University of Exeter Heart of the South West LEP Skills Advisory Panel Baseline analysis of employment and skills conditions:
2019 CONTENTS 1. introduction ...... 5 1.1 Purpose of this report ...... 5 1.2 Matching skills demand and skills supply ...... 5 1.3 Influencing skills demand ...... 6 2. R egional economic development policy context ...... 8 2.1 Smart Specialisation & European Structural & Investment Funds ...... 8 2.2 Shared Prosperity Funds ...... 9 2.3 Area based Investments ...... 10 2.4. Enterprise Zones ...... 12 2.4.1. Oceansgate, Plymouth 13 2.4.2. Gravity Enterprise Zone 13 2. 4.3. The Exeter and East Devon Enterprise Zone (EEDEZ) 14 2.4.4. The University of Exeter Enterprise Zone 14 2.5. Heart of the South West Local Industrial Strategy ...... 14 2.6. Digital Strategy, Digital Skills Partnerships and the Digital Skills Innovation Fund 17 3. Inclusion and employment Policy ...... 19 3.1. Welfare reforms ...... 19 3.2. The Work and Health Programme ...... 20 3.3. Disability Employment Gap Commitment ...... 20 3.4. Fuller Working Lives ...... 21 3.5. Opportunity areas ...... 22 4. Employment & Skills Policy ...... 23 4.1 Careers Hubs, Enterprise Coordinators and Advisers ...... 23 4.2. National Retraining Scheme ...... 24 4.3. Adult Education Budget ...... 24 4.4. A pprenticeships and Traineeships ...... 26 4.5. T levels ...... 27 4.6. Level 4 and 5 ...... 28 4.7. Higher level skills (including Advanced Learner Loans) ...... 29 4.8. Careers and employment engagement in skills and work ...... 29 4.9. Institutes of Technology ...... 30 4.10. Reforms including those to grow the profile of technical education routes ...... 31 4.11. Labour Education Policy ...... 32 5. S patial and demographic context ...... 33 5.1. Introduction ...... 33 5.2. Resident population ...... 35 5.3. Age structure of the population ...... 38 5.4. Ethnic origin ...... 40 5.5. Residents born outside the UK ...... 41 5.6. Population change ...... 41 5.7. Migration ...... 43 5.8. Commuti ng ...... 44 5.9. Travel to Work Areas (TTWA) ...... 52 5.10. Travel to education ...... 53 6. Business and economic context ...... 56 6.1. Introduction ...... 56 6.2. Business population ...... 56 6.1.1. Current business profile 56 6. 1.2. Change over time 60 6.1.3. Business Births and Deaths 62 6.1.4. New business formation 63 6.1.5. Business Survival Rates 63 6. 3. Economic output ...... 64 6.3.1. Current economic profile 64 6.3.2. Economic growth 68 6.3.3. Sectoral trends 69 6.4. Emplo yment ...... 70 6.4.1. Level and characteristics of employment 70 6.4.2. Sectoral strengths 71 6.4.3. Employment change 77 6.5. Pro ductivity ...... 80 6.6. Earnings ...... 84 6.6.1. Variations within the LEP area 84 7. Labour demand ...... 88 7.1. Introduction ...... 88 7.2. Characteristics of current employment demand ...... 88 7.3. Trends in employment demand ...... 91 7.4. Vacancies ...... 93 7.5. Recruitment practices ...... 98 7.6. Staff retention ...... 99 7.7. Redundancies ...... 101 7.8. Upskilling ...... 101 7.9. Employer investment in training ...... 104 7.10. Barriers to training and employment ...... 107 7.11. Prospects for labour and skills demand ...... 109 7.12. Vulnerability to technological change ...... 120 8. Labour Supply ...... 124 8.1. Introduction ...... 124 8.2. Economic activity rates ...... 125 8.3. Employment rate ...... 127 8.4. Self - employment ...... 130 8.5. Part time working ...... 130 8.6. Tempo rary contracts ...... 131 8.7. Occupational structure ...... 131 8.8. Industrial structure ...... 132 9. Skills infrastructure ...... 134 9.1. Int roduction ...... 134 9.2. Further education ...... 134 9.2.1. Delivery of government funded further education and skills 134 9.2.2. Quality of Further Education Providers 141 9.3. Higher education provision ...... 143 9.3.1. Undergraduate provision 143 9.3.2. Postgraduate provision 147 10 . Skills pipeline ...... 150 10.1. Introduction ...... 150 10.2. School leavers ...... 150 10.2.1. GCSE Attainment 150 10.2.2. Key Stage 4 destinations 153 10.3. Government funded further education and skills ...... 155 10.3.1. Education and training 156 10.3.2. Apprenticeships 157 10.3.3. Community learning 157 10.3.4. Learner outcomes 158 10.3.5. Attainment at Level 3 160 10.3.6. Destinations at aged 18 161 10.4. Higher education ...... 164 10.4.1. Students 164 10.4.2. Destinations 168 10.4.3. Outc omes 172 10.4.4. Graduate retention 173 10.4 Adult Learning ...... 174 10.5.1. Participation rate s 174 10.5.2. Barriers to training 178 10.5 .3. Highest qualification held 179 10.4.4 Digital Skills 182 11. Imbala nces in supply and demand ...... 187 11.1. Introduction ...... 187 11.2. Unemployment ...... 188 11.2.1. ILO me asure of unemployment 188 11.2.2. Claimant Count 192 11.3 Underemployment ...... 202 11.4. Skills shortages ...... 205 11.5. Skil ls gaps ...... 210 11.6. Underutilisation of skills ...... 214 11.7. Preparedness of education leavers for work ...... 216 11.8. NEET ...... 217 11.9. Job mobility ...... 219 12. cross cutting issues ...... 223 12.1. Place ...... 223 12.2. Transport ...... 223 12.3. Housing ...... 226 12.4. Low income indicators ...... 227 12.4.1. Relative and absolute low income 227 12.4.2. Social security benefits 228 12.4.3. The Indices of Deprivation 231 12.4.4 Deprivation and Education 234 12.5. Social Mobility ...... 238 12.6. Equalities ...... 244 12.6.1. Disability 244 12.6.2. Ethnic origin 247 12.6.3 Family Structure 248 12.7. EU exit ...... 249 12.8. Market strategies ...... 249 12.9. Technological change ...... 252 13. Conclusions ...... 255
1. INTRODUCTION
1.1 Purpose of this report
Skills Advisory Panels have been established to strengthen the link between public and private sector employers, local authorities, colleges and universities and to enable Local Enterprise Partnerships (LEPs) to fulfil their leadership role in the skills system. Their key task is to help LEPs to und erstand labour market challenges in their area, to determine skills priorities and target investments that address these.
To support this work, SAP h ave been given £75,000 to grow their analytical capability 1 and have been t asked with conducting a baseli ne analysis of employment and skills con ditions in their area. In H eart o f t he S outh W est , responsibility for conducting this baseline analysis has been contracted to the Marchmont Observatory, at the University of Exeter. This contract also includes a commitment to undertak ing three ‘deep dives’ per annum, to explore speci fic issues of concern to the SAP in detail.
This report, therefore, aims to :
creat e a common baseline understanding of labour market and skills conditions across Heart of the South West LEP area for SAP members and other stakeholders, such as Employment and Skills Boards; and
enable partners to pick out issues that they wish to explore together in detail, with a view to agreeing actions and investments to better match skil ls demand and skills supply.
1.2 Matching skills demand and skills supply
The objective of better match ing the skills supply with employer needs has been a goal of government policy for more than 35 years. 2
The fact that only 1% of employer expenditure on skills goes to colleges and universitie s in the form of fee s 3 has long been pointed to as an indication that publicly funded providers are not as responsive to employers’ requirements as they might be .
To address this national skills policy has focused on :
‘ reducing bureaucracy; removing unnecessary interference from intermediary agencies whether local, regional or national; …removing unnecessary regulation;
1 https://www.gov.uk/government/publications/skills - advisory - panels - analytical - toolkit 2 Ewart Keep in F E Week 3 See Employer Skills Survey, 2017, and, introducing new freedoms and flexibilities’ 4 , i.e. on cutting the supply side free to deliver programmes that employers and individuals wanted; and
devolving responsibility and ‘a significant proportion of the central skills funding to local areas, allowing business a far stronger influence in what is provided.’ 5
The 2012 Heseltine Review in particular argued that businesses and LEPs should take ‘ a new strategic role in skills policy’ and be made responsible for:
Articulating and aggregating employer demand for training;
developing business and sk ills plans that set out these needs;
using these plans as a basis for:
o negotiating with the supply side;
o unlocking government growth funds for local investment 6 .
While the level of skills funding devolved to regions has fallen well short of the Heseltin e report ’s vision , the creation and funding of SAPs represents a further push in the same direction . Concerns about competitiveness post Brexit and the need for clear Local Industrial Strategies that build on each region’s distinctiveness are new driver s of this discussion.
SAPs are being established dur ing politically uncertain times. However, as long as skills remain a matter of strategic concern (rather than something to be left to the market ) their objectives - understanding loc al labour markets and focusing skills investment to deliver regional inclusion and competitiveness - will remain a critical one .
1.3 Influencing skills demand
A challenge for SAPs is that while they are responsible for seeking to shape the region’s skills base , they have limi ted financial levers 7 . Government guidance to SAP s talk s about the importance of “identifying levers”, but SAPs are unable to change the amount provider s receive for different courses or apprenticeships. Programme weightings, reflecting the cost of teachin g different subjects ; uplift s designed to encourage a focus on the most disadvantaged learners; and area uplift s to compensate for differences in delivery costs in different geographies are all set nationally. Much p ublic funding still ‘follows the learner’, which means that colleges, universities and other training providers still have an incentive to compete with each other, attract ing le arner s by delivering the courses that individuals want to study. As independent organisations coll eges and training providers cannot be told to cut the number of places on popular courses (hair - dressing being the oft - cited example) or to expand loss making courses of strategic value. Their responsibility to individual learners also
4 Investing in Skills for Sustainable Growth - Further Education New Horizon , Nov 2010, BIS, p.2. 5 No Stone Unturned in Pursuit of Growth, M. Heseltine, H.M Government, October 2012 6 2012 Autumn Statement - http://cdn.hm - treasury.gov.uk/autumn_statement_2012_complete.pdf 7 Mayoral Combined Authorities will soon have what remains of adult - education budgets devolved to them, but eve n this is a limited pot of money, and its ability to leverage fundamental changes in the pattern of provision is likely to be highly rest ricted. means, as one Colleg e Principal once put it , that they can’t be asked ‘ to bash round pegs into square holes’ .
However, there remains much that SAP s can do to influence the demand for and supply of learning.
One thing they can do is seek to address the fact that many people , particularly when young, know very little about the types of jobs that are available . They know even less about those that are growing or declining in number or the paths they might take to attain jobs that appeal to them . I nvolving employers in raising y oung peoples’ awareness and understanding of opportunities by enhancing information, advice and guidance services ; creating opportunities for work experience, job - trials; getting employers involved with schools in ambassador programmes, by arranging site v isits, employer talks, CDP opportunities for t eachers and trainers, is one obvious area for activity.
Through LEPs, SAPs can influence on c apital expenditure, helping to create new state - of - the - art facilities to attract learners into strategically importa nt curriculum areas; demonstrating to learners and employers alike the value that the region attaches to particular areas of learning.
SAP are able to an influence funding opportunities such as EU Structural F unds or Shared Prosperity Funds. While these might not support mainstream course delivery costs, they can be used to create or enhance provision in priority areas by paying for: additional outreach and marketing activities, course development costs, taster sessions , bursaries for childcare and travel , or additional student mentoring and support, for example.
So there remains much that could and should be done . The SAP’s task is to agree where the priorities lie, based on a robust consideration of the best available intelligence.
2. REGIONAL ECONOMIC DEVELOPMENT POLICY CONTEXT
The SAP is not coming to this task afresh. Economic, productivity and industrial strategies have already been agreed and are being delivered across Heart of the South West LEP area at the regional, sub - regional and sectoral level . The SAP’s priorities will need to complement the infrastructure, innovation, business support and other investments being made the deliver these broader strategies.
This section reviews key policies and initiatives with which the SAP’s work must align.
2.1 Smart Specialisation & European Structural & Investment Funds
At the s tart of the current EU programming period , the European Commission asked all EU regions to consider their natural and competitive advantages a nd to agree a small number of ‘S mart S pecialisation ’ sectors on which they wished to focus their European Structural and Investment Funds (ESIF) expenditure . This push for ‘ Smart Specialisation ’ was rooted in a belief that regions had too often focused their EU fund s on seeking to achiev e com petitive advantage over other regions, often close - by, who also were investing their EU funds to achieve competitive advantage in the same sector ; a rather self - defeating exercise. In 2015, the following Smart Specialisation priorities were agreed for the Heart of the South West LEP area : aerospace, agri - food, big data, environmental futures, healthy ageing, marine, nuclear and electronics/photonics.
The EU also has a long - held ambition of seeing ESIF invested in a complementary way : for employability and s kills investments through the European Social Fund (ESF) to align with and support infrastructure, R&D and business support investment s made via the European Regional Development Fund (ERDF). The fact that ESF largely focuses on inclusion - related activity while ERDF mainly support s highly - skilled economic activity does not make this alignment easy. However, the idea of using ESIF or other skills funds to enable local people at a variety of ages and skill levels jobs secure knowledge - intensive jobs generated via ERDF and other productivity - focused investment is clearly a sound one. It sit s behind the skills ‘escalator’ concept adopted by the Heart of the South West LEP area Local Industrial Strategy and described more fully below .
Although central ly managed with funds allocated to projects via competitive tender, Heart of the South West LEP area LEP nonetheless had significant influence over the targeting of funds, through a) the Heart of the South West LEP area ESIF strategy and b) ongoing involve ment in shaping the focus of calls for proposals.
T he process of making funding commitments under the current ESIF programme is nearing an end . Given Brexit uncertainties , it is unknown whether the UK will participate in future ESIF programmes or whether these will be replaced by a new ‘ Shared Prosperity Fund’ ( discussed below ) . However, given ESIF’s position, as a large regionalised fund over which the SAP might expect to influence, it is useful to consider its scale. Over the seven years to 2023 , the cur rent programme will have invested : €67 million of ERDF across four ‘Priority Axis’: €19m for Research and Innovation; €6m for improvements to ICT infrastructure and SME capacity to exploit this: €29m for promoting SME competitiveness through incubation, e nterprise and business support; and €14m for low carbon initiatives.
€50 million of ESF across five Priorities: €0.8m for Access to Employment; €7m for the Integration of Young People; €11m for Active Inclusion; €28m for Livelong Learning; and €3m for imp roving the labour market relevance of education and training frameworks.
2.2 Shared Prosperity Funds
Government has pledged to set up a Shared Prosperity Fund to replace the c £2.1bn of EU funds that comes into the country each year.
In the EU referendum in 2016, the highest numbers of votes to leave the EU were recorded in the UK’s most deprived communities. As the UK prepares for Brexit, the creation of the UK Shar ed Prosperity Fund was seen as important in addressing the discontent e xpressed in the vote to leave and make ‘inclusive growth’ a reality. In recent years, the UK’s economic performance has improved, but not everywhere is benefiting. In some parts of the Midlands, for example, employment rates are more than 10 percentage p oints below the national average. ESIF funds have been critical in underpinning social and economic development in less prosperous communities, which cannot afford to lose this support.
However, m uch remains uncertain about the exact size, focus or mana gement arrangements for Shared Prosperity Funds.
In July 2018, James Brokenshire 8 made a Written Statement stating that:
The purpose of the Fund is “to reduce inequalities between communit ies across our four nations”;
The method for doing this is “stren gthening the foundations of productivity as set out in our modern Industrial Strategy to support people to benef it from economic prosperity”;
The role of the Industrial Strategy is heavily emphasised, both at a national and local level, with local areas i n England “being asked to prepare Local Industrial Strategies to prioritise long - term opportunities and challenges to increasing local productivity”;
Since then, consultation s on the design of the fund have been held up by Brexit. The original plan was f or a decision on the design of the Fund to be taken as part of the 2019 Spending Review , but this full Spending Review has now been postponed to 2020 9 .
8 Secretary of State for Housing, C ommunities and Local Government 9 It was replaced by a one - year spending p lan for 2020 / 21 Although much is uncertain , it is possible that further consultation s will follow the election, focused on topics such as :
T he t argeting of the funds - James Brokenshire’s Written Statement emphasised “ta ckling inequalities between communities by raising productivity, especially in those parts of our country whose economies are furthest behind ’. Others 10 have placed greater emphasis on the importance of inclusive growth .
The f ormula for distribution of funds across regions – T o what extent should this be determined by measures of output / productivity / innovation performance or high levels of unemploymen t / low wages?
Requirements for matched funding or whether the full cost of projects should be met
Pre - allocation of funds to regions vs competitive bidding
Management of the funds
o whether to decentralise management
o Whether the funds should be in a sing le pot (with no ESF / ERDF split)
o Duration of pr o gramm e , e.g. whether to replicate the ESIF seven year programme period
The SAP is likely to have a keen interest and a desire to contribute to these consultations.
Whatever the views of individual members , the sense in focusing on opportunities within sectors and places; and of seeking to link infrastructure, innovation, business support and skills investments appears sounds.
2.3 Area based Investments
This section looks the area - based initiatives that s et out priorities and opportunities of specific geographies within Heart of the South West LEP area , with which skills investment s should align.
2.1.1. Growth Deals & City Deals
Growth Deals and City D eals are packages of funding and decision - making powers that are devolved to local authorities and/or LEPs , giving them greater freedom to take decisions and to direct how public funds are spent to generate economic growth in their area .
10 Such as the Rowntree Foundation and National Council for Voluntary Organisations There have been three Growth Deal ‘rounds’ since July 2014 and 26 City Deals agreed between J uly 2012 and August 2014 . The first wave of City Deals covered the eight largest English cities outside London. The second wave, agreed in July 2014 , included Plym outh.
2.1.2. Heart of the South West LEP area Growth Deals
Since 2014, government has invested £240 million in Growth Deal projects in the Heart of the South West LEP area . The first two rounds of Growth Deals (£130.3 million in July 2014, and £65.2 million in J an uary 2015) led to investment in strategic and local transport infrastructure, including enterprise and innovation centres and new buildings or facilities for colleges.
The most recent Growth Deal (£43.57 million in November 2016) is funding ten projects designed to deliver “higher value careers, better infrastructure and improved productivity” 11 . The se investments support the delivery of the LEP ’s Smart S pecialisation priorities and capitalise on the six ‘Golden Opportunities’ set out in Heart of the South West LEP area ’s Devolution Prospectus 12 : Marine
Nuclear
Aerospace and Advanced Engineering
Data Analytics
Rural Productivity
Health and Care
The majority of projects are not directly skills - related , focusing instead on capital investment designed to unlock growth in these priority sectors. However, ensuring that the skills required to realise the potential of these strategically driven investments remains an important task for the SAP.
2.1.3. Plymouth and the South West Peninsula City Deal
The Plymouth and the So uth West Peninsula City Deal aims to reinvigorate the region’s marine and advanced manufacturing sectors, creating 9,500 permanent jobs.
11 The ten projects are: 1. Phase 3 of the Somerset Innovation Centre in Bridgwater 2. Expansion of the Connecting Devon and Somerset broadband and mobile project 3. Youth Construction Skills Project "Devon Communities Together" 4. South Devon College Hi Tech Centre 5. iAero (South) Centre, Yeovil, an aerospace innovation space 6. Next generation ICT training project "Blue Screen IT - PROJECT X" in Plymouth 7. Houghton Barton Pack age, Newton Abbot – a link road and park and change site. 8. Taunton Toneway Corridor Capacity Improvements 9. Huntspill Energy Park, Bridgwater, delivering infrastructure for the Enterprise Zone. 10. A regeneration project around Plymouth train station.
12 https://heartofswlep.co.uk/wp - content/uploads/2016/09/Heart - of - the - South - West - Devolution - Prospectus.pdf The focus of the Deal is on unlock ing land at the South Yard site at Devonport Naval Base in order create 32,400 squar e metres of new marine workspace and meet the need of marine companies that need new employment space for supply chain companies or to expand their business. It includes: the development of facilities for the deep water testing of marine products with comp lementary investment for research, development and innovation; tailored business support for small and medium sized enterprises and larger enterprises in the marine sector and their associated supply chains; A Deal for Young People to address unemployment by encourage and providing intensive support to 1,500 local young people, enabling at least 540 to achieve sustained employment in the area.
2.1.4. Greater Exeter Strategic Plan and Data Analytics Skills Escalator
The local authorities of East Devon, Exeter, M id Devon and Teignbridge and Devon County Council are working on a Greater Exeter Strategic Plan encompassing directives on the level of housing and employment land to be provided until 2040 13 . Adoption is scheduled for 2023 , at which point it will sit above Local Plans for each area . The purpose of the plan is to:
Create a joined - up vision and aspirations for the area
Meet the area’s housing needs
Secure economic growth and increased prosperity
Provide transport and infrastructure improvements needed to support sustainable growth
Conserve and enhance the area’s environment
The plan will build on an existing strategic ambition of developing Greater Exeter as a n ‘analytical city’ and a world leading location for a pplied environmental science. To support this ambition, partners are creation of a ‘ Data Analytics Skills Escalator ’ to ensure that a) analytical businesses can secure the talent they need and b) residents across Greater Exeter and the wider region can acquire the skills they need to benefit from knowledge - intensive growth.
