,000New Economy 15,000Tourism 8,000Universities 4,000Total 65,000Source: North East Independent Economic Review

But more jobs is not enough...

• The North East needs higher skilled and higher paid jobs

• 60% of its employment growth will be in graduate level

jobs

• In the long-term this will provide progression

opportunities within the labour market

• Growth sectors such as the new economy, tourism and

business services provide opportunities at various skill

levels

And a major focus on young people and education ..

• North East Schools Challenge to improve further primary

and secondary schools

• Doubling of youth apprenticeships to strengthen

vocational provision

• Increased access to University education for young

people

Achieving Inclusive Growth

Which groups experience lower outcomes?

Women Disabled People LGBT People

Young People (under 25)

Black and Ethnic Minority People

Offenders

Older People (over 50) Migrants and Refugees

Disadvantaged / Deprived Areas

Rural Areas / Less well-connected areas

• Disadvantage is multi-faceted

• The interplay of these characteristics, along with

geography and connectivity, impacts on economic

opportunities

Labour market contextKey Labour Market Statistics

Target Group Working age population

Economic Activity

Employment

Unemployment

Self Employment

NELEP Average 1,270,100 74.3% 66.8% 10.1% 6.4%

Women 636,200 68.2% 62.5% 8.0% 3.5%

Young People (16-24) 248,500 62.3% 48.4% 22.4% n/k

Older People (50-64) 376,700 64.3% 59.2% 7.9% n/k

Disabled People 308,700 50.3% 43.0% 14.6% n/k

BME 60,600 63.6%2 56.0% 11.9% 11.9%3

Offenders1 6,000 n/k 32.0% n/k n/k

LGBT – see below n/k n/k n/k n/k n/k Source: ekosgen analysis of Annual Population Survey (January – December 2012) 1 North East Equality and Diversity Partnership Board (2010) Differing Rates of Employment for a Range of Diverse Groups 2 Calculations based on 1 less the % of ethnic minority aged 16-64 who are economically inactive 3 ONS – Census 2001

Implications of low economic participation and employment for the North East economy

x Inability to fully maximise its economic opportunities

x Smaller pool of labour available to employers

x Reduced income in North East

x Limited purchasing power

x Lower levels of business start up rates

x Reduced innovation levels

x Overall economic growth below NELEP’s potential

What Works in Achieving Inclusive Growth?

How to improve aspirations and outcomes

Success Factors: Intensive / Outreach support - successful targeting of

disadvantaged groups requires a substantial outreach

element and intensive support over the long-term

Support self employment / community enterprise

development - promoting enterprise as an option and

providing a continuum of quality pre-start, start up and

post start support

Involvement of third sector organisations – they

understand the barriers and challenges

How to improve aspirations and outcomes

Success Factors: Provision of employment coaching and work

placements – engaging employers to source work and

brokering appropriate candidates into employment

Progression to mainstream support – complement

and don’t duplicate mainstream support: progress

groups to mainstream support once barriers are

removed.

Does the skills and employability infrastructure address barriers?

Significant disparities in participation in education, employment support, training and apprenticeships.

Low representation of women in science and engineering – 97% of starts in engineering were male

Less than 20% of starts in science, engineering and manufacturing, energy and utilities, construction and automotive are females

Only 7% of starts nationally were by individuals with a learning disability

Enhancing the skills and employability infrastructure

1. Addressing gender gaps in participation

2. Encouraging participation into ‘atypical’

employment

3. Raising women’s educational participation rates

4. Developing a strategy for lifelong learning

5. Building on the strengths of the third sector…

The role of the Third Sector

A vital part of the skills and employability

infrastructure:

• Provides employment and volunteering opportunities

• Improves the skills and experience of disadvantaged groups

• Provides a voice and influence

• Attracts investment

What can other sectors learn from the third sector

in providing opportunities for disadvantaged

groups?

The role of the Third Sector

What support does the third sector need to continue

playing this role?

1.Closer working between third sector and private sector

(capacity building and joint bidding)

2.On-doing engagement between NELEP and third sector

3.More coordinated and proactive approach to joint

commissioning of public services contracts by local

authorities and other local commissioners

4.Others?

What are the barriers to participation?

Employment

x Lack of technical skills – engagement in STEM subjects from

early age

x Lack of interest in some vocational areas amongst some

groups

x Access to low cost transport

Enterprise

x Growth focussed enterprise support – may not suit all

entrepreneurs

x Lack of engagement with mainstream business support

Summary

The 65,000 additional jobs envisaged in the IER could

provide significant opportunities for inclusive

employment and growth

However there is a need for...

• An understanding of the opportunities that will arise and

the skills / attributes needed to access them

• Clarity over the support needed to ensure all residents

can benefit from these opportunities

• Agreement on defining and measuring success

Discussion Sessions

Discussion 1: Opportunities in the North East Economy What employment opportunities are expected to arise in the NE

growth sectors?

What employment opportunities will arise in the rest of NE

economy?

What opportunities for enterprise are there within the NE economy?

What skills / attributes will be required to access these

opportunities?

What are the potential barriers to accessing these opportunities?

Do people within the disadvantaged groups / areas have these skills

and attributes and what support do they need to acquire them?

General Barriers to ParticipationSECTOR BARRIERS

Low Carbon

Creative and Digital

Advanced Manufacturing

Research and Innovation

Pharmaceuticals

Tourism

Other Sector (specify)

Other Sector (specify)

Other Sector (specify)

Specific Barriers to ParticipationSECTOR GROUPS

Women

Young People

Older People

Disabled BME Migrants & Refugees

LGBT Offenders Deprived/

Disadvantaged Areas

Low Carbon

Creative and Digital

Advanced Manufacturing

Research and Innovation

Pharmaceuticals

Tourism

Other Sector (specify)

Other Sector (specify)

Other Sector (specify)

Employment OpportunitiesSECTOR OPPORTUNITY

Low Carbon

Creative and Digital

Advanced Manufacturing

Research and Innovation

Pharmaceuticals

Tourism

Other Sector (specify)

Other Sector (specify)

Other Sector (specify)

Enterprise OpportunitiesSECTOR OPPORTUNITY

Low Carbon

Creative and Digital

Advanced Manufacturing

Research and Innovation

Pharmaceuticals

Tourism

Other Sector (specify)

Other Sector (specify)

Other Sector (specify)

Discussion 2: Delivery of Support to Disadvantaged Groups / Areas What support is needed?

What are the features of effective support?

How can support best be delivered to disadvantaged

groups and areas?

What roles should mainstream and specialist services

play?

What are the implications of the IER for institutional

capacity and support?

Types of Support NeededSECTOR TYPE OF SUPPORT

Low Carbon

Creative and Digital

Advanced Manufacturing

Research and Innovation

Pharmaceuticals

Tourism

Other Sector (specify)

Other Sector (specify)

Other Sector (specify)

Discussion 3: Success in encouraging Inclusive Growth in the North East

How would you define success?

How would you measuring success in supporting

Inclusive Growth?

Is there a need for new indicators and approaches?

Defining SuccessHow would you define success?

Plenary Discussion

Plenary Discussion

What are the implications of the discussions for

achieving Inclusive Growth in the North East?

Recommendations for the Growth Plan

Recommendations for the new European

Programme

Other issues / priorities