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FEBRUARY 2021 Introduction LABOUR MARKET INTELLIGENCE PACK FEBRUARY 2021 Introduction This document collates evidence about the labour market in the West of England, highlighting the current challenges posed by the COVID pandemic as well as identifying longer- term issues. The analysis looks at the characteristics and Contents spatial distribution of the labour force, and business and employer demand. It covers both short and long term This document is split into the Labour Market Intelligence and provides interpretation following sections: around the available data. Geography Section Page The document refers to the West of England region. This is Business Environment 4 taken to mean the West of England Local Enterprise Partnership area, which is made up of four unitary authorities: Unemployment, 12 Employment and ▪ Bath and North East Somerset Redundancy ▪ Bristol Current Labour 23 ▪ North Somerset Market Demand ▪ South Gloucestershire 2 Summary This section summarises results from the rest of the report. Business Environment CurrentLabour Market Demand ▪ The West of England has a broad sector base with a variety of ▪ Job posting data indicates that levels in January 2021 were businesses based in the region. slightly below those seen pre-pandemic, with a fall seen in January compared to December 2020, although postings were up ▪ The West of England has some specialist industries that make up a larger proportion of employment than the UK average, such as 81.7% on the year low of April 2020. There has been a shift in the Civil Engineering, Education and Knowledge Creation, Creative, type of jobs advertised. Gains in recent months were partly Financial and Legal Services, and Digital. The impact of the driven by strong increases in postings in both the IT and human economic downturn caused by the COVID pandemic is expected to health and social care sector. vary between sectors. ▪ The most frequently demanded jobs advertised January 2021 were: Programmers and software development Unemployment, Employment and Redundancy professionals (772), Nurse (437), Sales related occupations (363), Managers and proprietors in other services (347) and Care ▪ As of January 2021, 4.8% of working age population in the West of workers and home carers (306). England were claiming unemployment benefits (35,675 ▪ Thematic areas of skills demand: residents). This is a 0.1 percentage point decrease from the rate seen in December 2020 (4.9%). (1) STEM subjects – these are the basis of many technological jobs. (2) Digital/technology skills – these are applicable both within the ▪ The Labour Force Survey confirms unemployment is rising in the important and resilient IT, creative and digital sectors, as well as in South West region, with males and females seeing similar increases a variety of other jobs such as finance and investment roles. in rates between the Jan – March 2020 and Sept -Nov 2020 time period. Males saw consistently higher rates of unemployment both (3) Business skills – business related skills such as sales and nationally. The region saw a lower unemployment rate than England management are applicable across industry and see consistent as a whole, at 4.2% regionally compared to 5.3% nationally. demand. (4) Specific vocations – training for specific jobs currently in demand (based on evidence), for example warehouse operatives and HGV drivers, care workers, teachers and nurses. Sources: See corresponding later sections. 3 BUSINESS ENVIRONMENT Businesses in the West of England Business concentration Business size There are 46,275 businesses in the West of England. That Individuals in the Labour Market are often unaware that is 400 businesses per 10,000 residents. This is below the 78% of businesses in the West of England have fewer than five UK average and in the middle of comparator areas. employees. The results below are similar to those for the UK overall (78.5%) Number of businesses per 10,000 people (2020) Employee size of businesses in the West of England (2019) London 593 Cambridgeshire and Peterborough 432 UK 412 West of England 400 Greater Manchester 369 West Midlands 311 Sheffield City Region 280 Liverpool City Region 277 Tees Valley 261 5 Source: ONS Annual Population Survey via NOMIS; Office for National Statistics (ONS) Business; Activity, Size and Location Volume employers in the region The West of England has some volume employers with over 1,000 employees, including: 6 Employment by sector In 2019, the largest employing Employment by sector (% of total) (2019) sectors within the West of England LEP were: • Wholesale and retail trade; repair of motor vehicles and motorcycles (14% of all jobs in the region) • Human health and social work activities (13% of all jobs in the region) • Professional, Scientific and Technical Activities (11% of all jobs in the region) Source: ONS Business Register and Employment Survey via NOMIS 7 Regional Specialisms & Growth Areas The West of England has some specialist industries, which employ more Growth in the number people in the region proportionally than the national average. The of jobs (England) adjacent table highlights the sectors where we have employment specialisms, alongside whether these sectors are growing or shrinking between 2018 and nationally. This helps us understand where there are growth Sector specialism 2019 opportunities, and where there may be a future skills demand; or if a current specialism is at risk due to industry contraction. This is Vehicle and Defence Technology +2% particularly relevant during the current pandemic where COVID has altered or accelerated certain trends. Civil Engineering +6% Key points: Utility -3% • Civil Engineering is a strength and is growing nationally, as is creative. Education and Knowledge Creation 0% Both are strong contributors to GVA. Government +4% • The West of England has fewer people in professional services than the UK average, although London skews this data and it is still a Local Environmental Services +6% significant contributor to the region’s GVA. Creative +4% • Given its engineering specialisms, the West of England could have opportunities in both Precision Technology and Maritime sectors, Property Development -1% which it currently has a below average number of employees in. For more information, see appendix ‘Regional Specialisms’ Construction Products and Services -1% Financial and Legal Services -8% Source: EMSI ‘Strength Finder’ Tool, based on ONS ASHE and BRES Data 8 Wages in specialist areas National jobs Difference to West of Most of the West of England LEP’s specialist growth % (2018- Average Wage (West of England Average Full- industries pay more than the regional average, Sector Specialism 2019) England, 2019) time Wage (£31,183) reflecting their highly skilled nature and competitiveness. Vehicle and Defence Technology 2% £41,196 24% Only Government and Creative have an average Civil Engineering 6% £38,094 18% salary lower than that of the regional average. Utility -3% £45,500 31% Creative’s reliance on freelancer workers could Education and potentially mean this underestimates wages in the Knowledge Creation 0% £31,411 1% sector – it is likely that with these included, the average wage would be higher. Government 4% £29,110 -7% Local Environmental Services 6% £31,481 1% Creative 4% £30,872 -1% Property Development -1% £31,611 1% Construction Products and Services -1% £37,857 18% Financial and Legal Services -8% £36,591 15% Source: EMSI ‘Strength Finder’ Tool, based on ONS ASHE and BRES Data 9 Future Trends: Pre-pandemic Predictions Shape of the UK Labour Market 2017 – 2027 Working Futures provides a comprehensive and detailed model of the UK labour market and skills needs. It projects the future size and shape of the labour market by considering employment prospects by industry, occupation, qualification level, gender and employment status. Areas of growth Areas of Decline Impact of COVID Sectoral trends in employment • Business Services including • Distribution • Areas of growth are still considered professional and scientific • Manufacturing accurate • Health & Social Care • Finance and Insurance • Distribution and construction are no • Construction longer likely to decline in the short • Public Admin term, due to policy and demand changes Occupational trends • Caring and professional service • Secretarial Occupations • Growth in caring and professional • Corporate managers and • Plant, Process and Machine service is likely accelerated directors Operatives • Declining areas could experience • Business and public service • Skilled Metal and Electronic accelerated decline, although the associate professionals Trades future of manufacturing remains uncertain Replacement Demand – natural Replacement demand amongst all • In the immediate future, churn and movement within occupational groups is expected to replacement demand is expected to sectors. generate 7 times more job be less strong than predicted opportunities than growth • Economic downturn and extensive uncertainty make it less likely for individuals to leave their work and seek new employment 10 Source: Working Futures 2017 - 2027 Impact of COVID-19 on economic sectors The chart below shows the impact on Gross Value Added (GVA) of certain sectors of the economy at a UK level. Almost all sectors have experienced a drop in economic output since February 2020, but some have been more adversely impacted than others. After recovery over the summer, output in the accommodation and food service sector has fallen again more recently. This data does not yet reflect the impact of the third
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