2.4. Enterprise Zones
Whilst digital technology increases remote connectivity, the creation of physical assets that promote collaboration and knowledge - sharing remains an important facilitator of innovation , clustering and growth . Heart of the South West LEP area aims to develop its innovation infrastructure across the whole geography, building on existing investments in:
13 https://www.gesp.org.uk/ Three Clean Growth Enterprise Zones;
The Torbay Innovation Campus , support ing electronics, photonics and mar ine science businesses;
Science Parks in Exeter and Plymouth supporting the commercialisation of research and start - ups;
A network of Innovation Centres, with the intention of every town having its own hub.
Enterprise Zones 14 have established themselves as a n important force for driving local economies as they unlock key development sites, consolidate infrastructure, attract business and create jobs. They are also significant in that the growth in business rates generated by Enterprise Zones is retained b y LEPs and local authorities for reinvestment in site development and other local initiatives, including workforce skills.
The Heart of the South West LEP area is host to two of the country’s 48 Enterprise Zone and one of 20 University Enterprise Zones.
2.4.1. Oceansgate, Plymouth
Oceansgate is a world - class hub for marine - based industries, with opportunities for research, innovation and production in a collaborative environment. Oceansgate occupies a 35 hectare site on the southern edge of Devonport Dockyard, o ne of the largest naval dockyards in Europe, adjacent to Babcock Marine , offering access to a complex of industrial buildings and docks for commercial use, with direct deep water access to the English Channel.
Oceansgate will enable the creation of state - o f - the - art facilities for marine manufacturing, including space for engineering and composites workshops, assembly areas and mobilization. Oceansgate’s three docks are suitable for many marine industry dockside operations and will offer marine specialist co mpanies a unique expansion opportunity. The dry dock facilities can be reinstated and the site has the capacity to undertake deep water testing.
2.4.2. Gravity Enterprise Zone
Heart of the South West LEP area is home to the first new nuclear power station in 20 y ears: Hinkley Point C (HPC) in Somerset. At a global level, the nuclear market is expected to grow. By anchoring the nuclear sector and supply chain in the Heart of the South West, the area will be well positioned to seize global export markets and create high value jobs.
The Gravity Enterprise Zone, a 222 acre innovation campus just off Junction 23 of the M5, aims to create 4,000 high value skilled jobs focused around low carbon and energy generation.
14 https://enterprisezones.communities.gov.uk/about - enterprise - zones/ The construction of HPC also provides the opportunity to address critical skills gaps within the nuclear construction and wider engineering sector through Centres of Excellence. An example of this the location of the southern hub of the National College for Nuclear at Bridg water , providing a range of specialised nuclear skills and training to create a new generation of nuclear technicians and engineers .
2.4.3. The Exeter and East Devon Enterprise Zone (EEDEZ)
Located on the edge of Exeter, The Exeter and East Devon Enterprise Zone (EEDEZ) focuses on the inn ovation, digital, business & professional services, low carbon industry, advanced manufacturing/engineering and aerospace sectors. With excellent connectivity via road, rail and air links, it provides business rate relief and simplified planning across fou r locations:
Skypark (Size: 40 hectares Jobs: 6,500) - A business park equipped to accommodate high quality business and services, including crèches, cafes, shops and a 150 bed hotel with leisure and conferencing facilities.
Exeter Science Park ( Size: 25 hectares Jobs: 3,000) - A rapidly expanding Science Park which hosts a range of technology and innovation companies and is home to the Met Office’s HPC Complex and super computer.
Cranbrook Town Centre (Size: 5 hectares Jobs: 500) - Which provides an oppo rtunity to relocate or build a business within a growing community.
Exeter Airport Business Park Expansion (Size: 5 hectares Jobs: 500)
2.4.4. The University of Exeter Enterprise Zone
The University of Exeter Enterprise Zone (UEEZ) is one of 20 new University Enterprise Zones established around the UK to stimulate economic growth by providing intensive business incubation, acceleration and support . UEEZ build s upon an active community of entrepreneurs, innovators, start - ups and early - stage growth enterprises , f ocusing on generating and commercialising innovation to grow key sectors in the regional economy , including environmental data and digital science.
2.5. Heart of the South West Local Industrial Strategy
In December 2018, Government announced that it would work with all areas across England to develop Local Industrial Strategies (LIS): l ong - term plans demonstrating how the n ational Industrial Strategy could be implemented building on each area’s strengths to deliver economic growth and high quality jobs. The He art of the South West LEP area Local Industrial Strategy (LIS) identifies that the LEP area has world class businesses and public assets across three areas - Energy Futures , Engineering Futures , and Digital Futures – which can be harnessed to deliver national ‘Clean Growth’ Grand Challenges in an inclusive way through investments in ideas, people, infrastructure, places and the business environment. Figure 1 L ocal I ndustrial S trategy Diagram , Heart of the South West LEP , 2019
Source: Heart of the South West LEP Local Industrial Strategy Progress Statement 2
The pledge is to develop a new approach to growth in urban, rural and peripheral areas, where economic growth is decou pled from emissions growth and where the proceeds of economic growth are shared across people and communities.
The key goals, relating to each pillar of the strategy are as follows.
2.5.1. Energy Futures
“The Heart of the South West will increase the critical m ass of businesses operating within or supplying to the energy sector in order to create a globally recognized cluster by 2038.”
This priority is focused on seizing opportunities for Clean Growth associated with: The nuclear industry, centred on Hinkley and its legacy; Next generation marine renewables ; and, Improve ments to energy infrastructure, including solar, wind, geothermal, marine and biomass.
2.5.2. Engineering Futures
“The Heart of the South West will increase the size of its engineering and high value manufacturing sector by 2038 through developing clean technologies and solutions.” This priority is focused on seizing opportunities associated with:
Advanced manufactu ring and engineering clusters – to anchor, grow and attract high value manufacturing and engineering and to form a low carbon technology cluster Marine Autonomy – capitalising on major new global markets Sustainable Aviation – to contribute to the sustain able aviation challenge through development of rotary technologies and electric planes; and, Industrial digitisation – to unlock productivity through automation and harnessing of data, aligned with ambitions in the AI sector deal.
2.5.3. Digital Futures
“The He art of the South West will pioneer clean growth by harnessing datasets and the application of AI to become a globally recognised centre of excellence by 2038.”
This priority is focused on pioneering Clean Growth opportunities through harnessing data sets and the application of AI related to: The Environmental Intelligence Market – through an Environmental Intelligence Accelerator; The challenge of reducing emissions from agriculture; The marine geospatial innovation market - through a Geospatial Innovation Centre and Data Hub; and, Health Technology – through capitalising on the area’s ageing demographic and health research assets to position the area as a health technology pioneer.
2.5.4. The LIS People Foundation
“The Heart of the South West will ensure a skilled workforce through the Skills Escalator approach, securing the opportunities of the future”
To realise these aspirations, the draft LIS commits six strategic objectives under the ‘People’ element our ‘foundation’ of the strategy:
1. Champion STEM cours es (including T Levels) to support increasing take up
2. Ensure all residents have the employability skills they need to progress
3. Increase take up of technical qualifications and explore ways to improve retention and recruitment of those with technical and hi gher level skills 4. Increase employer investment in workforce development
5. Work with institutions to ensure that the Heart of the South West’s learning facilities and teaching capacity are fit for purpose and meeting future need
6. Mainstream inclusive approach to growth so all that residents can benefit from future prosperity These objectives are to be achieved through the ‘Skills Escalator’ approach: creating a series of layered interventions that ‘accelerate and focus efforts to increase the availability of hi gher level and technically trained individuals, supporting every individual to play an active part in the future prosperity of the area’ .
To achieve this and, in particular to deliver the objective of inclusive growth, the Skills Escalator approach will n eed to:
• Mobilise, inspire and empower young people both in and out of education to train and learn through academic, apprenticeships, T levels and other routes into opportunity sector roles;
• Engage and support those outside the labour market access releva nt opportunities within the Heart of the South West LEP area growth sectors, and develop the basic and intermediate skills they need to progress;
• Enable those already in work to up - skill and access new opportunities through both in work training, apprenticeships and other vocational opportunities including wider career jumping approaches between sectors;
• Maximise and retain the talent of older people and those seeking to leave the labour market in key roles, including teaching to support a pipeline of talent for all sectors; and,
• Interact and support the business community to optimise their existing workforce and better prepare and contribute to creating the workforce of the future.
2.6. Digital Strategy, Digital Skills Partnerships and the Digital Skill s Innovation Fund
In March 2017, the government published its Digital Strategy 15 , to create a world - leading digital economy that works for everyone, by:
Building world class digital infrastructure for the UK
Giving everyone access to the digital skills th ey need
Making the UK the best place to start and grow a digital business
Helping every British business become a digital business
Making the UK the safest place in the world to live and work online
Maintaining the UK government as a world leader in servin g its citizens online
Unlocking the power of data in the UK economy and improving public confidence in its use.
15 DCMS (2017) UK Digital Strategy 2017 The Digital Skills Partnership (DSP) brings together public, private and charity sector organisations to drive forward the national Digital Stra tegy by increasing the digital capability of individuals and organisations 16 . It is responsible for improving digital capability across the whole skills spectrum - from the essential skills to reduce digital exclusion, to enabling workers to keep up to date in an increasingly digital economy, through to forging the advanced skills required for specialist roles.
To do this, the national DSP has established cross - sector Groups to deliver four priorities: Increase the national coherence of digital skills provi sion. Support the development of Local Digital Skills Partnerships that can deliver targeted digital skills training for local communities and economies with local and national partners. Increase digital enterprise by helping small businesses and charitie s upskill their employees and increase their digital capabilities. Support computing in schools by convening industry and other partners to ensure that teachers have the knowledge and skills to teach a new world - leading computing curriculum.
The government is working with LEPs and Combined Authorities (CAs) to help establish Local Digital Skills Partnerships (Local DSPs) across the country to tackle local digital skills challenges and build thriving and inclusive local economies. In 2018, one of the first t hree Local DSPs was established in Heart of the South West LEP area .
Since then the Heart of the South West LEP area Digital Skills Partnership has undertaken a review of Digital Skills in the region and launched a new Digital Momentum programme 17 . The pro gramme sets out to encourage currently under - represented groups, notably women who make up just 17% of tech workers, into the digital sector to embark on, or progress within, digital careers. It also seeks to engage people living in high unemployment regio ns across Somerset, Devon, Torbay and Plymouth, offering a range of free training opportunities and support at all levels of digital competency.
16 https://www.gov.uk/guidance/digital - skills - partnership 17 https://heartofswlep.co.uk/about - the - lep/strategies - and - priorities/digital - skills - partnership/digital - momentum/ 3. INCLUSION AND EMPLOY MENT POLICY
3.1. Welfare reforms
While moves to reform welfare and incentivise work have contributed to more people being in work than ever before, rates of in - work poverty have risen and today more people who are in work are in poverty compared to people who are workless. One reason behind this is that many of the jobs that people are supported into offer limited progression opportunities.
While all areas have been affected, the impacts of welfare reform have varied from place to place. In the northern half of the country, in work poverty has been driven by low incomes and weaker labour markets. In the south, in - work poverty is largely driven by high housing costs. Less prosperous seaside towns (such as Torbay) which combine high levels of worklessness, low wages and high p roportions of private renters have been identified as being among the hardest hit areas.
Heart of the South West LEP area currently boasts higher employment rates than the rest of the UK, (81.2% compared with 75.4% across Great Britain 2 ), but in areas wi th a higher number of claimants (such as Plymouth and Torbay) the proposed welfare reforms and benefit cap may have a greater impact on residents and therefore the wider economy.
Common welfare and employment challenges, particularly across rural parts of Heart of the South West LEP area , include: A high prevalence of low paid and seasonal work
An economy dominated by small and medium enterprises
Housing affordability ratios above the national average
Higher than average and growing population of peopl e with a disability or long - term health condition in receipt of benefits
Sparse and predominantly rural population making service targeting difficult
In 2012, the Devon Strategic Partnership carried out an assessment of the impact of welfare reforms and estimated that, by 2017, £343 million would be taken out of Devon economy due to reductions in welfare benefits to those of working age. This loss was projected to fall across 160,000 working age households, 60% of whom are in employment, with an average loss of almost £2,000.
However, the report also identified a number of opportunities arising from the changes, including the opportunity for local action to promote jobs and employability; to support people to gain financial, digital and employment skills ; and to help thousands of people to become more independent and self - reliant.
Four recommendations were made: 1. Use all available levers to influence employment and skills, and to support people to find good quality work.
2. Align priorities towards the aim of giving people opportunities greater independence and self - reliance, changing the emphasis of communication and spending towards independence and employability, with support targeted towards those furthest from that outco me.
3. Support individuals and communities to help themselves and one another.
4. Collaborate more closely on commissioning and service delivery to make the most of limited resources, whilst enabling local flexibility.
3.2. The Work and Health Programme
The Work and Health Programme is designed to help people who are out of work to find and keep a job 18 . Launched England between November 2017 and April 2018, it replaced the mainstream Work Programme and the specialist Work Choice scheme for disabled people, but with a significant cut in its funding 19 . Its participants are people with disabilities , the long - term unemployed and people in ‘early access groups’ for whom support to enter into and stay in work is prioritised. Participants do not have to be on benefits to rece ive support.
The programme aims to help participants to: identify their employment needs; match their skills to work that’s available; put them in touch with employers; find long - term employment; get training to help find work; and manage health problems. In Heart of the South West LEP area it is delivered by Seetec Pluss 20 .
3.3. Disability Employment Gap Commitment
Across the UK, 53% of people with a disability are in employment compared to 81.5% of those without a disabilit y 21 . This equates to 4.6 million people with a disability or long - term health condition being out of work 22
In November 2017, the Department for Work & Pensions and the Department of Health and Social Care launched a Green Paper seeking views on activities that could help “create a societ y in which everyone has a chance to fulfil their potential” 23 .
18 https://www.gov.uk/work - health - programme 19 https://www.disabilityrightsuk.org/news/2019/may/9 - out - 10 - work - and - health - programme - participants - do - not - have - job - outcome 20 https://www.seetec.co.uk/employability/seetec - pluss 21 People with disabilities in employment 2019. House of Commons Libr ary. https://researchbriefings.parliament.uk/ResearchBriefing/Summary/CBP - 7540#fullreport 22 Office for National Statistics. Labour Force Survey, Q2 2 016; 2016 23 https://www.gov.uk/government/consultations/work - health - and - disability - improving - lives/work - health - and - disability - green - paper - improving - lives The paper acknowledges that health - related benefits arising from being in employment are not fully reflected in decisions across health services and that opportunities to support people to achi eve their employment aspirations are regularly lost.
A recent Commons Library Briefing suggests that these gaps are closing and that of the 7.7 million people of working age (16 - 64) with a disability in April - June 2019, an estimated 4.1 million were in em ployment, up 246,000 on the previous year. However, despite this improvement, the employment gap for people with disabilities remains huge .
The 2018 Heart of the South West LEP area LEP Productivity Strategy 24 pledged collaboration with local and national partners 25 to create a “no wrong door” approach to support ing people facing barriers to work including : those physically unable to reach employment and skills provision due to transport issues; those with a childcare need or other personal barrier; and thos e with a disability or wider health related barrier. Monitoring progress and advising on steps required to achieve these goals could be an important role for the SAP.
3.4. Fuller Working Lives
‘Fuller Working Lives: a partnership approach’ is a government poli cy paper which explains how employers will need to draw on the skills and experience of older workers to avoid loss of labour 26 as the population ages. It also explains how working longer can improve health and wellbeing and bring the benefits of a multi - generational workforce to businesses. It sets out a number of recommendations on how to support older workers to remain in the workforce and how to help employers retain, retrain and recruit older workers so they have fuller working lives. Policy are as covered include flexible working, retraining for a new career, self - empl oyment, volunteering and phased retirement.
Between 2005 and 2016 , the proportion of Heart of the South West LEP area ’s population aged sixty five and over in employment rose from 7 .2% to 13.1% 27 . This equates to an additional 66,000 older people being in work over a period during which total employment grew by 99,000. This trend is likely to continue . B etween 2015 and 2030 , Heart of the South West LEP area ’s population is projected t o grow by 153,000, while the working age population (16 to 64) is forecast to fall by 3,500. The need for upskilling and reskilling older members of the population will be important to minimise labour shortages and skills gaps.
The draft Heart of the Sout h West LEP area Local Industrial Strategy recognises this, pledging to maximise and retain the talent of older people and those seeking to leave the labour market in key roles, including teaching to support a pipeline of new talent for all sectors.
24 https://heartofswlep.co.uk/wp - content/uploads/2018/04/HeartoftheSouthWestProductivityStrategy.pdf 25 I ncluding local a uthorities, colleges, Jobcentre Plus and wider providers 26 https://www.gov.uk/government/publications/fuller - working - lives - a - partnership - approach 27 Skills and productivity in the Heart of the South West https://heartofswlep.co.uk/wp - content/uploads/2018/11/Skills - and - Productivity - in - the - Heart - of - the - South - West.pdf 3.5. Opportu nity areas
The Opportunity A rea programme aims to help children and young people to achieve their full potential in 12 local areas nationally with the lowest social mobility. Each O pportunity A rea is working in partnership with nurseries, schools, business es and charities to overcome the barriers that hold children and young people back.
West Somerset, which is the lowest ranking district in the whole country in the Social Mobility Index 28 , is one of these Opportunity Areas. While achievement of all pupils and of disadvantaged pupils in West Somerset at the end of key stage 4 is in line with the national average, fewer young people then progress to higher education and good careers than anywhere else in the UK.
West Somerset will , however, benefit from the new nuclear build at Hinkley Point which will bring new job opportunities, many of which will be highly skilled. A core purpose of the Opportunity Area is to enable young people who have the skills and aspiration to access these, and other , highly skilled jobs. This starts by getting children ready when they start school and working with three national partners 29 to ensure:
1. Every child has a great start in life
2. Educational excellence in the classroom
3. Transition to adulthood
4. Skills for employment and business
28 https://www.gov.uk/government/publications/social - mobility - index - 2017 - data 29 The Careers and En terprise Company (CEC), the National Citizen Service and the Education Endowment Foundation 4. EMPLOYMENT & SKILLS POLICY
4.1 Careers Hubs, Enterprise Co ordinators and Advisers
The Careers and Enterprise Network connects schools and colleges with employers and careers programme providers, support ing them to work to gether to provide young people with effective and high - quality encounters with the world of work 30 .
The network is made up of Enterprise Coordinators who are co - funded by Local Enterprise Partnerships and Combined Authorities. Enterprise Coordinators are t rained professionals who work with clusters of 20 schools and colleges to build careers plans for students and make connections to local and national employers. They also support a group of senior business volunteers, known as Enterprise Advisers, who the y match with one of the school or colleges in the network. Enterprise Advisers use their knowledge of the local business landscape to create opportunities with their business contacts in the area for their school or college’s students.
Careers Hubs are a c entral part of the government’s Careers Strategy, published in December 2017. Their over - arching purpose is to help young people take up the education and training choices that will enable them to follow rewarding careers in high value sectors that match t heir aspirations and abilities. Each Hub consists of a group of between 20 and 40 secondary schools and colleges who work together to deliver to the ‘Gatsby Benchmarks’ 31 that set out effective and good standards for careers provision in schools and college s. All Careers Hubs have access to support and funding to help them meet the Gatsby Benchmarks. This includes: A ‘Hub Lead’ to help coordinate activity and build networks Access to bursaries for individual schools and colleges to train Careers Leaders Cent ral Hub Fund of equivalent to £1,000 per school or college per annum
Data shows that schools and colleges in the first wave of Careers Hubs are outperforming the national average across all aspects of careers education, with 58% providing every student with regular encounters with employers and 52% providing every student with workplace experiences such as work experience, shadowing or workplace visits
Just over 1,300 secondary schools and colleges (around a quarter of those in England) now benefit from being part of a Careers Hub.
The Heart of the South West LEP area Careers Hub, one of 33 across the country, is a partnership between the LEP; local authorities , the Careers and Enterprise Company; 6 0 local schools, colleges and FE establishments; and loca l and national employers in the
30 https://www.careersandenterprise.co.uk/about - us/our - network 31 The Gatsby Benchmarks - see https://www.careersandenterprise.co.uk/schools - colleges/understand - gatsby - benchmarks public, private & social enterprise sectors. It also hosts a well - established Enterprise Advisor Network (EAN) 32 and , via the EAN, is engaged with 123 schools and FE institutions.
4.2. National Retraining Scheme
In Autumn 2017, as part of the national Industrial Strategy, the government committed to a National Retraining Scheme to help workers adapt to the changing nature of jobs and new tasks that people will need perform in the future economy .
The autumn 2018 budget announced £10 0 million for the development and testing of the first phase of the scheme. This includes a new careers guidance service to help people identify work opportunities in their area and the skills they need to land the job they want. Called ‘Get help to retrai n’, this service will be available to eligible adults and businesses in six areas across England from 2020, including Heart of the South West LEP area . Initially, it will support adults who:
are already in work
are aged 24 and over
do not have a qualificat ion at degree level
are paid below a certain wage threshold
Designed to complement existing training programmes for adults , it will provide :
1. tailored advice and guidance from a qualified adviser
2. functional skills training, focusing on English and maths
3. flexible online and blended learning, a mix of online and face - to - face provision, enabling more adults to access training
4. in - work vocational training, learnt on the job.
4.3. Adult Education Budget
The Adult Education Budget (AEB) aims to engage adults and to equip them with the skills they need for work, an apprenticeship or other learning. It enables flexible programmes of learning to be made available, which may or may not require a qualification, to help eligible learners engage, build confidence, and/o r enhance their wellbeing. 33
The AEB, which represents just 2.3% of the government’s overall annual spend on education and training, is the only major element of national (as opposed to EU) skills funding that has been partially devolved to regions.
32 https:// heartofswlep.co.uk/news/7364/ 33 https://www.fenews.co.uk/press - releases/21782 - detailed - guide - adult - education - budget - aeb - devolution Admi nistered by the ESFA, it supports three statutory entitlements to full funding for eligible adult learners :
English and maths, up to and including level 2, for individuals aged 19 and over, who have not previously attained a GCSE grade A* to C or grade, or higher, and/or
first full qualification at level 2 for individuals aged 19 to 23, and/or
first full qualification at level 3 for individuals aged 19 to 23.
In 2015 to 2016, the government agreed a series of devolution deals between central government and combined authorities in England 34 . As part of the devolution deals, central government transferred certain adult education functions to the combined authorities. Through this transfer, the combined authorities took on responsibility for the AEB.
From t he 2019 to 2020 academic year (1 August 2019 to 31 July 2020), the government will devolve the AEB to the following six combined authorities and to the Greater London Authority (GLA):
Cambridgeshire and Peterborough
Greater Manchester
Liverpool City Region
Tees Valley
West Midlands
West of England
Subject to readiness, two further authorities, North of Tyne and Sheffield City Region will take on the new responsibilities from the 2020/21 academic year.
Under current policy, the D epartment f or E ducation wil l not transfer or delegate functions relating to: Apprenticeships; Persons subject to adult detention; Traineeships for 19 to 24 year olds; Education and training for 16 - to - 18 - year olds; and Higher education
While this devolution accords significant opportunities to local areas, enabling them to link skills investment to economic developments or key sectors, it is worth noting that the Adult Education budget fell by c. 35% to 40% between 2010/11 to 2015/16 (ac counting for inflation) and has remained fairly static since.
Of the £700m being delegated to combined authorities, around £450 million is currently allocated to FE colleges, representing roughly 8% of these colleges total income.
34 https://www.gov.uk/government/publications/devolution - and - mayors - what - does - it - mean As it is not a combined authority area, this opportunity is not currently available to the Heart of the South West LEP area .
4.4. Apprenticeships and Traineeships
In recent years, a broad emphasis of UK skills policy has been to seek to create a market for training that improves the match between the skills that people acquire and those that are needed in the economy 35 . A criticism of skills policy over the 1990s and early 2000s was that it paid too little attention to the nature of the tr aining being provided, emphasising instead the importance of hitting targets relating to the volume of training delivered or the proportion of the population trained to a given level. By placing employers at the centre of the skills system and granting the m increased influence over the design and structure of vocational qualifications, policy makers believe the skill system will become more responsive to skills demand and, therefore, efficient . In theory, this responsiveness would also increase employer pre paredness to acquire skills from public and private sector providers , potentially offsetting the impacts of cuts to budgets for adult education and training . R equiring employers to meet a greater proportion of the cost of vocational education and training was also considered likely incentivise employers to ensure that the skills system meets their needs.
The apprenticeship levy, introduced in April 2017, aims to encourage increased emp loyer investment in training and to create better pathway s , particularly to higher level technical skills, for young people attracted to the idea of ‘ earning while learning’ . Organisations with a wage bill of £3 million or more now contribute 0.5 per cent of this to the levy. Apprenticeships provide significant benefits to employers. Greater access to skilled workers, a greater ability to attract new and retain existing workers and improved organisational performance. With the introduction of higher and degree level apprentice ships, employers can use the funding to build the higher - level skills they require to future - proof their organisations against the changing world around them.
In April 2019, FE Week reported that employers had used just 22% of their apprenticeship levy f unds in the 12 months to the end of January 2019. While this is up from 5% in the year after the launch of the levy, it is clear that there remains a significant opportunity to work with employers to find ways to make better use of this resource. The fli p - side of this is that a number of large employers are lobbying to scrap the levy or at least to loosen the restrictions around its use , allowing it to be spent across supply chains or to support training other than apprenticeships.
35 Gambin L. and Hogarth T. 2016 The UK skills system: how well does policy help meet evolving demand? https://assets.publishing.service. gov.uk/government/uploads/system/uploads/attachment_data/file/571688/ER6_The_UK_skills _system_how_well_does_policy_help_meet_evolving_demand.pdf 4.5. T levels
T Levels wil l become a main s tream choice for students after GCSE , alongside apprenticeships and A levels. Developed with employers and businesses, they will be equivalent to 3 A Levels, delivered over 2 years via a mixture of classroom learning and ‘on - the - job’ experi ence during an industry placement of c. 3 months.
The first three T Levels will be available at fifty colleges and schools across England 36 , (including Bridgwater & Taunton and Exeter College ) from September 2020 in:
digital production, design and development
design, surveying and planning
education
T Levels will be based on the same standards as apprenticeships, designed by employers and approved by the Institute for Apprenticeships and Technical Education (the Institute).
The total time for a T Level is to be around 1,800 learning hours over 2 years, including the industry placement. This is a significant increase on most current technical education courses. T Levels also differs from apprenticeships, which are typically 80% on - the - job and only 20% off - the - job learning.
T Level courses will include the following compulsory elements:
a technical qualification, which will include o core theory, concepts and skills for an industry area o specialist skills and knowledge for an occupation or career a minimum standard in maths and English , if not already achieved
an industry placement with an employer, lasting a minimum of 45 working days but potentially longer.
Employers can offer industry placements as a block, day release or a mix of these. Provid ers will support them through a careful planning process, support with designing the industry placement and assistance with the necessary paperwork.
Students who pass all the elements of their T Level will get a nationally recognised certificate showin g an overall grade of pass, merit or distinction. It will also set out the details of what students have achieved on the course. Students who want to progress into higher education will be able to see how UCAS Tariff points are allocated to their T Leve l grade, as shown below.
36 https://www.gov.uk/government/publications/providers - selected - to - deliver - t - levels - in - academic - year - 2020 - to - 2021 Figure 2 : UCAS Tariff by T Level Grade
Source: Universities and Colleges Admissions Service (UCAS)
The equivalence with high levels of A level attainment and UCAS scores enabling progression to prestigious universities forms a key plank in current policy aimed at achieving greater equality of esteem between academic and vocational qualifications.
4.6. Level 4 and 5
The Department for Education a currently conducting a comprehensive review of Level 4 - 5 education with a focus on how technical qualifications at this level can best address the needs of learners and employers. The Review forms part of the Departm ent’s wider work on skills and Higher and Further Education, including the implementation of the Post - 16 Skills Plan. This evidence will feed into the Review of Post 18 Education and Funding 37 .
The premium on wages and employment at age 25 associated with h olding Level 4 - 5 qualifications , compared to lower levels , suggests that qualifications at this level have significant labour market value. However, the variety of qualifications at Levels 4 and 5 mak es it hard for employers to identify the provision that best aligns with their needs. There is no single badge of quality across different Level 4 - 5 qualifications and programmes and a lack of clear information, advice, and guidance to help learners of all ages steer their way through this complex system.
Mean while providers of Level 4 - 5 qualifications face several challenges. The best provision is often developed and delivered closely with employers. However, levels of engagement vary from sector to sector . I nvolving SMEs can be a particular challenge. Staff n eed to have expertise in both teaching and the relevant industry practices, but the costs of attracting tutors with these skills and attributes is high. Providers must also navigate both the Higher Education and Further Education regulatory and funding reg imes, which intersect at this level.
37 htt ps://www.gov.uk/government/publications/review - of - level - 4 - and - 5 - education - interim - evidence - overview Further government research will include a market study examining supply - side issues within Level 4 - 5 provision, and how the market varies depending on whether Level 4 - 5 study is focussed on progression to further study , or progression within employment.
4.7. Higher level skills (including Advanced Learner Loans)
Learning Loans, originally known as 24+ loans, were introduced in 2013/14 for learners studying courses at levels three or four and aged 24 and older. Their introduction resulted in (or coincided with) a fall in th e number of adults studying at l evel 3 and above (outside apprenticeships) from 273,400 in 2012/13 to 169,400 by 2015/16. Despite this, the loan system was expanded in 2016/17 to include 19 to 23 yea r - olds and courses at levels five and six.
Currently, Advanced Learner Loans (ALLs) are available via the Student Loans Company to people taking ‘non - prescribed’ awards at Levels 3 to 6. ‘Prescribed’ qualification s , including some level 4/5 provision, are part of the HE system and students on these courses get access to HE loans for fees and maintenance. These include Foundation Degrees, Higher Nationals (HNDs and HNCs) and Certificates/ Diplomas of Higher Education. ‘Non - prescribed’ Level 4/5 provision is part of the FE system. These include professional Certificates, Diplomas and Awards such as those awarded by City and Guilds. There is no maintenance offer for non - prescribed courses.
Some have argued that this dual system is complex for institutions, stu dents and employers and militates against the emergence of a clearly understood higher technical pathway.
However, one advantage of loan s is that eligib ility does not depend on income, there are no credit checks 38 and, like HE loans, they begin to be paid off when the borrower’s income is over a threshold amount.
4.8. Careers and employment engagement in skills and work
The most recent (December 2017) Career Strategy from Government states:
Excellent careers guidance makes sure there is equality of opportunity. It unlocks potential and transforms outcomes for people of all ages. Evidence suggests that effective and impartial careers provision is particularly important for students from working class backgrounds.
Th e strategy comes off the back of numerous previous changes to the careers system over the years , perhaps the most significant of which was a decision in 2012 to give school head - teachers freedom to secure careers guidance services from an independent provider (a contractor - supplier relationship). This left schools to define the form such services should take . However, no ring - fenced or any recognisable new budget was made available. Funding
38 https://www.gov.uk/advanced - learner - loan for careers guidance had to compete pressure on staff wages and a myriad of other urgent financial needs.
Al so in 2012, the National Careers Service was established to provide information, advice and guidance through face - to - face and telephone advice, web chat and email. Local, community based, in - depth support through the National Careers Service is primarily for adults, though young people can also access the website and telephone advice.
In 2014, the Government established The Careers & Enterprise Company (CEC) to be the strategic coordinating function for employers, schools, colleges, funders and providers and to provide high impact careers and enterprise support to young people (aged 12 - 18). The CEC has invested over £10 million in careers interventions helping 250,000 young people nationally , with a particular focus on areas of the country most in need o f support.
Since 2015, local Jobcentre Plus (JCP) advisers have also been working directly with young people in schools, to advise on work experience opportunities; routes into traineeships or apprenticeships; and on local labour market requirements (inc luding ‘soft skills’ employers value, such as team work and commitment). Despite this government recognises in the strategy that the quality of careers provision across the country remains variable and there is much to do.
Nationally there are five pilots , including one in Heart of the South West LEP area , which are testing ideas for attracting learners by exploring approaches to outreach and engagement and offering subsidised courses at different levels. The pilots aim to understand what works well locally and to shape the future of the National Retraining Scheme. The Heart of the South West LEP area Career Learning Pilot entered its first full year of operation in 2018/19, delivering over 450 Level 3 training opportuni ties 39 . Aimed at supporting harder to reach adults (older people, women returners, young people from deprived areas), the project provided subsidised learning, wraparound support and careers advice for those who have traditionally struggled to progress.
4.9. In stitutes of Technology
Institutes of Technology form part of the Government’s drive to boost technical education and to set more young people on a clear path to a high skilled, high wage careers. They are being created to address the fact that:
new technol ogies are transforming the world of work;
only 7 per cent of people in England aged between 18 and 65 are undertaking training at Level 4 or 5 (one of the lowest rates in the OECD); and
39 https://heartofswlep.co.uk/wp - content/uploads/2019/05/Heart - of - the - SW - LEP - Annual - Delivery - Plan - 2019 - 20.pdf there is an urgent need to equip the future workforce with the techn ical skills that the economy needs to grow.
With the support of regional employers 40 , the South West Institute of Technology (SWIoT) is one of the first wave of 12 IoTs to be established across England to address regional disparities in productivity and to enable the region to play a leading role in delivering the national industrial strategy.
Delivered by two universities and five colleges 41 , SWIoT will create a cadre of highly skilled technical staff to drive growth in the digital, engineering and manufact uring sectors, across Cornwall, Devon and Somerset.
Capital investment, £15 m from DfE and £12m from partners, will create:
new buildings in Exeter, providing a purpose - built, professional environment for teaching data science and digital technologies
a range of new facilities and equipment, within refurbished build ings, in Barnstaple, Bridgwater and Cannington to create a step change in the region’s provision in manufacturing and engineering technologies.
SWIoT will deliver a range of courses across its sector specialisms with three quarters of planned provision at levels 4 and 5. By academic year 5, it will have over 1,500 new learners. It will create an Employer Leadership Group who, along with its anchor employers, will ensure that its provision is ta ilored to employer needs and meets industry standards. Drawing on the expertise of the Universities of Exeter and Plymouth, SWIoT will also establish an Observatory, responsible for ensuring that its curriculum is matched to the current and future occupati ons and skills needs, through market intelligence.
4.10. Reforms including those to grow the profile of technical education routes
T Levels and Institutes of Technology are just two recent initiatives that aim to boost the standing of vocational programmes and t o achieve ‘parity of esteem’ with academic learning: a long - cherished goal of adherents of technical education.
The following indicators have been suggested as benchmarks to help policymakers assess to what extent vocational and technical are viewed equal ly in a region's learning system 42 :
People are able to reach equivalent levels of qualification and employment having taken different (academic and/or vocational) education and training routes.
40 Including Babcock, TDK Lambda, the Met Office and Oxygen House 41 The educat ion partners are the University of Plymouth, University of Exeter, PETROC, Exeter College, City of Plymouth College, Bridgwater and Taunton College and Truro and Penwith College. 42 Best practice approac hes to achieving parity of esteem in education and training: final report (Huggins, R, Harries, S, Lewis, S, Gordon, J & Libert, I 2003) Society values these choices equally, meaning for example, that families would make a positive choice of vocational routes.
HE institutions accept entrants with vocational and academic awards on an equal basis
Employers recruit candidates with both voca tional and academic qualifications to similar levels of employment and financial reward.
Interestingly MP Robert Halfon recently proposed that the UK should “blend technical and academic learning” and that universities should dramatically increase their levels of technical training to close the skills gap and deliver social justice.
4.11. Labour Education Policy
The Labour Party has launched its second consultation on its plans for a National Education Service, which will explore how to move to a system “em powered by local accountability”. Labour leader Jeremy Corbyn has previously revealed his preference for free lifelong learning which could mean Colleges lose their status as independent corporations and could be brought back under local authority control .
At a time when working lives and the skills our economy needs are changing rapidly, governments have the responsibility to make lifelong learning a reality by giving everyone the opportunity to access education throughout their lives. To meet this re sponsibility, Labour will create a unified National Education Service (NES) for England to move towards cradle - to - grave learning that is free at the point of use. The NES will be built on the principle that ‘Every Child – and Adult Matters’ and will incor porate all forms of education, from early years through to adult education.
In a consultation document entitled “local accountability in the National Education Service”, the party’s early years, education and skills policy commission warns that “in our haste to rectify the damage the Conservatives are doing to our education system, it could be tempting to simply return to what has been done in the past - “But this would be a wasted opportunity,” the document states.
At last year’s conference, the Labo ur Party voted to recreate a “coherent, planned and appropriately funded national public system which is accountable to its various stakeholders and communities”. It has also set out 10 guiding “principles” which will be followed during policy development . To help shape the NES, Labour has launched a lifelong learning commission. The Commission will bring together 14 experts from across education, top names in their fields, including the EEF’s Chief Economist Seamus Nevin. It is co - chaired by the former Education Secretary, Estelle Morris and the General Secretary of the Communication Workers’ Union, Dave Ward.
5. SPATIAL AND DEMOGRA P HIC CONTEXT
5.1. Introduction
The Heart of the South West is the second largest LEP area extending over 10,158 square kilometres of the South West peninsular of England ( Figure 3 ). Rich in environmental and cultural heritage assets and featuring long - held mariti me and agricultural traditions, the area is renowned for its inspiring land and seascapes, rich wildlife habitats, ancient heritage sites, stately homes and gardens, and cultural events 43 . Reflecting this quality, and in particular the desire to preserve i t, the area has an abundance of national and international environmental designations, the most notable of which include:
484 miles 44 of coastline encompassing sections of the South West Coast path and the unique historical and paleontologically valuable, UNESCO World Heritage ‘Jurassic’ coast (England’s only natural World Heritage Site). Nationally important marine habitats and species are also protected through the design ation of several Marine Conservation Zones in the area.
Protected moorland, woodland, valleys and farmland within Exmoor National Park (267 square miles) and Dartmoor National Park (368 square miles). Exmoor National Park is also one of only 15 internationally recognised Dark Sky Reserves , providing striking views of the night sky.
Areas of Outstanding Natural Beauty (AONB) incorporating coastline in North Devon , East Devon , and South Devon , the Mendip , Quantock and Blackdown hil ls, and the drowned river valley system of T a mar Valley .
43 https://heartofswlep.co.uk/ wp - content/uploads/2017/10/Evidence - Report.pdf 44 http://democracy.somerset.gov.uk/ieListDocuments.aspx?CId=357&MID=872 Figure 3 Map of LEP areas in England:
Source: LEP Network – Growth Hubs
The LEP area comprises the upper tier local authority districts of Somerset, Devon, Torbay and Plymouth ( Figure 4 ) and the lower tier local authority districts of Mendip, South Somerset, Sedgemoor, Somerset West and Taunton, North Devon, Mid Devon, East Devon, Teignbridge, South Hams, West Devon and Torridge.
Figure 4 Heart of the South West LEP
Source: Heart of the South West LEP – Ab out the LEP
Unsurprisingly, much of the LEP area remains undeveloped with more than 95% of land in West Somerset, West Devon, Torridge, Mid Devon, North Devon and South Hams given over to agriculture, forests, open land and water, outdoor recreation and re sidential gardens or other underdeveloped land 45 . By contrast, within the LEP area, Plymouth (37%), Exeter (34%) and Torbay (25%) have the highest percentages of ‘developed land use’.
5.2. Resident population
The Heart of the South West is also one of the largest LEP areas in population terms 46 . Home to more than 1.75 million people it is of similar size to Sheffield City Region and Enterprise M3. It is a predominately rural LEP with almost two - thirds (63%) of the population living in a local authority are as classified as either mainly or largely rural 47 . Its rurality is also reflected in its low population density compared to other LEP areas 48 .
45 https://www.gov.uk/government/statistical - data - sets/live - tables - on - land - use 46 It ranks 11 th among LEP areas: slightly less populated than Sheffield City Region but more so than Enterprise M3. 47 https://assets.publishing.service.gov.uk/government/uploads/system/uploads/att achment_data/file/539241/Guide_to_applying _the_rural_urban_classification_to_data.pdf 48 In 2018, the Heart of the South West LEP area LEP had a population density of 173 residents per square kilometre. This is a comparable density to New Angela (181) and C ornwall and the Isles of Scilly (160). Among other LEP areas, the most densely populated was London (5,666) and the least densely populated, Cumbria (74). Almost two - fifths, of the LEPs residents live in a local authority designated as a city or town (30%) or with a significant rural population 49 (7%). The most populous built - up areas are 50 :
Plymouth (266,789 residents)
Exeter (127,937)
Paignton and Torquay (119,503)
Taunton (68,239)
Yeovil (48,303)
49 Taunton Deane is the only local authority in this category. 50 Population estimates for 2017 bas ed on OND definition of Built - up Areas (BUAs). Downloaded from NOMIS on 22 October 2019. Figure 5 OAs by rural/urban classification , Heart of the South West LEP, 2011
Source: Department for Environment, Food & Rural Affairs (DEFRA) – Rural Statistics Unit https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/ 27 0551/Heart_of_the_South_West_LEP_full_class.jpg
5.3. Age structure of the population
In addition to being predominately rural, the other notable characteristic of the Heart of the West population, is that it has an older age structure. Very broadly, the resident population comprises almost 300,000 infants and children aged under 15, more than 1,000,000 million residents of ‘working age’ (aged between 16 and 64) and around 420,000 residents aged 65 and over. Compared to the South West and the UK, Hear t of the South West LEP area has smaller proportions of infants and children and people of working age, and a higher proportion of residents aged 65 and over ( Figure 6 ).
Figure 6 Broad population structure of the Heart of the South West LEP area; the South West region and the UK , 2019
70% 63% 60% 59% 60%
n 50% o i t a l u
p 40% o p
l a t o t
30% f
o 24% 22% % 19% 20% 17% 18% 18%
10%
0% Aged 0 to 15 Aged 16 to 64 Aged 65+ Heart of the South West South West United Kingdom Source: ONS Population Estimates downloaded from NOMIS on 27/09/2019
Of the 39 LEP areas, Heart of the South West LEP area has the 4 th highest share of residents aged over 65. It also has one of the lowest proportions of the population of working age of all LEP area s (35 th out of 38 LEP areas). With 70 residents of dependent age for every 100 r esidents of working age, Heart of the South West LEP area has the fourth highest depe ndency ratio in the country . By contrast, London has the lowest dependency ratio (55 dependent residents per 100 residents of working age). H igh dependency ratios tend to be associated with lower levels of economic growth.
The fact that Heart of the South West LEP area ’s population is ‘older’ than average is an important feature of the local labour market. The chart below ( Figure 7 ) shows that outside the two major cities, the median age of the population is at least six years older than the national average in every local authority , rising to 11.1 years above national ave rage in the South Hams.
Figure 7 Median age of population, Heart of the South West LEP area local district authorities, 2018
60.0 50.9 51.2 50.8 48.6 49.2 50.2 50.0 47.3 47.0 46.5 47.6 46.6 46.5 47.5 47.2 43.9 40.1 38.3 40.0 33.7
30.0
20.0
10.0
0.0
Source: ONS 2018 Mid Year Population Estimates
Heart of the South West LEP area LEP is, of course, diverse . D emographic opportunities and challenges vary from each to area . Figure 8 illustrates this, by comparing the demographic profile of Exeter and the South Hams, the two very different geo graphies. A number of features stand out :
The large influx of young people coming to Exeter, the majority of whom leave again taking valuable skills with them. This is also tr ue of Plymouth.
Young people leaving the South Hams, and similar rural geographies, to study and start careers in other, mainly urban, parts of the country. The number of 20 year olds resident in the South Hams is 43% l ower than the number of 17 year olds .
The arrival or return of people in mid - life / mid - career to rural areas, accelerating from age 40 onwards, often bringing valuable skills and experience with them, but competing with local people for knowledge - intensive and well - paid employment.
The ve ry large cohort of older workers, who may have a need for upskilling and re - skilling to keep abreast of occupational and technological change.
Figure 8 Demographic profile of population in Exeter, South Hams and UK, 2018
4.0%
3.5%
Influx of students 3.0% most of whom leave
2.5% Large cohort of older workers 2.0% Mid career arrivals or returners
1.5%
1.0%
Young people leave to university 0.5% and early stage careers elsewhere
0.0% 0 2 4 6 8 10 12 14 16 18 20 22 24 26 28 30 32 34 36 38 40 42 44 46 48 50 52 54 56 58 60 62 64 66 68 70 72 74 76 78 80 82 84 86 88
Exeter South Hams UK
Source: ONS 2018 Mid Year Population Estimates
5.4. Ethnic origin
The Heart of the South West LEP area does not have a particularly diverse ethnic population compared with the UK average. People identifying with a minority ethnic group comprise 2.6% of the popu lation aged 16+ and 3.4% of the population aged 16 to 64. This latter, “working age” population comprises: 6,200 residents from a mixed ethnic group; 3,300 who are Indian;; 4,300 who are Black or Black British and 19,200 who are from another ethnic group (including Chinese) 51 .
The data in the Annual Population Survey is broken down by specific ethnic groups due to their prevalence in the population: for example, as of the 2011 census Indian and Pakistani were the next highest groups after White British and Any Other White 52 in England and Wales. This same census data listed Torridge, a local authority in the Heart of the South West, as one of the areas of the country with the lowest proportion of ethnically Indian residents 53 .
51 The estimate for the number of residents who are Pakistani/Bangladeshi is not reproduced here as the group sample size is too small to generate a reliable estimate. 52 https://www.ons.gov.uk/peoplepopulationandcommunity/culturalidentity/ethnicity/articles/ethn icityandnationalidentityinengland andwales/2012 - 12 - 11 53 Ibid. Figure 9 Percentage of the population aged 16+ that are ethnic minorities, England, South West and Heart of the South West LEP , September 2019
13.8 Ethnic Minority - Total 4.1 2.5
3.6 Other Ethnic Group 1.5 1.4
3.4 Black or Black British 0.8 0.3
2.8 Pakistani/Bangladeshi 0.3 0.2
2.9 Indian 0.7 0.2
1.1 Mixed Ethnic Group 0.8 0.4
0 2 4 6 8 10 12 14 16
England SW HotSW
Source: Annual Population Survey via NOMIS
5.5. Residents born outside the UK
In the context of continuing uncertainty about the UK’s relationship with the European Union it would be useful to know broadly how many people employed in the area have nationality ot her than British. During October 2018 - September 2019, a n estimated 85,8 00 Heart of the South West residents were non - UK nationals , the vast majority of whom were ( 69,600 ) of working age. The number of ‘working - age’ non - UK nationals resident in the LEP area almost doubled in the last 10 years , increasing their share of the population from 3.5 % to 6.9 %. The Heart o f the South West LEP h as a notably lower percentage of non - UK born working age residents t han the UK average (11.8 %).
5.6. Population change
How has the demographic profile of the local area changed over the past 5 years? How will this impact future labour supp ly?
The resident population of the Heart of the South West LEP increased by 66,500 between 2013 and 2018. At 3.9%, the rate of increase was broadly in line with the South West (4.1%) and UK (3.6%) average. Heart of the South West LEP area was the 11 th fastest growing LEP area over this period. Within the area , the fastest growing local authorities were Exeter (7.8%) and East Devon (6.9%). T he slowest growing were Plymouth (1.7%), North Devon (2.5%), South Hams (2.5%), Torbay (2.7%) and West Devon (2. 8%). Over 80% of the total increase , of 65,500, in the population over the last 5 years was due to a rise in the number of people aged 65 and over (40,700) and aged under 16 (13,000).
People of working age 54 , accounted for just one - fifth of the increase ( 12,700). Within the working age population, rises in the population aged 25 to 39 (+ 23,000) and 50 to 64 ( + 26,400) were largely offset by declines in the population aged 1 5 to 24 ( - 12,700) and 40 to 49 ( - 25,200) .
The picture, again, varies significantly across the LEP area . The working age population increased strongly in Exeter (8.4%) and, to a lesser extent, East Devon (4.6%). Growth elsewhere was modest and some places saw a decline in the w orking age population : Plymouth ( - 0.6%), South Hams ( - 1.4%), Torbay ( - 0.3%) and West Devon ( - 0.9%).
The median age of the LEPs population is not only higher than average it is rising at a faster rate than the national average. Figure 10 shows that while the median age in the UK rose by 2.2 years between 2001 and 2018, it rose by 5.4 years in Somerset, 4.5 years in Torbay and 4.1 years in Devon. Only in Plymouth (+0.8 years) a nd Exeter ( - 2.3 years) did the median age fall or rise by less than the UK average, due in part to the expansion of Universities in the se cities.
Figure 10 Change in Median age of population between 2001 and 2018
7.0 6.5 6.3 6.2 5.9 6.0 5.6 5.4 5.2 4.9 4.7 5.0 4.6 4.5 4.3 4.1 4.0 3.4 2.8 3.0 2.2 2.0
0.8 1.0
0.0
-1.0
-2.0 - 2.3 -3.0
Source: ONS 2018 Mid Year Population Estimates
Looking ahead, ONS population projections suggest that the LEP area’s population will increase by 3.2% between 2016 and 2021 , a rate broadly in line with the national average (3 .0%) . The population of working age, however, i s only expected to increased marginally (0.2%) over the period, and by less than the England average (1.3%). By contrast , the
54 Aged 16 to 64 years. number of residents aged 65+ and under 16 are projected to rise rapidly, by 8.7% and 4.6% respectively.
These demographic tren ds have important implications for labour supply and future rates of employment growth. The task of making best use of the talents of an ageing population, e.g. through upskilling, is a lso significant one the region.
5.7. Migration
Between 2003 and 2018, t he growth in t he Heart of the South West LEP area population was almost entirely driven by net inward migration . This migration was mainly f r om elsewhere in the UK (+55,200), though migration from overseas is also a factor ( + 20,200). The ‘natural change’ ( births minus deaths ) in the LEP’s population was negative, at - 10,400 .
Fr om 2020 to 2030, the population of the Heart of the South West LEP area is projected to grow by around 100,000.
Figure 11 shows the components of this projected growth and that internal migration is projected to remain the key contributor to growth, with 114,000 more migrants coming to the region from other parts of England than leaving. International migration is projected to continue 55 contributing a net increase of 27,000 to the Heart of the South West LEP area population. Natural change (i.e. births minus deaths among the resident population) is expected to be continue negative, at - 33,000. This ability to attract labour and skills from elsewhere is an important feature of the local labour market and driver of local growth.
Figure 11 Components of Population Change in ‘000s of people , H eart of the South West LEP area , 2020 to 2030
55 The unknown impacts of Brexit will add volatility to this projection. 900.0 798.7 800.0 684.4 700.0
600.0
500.0
400.0
300.0 219.5 186.9 200.0 114.3 82.7 100.0 55.7 - 32.5 27.0 -
-100.0
Source: ONS 2016 based subnational population projections
5.8. Commuting
Which skills to the commuting workforce bring to the local area?
So far the analysis has describes the demographic characteristics of people who live in the LEP area irrespective of where they work . While the data makes it impossible to isolate the skills of commuters, it is possible to compare the occupations of people who live in and those who wor k in Heart of the South West LEP area , which provides an indication of the skills t hat the Heart of the South West LEP area gains and loses through commuting flows.
Figure 12 shows that overall, the Heart of the South West’s workplace population is great er than its resident population . The gains are distributed across almost all broad occupational areas but are particularly large for the ‘ associate professional and technical and administrative and secretarial occupations ’ . The only occupation for which the LEP is a net loser or exporter of skills and experience i s ‘ managers, directors and senior officials ’ . This could be due to the area’s lack of large employ ers as well as r eflecting this group ’ s preparedness to commute significant distances, e.g. to Bristol or London.
Figure 12 Difference between workplace and resident - based estimates of employment by occupation: Heart of the South West: July 20 18 to June 2019
Managers, directors and senior officials - 1400
Professional occupations 600
Associate prof & tech occupations 2300
Administrative and secretarial occupations 2000
Skilled trades occupations 400
Caring, leisure and other service occupations 600
Sales and customer service occupations 700
Process, plant and machine operatives 800
Elementary occupations 0
-2000 -1500 -1000 -500 0 500 1000 1500 2000 2500
Source: Annual Population Survey residents and workplace estimates via NOMIS
L ocal areas across the Heart of the South West LEP area have very different patterns of commuting . Unfortunately, t he only detailed source of information on this is the Census, last conducted in 2011, which means that the data will have changed even if the patterns remain unchanged.
Figure 13 shows that Exeter, while not the largest employment centre in the area, was the Local Authority area with the largest number of daily inward commuters (38,000), followed by Plymouth (26,000), the South Hams, Taunton Deane and South Somerset (15,000 to 17,0 00). The net change in the working - day population in Exeter (inflows minus outflows) of +26,000 is far higher than that for any other area. Taunton Deane (+6,000 ) and Plymouth (+5,000) are the areas with the next greatest volume of net inward commuting.
Figure 13 Commuting by Local Authority, Heart of the South West LEP area LEP area, 2011
40,000
30,000
20,000
10,000
0
-10,000
-20,000
Commuters - Inflow Commuters - Outflow Net Change
Source: 2011 Census , ONS Plymouth and Teignbridge have the largest volume of commuter outflows (both - 22,000) but for very different reasons. The Plymouth workforce is around three times the size of Teignmouth’s, so the volume of outflows is largely a reflection of labour market size. For Teignmouth, and some other rural geographies, it is a function of p roximity to urban employment centres. The connectivity is best considered by looking at outbound commuters as a proportion of the number of people working in each area.
Figure 14 below shows that the commuter outflow from Mid Devon is equivalent in scale to nearly 70% of local employment. Teignbridge (58%) and East Devon (47 %) also have a large proportion of workers commuting to Exeter, while West Devo n (59%) is clearly linked to Plymouth and Torridge (52%) to North Devon.
Figure 14 Commuting outflows and inflows as a % of employment, Heart of the South West LEP area local district authorities, 2011
80%
70%
60%
50%
40%
30%
20%
10%
0%
Inflow Outflow
Source: Census 2011 , ONS
From a skills supply perspective, the table is interesting in suggesting that peripheral and relatively self - contained labour markets, such as North Devon, with a low proportion of inward and outward commuting , will need to find skills solutions from withi n their area. Conversely, interconnected labour markets such Exeter need to find skills solutions through more integrated strategies delivered across a multiple administrative geographies .
47 It is possible to drill down further, to examine the origins and d estinations of commuters into and out of each local authority area, but the depth of such an analysis extends beyond the scope of this report.
However, to take the two main cities, Figure 15 shows that the largest inflow into Plymouth is from Cornwall and the Isles of Scilly, while the largest outflow is to the South Hams. Local knowledge of industrial estates, the types of jobs able to attract employees from different residential areas is required to understand fully these flows . However, the fact that 9,000 Cornish residents commute to Plymouth each day points to a need for strategic alignment between the two LEPs .
Figure 15 Commuting inflows and outflows: Plymouth , 2011
Source: Census 2011, ONS
Exeter is a smaller employment centre that Plymouth , but with a large daily inflow of 37,000 commuters, mainly from East Devon, Teignbridge and Mid Devon, who collectively make up n early 50% of the City’s workers. The number of outbound commuters is roughly half that found in Plymouth, with destinations mainly in and around the East Devon growth point.
48
Figure 16 Commuting inflows and outflows: Exeter , 2011
Source: 2011 Census, ONS
North Devon is also interesting . It shows some of the same dynamics seen around Exeter at a smaller level within a relatively peripheral labour market, with Barnstaple and Bude providing important source of employment for residents of Torridge.
Figure 17 Commuting inflows and outflows: North Devon , 2011
Source: 2011 Census, ONS
49 Figure 18 shows the average home to work journey time for residents of each Local Authority within Heart of the South West LEP area . It is important to bear in mind that the figures are a product both of the proportion of people who commute as well as the duration of journeys . Home workers, whose travel time is zero are included in the data alongside those with very long commutes. However, it shows th at on average residents of West Devon and Teignbridge spent an average of 30 minutes getting to work in 2018, with those of Mid and East Devon not far behind.
Figure 18 Average home to work journey times in minutes for people age d 16 plus, local district authorities, 2018
35 31 30 29 27 26 25 24 24 25 22 22 22 21 20 20 18 18 16 15
10
5
0
Source: ONS analysis of Labour Force Survey
Table 1 below breaks this data down further, looking at the average journey times by car and public transport car to the nearest small centre of employment (500 to 4,999 employees) and the nearest employment centre with 5,000 employees or more.
This data shows that jobs in smaller employment centres (market towns) are relatively accessible to residents of West Somerset , being an average of 11 minutes away by car and 25 minutes away by public transport, while jobs in large r employment centres (5,000+ jobs) are fa irly remote: 46 minutes away on average by car and 79 minutes away by public transport. For a two - way journey, this equates to an average one and a half hour commute by car and two and a half hour commute by public transport to a major employment centre. T he range of job opportunities available is severely constrained by these distances, which is a factor behind West Somerset being the local authority at the bottom of the Social Mobility Index (discussed in section xx).
The fact that Heart of the South Wes t LEP area has a great many Local Authorities, such as South Hams, Torridge, West Devon, Mendip and West Somerset, where the
50
average duration of a round - trip to the nearest large employment centre (5,000+ jobs) is two hours or longer by public transport, c learly limits the range of job opportunities available to non - car owners. Better internet connectivity improves and an increase in employers looking to flexible, remote and home - working as a means of expanding th eir potential recruitment pool, may improve opportunities in these areas in future. However, the localised / limited size of the labour pool from which many employers, particularly those in rural locations, necessarily recruit is an important feature of the Heart of the South West LEP area labour m arket and one that could act as a driver of training as employers appreciate that they need to grow the foster they require from a limited local population.
Table 1 Travel time in minutes to nearest employment centre by size and mode of transport , county and district authorities, 2016
500 to 4999 employees 5000 employees + Public Public Transport Car Transport Car Plymouth 11 8 28 15 Torbay 11 8 41 18 Devon 21 10 50 25 East Devon 19 9 59 30 Exeter 12 9 18 10 Mid Devon 23 11 70 31 North Devon 21 10 40 21 South Hams 25 11 67 33 Teignbridge 18 10 34 17 Torridge 29 11 73 34 West Devon 30 12 79 36 Somerset 17 9 53 24 Mendip 16 9 74 33 Sedgemoor 17 10 63 21 South Somerset 18 9 43 22 Taunton Deane 16 9 30 15 West Somerset 25 11 79 46 Source: Department for Transport, Local Authority Indicators
51 5.9. Travel to Work Areas (TTWA)
TTWAs became the official British definition of local labour market areas in the 1960s, although their predecessors go back further than this 56 . Produced following each national census they are defined using commuter flow data for workers based on their area of residence and workplace. The most recent TTWAs were published in August 2015 using results from the 2011 Census. TTWA areas are interesting because they r eflect functional economic areas rather than administ rative one (e.g. local authority areas). The number of TTWAs has fallen over time as people commute longer distance reflecting a combination nu mber of factors:
Fewer jobs in traditional employment sectors such as mining, where local working was common
More households with 2 earners who often cannot live near both workplaces
More complex working patterns (e.g. home working);
More jobs at professio nal and managerial levels with higher pay levels making travel more affordable
Changes in the method of travel to work.
The Heart of th e South West LEP area contains several TTWAs either wholly in part ( Figure 19 ). The largest TTWAs in the Heart of the South West LEP area in population terms are Exeter (342,400 aged 16 and over ) and Plymouth (300,500) although the size of the former suggests that people working in Exeter travel longer distances to get to work than those working in Plymouth, which appears comparatively self - contained. The next largest TTWA in population terms are: Yeovil (142,700) which extends into Dorset, Torquay and Paignton (131,500) and Weston - Super - Mare (128,400), Taunton (94,200), Bridgwater (88,300) and Barnstaple (80,500).
56 https://ec.europa.eu/eurostat/cros/system/files/ttwa_in_uk.pdf
52
Figure 19 Map of travel to work areas
Source: ONS
5.10. Travel to education
There is a good evidence to suggest that travel has an impact on extent to which young people engage in education, employment and training 57 .
These problems relate to cost, availability of public transport and journey times. However, y oung people can also be reluctant to travel even very short distances if this means venturing into areas with which they were not famil iar, due to lack of confidence around use of transport, visiting new and bigger institutions, and , for some, concerns about rivalries between groups.
Table 2 shows the proportion of 16 to 19 year olds in each Heart of the South West LEP area local authority who, in 2016, were able to access further education within 15 / 30 / 45 / 60 minutes b y foot or public transport. Further education is defined as all further education and sixth form colleges and school sixth forms.
It shows that 100% of 16 - 19 year olds in Plymouth were able to access further education by public transport or walking within 30 minutes. At the other end of the spectrum, only 16% and 36% of young people in Mid Devon and Torridge (respectively) were able to access FE within 30 minutes; and only 42% and 64% were
57 See, for example, Increasing Participation: Understanding Young People who do not Participate in Education or Training at 16 and 17 , Thomas Spielhofer , National Foundation for Educational Res earch, 2009
53 able to access further education within 45 minutes. 26% of young pe ople in Torridge and 22% of young people in Mid Devon also faced journey times of over an hour.
Table 2 % of 16 to 19 year olds who are able to access further education by public transport or walking within 15 / 30 / 45 / 60 minute s , county and district authorities, 2016
15 Mins 30 Mins 45 Mins 60 Mins Plymouth 55% 100% 100% 100% Torbay 45% 98% 100% 100% Devon 19% 64% 82% 90% East Devon 27% 79% 91% 94% Exeter 29% 98% 100% 100% Mid Devon 7% 16% 42% 78% North Devon 9% 50% 77% 85% South Hams 15% 63% 80% 90% Teignbridge 23% 66% 93% 96% Torridge 16% 36% 64% 74% West Devon 13% 37% 72% 84% Somerset 17% 68% 90% 95% Mendip 17% 76% 92% 97% Sedgemoor 19% 74% 93% 97% South Somerset 16% 65% 90% 95% Taunton Deane 17% 62% 87% 92% West Somerset 18% 43% 74% 83% Source: Department for Transport – Journey Time Statistics
While l ong travel - to - learn times are common in rural areas, this is also a problem that is highly localised, influenced by factors such as walking distance to bus stops, bus time - tabling, not just rurality and peripherality.
Data for Lower Super Output Area (LSOAs), small units of geography with a population of around 1,500 people, can be used to pick out communities where travel to learn times are extremely high.
Table 3 below shows that there are five LSOAs in Tor ridge (out of a total of 37) in which not one young person is able reach an FE location by foot or public transport within 60 minutes. No young people are able to get to a further education provider by public transport or foot within 30 minutes from over h alf of Torridge’s LSOAs (54%).
Mid Devon has fewer extremely isolated LSOAs where no - one can get to a further education provider within 60 minutes, but the proportion of its area from which journey times are between 45 and 60 minutes or between 30 and 60 minutes is higher than it is in Torridge.
54
Table 3 Number and proportion of LSOAs from which 0% of 16 - 19 year olds can reach a further education college via public transport or walking within 30/45/60 minutes, local district author ities, Heart of the South West LEP area and England, 2016
Total LSOAs in Number % LA 30 Mins 45 Mins 60 Mins 30 Mins 45 Mins 60 Mins Torridge 37 20 8 5 54% 22% 14% Mid Devon 43 33 16 3 77% 37% 7% West Somerset 18 9 4 1 50% 22% 6% North Devon 58 20 8 3 34% 14% 5% West Devon 31 12 4 1 39% 13% 3% Taunton Deane 65 13 4 2 20% 6% 3% East Devon 80 5 3 2 6% 4% 3% Teignbridge 84 16 2 1 19% 2% 1% Exeter 69 1 - - 1% 0% 0% Mendip 65 9 1 - 14% 2% 0% Plymouth 159 - - - 0% 0% 0% Sedgemoor 64 8 3 - 13% 5% 0% South Hams 49 15 4 - 31% 8% 0% South Somerset 103 21 2 - 20% 2% 0% Torbay 89 2 - - 2% 0% 0% HotSW 1,014 184 59 18 18.1% 5.8% 1.8% England 32,825 2,695 412 120 8.2% 1.3% 0.4% Source: Department for Transport - Journey time statistics
55 6. BUSINESS AND ECONOMI C CONTEXT
6.1. Introduction
The demand for skills is heavily influenced by the scale and nature of economic activity observed in an area. This section presents information about :
the population of businesses in the area, includi ng the current business profile in terms of distribution, sector and turnover ;
economic output , including GVA, economic growth and sectoral tren ds ;
employment, sectoral strengths and employment change;
pr oductivity , compared across different levels and over time;
earnings , including variation by area, the lowest quintile, and the gender pay gap;
Without an understanding of the economic context, i t will be much harder to make meaningful suggestions for change . This is also crucial to understand for encouraging and maintaining productivity within the area even in the face of potential political upheaval.
6.2. Business population
6.1.1. Current business profile
More than 72,000 VAT and/or PAYE - based enterprises are located within the Heart of the South West LEP area. These were broadly distributed as follows:
37,725 in Devon
24,510 in Somerset
5,770 in Plymouth
4,075 in Torbay
As nationally, the vast majority of enterprises in the LEP area are small – around three - quarters employ fewer and 5 people (77%) ( Table 4 ) and/or turn over less than £250,000 a year (72%) ( Table 5 ). The LEP area hosts 200 large employers (i.e. those employing more than 250 employees) with most of these located in Exeter (35), Plymouth (30) and Taunton Deane (25) and South Somerset (20). Less than one in ten local enterprises (8%) have a turnover of £1 million a year or more.
56
The VAT registrations data is also disaggr egated by 14 discrete sectors, the largest of which locally is agriculture, forestry and fishing whi ch accounts for 16% of all enterprises in the area. This is closely followed by construction (14%), professional, scientific and technical (12%) .
Table 4 Percentage of VAT and/or PAYE based enterprises in by employment size bands , local district authorities, Heart of the South West LEP area , S outh W est and UK, 2019 10 - 20 - 50 - 100 - Total Area 0 - 4 5 - 9 250+ 19 49 99 249 (=100%) Plymouth 71.2 14.6 7.3 4.2 1.4 0.8 0.5 5,765 Torbay 73.4 14.6 6.5 3.6 0.9 0.7 0.4 4,075 East Devon 77.6 12.3 5.7 3.0 0.8 0.5 0.2 6,525 Exeter 69.6 14.3 8.1 4.5 1.9 0.8 0.8 4,140 Mid Devon 81.4 10.8 4.4 2.3 0.6 0.3 0.1 4,520 North Devon 77.3 12.3 6.1 2.7 0.9 0.4 0.3 4,925 South Hams 77.5 11.3 6.4 3.3 1.0 0.3 0.2 5,135 Teignbridge 75.7 12.4 6.6 3.4 1.0 0.7 0.2 5,735 Torridge 79.4 12.1 4.6 2.5 0.8 0.6 0.0 3,600 West Devon 80.6 10.8 5.4 2.4 0.5 0.2 0.2 3,145 Mendip 78.0 11.8 5.5 3.2 0.9 0.4 0.2 5,775 Sedgemoor 77.0 13.1 5.2 3.2 0.9 0.4 0.2 4,925 South Somerset 78.5 11.0 5.4 3.3 1.0 0.4 0.3 7,165 Taunton Deane 78.2 10.7 5.9 3.0 1.1 0.5 0.5 4,885 West Somerset 79.5 12.8 4.5 2.6 0.6 0.0 0.0 1,760 Heart of the South West LEP 76.8 12.3 5.9 3.2 1.0 0.5 0.3 72,075 South West 77.2 11.9 5.9 3.1 1.0 0.5 0.3 234,420 United Kingdom 78.2 11.3 5.6 3.0 1.0 0.6 0.4 2,718,435 Source: Office for National Statistics
Table 5 Percentage of VAT and/or PAYE based enterprises in by turnover size bands , local district authorities, Heart of the South West LEP area , S outh W est and UK, 2019
9 9 9
9 9 9 9 9 9 - +
9 9 4 9 9 9 9 9 0 0 9 9 9 1 4 9 2 4 9 0 Total 0 4 ------9 - 0
Area 0 0 0 0 0 0 0 0 9 0 0 0 0 0 0
5 0 5 0 (=100%) 4 1 5 0 0 0 1 2 5 1 2 5
Plymouth 12.7 22.0 33.4 14.4 7.7 4.4 3.6 0.9 0.8 0.3 5,765 Torbay 14.0 22.2 34.4 14.7 7.4 3.7 2.3 0.7 0.6 0.0 4,075 East Devon 18.7 21.6 31.3 13.2 7.7 3.6 2.3 0.9 0.5 0.1 6,525 Exeter 14.1 20.5 30.3 14.3 9.2 4.6 3.7 1.6 1.2 0.5 4,140 Mid Devon 23.0 21.1 29.9 12.3 7.1 3.5 2.1 0.7 0.3 0.0 4,520 North Devon 20.5 20.2 31.2 13.9 7.6 3.1 2.1 0.5 0.6 0.2 4,925 South Hams 19.5 20.7 31.6 13.5 7.3 3.9 2.1 0.9 0.3 0.1 5,135 Teignbridge 18.5 20.5 32.0 13.1 7.4 4.2 2.5 1.0 0.8 0.1 5,735
57 Torridge 24.7 20.1 29.0 12.9 6.7 3.6 1.8 0.7 0.4 0.0 3,600 West Devon 25.0 21.5 29.4 13.2 6.5 2.7 1.3 0.2 0.3 0.0 3,145 Mendip 17.1 22.4 31.8 13.4 7.7 3.6 2.6 0.7 0.5 0.1 5,775 Sedgemoor 17.8 21.3 32.8 12.7 7.1 3.9 2.8 0.7 0.8 0.1 4,925 South Somerset 18.6 22.8 30.7 12.7 7.3 3.6 2.5 0.8 0.8 0.2 7,165 Taunton Deane 19.1 22.2 31.3 12.2 6.4 3.9 2.9 1.0 0.7 0.2 4,885 West Somerset 23.9 20.7 32.7 13.4 4.8 3.1 1.1 0.3 0.0 0.0 1,760 Heart of the South West LEP 18.7 21.4 31.5 13.3 7.3 3.8 2.5 0.8 0.6 0.1 72,075 South West 17.1 22.3 32.0 13.1 7.2 3.9 2.6 0.9 0.7 0.2 234,420 United Kingdom 15.6 23.2 32.2 12.6 7.2 4.1 2.8 1.1 1.0 0.3 2,718,435 Source: Office for National Statistics
58 Table 6 Percentage of VAT and/or PAYE based enterprises by broad industry group, local district authorities, He art of the South West LEP area , SW and UK, 2019
Area l r & n e e
a e
c o & y g c i s h r n i t
& t a t , e n r s n a a l s o s n ) m r r n c
o e h o l i n a t e e i o e e n t l u s o i t
c y c r v & s a s o m i n c t d i t o t i i l s t r a s S a g i h i e t r e o o o c v a n t t s t c f s n i e a e n l n d r c r i c a i e c i u r e a i
t t & o s e Total , s e n t a r o f e u l i p & r h c v t t s m e r e p t s s & e & e r o s d r i . r o r s s m u e d o c t i r .
R (=100%) c f d e h i u o t o n u f o H n d e d a f i n t r m o s n P i o l o p c B p o o f i t E r & e W P o c s ( m u p n i o n n C M , l c P f I c n d a u i e s c b i r a a t s n r r i c u A g s T F A P A
Plymouth 1.0 5.8 18.5 4.3 2.9 8.6 3.2 9.3 4.5 2.1 4.8 13.3 7.2 0.1 2.2 5.9 6.3 5,770 Torbay 2.7 5.3 16.0 3.3 3.3 9.8 3.4 12.8 4.0 1.6 4.4 11.2 8.0 0.0 1.7 5.3 7.2 4,075 East Devon 16.4 5.7 13.7 3.4 2.8 7.5 3.0 7.0 4.3 1.3 4.0 12.8 6.5 0.8 1.5 3.7 5.7 6,525 Exeter 1.0 5.1 13.3 3.4 3.5 8.0 2.8 6.9 6.8 3.4 5.1 17.3 7.1 0.1 2.7 6.3 7.5 4,140 Mid Devon 31.6 6.6 11.9 3.5 3.4 4.4 2.9 4.4 3.2 1.0 2.3 9.3 5.8 0.8 0.9 2.4 5.4 4,520 North Devon 26.8 4.9 12.2 3.1 2.4 7.2 1.9 9.0 3.1 1.2 3.0 8.8 6.1 0.7 1.0 3.2 5.1 4,925 South Hams 17.8 6.4 12.1 2.6 3.0 7.7 2.0 7.8 4.6 1.3 4.1 13.1 6.1 0.9 1.3 3.1 6.0 5,135 Teignbridge 12.6 6.4 14.7 4.2 3.7 6.5 3.1 7.2 4.5 1.7 3.7 12.4 7.1 0.7 1.6 3.9 5.8 5,735 Torridge 36.5 5.0 11.9 3.3 2.5 5.6 2.4 6.1 2.2 0.7 2.2 8.1 5.0 0.6 1.4 2.5 4.0 3,600 West Devon 33.5 4.3 9.9 2.9 2.4 6.7 2.4 6.0 3.8 0.8 2.7 8.9 5.6 1.0 1.1 3.0 5.1 3,145 Mendip 15.6 6.6 13.5 3.6 3.3 6.6 2.9 6.1 4.9 1.6 3.4 13.4 6.7 0.8 1.6 3.2 6.0 5,775 Sedgemoor 13.6 7.1 14.1 3.0 3.2 6.8 2.9 5.8 6.2 1.4 3.6 14.7 6.8 0.6 1.6 2.6 6.0 4,925 South Somerset 14.0 7.1 14.0 4.1 3.6 5.9 4.2 7.0 4.2 1.6 3.4 13.1 6.9 0.8 1.6 3.0 5.6 7,165 Taunton Deane 16.5 7.3 13.8 3.8 3.5 6.7 2.6 5.4 4.8 1.7 3.1 12.6 6.6 0.9 1.7 3.1 6.1 4,885 West Somerset 13.2 5.4 13.5 3.8 3.2 6.7 2.3 5.2 5.1 2.1 4.2 14.6 7.2 0.8 1.8 4.7 6.1 1,760 Heart of the South West LEP area LEP 30.4 4.3 8.8 3.1 2.0 7.7 2.6 10.2 2.8 0.6 2.0 9.4 5.4 1.4 0.6 2.6 6.3 72,080 South West 10.3 5.8 13.6 3.2 3.2 6.8 3.2 6.5 6.9 1.9 3.6 15.3 7.4 0.5 1.7 3.7 6.2 234,425 United Kingdom 5.5 5.6 12.6 2.8 3.8 7.7 4.1 5.8 8.3 2.2 3.7 17.4 8.4 0.3 1.6 3.8 6.4 2,718,435
59 The composition of the LEPs business community differs from the national average in a number of important ways (Tables 4 to 6):
Firstly, the Heart of the South West has a smaller share of large enterprises than the UK average – both in terms of employment and turnover. The differences are not huge however: with 0.8% of enterprises employing 100 people or more (compared to 0.9% acr oss the UK) and 7.8% with turnover of £1m or more (compared to 9.3% across the UK). Variations within the LEP area are however, stark with large enterprises accounting for a much larger share of enterprise in Exeter and Plymouth than in West Somerset and West Devon.
Secondly, the UK’s single biggest sector – professional, scientific & technical 58 – which includes highly productive activities such as law and accounting, head offices and management consultants, scientific research and advertising – accoun ts for a smaller share of enterprises locally (12% compared to 17% nationally) than the national average. Similarly, the share of enterprises in high value sectors such as information & communication, finance & insurance and business administration & supp ort services is also lower locally than the UK average. Taken together, the broadly defined ‘business and financial services’ sector 59 accounts for just 28% of enterprises locally compared to the UK average of 40%. Only Exeter (40%) and to a lesser extent Mendip (33%), Taunton Deane (33%) and Plymouth (32%) have a comparable share of enterprises in this sector to the national average.
Thirdly, the Heart of the South West’s single biggest sector – accounting for 16% of enterprises, slightly more than constr uction (14%) and professional, scientific and technical (12%) – is agriculture, forestry & fishing (16%). The proportion is higher still in Torridge (37%), West Devon (34%), Mid Devon (32%) and West Somerset (30%). Other sectors accounting for a larger share of enterprises locally than the national average include: public administration & defence, accommodation and food services, production, construction and motor trade.
6.1.2. Change over time
The Heart of the South West’s business community has expanded over the last 9 years ( Figure 10 ) to the extent that there were 7,685 more enterprises registered for VAT and/or PAYE in 2019 than in 2010. The rate of increase, however, has lagged the UK average: with the rate of increase locally (averaging 1.3% per annum over the period) less than half that recorded across the country as a whole (averaging 2.9% per annum over the same period). The rate of growth withi n the Heart of the South West is among the lowest reported among LEP areas nationally: only Cumbria reported slower growth in their business population (0.9% per annum) over this period. The growth
58 http://www.siccodesupport.co.uk/sic - division.php 59 Also includes property.
60
rate locally is however, similar to that recorded in The Marshes (1.3% per annum), New Anglia (1.4% per annum) and Greater Lincolnshire (1.4% per annum). Business growth was strongest in London (5.2% per annum) and Greater Manchester (4.1% per annum).
Figure 20 Number of VAT and/or PAY E based enterprise; Heart of the South West LEP area: 2010 to 2019
80,000
70,000
60,000 s e s i
r 50,000 p r e t n
e 40,000
f o
r e
b 30,000 m u N 20,000
10,000
0 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Source: UK Business Counts accessed via NOMIS
Further examination of the data reveals that the slower than average growth recorded across the LEP area can be attributed to relatively slow growth in the number of
Micro 60 and small 61 businesses (since the number of medium - sized 62 and large 63 companies incr eased faster than the national average between 2010 and 2019).
enterprises across most industry sectors except agriculture, forestry & fishing, manufacturing and electricity, gas, steam and air conditioning supply and public administration and defence; com pulsory social security. As nationally, electricity, gas, steam and air conditioning supply recorded the fastest rate of growth among all sectors increasing in number by 31% per annum in the Heart of the South West and 29% per annum across the UK.
60 Employing between 0 and 9 employees 61 Employing between 10 and 49 employees 62 Employing between 50 and 249 employees 63 Employing 250 or more employees
61 priv ate sector businesses (1.2% per annum locally compared to 2.9% across the UK). By contrast, the number of public sector enterprises increased faster than the UK average locally.
enterprise across all districts within the LEP area since none recorded a ra te of business growth that exceeded the national average. At 2.4% per annum, North Somerset came closest to the UK average followed by Exeter (1.9% per annum), and Plymouth (1.8% per annum). Business growth was weakest in West Somerset (0.2% per annum), West Devon (0.7%), South Somerset (0.8% per annum) and North Devon (0.9% per annum).
6.1.3. Business Births and Deaths
The change in business stocks described above reflect the net change between new business registrations (‘births’) and de - registrations (‘deaths ’). On average more than 6,800 new businesses were created in the Heart of the South West LEP area each year between 2013 and 2018. The figure fluctuates from year - to - year but has fallen slightly in each of the last two years. The number of business clo sures has been lower than business starts over the last six years, with a net gain of around 500 businesses recorded in 2018.
Figure 21 Number of Business births and deaths in Heart of the South West LEP area , 2013 to 2018
8000 7120 6960 7070 7000 6715 6630 6590 6545 6120 5880 6055 6000 5605 5675
5000
4000
3000
2000 1515 1040 1190 840 1000 490 40 0 2013 2014 2015 2016 2017 2018
Births Deaths Net
S ource: ONS Business Demography https://www.ons.gov.uk/businessindustryandtrade/business/activitysizeandlocati on/datasets/bus inessdemographyreferencetable/current
62
6.1.4. New business formation
It can also be instructive to examine the new business formation in relation to the size of the existing stock. In 2018, new businesses represented 9.9% of the stock of ‘active e nterprises’ registered in the Heart of the South West LEP area. This is slightly lower than the South West (10.4%) average and three percentage points lower than the England (13.1%) average. Business formation rates have fallen in each of the last three years locally, and in each of the last two across the South West and England.
Figure 22 New business formation rates as percentage of active enterprise, Heart of the South West LEP area , SW and England : 2012 to 2018
HotSW SW England
16
e 14 s i r p r
e 12 t n e
e v
i 10 t c a
f o
8 k c o t s
f 6 o
%
s
a 4
h t r i
B 2
0 2012 2013 2014 2015 2016 2017 2018
Source: ONS Business Demography https://www.ons.gov.uk/businessindustryandtrade/business/activitysizeandlocation/datasets/bus inessdemographyreferencetable/current
6.1.5. Business Survival Rates
Less than half (44.8%) of businesses started in the Heart of the South West LEP area in 2013 were s till trading in 2018. Encouragingly, the five year business survival rate is higher than the UK average (42.4%) in almost all districts within the LEP area with the exception of South Somerset (41.8%) and Plymouth (30.7%). Within the LEP area, this ‘five year’ survival rate is highest in West Devon (51.2%), Mid Devon (50.8%), South Hams (50.6%) and Mendip (50.5%).
63 Business survival rates locally have fallen over time ( Figure 23 ). Businesses formed in 2013, for example, were more likely to survive one year (94%) than those formed in 2017 (91%).
Figure 23 Business Survival Rates in Heart of th e South West LEP area , 2013 to 2017 8 9 . . 6 1 7 . 3 . . 100 2 1 9 1 0 9 9 9 9 90 2013 2014 2015 2016 2017 8 6 . . 6 3 6 . . 5 7 3 3 80 7 7 7 d 7 . 4 o . 3 i 6
70 . r 1 6 9 6 e 5 9 3 p .
. 2 2
h 60 5 5 c 8 . a 4 e
50 4 g n i v
i 40 v r u s
30 % 20
10
0 1 Year 2 Years 3 Years 4 Years 5 Years
Source: ONS Business Demography https://www.ons.gov.uk/businessindustr yandtrade/business/activitysizeandlocation/datasets/bus inessdemographyreferencetable/current
Nationally, the most productive areas tend to characterised by high levels of business creation and destruction; indicative of a high level of entrepreneurial acti vity. High business survival rates, while clearly positive for individuals, do not correlate equate with high levels of growth at the macro - economic level. The picture is complex and entrepreneurial activity, e.g. self - employment, borne out of a scarcity o f well - paid jobs, does not necessarily correlate with positive local growth or economic opportunity.
6.3. Economic output
6.3.1. Current economic profile
At the local level, economic output is expressed in terms of Gross Value Added (GVA), a measure of the increase in the value of the economy due to the production of goods and services. GVA is equivalent to Gross Domestic Product (GDP) less taxes (plus sub sidies) on products. GVA (B) is measured at current basic prices which includes the effect of inflation, and in “real” terms in chained volume measures (CVM), with the
64
effect of inflation removed 64 . The GVA estimates presented here are compiled on a workp lace basis (allocated to the location where the economic activity takes place).
On this basis, t he Heart of the South West economy generated £35.286 billio n in GVA in 2017 making it the 16 th largest LEP economy. As might be expected, within the LEP area the local authority districts of Plymouth (£5,254m) and Exeter (£5,076m) generate the highest value of GVA ( Table 7 ) and combined, these two districts g enerate 29% of the LEPs areas output.
Table 7 £million Total GVA and Percentage growth of total and ‘real’ GVA: UK, SW, Heart of the South West LEP area , and county and district authorities , 1998 to 2017 Annual Annual Total GVA growth in growth in
(£ million) total GVA ‘real’ GVA (%) (%) UK 1,819,754 3.6 1.8 South West 130,636 3.5 1.6 Heart of the South West LEP 35 , 286 3.3 1.4
Somerset 11 , 326 3.2 1.3 Plymouth 5 , 254 2.9 1.0 Torbay 2 , 098 1.9 0.2 Devon CC 16 , 608 3.6 1.6
Mendip 2,207 3.3 1.4 Sedgemoor 2,347 3.8 1.8 South Somerset 3,499 2.7 1.2 Taunton Deane 2,570 3.3 1.2 West Somerset 704 3.4 0.7 East Devon 2,496 3.2 1.1 Exeter 5,076 4.4 2.2 Mid Devon 1,202 3.1 1.2 North Devon 2,035 3.6 1.6 South Hams 1,792 3.0 1.4 Teignbridge 2,328 4.0 2.0 Torridge 936 3.2 1.4 West Devon 741 2.8 0.7 Source: ONS – Regional Gross Value Added
64 https://www.ons.gov.uk/economy/grossvalueaddedgva/bulletins/ regionalgrossvalueaddedbalanceduk/19 98to2017
65 As nationally, real estate activities is the largest contributor to Gross Value Added (16%) locally ( Table 8 ). This is followed by manufacturing (12%) and wholesale and retail trade (11%). Broadly, the sector contributions mirror the national average but with greater emph asis locally on:
Manufacturing (12% compared to 10%)
Agriculture, mining, electricity, gas, water & waste (6% compared to 4%)
Construction (8% compared to 6%)
‘Public services’ 65 (23% compared to 18%).
By contrast, taken together sectors that can be more br oadly defined as financial and business services 66 contribute a smaller share of GVA than average for the UK (29% compared to 40%). This includes real estate activities.
65 Comprising: Public administration & defence, education and human health and social work activities. 66 Includes: Information and communication, financial and insurance activities, real estate activities, profes sional, scientific and technical activities and administrative and support service activities
66 Table 8 £million and Percentage Average Annual Growth of GVA, Heart of the South West LEP area and UK, 1998 - 2017
£m % Average annual growth, % Heart Heart of Heart of Heart of Heart of of the the the the the South South UK South South UK South UK West West LEP West LEP West LEP West LEP LEP area area area area area 2017 1998 1998 - 2017 2009 to 2017 Agriculture, mining, electricity, gas, water & waste 2,141 6.2 4.4 6.4 - 0.2 - 2.6 1.1% - 0.4% Manufacture of food, beverages, textiles & clothing 794 2.3 1.9 4.1 - 1.8 - 1.1 0.1% 0.8% Manufacture of wood, petroleum, chemicals & minerals 802 2.3 3.1 3.2 - 0.9 - 1.6 - 0.9% - 1.2% Manufacture of metals, electrical products and machinery 2,154 6.2 4.1 5.3 0.9 - 1.4 5.1% 2.7% Other manufacturing, repair and installation 410 1.2 0.9 1.4 - 0.2 - 0.1 3.2% 2.7% Construction 2,644 7.6 6.3 6.5 1.1 - 0.2 2.4% 3.2% Wholesale and retail trade; repair of motor vehicles 3,843 11.1 10.4 9.5 1.6 0.1 3.1% 2.6% Transportation and storage 1,072 3.1 4.3 3.5 - 0.4 - 0.4 - 1.0% 1.3% Accommodation and food service activities 1,444 4.2 3.0 3.6 0.6 0.2 1.0% 2.0% Information and communication 1,102 3.2 6.5 1.5 1.7 3.0 3.3% 3.5% Financial and insurance activities 746 2.1 7.2 2.7 - 0.6 0.2 - 4.1% - 1.1% Real estate activities 5,367 15.5 13.7 19.0 - 3.5 1.4 0.1% 2.0% Professional, scientific and technical activities 1,900 5.5 7.7 3.0 2.5 2.9 4.3% 4.0% Administrative and support service activities 1,102 3.2 4.9 1.8 1.4 2.0 2.9% 5.7% Public administration and defence 2,239 6.4 4.6 8.5 - 2.1 - 1.9 - 1.8% - 1.7% Education 2,433 7.0 5.9 8.3 - 1.3 - 1.4 0.9% 0.7% Human health and social work activities 3,155 9.1 7.3 7.6 1.5 1.6 1.1% 2.0% Arts, entertainment and recreation 417 1.2 1.5 1.4 - 0.2 - 0.3 - 0.4% 0.6% Other service activities 784 2.3 2.1 1.8 0.5 0.0 1.7% 1.6% Activities of households 167 0.5 0.4 0.9 - 0.4 - 0.2 - 5.8% 0.5% Total 34,716 100 100 100 1.4 1.8 1.2% 1.7% Source: ONS - Regional gross value added (balanced) by combined authority, city regions and other economic and enterprise regions of the UK
67 6.3.2. Economic growth
Since 1998, GVA for the Heart of the South West LEP has increased in real terms by 1.4% on average, per annum. This compares to 1.6% f or the South West and 1.8% for the UK ( Table 8 ).
Figure 24 : GVA (£million) in 2016 prices, Heart of the South West LEP area , 1 998 - 2018
40000
35000
30000
25000
20000
15000
10000
5000
0 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Source: ONS - Regional gross value added (balanced) by combined authority, city regions and other economic and enterprise regions of the UK
Examining the period in more detail reveals four periods ( Figure 24 ):
Sustai ned growth between 1998 and 2006. During this period, the Heart of the South West economy area grew by 2.5% per year (in real terms) matching the UK growth rate (2.5%) and exceeding that recorded across the South West (2.4%). Several districts out - perfor med the UK average: South Hams (3.9%), Exeter (3.7%), North Devon (3.2%), Mendip (3.0%), Taunton Deane (2.7%), West Somerset (2.9%), Teignbridge (2.9%), and Torridge (2.8%). By contrast, growth was most sluggish in Torbay (1.3%), Plymouth (1.7%) and Sedge moor (1.8%).
Contraction between 2006 and 2009. The global financial crisis of 2007 - 2008 contributed to three consecutive years of negative growth with the Heart of the South West economy contracting by 1.6% on average in each of these years. The contrac tion was greater locally, than the UK ( - 0.5%) and South West ( - 0.4%) averages and was particularly strong in West Somerset ( - 3.8%). Exeter ( - 0.4%) proved to be the most resilient.
68
Post - recession recovery between 2009 and 2014. The Heart of the West econo my did not return to its pre - recession size (in real terms) until 2014. Growth over this period averaged 1.1% per year, slower than both the UK (1.6%) and South West (1.5%) averages. Sedgemoor (2.4%), Teignbridge (2.4%), South Somerset (2.2%) and Plymouth (2.2%) grew strongest. West Devon continued to contract ( - 0.5%)
Post - recovery expansion between 2014 and 2017. Given that average growth rates over this period for the Heart of the South West and the UK are the same as those recorded in the previous, ‘p ost - recovery’ phase they could arguably be considered one phase. However, separating them does highlight the fact that growth continues to be fairly sluggish – eight years after the recession ended and three years after the economy returned to its pre - rec ession size. The impact of the 2016 Referendum and on - going uncertainly over the UK relationship with the EU is also likely to have contributed to a slowing of growth during the final year of this phase. Indeed some districts within the Heart of the South West LEP area have already contracted in real terms during this final year for which data is available. Most affected are: West Somerset ( - 5.9%), South Hams ( - 3.6%) and North Devon ( - 2.5%).
6.3.3. Sectoral trends
Some sectors have become progressively less sign ificant contributors to local GVA over time ( Table 8 ) . For example, agriculture, mining, electricity, gas, water & waste; most manufacturing sectors; tr ansportation & storage; public administration & defence; education; arts, entertainment and recreation and activities of households accounted for a smaller share of local and national GVA in 2017 than they did in 1998. At the same time, wholesale & retail trade; accommodation & food services; information and communication; professional, scientific and technical activities; administrative & support service activities; human health & social work activities and other service activities accounted for a greater share of local and national GVA. The main differences between Heart of the South West LEP area and the UK average were:
Contraction in the relative contribution of financial & insurance activities and real estate activities compared to growth nationally;
Increase in the share of GVA contributed by: manufacture of metals, electrical products and machinery and construction. Both of these sectors become relatively less important contributors to GVA nationally over the same period.
Examining sectoral rates of growth over the post - recession period ( Table 8 ) reveals that the fastest growing sectors were (average annual growth rates in brackets):
Manufacturin g of metals, electrical products and machinery (5.1%)
Professional, scientific and technical activities (4.3%)
Information and communication (3.3%)
Other manufacturing, repair and installation (3.2%)
69 Wholesale and retail trade; repair of motor vehicles (3. 1%)
Administrative & support activities (2.9%)
Construction (2.4%)
By contrast, the following sectors contracted:
Activities of households ( - 5.8%)
Financial and insurance activities (4.1%)
Public administration and defence ( - 1.8%)
Transportation & storage (1.0%)
Manufacture of wood, petroleum, chemicals and minerals ( - 0.9%)
Arts, entertainment and recreation ( - 0.4%)
6.4. Employment
The Office for National Statistics generates sub - regional estimates of total employment from three main sources: the Business Regis ter and Employment Survey (BRES), the Annual Population Survey and the Census.
The estimates generated by the BRES – detailed sec tor – workplace based, updated annually latest 2018. The BRES estimates are analysed below in section 6.4 .1. These are the preferred source for generating estimates of private sector jobs and is the closest to estimates workforce jobs.
Annual Population Survey – household survey – respondents are asked where they work so estimates are published on a workplace and residence bas is. It c ounts persons in employment – not jobs – so someone with two jobs will only be counted once. It does have f a irly wide confidence intervals, so it can be difficult identifying statistically significant change over time or between geographies withi n the LEP area. The residence based household estimates are analysed in the labour supply section.
Census – every 10 years. Useful for providing information at relatively small geographies but becomes dated quickly as BRES and APS are updated more frequ ently.
6.4.1. Level and characteristics of employment
According to the Business Register and Employment Survey ( BRES 67 ) , total workplace employment across the LEP area stood at 766,000 in 2018. This places Heart of the South
67 BRES is regarded as the definitive source of official government employee statistics by industry.
70
West LEP area , 12 th among LEP areas in terms of total employment; a similar size to Sheffield City Region an Enterprise M3 . In terms of broad characteristics , in 2018 :
The Heart of the South West had 643,200 private sector and 123,300 public sector jobs in 201 8. At 84%, the share of private sector employment was equal to the national average.
The vast majority of this employment (93%) comprised employees (716,000) with the remainder consisting of working business owners. Heart of the South West LEP area has one o f the largest shares of working business owners among LEP areas , reflecting the significance of self - employment in the area.
Most employees (62%) were employed full time. 38% were employed part time . Heart of the South West LEP area had the second lowest share of full time employees (and second highest share of part - time employees) of all the LEP areas. Only Cornwall and Isles of Scilly had a lower share of employees (59%).
6.4.2. Sectoral strengths
In common with the UK, employment within the Heart of the Sou th West LEP is concentrated within the marketed services sector with this broad cluster of sub - sectors accounting for more than half of employment locally (51%) and nationally (55%). The remainder is broadly equally split locally between ‘production’ indu stries (21% in the Heart of the South West and 18% in England) and ‘public services’ (28% in the Heart of the South West and 27% across England).
Examining these sectors in more detail reveals that heath is the single biggest sector locally accounting fo r 15% of employment across the LEP area. This is followed by accommodation and food services (10%), retail (10%), manufacturing (9%) and education (9%). Very broadly, the industrial distribution of employment across the Heart of the South West mirrors th at of the England average albeit with lower proportions in business and financial services (16% compared to 21%).
71 Figure 25 Percentage of Employment by Industrial Sector, Heart of the South West LEP area and England, 2018
Arts, entertainment, recreation & other services 5% 5% Health 14% 15% Education 8% 9% Public administration & defence 4% 4% Business administration & support services 6% 6% 7% Professional, scientific & technical 5% Property 2% 2% England HotSW Financial & insurance 3% 1% 3% Information & communication 2% 10% Accommodation & food services 10% 4% Transport & storage 4% 10% Retail 10% 4% Wholesale 4% Motor trades 2% 2% Construction 6% 6% 8% Manufacturing 9% 1% Mining, quarrying & utilities 2% 3% Agriculture, forestry & fishing 4%
0% 5% 10% 15% 20% % of employment
Source: Business Register and Employment Survey (via Nomis)
Analysis of BRES employment estimates at the 3 digit SIC code reveals that the largest sectors are:
Hospital activities 43,000 Retail trade in non - specialised stores 35,000 DEFRA Agricultural data 32,000 Restaurants and mobile food service activities 30,000 Primary education 29,000 Secondary education 21,000 Retail trade of other goods in specialised stores 20,000
72
Comparing the percentage of employment in specific sectors locally with th e same statistic nationally reveals those sectors where the Heart of the South West has a comparative advantage or sector specialism. The following sectors have a Location Quotient of 2 or more: this means that these sectors account for at least twice the share of employment locally than nationally:
Table 9 Location Quotients for Sector specialisms 68 , Heart of the South West LEP area and UK , 2018
3 digit SIC Location Total Quotient 69 employment Building of ships and boats 11.7 9,000 Tanning and dressing of leather; manufacture of luggage, 8.0 900 handbags, saddlery and harness; dressing and dyeing of fur Manufacture of dairy products 6.4 3,500 Manufacture of domestic appliances 5.5 1,500 Camping grounds, recreational vehicle parks 4.8 4,500 Holiday and other short stay accommodation 3.9 4,500 Quarrying of stone, sand and clay 3.1 1,250 DEFRA data 2.9 32,000 Manufacture pf prepared animal feed 2.9 1,000 Manufacture of air and space craft and related machinery 2.5 5,000 Manufacture of electric motors, generators, transformers and 2.1 1,250 electricity distribution and control apparatus Retail sale of automotive fuel in specialised stores 2.1 1,750 Manufacture of medical and dental instruments and supplies 1.9 1,750 Veterinary activities 1.8 3,000 Compulsory social security activities 1.7 2,000 Residential care activities for the elderly and disabled 1.7 10,000 Manufacture of general purpose machinery 1.6 2,000 Development of building projects 1.6 4,500 Medical and dental practice activities 1.6 15,000 Electric power generation, transmission and distribution 1.6 4,000 Waste treatment and disposal 1.6 1,750 Source: Business Register and Employment Survey (BRES) via NOMIS
68 Only including sectors with total employment at 900 or abov e. 69 Share of employment in the Heart of the South West LEP area divided by share of employment in Great Britain.
73 The Heart of the South West LEP aims to focus on six ‘Golden Opportunities’, as described in the Devolution Prospectus 70 , which are Marine, Nuclear, Aerospace and Advanced Engineering, Data Analytics, Health and Care, and Rural Productivity. Defining thes e sectors in terms of the Standard Industry Classification (SIC) is not straightforward – particularly in terms of the data analytics and rural productivity since the concepts transcends sectors as such. To overcome this, a definition of the “digital secto r” developed by the ONS (based on an expanded OECD definition) 71 is used as a proxy for data analytics and agriculture, forestry and fishing is adopted as a proxy for rural productivity.
Table 10 Location Quotient and Total Employ ment by Golden Opportun ity, Heart of the South West LEP area and G reat B ritain , 2018 Total Employment LQ 2018 Aerospace and Advanced Engineering 24,000 0.9 Digital Sector 20,000 0.5 Health and Care 95,000 1.1 Marine 12,000 3.3 Nuclear 27,000 0.7 Rural Productivity 46,000 1.8 Source: Business Register and Employment Survey (BRES) via NOMIS
Among the “Golden Opportunity” sectors, the largest is health and care, followed by rural productivity. Aerospace and advanced engineering, digital, m arine and nuclear are smaller, niche sectors. When compared to the share of employment nationally, marine and rural productivity, have particularly high percentages of employment locally. The relatively low location quotient for nuclear probably reflects the fa ct that the nuclear reactors at Hinkley Point C are still under construction.
The Tech National report for 2018 presents city - based estimates for the proportion of employment in digital technology jobs (in any sector) and the digital technology sector (in any job). The resulting Location Quotients, reveal that Exeter has a higher proportion of digital technology jobs than the UK average but employment in the digital technology sector accounts for a smaller share of employment than the UK in Exeter and Plym outh. Plymouth also has a smaller share of employment in digital technology job than the average for the UK. While the need for skills in this field is important and clearly highly present in Exeter, this does not mean that there will be innovation and d evelopment in this specific sector as this accounts for individuals providing Digital Tech services in unrelated industrial sectors.
70 https://heartofswlep.co.uk/wp - content/uploads/2016/09/Heart - of - the - South - West - Devolution - Prospectus.pdf 71 https://www.ons.gov.uk/businessindustryandtrade/itandinternetindustry/articles/ecommerceandinternetuse/2015 - 10 - 08
74
Figure 26 Digital Tech Jobs by SOC and SIC Location Quotient, Plymouth, Exeter and the UK , 2018
1.8 1.56 1.6 1.4 1.2 1 0.8 0.73 0.72 0.6 0.4 0.16 0.2 0 Digital Tech Jobs as % of Total Employment Jobs in Digital Tech as a % of Total Employment
Exeter Plymouth UK
Source: Tech Nation 2018 – ONS Annual Population Survey data
Given the size of the Heart of the South West LEP area it is not surprisingly that many of its constituent lower tier local authority areas have their own sectoral strengths and specialisms. Table 11 describe these using location quotients to determine the extent to which broad sectors account for a greater and lesser share of total employment than the Great Britain average. The results reveal the following sector specialisms within specific location s
Agriculture, forestry & fishing accounts in all local authority areas outside the urban centres of Exeter, Plymouth and Torbay but particularly in Torridge, West Devon, West Somerset and Mid Devon.
Mining, quarrying and utilities in West Somerset and to a lesser extent Exeter, Mendip and Sedgemoor than the GB average.
Motor trades & r etail in mo st local authorities within the LEP area
Manufacturing in several districts but particularly South Somerset, Mid Devon and Sedgemoor
Accommodation and food service in the popular tourism destinations of West Somerset, Torbay, West Devon, South Hams and East Devon.
Public administration, education and health within the urban districts of Exeter and Plymouth reflecting their role as sub - regional administrative centres
T he broad financial and business services sector is under - presented in most parts of the LEP area and in most cases significantly so.
75 Table 11 Location quotients for employment by sector, lower tier local authorities i n the Heart of the South West LEP area and Great Britain, 2018
h d e e
i e n t
r p y m
s r s e n i n n t n t s
h h g o t h u r r e
e t t t a t r b s s n o o o o d t s d d o e e i r m e i b g u u n v v v t n v t o a e e n e a r r o g a d o o u e e e m o g r e e x m m e M i o E W W y e N a o S H S o o l D E D D D D e T M T S T S S P T
Agriculture, forestry & fishing 3.53 0.03 2.78 7.54 4.60 0.06 2.72 3.83 3.07 2.14 2.79 0.19 9.63 9.32 7.73 Mining, quarrying & utilities 0.85 2.03 1.87 1.04 0.56 0.86 1.46 0.92 0.95 0.65 0.90 0.63 0.50 0.66 5.33 Manufacturing 0.59 0.34 1.24 1.73 1.59 1.49 1.70 1.39 2.12 0.75 1.12 0.52 1.25 0.78 0.44 Construction 1.93 0.88 1.22 1.59 0.97 0.84 1.19 1.26 1.15 1.05 1.83 0.85 1.35 1.27 1.45 Motor trades 1.26 1.44 1.32 1.29 1.41 1.22 1.29 1.05 1.50 1.37 1.33 1.00 0.94 1.06 0.94 Wholesale 1.07 0.82 0.75 1.74 0.80 0.46 0.98 1.24 1.24 0.65 1.13 0.79 1.00 0.75 0.71 Retail 1.20 1.03 1.47 0.92 1.12 1.07 0.92 1.04 1.05 1.09 1.27 1.32 1.05 1.06 0.94 Transportation and storage 1.39 0.68 1.04 1.09 0.55 0.96 1.83 0.64 0.59 0.36 0.63 0.55 0.83 0.63 0.45 Accommodation and food service activities 1.74 0.85 1.31 0.91 1.67 1.09 1.15 1.94 0.93 0.90 1.57 2.19 1.45 1.97 2.80 Information and communication 0.57 1.17 0.71 0.33 0.30 0.44 0.28 1.03 0.59 0.51 0.48 0.30 0.24 0.48 0.34 Financial and insurance activities 0.17 0.72 0.24 0.20 0.19 0.34 0.23 0.16 0.19 0.64 0.21 0.31 0.16 0.33 0.09 Property 1.49 0.86 0.94 0.73 0.89 0.97 0.61 1.04 0.93 0.72 1.05 1.10 1.05 1.05 0.93 Prof essional, scientific & technical activities 0.54 0.98 0.79 0.49 0.54 0.47 0.44 0.63 0.64 0.88 0.57 0.53 0.50 0.45 0.36 Business administration & support services 0.37 0.97 0.56 0.48 0.59 0.82 0.65 0.48 0.71 0.58 0.67 0.58 0.40 0.34 0.24 Public administration and defence 0.68 1.81 0.38 0.50 1.01 1.32 0.81 1.17 0.59 1.23 0.71 0.75 0.42 0.95 0.59 Education 0.88 1.26 1.15 1.00 0.86 1.28 1.01 0.71 0.82 1.00 0.81 1.09 1.03 0.87 0.74 Human 0.87 1.33 0.77 0.67 1.14 1.48 1.05 0.76 1.09 1.85 0.92 1.76 0.85 0.86 0.82 Arts, entertainment and recreation & 1.45 0.83 1.08 0.94 0.81 1.00 0.95 0.94 0.92 1.13 1.31 1.14 0.97 1.09 1.24 Total 0.99 1.01 1.00 1.03 1.00 1.01 1.00 1.00 1.01 1.00 0.99 0.99 1.01 0.99 0.98 Source: BRES accessed via NOMIS
76
6.4.3. Employment change
According to latest BRES estimates , total employment in the Heart of the South West LEP area increased in each of the last three years rising from 748,000 in 2015 to 766,000 in 2018. When expressed in percentage terms, the average annual growth rate locally (0.8%) was lower than the England average (1.2%). The fastest growi ng LEP areas in employment terms were Hertfordshire (3.4%), Greater Manchester (2.8%), Worcestershire (2.6%) and the South East Midlands (2.5%).
Figure 27 Total employment by type in the Heart of the South West: 2015 to 2018
900,000
766,000 800,000 748,000 754,000 757,000 716,000 697,000 703,000 705,000 700,000
600,000
500,000 444,000 449,000 443,000 445,000
400,000
300,000 253,000 254,000 262,000 270,000
200,000
100,000
0 2015 2016 2017 2018
Employees Full-time employees Part-time employees Employment
Source: Business Register and Employment Survey (BRES) via NOMIS
The growth in employment recorded locally was exclusively private - sector led (+19,300) with public sector employment contracting by 500 over this period. Private sector leadership in employm ent growth is possibly tied into austerity measures in the public services including factors such as pay increase caps and some lower paid jobs shifting to the private sector 72 , and reflects a statistical trend across the country since December 2008 73 .
Furt hermore, m ost of the increase in employment locally was in :
72 https://www.ons.gov.uk/employmentandlabourmarket/peopleinwork/earningsandworkinghours/articles/ispayhigherinthepublico rprivatesector/2017 - 1 1 - 16 73 https://www.ons.gov.uk/employmentandlabourmarket/peopleinwork/publicsectorpersonnel/bulletins/publicse ctoremployment/s eptember2019
77 Part - time employees (+17,000 ) although the number of full time employees also increased modestly (+1,000) . An increase in part - time employment may be symptomatic of what’s been called the “gig eco nomy”, a “labour market characterised by the prevalence of short - term contracts or freelance work, as opposed to permanent jobs” 74 , with companies such as Ü ber and Deliveroo often given as examples, where employees are paid by the task rather than a regular wage.
Devon (+10,000) and Somerset (+8,500). Total employment contracted in Plymouth ( - 1,275) and Torbay ( - 1,400) ( Table 12 ) .
Accommodation & food services (+13,000), arts, entertainment, & other services (+5,000), mining, quarrying & utilities (+4,000), Construction (+3,000) and Information & communication (+3,00 0). By contrast, total employment contracted in: professional, scientific & technical ( - 6,000), retail ( - 5,000), motor trades ( - 3,000), transport and storage ( - 2,000) and financial & insurance ( - 2,000).
With regards to the changes based on industry, there are certain country - wide trends that need to be taken account of. The environment for retai l is admittedly difficult w ith the rise of digital options, business rates, and high rents traditional retailers are likely to struggle , and according to the British Retail Consortium, as many as a third of Britain’s retail jobs could vanish by 2025 75 . Retail, motor trades, transport and financial are also likely to be affected by concerns surrounding Brexit before the UK leaves due to changes in the value of the pound and insecurity regarding trade and travel.
Table 12 Employment Change, Heart of the South West LEP area , South West and England , 2015 - 2018 Change 2015 % change 2015 Area 2015 2018 - 2018 - 2018 Devon 349,000 359,000 10,000 2.9% Plymouth 111,375 110,100 - 1,275 - 1.1% Somerset 239,000 247,500 8,500 3.6% Torbay 49,950 48,550 - 1,400 - 2.8% Heart of the South West 748,000 766,000 18,000 2.4% South West 2,516,000 2,598,000 82,000 3.3% England 25,932,000 26,842,000 910,000 3.5% Source: BRES (via Nomis). Note: employment numbers cover employee jobs and working business owners
Employment change by region poses unique difficulties: while Devon and Somerset have been doing relatively well, only Somerset has surpassed the rate for Eng land. Devon’s major areas of proportional increase are Electricity, gas, steam and air conditioning supply and Accommodation and food service activities, while the areas with the greatest percentage
74 https://www.bbc.co.uk/news/business - 38930048 75 https://www.telegraph.c o.uk/business/tips - for - the - future/future - of - retail/
78
change for Somerset are Electricity, gas, steam and air c onditioning supply once again and Arts, entertainment and recreation.
Plymouth and Torbay face decreases in employment , with both having the greatest rate of the decrease in the Financial and insurance activities section . However, it is worth noting that b ased on the statistics for the South West in the Annual Survey of Hours and Earnings (ASHE), Financial and insurance workers earn considerably more than their peers in Accommodation & food service activities and Arts, entertainment & recreation at each percentile. 76 This suggests potential issues with decreasing higher paid work and increasing lower paid work. However, workers in Electricity, gas, steam and air conditioning supply typically earn more than Financial and insurance workers in the South West at each percentile 77 , and this section has been on the increase.
Focusing on the Heart of the South W est LEPs ‘golden opportunities’, the picture is mixed . While there is a considerable increase in the Digital Sector, employment in both Nuclear and Aerospac e and Advanced Engineering contracted over the last three years. As these are focal areas for growth, the lack of change in Rural Productivity is also concerning (rounding rules used for BRES data prevent smaller changes from being apparent). Health and Ca re has the highest number increase, but already high employment within this field in the Heart of the South West LEP area .
Marine is a relative success story as this is an area that has had relatively high growth across Heart of the South West LEP area bu t has contracted across England. It is useful to note that these categories were set out in the Heart of the South West LEP Prospectus for Productivity, which was submitted to government in March 2016, and released on the website in July of the same year 78 . This means that longer term strategies for these fields may not have had much time to start showing impact, but nonetheless these have been focal areas for the majority of the time covered by the data. This data also suggests that specialised STEM areas m ay need promotion to avoid further contraction in both Aerospace and Advanced Engineering and Nuclear, although the latter trend may change after the completion of Hinkley Point C (the first reactor is due to be operational in 2023 and run for 60 years 79 ).
76 https://www.ons.gov.uk/employmentandlabourmarket/people inwork/earningsandworkinghours/datasets/regionbyindustry2digit sicashetable5 77 Ibid. 78 https://heartofswlep.co.uk/about - the - lep/strategies - and - priorities/heart - south - west - joint - committee/ 79 https://www.bbc.co.uk/news/business - 24604218
79 Table 13 Employment change within the Heart of the South West LEP ‘golden opportunity sectors, Heart of the South West LEP area and England, 2015 to 2018
Heart of the South West England Number % Aerospace and Advanced Engineering - 3,000 - 11% 2% Digital Sector 3,000 18% 4% Health and Care 4,000 4% 5% Marine 1,000 9% - 1% Nuclear - 1,000 - 4% 5% Rural Productivity 0 0% 3% Source: BRES via NOMIS
6.5. Productivit y
What is the level of productivity and economic activity (overall and by sector/occupation)?
Productivity is a measure of how efficiently resources such as labour and capital are used to produce output. Its importance lies in it being perhaps the key determinant of wages and living standards. It also determines enterprises capacity to grow through investing in their business. McKinsey (2018) 80 identify four phenomena — financial sector boom and bust, employment growth, invest ment decline, and uneven digitis ation — to explain much of the recent decline in labour - productivity growth in the UK (the UK’s productivity puzzle). Enhancing productivity McKinsey argue, requires first and foremost, improvements in education and skills. Secondly, they recommend closing adoption gaps in digital and next - generation technolo gies could boost productivity growth but will require better information, access to finance, collaborations, and a favourable policy environment for diffusion.
“It is well understood that enhancing employees’ skills is critical for driving productivity g rowth and maintaining high levels of employment in an era of rapid technological change. Yet what is less clear is the most effective way to achieve that. What kind of education system better equips young people for the workplace of the future? When retr aining workers, are government or private - sector programmes more effective? How can reskilling and upskilling be delivered affordably and at scale? How can firms overcome change resistance and inertia in adopting new practices and technologies?” 81 (McKinsey 2016)
80 Solving the United Kingdom’s productivity puzzle in a digital age https://www.mckinsey.com/~/media/mckinsey/featured%20insights/meeting%20societys%20expectations/solving%20the%20un ited%20kingdoms%20productivity%20puzzle%20in%20a%20digital%20age/mgi - prod uctivity - in - the - uk - discussion - paper - september - 2018.ashx 81 https://www.mckinsey.com/featured - insights/regions - in - f ocus/solving - the - united - kingdoms - productivity - puzzle - in - a - digital - age
80
These are clearly key questions for the SAP.
Three main messages emerge from an analysis of the 2017 sub - national productivity estimates produced by the ONS.
Firstly, productivity in the Heart of the South West LEP (at £27.9 per hour worked) was 17 % below than for the UK as a whole (£33.60) ( Figure 28 ) . It is lower than the UK average across all its local authority areas but particularly so in Torbay. When ranked in terms of productivity, the Heart of the South West LEP comes 32 nd out of 38 LEP areas 82 . The ONS suggests that rural and coastal areas are more susceptible to low productivity, and that only 15 of 49 sub - regions in the south of England had productivity levels above the (admittedly London - skewed) UK average 83 .
Secondly, in real t erms productivity levels across the Heart of the South West in 2017 were broadly what they were in 2007. P roductivity improved between 2004 and 2006 but these gains w ere eroded between 2006 and 2007 . Interestingly, productivity then increased by almost 4 % (in real terms) in a single year (between 2015 and 2016) 84 before falling by more than 1% the subsequent year.
Thirdly, the productivity gap with the UK average has widened slightly over time ( Figure 29 ) .
82 https://www.ons.gov.uk/employmentandlabourmarket/peopleinwork/labourproductivity/datasets/subregionalproductivitylabourp roductivitygvaperhourworkedandgvaperfilledjobindicesbylocalenterprisepartnership 83 https://www.ons.gov.uk/employmentandlabourmarket/peopleinwork/labourproductivity/ articles/regionalandsubregionalproducti vityintheuk/february2019#results - for - nuts3 - subregions 84 It is unclear what caused this jump, though some caution is required with using productivity estimates for local areas.
81 Figure 28 Nominal (smoothed) GVA per hour worked (£), County, Heart of the South West LEP area , and UK, 2017
40
35 33.7
30 27.9 28 28.2 28.2 d
e 25.2 k r 25 o w
r
u 20 o h
r 15 e p
£ 10
5
0 Torbay Heart of the Devon CC Somerset Plymouth UK South West
Source: https://www.ons.gov.uk/employmentandlabourmarket/peopleinwork/labourproductivity/d atasets/subre gionalproductivitylabourproductivitygvaperhourworkedandgvaperfilledjobindicesbylocalenterprisepartn ership and https://www.ons.gov.uk/employmentandlabourmarket/peopleinwork/labourproductivity/datasets/subre gionalproductivitylabourproductivitygvaperhourworkedandgvaperfilledjobindicesb yuknuts2andnuts3su bregions
82
Figure 29 Nominal (smoothed) GVA per hour worked (UK=100): Heart of the South West: 2004 to 2017
87 86 86 85.6 )
0 85.2 0 1
= 85 K 84.4 U (
d 83.9 e 84 k r o
w 83 82.9 r
u 83 82.5 82.6 o h 82.1 82.1 r 82 82 82 e
p 82
A V G 81
80 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 Axis Ttle
Source: https://www.ons.gov.uk/employmentandlabou rmarket/peopleinwork/labourproductivity/datasets/subre gionalproductivitylabourproductivitygvaperhourworkedandgvaperfilledjobindicesbylocalenterprisepartn ership
83 6.6. Earnings
6.6.1. Variations within the LEP area
There is a close relationship between productivity an d earnings because “compensation of employees” accoun ts for the la rgest component of Gross Value Added (55%) . In 2019, the median full time weekly wage for people working in the Heart of the South West was £521.30 85 and £531.80 for people living in the Hear t of the South West . Both estimate s are lower than the UK average in all higher tier local authority districts within the LEP area. To ameliorate some of the data effects arising for the high confidence intervals, Table 14 below shows the average weekly pay of full time workers who are a) resident and b) working in each district over the last ten years.
It suggests that residents’ pay is particularly low, relat ive to the national average, in Torbay, North Devon and Torridge. The wages of those working in Torridge (79% of the UK average) fall even further behind those who reside in Torridge (84% of UK average) due to some measure of commuting to reasonably paid j obs in other areas.
The wages of residents of Mendip, South Somerset and Exeter are the highest in the region (98% of the UK average), but this, again, is partly due to commuting to relatively well - paid jobs elsewhere. The pay of those working in Mendip a t 79% of the UK average respectively, is far lower than that of residents.
Conversely, the region’s cities, Exeter and Plymouth offer access to significant numbers of well relatively well paid jobs, resulting in pay at 99% and 91% of the UK average. Howev er, with many of these jobs occupied by commuters, the pay of residents (98% and 86% of the UK average respectively) lags that of local workers, although less severely in Exeter.
85 The standard error associated with b oth these estimates is ± 1.7% of the figure.
84
Table 14 : Average Median gross weekly pay of full time workers , County and District Authority , 2009 to 2019
% of UK Average Resident Analysis Workplace Analysis
2009 Index 2019 Index 2009 Index 2019 Index Devon 88% 89% 85% 88% Plymouth 91% 86% 96% 91% Somerset 93% 97% 88% 92% Torbay 77% 86% 73% 83% East Devon 89% 94% 78% 88% Exeter 86% 98% 94% 99% Mendip 95% 98% 82% 79% Mid Devon 86% 93% 88% 78% North Devon 75% 83% 76% 84% Sedgemoor 94% 95% 82% 82% Somerset West and Taunton Unavailable 94% Unavailable 97% South Hams 106% 93% 85% 87% South Somerset 89% 98% 89% 97% Teignbridge 93% 89% 86% 79% Torridge 77% 84% 66% 79% West Devon 91% 86% 71% 81% UK 100% 100% 100% 100%
Source: Annual Survey of Hours and Earnings via NOMIS
Table 14 shows that c onditions have changed through the past decade, with some areas getting closer to the UK average (such as Somerset, Torbay and Torridge residents) and some dropping away (such as South Hams and West Devon residents). Overall, however, in both residential and workpla ce analysis most of the South West LEP is closer to the UK average than in 2009. However, due to this being indexed this does not necessarily indicate an increase in gross weekly pay in this region compared to reductions elsewhere reducing the UK average. This is positive news comparatively but average weekly earnings across the South West are still lower than the UK average even in the areas with the highest income. This is not conducive to drawing talent or young people into the area, and as will be discu ssed below in Figure 30 , indicates a higher risk of in - work relative poverty.
Nominal w orkplace earnings have increased broadly in line with the UK average at 2.3% per annum (compared to 2.4% per annum nationally) between 2014 and 2019, maintaining an ‘earnings gap’ with the UK of around 11%. Real full time weekly earnings wages, however, nationally, are lower than a decade ago 86 , focusing attention on the growing problem of in - work poverty. According to research by the Joseph Rowntree Foundation, the number of
86 https://www.ons.gov.uk/employmentandlabourmarket/peopleinwork/ earningsandworkinghours/bulletins/annualsurveyofhours andearnings/2019
85 people in in - work poverty across the UK grew from c3.5m to 4m between 2012 and 2017, equivalent to 13% of all workers.
Precise data on in - wor k poverty in the Heart of the South West LEP area is not available. However, in - work poverty is un doubtedly a significant problem. This is evident from data on the earnings of the 20% most poorly paid workers in the region. Figure 30 shows that the average weekly pay of the worst paid 20% of the work force is below the UK average in all areas apart from South Somerset and Exeter , and this is also true whe n analysing by workplace . West Devon is lowest on residential terms at 91% of the average, and when considered on workplace terms, is even lower at 86% of the UK average.
Figure 30 Average weekly pay excl. overtime of lowest 20% of full - time earners by residence , indexed UK=100, 20 19
400 104% 101% 101% 102% 390 100% 99% 100% 98% 380 97% 98% 96% 95% 370 95% 96% 94% 93% 94% 92% 92% 360 92% 92% 91% 350 90% 88% 340 86% 330 84%
£ per week % of UK average
Source: Annual Survey of Hours and Earning s – via NOMIS
The prevalence of low pay in the region is, to a significant degree, a reflection of the s truc ture of the economy and jobs. Reason would , however, also suggest that some Heart of the South West LEP area employees are simultaneously being paid less than others in the same job in areas such as London which, owing to its size and increased cost of li ving , will impact the national average.
86
As with other parts of the UK, Heart of the South West LEP area has a signific ant gender pay gap. In 2019 , the average weekl y pay of female workers in Heart of the South West LEP area (£ 339) was 66.5 % of that of male workers (£ 510 ). This pay gap is slightly smaller than that seen across UK where median female pay is 67 .5 % that of males. The gap appears to be even larger in Somerset where female pay is 62.5 % of male pay, although some caution is needed due to conf idence intervals.
Figure 31 £ per week of Median weekly pay and percentage gender gap in all jobs , resident analysis , UK, Heart of the South West LEP area and county level , 2019
700 74.0% 72.6% 575 71.9% 72.0% 600 553 510 499 490 70.0% 500 458 67.5% 68.0%
400 66.5% 352 65.9% 346 333 66.0% 388 339 300 329 64.0% 62.5% 62.0% 200 60.0% 100 58.0%
0 56.0% United Heart of the Devon Plymouth Somerset Torbay Kingdom South West
Male Female Female as % of Male
Source: Annual Survey of Hours and Earnings via NOMIS
87 7. LABOUR DEMAND
7.1. Introduction
This section describes the nature and extent of demand for labour and skills across the Hea rt of the South West LEP area. It considers:
the current profile and characteristics of employment demand;
the trends that are present over time;
the role of recruitment practices;
staff retention and redundancies; the need for upskilling, and as a result, employer levels of investment in training as well as barriers to training and employment;
the future for labour and skills demand, including the potential vulnerability caused by technological change.
This focuses on the demand of employers for skills and employees, rather than the demand of employees for jobs, and how issues of churn and skills gaps can be handled.
7.2. Characteri stics of current employment demand
The earlier BRES analysis presented in section 6.7 put workplace employment in the LEP area at 766, 000 in 2018. This source revealed that, compared to the UK, employment in the LEP area was particularly characterised by greater levels of self - employment and part - time working and with sectoral strengths in production, retail, accommodation and food services, and education and health.
Workplace analysis derived from the Annual Population Survey offers a further perspective on labour demand and is particularly useful in providing an understanding of the occupations supported locally. The APS suggests total employment in the LEP area was 862,200 during the 12 month period July 2018 to June 2019. This APS estimate is higher than the BRES estimate because.
In terms of employment characteristics, this APS also reveals that compared to the UK as a whole, the LEP area has a greater proportion of:
Workers aged 50 and over (37% compared to 32%)
Self - employment (18% compared to 15%)
Employment in production sectors, distribution, hotels and restaurants and public administration & health.
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In terms of occupation, the APS reveals that the occupational profile broadly comprises:
High skill occupations (43%) including managers and seni or officials, professionals and associate professionals and technicians
Middle skill occupations (22%) including administrative & secretarial and skilled trades;
Service intensive occupations (17%) including caring & personal services and sales and custom er services;
Labour intensive services (18%) including plant and machine operatives and elementary occupations.
The sub - major occupational categories accounting for the most jobs locally are
Elementary administration and service occupations (9.5%)
Carting personal and service occupations (8.3%)
Administrative occupations (7.0%)
Business and public service associate professionals (6.2%)
Corporate managers and directors (6.1%)
Sales occupations (6.0%)
The distribution of employment across occupations locally mirrors that nationally, in broad terms, but with an over - representation of:
Labour intensive occupations and elementary administration and service and elementary trades and related occupations specifically;
Middle skill occupations, particularly skilled agricultural and related trades and skilled metal, electrical and electronic trades.
By contrast, high - skill occupations overall accounted for a lower share of employment locally than the national average but with an over - representations of some specific s ub - groups, specifically: other managers and proprietors, teaching and educational professionals and science, engineering and technology associate professionals.
The share of employment in service intensive occupations was broadly comparable to the UK avera ge but with particularly high percentages in caring and personal service occupations and sales occupations.
89 Table 15 Distribution of total employment by sub - major group (SOC2010), Heart of the South West and UK, July 2018 to June 2019 Heart of the South UK West Occupation Number % Corporate Managers and Directors 52,200 6.1 7.9 Other Managers and Proprietors 40,400 4.7 3.2 Science, Research, Engineering and Technology Professionals 42,900 5.0 5.7 Health Professionals 35,300 4.1 4.6 Teaching and Educational Professionals 44,200 5.1 4.9 Business, Media and Public Service Professionals 37,500 4.4 5.8 Science, Engineering and Technology Associate Professionals 17,700 2.1 1.9 Health and Social Care Associate Professionals 13,300 1.5 1.5 Protective Service Occupations 14,700 1.7 1.2 Culture, Media and Sports Occupations 21,100 2.5 2.4 Business and Public Service Associate Professionals 53,200 6.2 7.7 Administrative Occupations 60,500 7.0 7.9 Secretarial and Related Occupations 20,900 2.4 2.0 Skilled Agricultural and Related Trades 20,800 2.4 1.2 Skilled Metal, Electrical and Electronic Trades 37,900 4.4 3.6 Skilled Construction and Building Trades 28,600 3.3 3.3 Textiles, Printing and Other Skilled Trades 18,200 2.1 2.0 Caring Personal Service Occupations 71,100 8.3 7.1 Leisure, Travel and Related Personal Service Occupations 11,800 1.4 2.0 Sales Occupations 51,400 6.0 5.4 Customer Service Occupations 9,900 1.2 2.0 Process, Plant and Machine Operatives 25,000 2.9 2.5 Transport and Mobile Machine Drivers and Operatives 31,400 3.7 3.8 Elementary Trades and Related Occupations 18,700 2.2 1.5 Elementary Administration and Service Occupations 81,500 9.5 8.8 All occupations 860,200 100.0 100.0
HIGH - SKILL 372,500 43.3 46.8 MIDDLE - SKILL 186,900 21.7 20.0 SERVICE - INTENSIVE 144,200 16.8 16.5 LABOUR - INTENSIVE 156,600 18.2 16.6 Source: Annual Population Survey (Workplace analysis) accessed via NOMIS
90
7.3. Trends in employment demand
Employment level
Employment levels have increased across the LEP area in each of the last five years with levels returning to their pre - recession peaks during 2014/5. Over the long - term 87 , employment growth locally broadly matched the UK average (at 0.9% per year) but growth over th e last five years has out - performed the national average (2.1% per annum compared to 1.5%).
Figure 32 Numbers in employment (workplace based), Hear t of the South West LEP area, 2004/05 to 2018/19 (all June to July)
1,000,000
900,000
800,000
700,000
600,000
500,000
400,000
300,000
200,000
100,000
0
Source: Ann ual Population Survey (Workplace analysis) accessed via NOMIS
1.1.1. Occupations
Studies of the changing demand for skills over the past two decades suggest a ‘skills polarisation’: demand for medium - skilled intermediate occupations is falling, while demand in both high - skilled and low - skilled occupations is rising. This trend suggests that the labour market is becoming ‘hour - glass’ shaped, also referred to as the ‘hollowing out’ or, more freq uently, ‘skills polarisation’. These trends are bo rne out locally in a n analysis of employment change over the last five years. Broadly, demand for high - skill and labour intensive occupations has increased whilst the demand for service - intensive occupations has declined and that for middle - skilled occupations remained broadl y the same ( Figure 33 ).
87 Between 2004/5 and 2018/19.
91 Figure 33 Percentage change in employment by sub - major occupations, Heart of the South West and Unite d Kingdom, July 2014/June 2015 to July 2018/June 2019
Heart of the South West United Kingdom
9 Corporate Managers and Directors 22 Other Managers and Proprietors 17 6 Science, Research, Engineering and Technology… 40 2 18 Health Professionals 17 36 Teaching and Educational Professionals 6 Business, Media and Public Service Professionals 36 14 Science, Engineering and Technology Associate… 33 14 34 Health and Social Care Associate Professionals 14 Protective Service Occupations 4 65 Culture, Media and Sports Occupations 30 16 Business and Public Service Associate Professionals 13 29 Administrative Occupations 2 5 Secretarial and Related Occupations - 11 - 7 Skilled Agricultural and Related Trades 4 9 17 Skilled Metal, Electrical and Electronic Trades 1 Skilled Construction and Building Trades - 20 2 2 Textiles, Printing and Other Skilled Trades 1 Caring Personal Service Occupations 3 6 Leisure, Travel and Related Personal Service… - 32 5 Sales Occupations - 4 1 Customer Service Occupations - 10 18 Process, Plant and Machine Operatives 12 1 Transport and Mobile Machine Drivers and… 23 13 Elementary Trades and Related Occupations 23 0 Elementary Administration and Service Occupations - 1 3 All occupations 8 11
HIGH-SKILL 25 14 MIDDLE-SKILL 1 1 SERVICE-INTENSIVE - 3 4 LABOUR-INTENSIVE 5 7 -40 -20 0 20 40 60 80
Source: Annual Population Survey (Workplace analysis) access via NOMIS
In absolute numbers, employment within high - skills occupations expanded by 75,200, with the largest increases associated with e mployment in science, research, engineering and technology occupations (+12,300), teaching and educational professionals (+11,700) and professionals (+10,000) and associate professionals (+12,000) in business and public
92
services. Employment in labour int ensive occupations increased by 10,900 overall and middle - skill occupations by 1,000. Service - intensive employment contracted by 4,200.
7.4. Vacancies
According to the ONS Vacancy Survey, the number of vacancies in the UK has been generally increasing since 2012, although it has been falling since early 2019 , with a small increase from November 2019 to January 2020 88 . Provisional data for August to October 2019 reveals that four sectors accounted for more than half (55%) of all vacancies nationally: human hea lth and social work activities (136,000, wholesale & retail trade; repair of motor vehicles and motorcycles (129,000) and accommodation and food service activities (93,000) and professional scientific and technical activities (83,000). When expressed as a ratio of employment levels, some sectors had a higher incidence of recruitment activity than others. For example, the accommodation and food services sector had 4.1 vacancies per 100 employee jobs, more than twice that of several other sectors including construction (1.6 vacancies per 100 employee jobs), water supply , sewage, waste & remediation activities (1.7), public administration, defence & compulsory social security (1.8) and education (1.8).
Since the discontinuation of Jobcentre Plus vacancy data in 2012, the only official source of vacancy data is from the UK Employer Skills Survey. This source identified just over 26,500 vacancies in the Heart of the South West LEP area in 2017. At the time, one in five establishments (20%) in the LEP area had a t least one vacancy at the time of the survey, the same as nationally. The number of vacancies locally equated to 4% of all employment.
The distribution of these vacancies across sectors is similar to that described above with result to the UK Vacancy Su rvey: with a significant proportion within the health and social work (15%), wholesale & retail (17%), hotels and restaurants (15%) and business services (13%).
88 https://www.ons.gov.uk/employmentandlabourmarket/peopleinwork/employmentandemployeetypes/bulletins/u klabourmarket/ february2020#vacancies
93 Table 16 Percentage of vacancies by sector, Heart of the South West LEP area and comparator LEPs and England, 2017 Heart of the Occupation England Cumbria New Anglia South West Primary Sector & Utilities 2% 4% 6% 3% Manufacturing 6% 9% 9% 5% Construction 4% 5% 3% 5% Wholesale & Retail 14% 17% 17% 15% Hotels & restaurants 12% 15% 17% 16% Transport & Storage 4% 3% 4% 3% Information & Communications 4% 1% 0% 3% Financial Services 3% 3% 0% 2% Business Services 22% 13% 14% 20% Public admin. 4% 4% 0% 2% Education 5% 5% 4% 3% Health & social work 15% 15% 17% 21% Arts & Other Services 6% 5% 5% 2% Total 852,921 26,504 7,261 24,887 Source: ESS, 2017
Analysis by occupation (not available using the UK Vacancy Survey), reveals that m ore than almost a fifth of vacancies identified by Heart of the South West employers responding to the UK Skills Survey were for elementary roles (21%). The next largest occupational categories were for sales and customer services staff (15%), caring leisure & other servi ces staff (13%), skilled trades occupations (11%).
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Table 17 Percentage of vacancies by o ccupa tion, Heart of the South West LEP area and comparator LEPs and England , 2017 Heart of the Occupation England Cumbria New Anglia South West Managers 3% 2% 3% 2% Professionals 14% 10% 15% 12% Associate professionals 15% 10% 14% 19% Administrative/clerical staff 8% 8% 7% 8% Skilled trades occupations 10% 11% 12% 10% Caring, leisure and other services 13% 13% 11% 13% staff Sales and customer services staff 12% 15% 14% 9% Machine operatives 6% 9% 7% 7% Elementary staff 16% 21% 17% 18% Unclassified staff 3% 1% 1% 2% Total Vacancies 852,920 26,357 7,223 24,818
HIGH - SKILL 32% 22% 31% 33% MIDDLE - SKILL 18% 20% 19% 19% SERVICE - INTENSIVE 25% 28% 25% 21% LABOUR - INTENSIVE 22% 30% 24% 25% Source: UK E mployer S kills S urvey , 201 7
Advances in web - scraping technologies have stimulated the creation of a number of commercial packages that gather and analyse vacancies advertised on the internet. Labour Insights, is one such package providing access on a subscription basis. Interrogati on of the Labour Insights tool suggested that there were 133,500 vacancies were advertised in the Heart of the South West LEP area during the year to 30th September 2019. The volume of vacancies was 29% lower than that recorded the previous year. While this technology remains, to an extent, experimental and methods used to scrape and de - duplicate vacancies are still evolving, a decline in the number of advertised vacancies of this magnitude remains a concern. Of these 133,500 vacancies:
62,000 (or 46% ) were advertised by employers located in Devon;
49,500 (37%) by employers in Somerset;
17,000 (13%) by employers in Plymouth and
5,000 (4%) by employers in Torbay.
Of the Devon vacancies that were attributable to locations within Devon 89 , 58% were vaca ncies advertised by employers in Exeter. This is partly reflective of the strength of the
89 74% of Devon vacancies could be attributed to a location within Devon.
95 Exeter labour market but it is also reflective of Exeter’s role as a recruitment centre that is host to agencies advertising jobs for employers across the region.
Of the 96% of these vacancies that proved possible to categorise into a broad occupation code, the largest propor tion (13.3%) were vacancies in health c are, including nursing. While different occupations will employ different recruitment methods and those us ing word - of - mouth may be under - represented, the graph below shows that there are significant numbers of vacancies in the Heart of the South West LEP area for people in Business Management and Operations (8.7% of all vacancies ) , Sales (7.9%), Education & Tr aining (7.5%), Hospitality (7.4%), Clerical & Administrative roles (6.5%), Engineering (5.7%) and Information Technology (5.4%)
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Figure 34 Percentage of advertised vacancies by Burning Glass broad occupation families , Heart of the South west LEP area , 1 st Oct 2018 to 30 th Sept 2019,
14.0% 13.3%
12.0%
10.0% 8.7% 7.9% 8.0% 7.5% 7.4% 6.5% 5.7% 6.0% 5.4% 5.0% 4.5% 3.8% 3.8% 4.0% 3.5% 3.4% 3.1% 3.0% 1.9% 1.6% 2.0% 1.2% 1.1% 0.7% 0.6% 0.5% 0.0% 0.0%
Source: Labour Insights / Burning Glass
97 Roughly two thirds of these advertised vacancies contained information for Labour Insights to specify a broad skills cluster that employers were seeking from applicants. The graph below shows that Basic Customer Service (22% of adverts) and General Sales s kills (12%) were most commonly sought, following by Education & Teaching (11%), Information Technology (9%) and Administration skills (9%).
Figure 35 Skills Clusters most frequently requested, Heart of the South West LEP area , 1 st Oct 2018 – 30 th Sept 2019
0% 5% 10% 15% 20% 25%
Customer and Client Support: Basic Customer Service 22%
Sales: General Sales 12%
Education and Training: Teaching 11%
Information Technology: Microsoft Office and Productivity Tools 9%
Administration: General Administrative and Clerical Tasks 8%
Finance: Budget Management 7%
Business: Project Management 6%
Personal Care and Services: Food and Beverage Service 6%
Business: People Management 6%
Administration: Administrative Support 6%
Source: Labour Insights / Burning Glass
7.5. Recruitment practices
What do different recruitment practices and retention rates look like? How does this differ by sector, geography and skills levels? How are these trends likely to differ in the next years?
The Employer Perspectives Survey of 2016 collected data on the various recruitment methods employers use when trying to source skilled applicants. The table below shows that word of mouth and personal recommendations remain the m ost common method used, cited by just over 40% of survey respondents. Digital advertising of vacancies were among the next most common methods, with around a quarter of employers using social media. A similar proportion had used paid - for recruitment servic es.
Table 18 Percentage of employers using selected recruitment methods within the last 12 months, Heart of the South West LEP area and England, 2016
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Heart of the England South West Placed adverts on their website to recruit. 27% 29% Placed adverts on social media to recruit 21% 24% Paid someone to place adverts on their website or social media 5% 5% Used some other form of paid - for recruitment service 21% 24% Used a government recruitment service or scheme 19% 20% Used school, college or university job fairs or careers services 10% 10% Relied on word of mouth or personal recommendations 41% 42% Source: Employer Perspectives Survey 2016 https://www.gov.uk/government/publications/employer - perspectives - survey - 2016
Although the table suggests lower proportions of employers in the Heart of the South West LEP area have recently used most of the recruitment methods listed, the fact that the proportion of employers who had recruited locally was slightly below the national average suggests that the methods used to recruit staff closely follow the national average.
7.6. Sta ff retention
Retention of employees is a challenge for all employers but unfortunately there is little if any regional data ava ilable concerning the Heart of the South West LEP . However, the national context is still useful, if less specialised, as replaci ng staff is estimated to cost British businesses at least £4.13 billion each year, with an average of £30,614 per staff member 90 . One - year retention rates are very similar across the private and public sector and on average have slightly increased between 2 012 - 2013 and 2016 - 2017, but differ by occupation and by age group, with 35 to 49 year olds having the highest retention rates 91 .
90 https://www.tele graph.co.uk/finance/jobs/10657008/Replacing - staff - costs - British - businesses - 4bn - each - year.html 91 ONS – Is staff retention an issue in the public sector?
99 The ONS generates employee turnover rates through longitudinal analysis of the Annual Population Survey. This examines the employment status of individuals at a two points in time, and determines the percentage of which who are either working for a different employer or not working at all. The results suggest that employee retention rates vary by sector although typically aro und on third of employees change their employer (at least once) or stop working during a two year period.
Figure 36 Percentage of employees with a different employer or not employed within two year period by industry sector, Unite d Kingdom , January 2017 to Dec ember 2018
50% 45% 44% 45% 42% 40% 40% 38% 38% 36% 36% 34% 34% 34% 34% 35% 33% 32% 33% 32% 31% 30% 29% 29% 30% 25% 25% 20% 15% 10% 5% 0%
Source: ONS – APS - Employee turnover levels and rates by industry section, UK
It is worthy of note, that the Heart of the South West LEP has a greater share of employment in sectors that have poor retention rate s with accommodation and food services and wholesale & retail, particularly examples of this 92 . A high lack of retention points towards incr eased job churn and instability , an d so additional costs for employers.
92 Annual Population Survey via NOMIS
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7.7. Redundancies
Redundancy is measured by t he ONS o n a countrywide basis although the most localized results are published for the regional level. During the latest period for which data is available, an estimated 118,000 people were made redundancy across the United Kingdom 93 . This figure is higher than that recorded during the previous quarter (104,000), and the previous 12 months (84,000). At 4.3 (per 1,000 employees) the redundancy rate has followed a generally upward trend since August - October 2018 although it is currently considerably lo wer than the peak of 12.0 recorded during March to May 2009.
Figure 37 Redundancy Comparison – South West vs UK , 2018
14.0 s e e
y 12.0 o l p
m 10.0 e
0 0
0 8.0 1
r e p 6.0 s e i c
n 4.0 a d n u
d 2.0 e R 0.0 7 8 9 0 1 2 3 4 5 6 7 8 9 0 1 2 3 4 5 6 7 8 9 9 9 0 0 0 0 0 0 0 0 0 0 1 1 1 1 1 1 1 1 1 9 9 9 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 1 1 1 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2
UK South West
Source: ONS Redundancies RED02 94
Redundancies per 1000 employees have largely been in line with the rest of the UK in the South West, although there are notable variations between 2001 and 2003, and in quarter 1 and quarter 4 of 2014. The most recent data available for this measurement is quarter 1 2018.
7.8. Upskilling
The UK Employer Skills Survey also covered questions on ‘upskilling’, where employers anticipate that staff will need to acquire new skills over the next twelve months. Across the UK, six in ten employers (63%) expect that at l east some of their
93 Figure is for July - September 2019. https://www.ons.gov.uk/employmentandlabourmarket/peoplenotinwork/redundancies/datasets/redundanci eslevelsandratesseasonallyadjuste dred01sa 94 Blank spaces in Figure 37 represent where data was unavailable as the sample size was too small to provide an estimate.
101 staff will need to acquire new skills or knowledge over the next twelve months. Significantly fewer employers reported a need for upskilling than in 2013 (72%).
Employers anticipating the need for staff to acquire new skills or knowledge were asked which single occupation would be most affec ted. The table below shows that nationally 45% of employers employing any Managers anticipate this occupation being the priority, an increase from 32% in 2013. 39% of employers that employ Caring, Leisure and Other services staff anticipate these staff being the priority (an increase of two percen tage points since 2013).
There has been a decrease in the proportion reporting that Professionals they employ would be most affected, from 39% in 2013 to 29% in 2017. There were also decreases in those reporting that Associate Professionals (21% compared to 29% in 2013) and Sales occupations (22% compared to 29% in 2013) would be most affected. There has been little change for other occupations over the same period.
Table 19 Single occupation s most affected by a need for upskilling (% of establishments that identified an occupation in need of upskilling and employ that particular occupation) , UK, 2013 to 2017
Occupation 2013 2017 Managers 32 45 Professional occupations 39 29 Associate professional and technical occupations 29 21 Administrative and secretarial occupations 12 12 Skilled trades occupations 31 30 Caring Leisure and Other Service Occupations 37 39 Sales and customer service occupations 29 22 Process plant and machine operatives 21 19 Elementary occupations 14 14 Source: ESS 2017 (taken from main survey findings report by IFF Research). Note: only national data is available for these questions
Those employers that identified a need for upskilling were asked which skills require developing among their staff. As before, these have been grouped into technical / practical skills and people / personal skills.
The most common technical and practical skills that employers felt needed developing were knowledge of products and services (48%), specialist skills or know ledge (47%) and adapting to new equipment or materials (43%). Almost two - fifths (38%) mentioned complex analytical skills such as complex numerical or statistical skills, while around 30% cited digital skills (at advanced and/or basic level). The prevalen ce of upskilling
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needs appears to be higher than average in the South West, for most categories of technical and practical skills.
Table 20 Technical & Practical skills most affected by a need for upskilling (% of establishments that identified a need for upskilling ), UK, 2017 South Skill area in need of improvement England West Knowledge of products and services offered by your 51% 48% organisation and organisations like yours Specialist skills or knowledge needed to perform th e role 51% 47% Adapting to new equipment or materials 46% 43% Solving complex problems requiring a solution specific to the situation 41% 38% Computer literacy / basic IT skills 33% 31% Advanced or specialist IT skills 31% 30% Knowledge of how your organisation works 33% 30% Reading and understanding instructions guidelines manuals or 28% 26% reports Writing instructions guidelines manuals or reports 24% 22% More complex numerical or statistical skills and understanding 20% 19% Basic numerical skills and understanding 14% 15% Manual dexterity 13% 13% Communicating in a foreign language 9% 12% Source: ESS 2017
The most frequently cited upskilling needs in this area were the ability to manage own time and prioritise their own tasks (45% nationa lly), managing or motivating other staff and team working (both 39% nationally ). As with technical and practical skills, a slightly higher proportion of employers in the South West cited upskilling needs of most types, compared to the average for England a s a whole.
When specific people skills required are grouped, over half (53%) cited management and leadership skills (55% in the South West), a similar proportion (52%) mentioned self - management skills (54% in the South West) and over two - fifths (45%) had sales and customer upskilling needs (47% for the South West).
103 Table 21 People & Personal skills most affected by a need for upskilling (% of establishments that id entified a need for upskilling), South West and England , 2017 South S kill area in need of improvement England West Ability to manage own time and prioritise own tasks 48% 45% Team working 42% 39% Managing or motivating other staff 41% 39% Customer handling skills 39% 36% Instructing teaching or training people 35% 35% Managing their own feelings or handling the feelings of 35% 33% others Sales skills 32% 31% Setting objectives for others and planning human financial 33% 31% and other resources Persuading or influencing others 32% 31% Making speeches or presentations 16% 19% Source: ESS 2017
7.9. Employer investment in training
What is the rate of employer investment in skills? How large is training investment?
According to the UK Employer Skills Survey employers nationally spent around £44.2 billion trainin g and developing their staff during 2017 95 . As well as such elements as fees to external providers and expenditure on equipment or materials (which comprised a relatively small proportion of overall employer investment in training), a substantial proportion of this expenditure covered the wages o f staff while being trained, and of staff delivering training. Employer investment in training has increased in real terms since 2011 but the proportion of staff trained has remained stable at just over three - fifths of the workforce since 2013.
Table 22 presents a selection of metrics describing employers’ investment in training in the Heart of the South West LEP area compared to Cumbria, New An glia and England. The LEP area performs well on most measures – the percentage of employers offering training is higher than the national average as is the percentage of employers providing on - the - job training. Furthermore the percentage of local employer s providing off - the - job train ing and the share of employees engaging in training is broadly in line with the national average. Less positively, however, the LEP area performs less well on measures that describe the intensity of training – with fewer days provided per trainees and member of staff. Interestingly, the Heart of the South West LEP compares
95 Employers’ total investment in train ing over the previous 12 months was equivalent to around £2,470 per person trained and £1,530 per employee.
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fa vourably with the comparator LEP areas in terms of the extent of training participation but less well in terms of training intensity.
Table 22 Percentage of Employer investment in training summary measures, Heart of the South West vs comparator LEPs, South West and England , 2017 Heart of the Training Measure Cumbria New Anglia England South West % of establishments 7 0% 61% 68% 66% training staff % of establishments providing off - the - job 49% 48% 49% 48% training % of establishments providing on - the - job 56% 48% 54% 53% training % of training establishments providing 50% 47% 47% 52% online training or e - learning Total number trained 442,917 129,418 395,472 15,232,729 (including modelled data) Total number of staff 708,281 233,585 667,335 24,452,030 Number trained as % of 62.5 55.4 59.3 62.3 total staff Total Days Training 2,615,488 950,625 2,636,091 97,581,459 Training days per trainee 5.9 7.3 6.7 6.4 Training days per staff 3.7 4.1 4.0 4.0 Source: ESS, 2017
Employers have been fairly consistent in the type of training offer over time. Within the South West LEP area, the most common training is job - specific training (87%) followed by health and safety and/or first aid training (75%), basic induction training (62%). More specialised training (for example, training in technology or management training) tends to be less commonly offered. The Heart of the South West LEP area compares favourably against the England average for the percentage of employers (who train) who provide job specific training but less so, for other specialised training.
Table 23 Percentage of employers (providing training) offering each type of training, Heart of the South West, Cumbria, New Anglia and England, 2017 Heart of the New Cumbria England South Anglia West Job specific training 87% 86% 84% 83% Health and safety/first aid training 75% 77% 78% 74%
105 Basic induction training new staff receive 62% 62% 63% 65% when they start the job Training in new technology 46% 46% 44% 47% More extensive induction training for 34% 30% 33% 36% new staff Supervisory training 31% 30% 34% 35% Management training 30% 32% 33% 35% Personal Development Training* 1% 2% 2% 1% Any other types 1% *% 1% 1% None of these 1% 1% 1% 1% Source: ESS, 2017
Results for England as a whole, suggest that the incidence of training varies considerably across occupations with caring, leisure and other services staff (80% of staff within this occupation) and professionals (71%) significantly more likely to train tha n managers (50%), machine operatives (52%) and administrative and clerical staff (53%).
In the UK over the next year, employers are planning to change the type of training they offer to their staff, with the number of organisations in England offering a pprenticeships expected to nearly double from 31 per cent, to 59 per cent – most likely as a result of the new apprenticeship levy. Just over half (52%) of employers in England expect the levy to reduce the skills gap in the next year, with three in five (62%) viewing it as an opportunity for their organisation. 96
Despite this positivity from organisations, seven in 10 (69%) businesses believe they will struggle to hire people with the right skills in the next 12 months, implying certain skills may take l onger to build. With three in five (58%) employers saying the skills shortage has damaged their organisation, it is important that they ensure their training programmes provide their staff with the skills they require, in a way that allows them to put the ir new knowledge into practice in the workplace as soon as possible.
Which sectors/occupations are investing in their workforce and at what skills levels?
As nationally, the percentage of employers providing training within the LEP area varies considerab ly by sector and size. Unsurprisingly, larger employers are more likely to have trained their staff with the ‘step change’ tending to occur as employers reach the 5+ employee size bracket. Local or Central government funded establishments (92%) and those from the charity or voluntary sector (89%) are more likely to train staff than profit - seeking enterprises (67%). It follows therefore, that training is almost ubiquitous within the health and social work (93%), education (93%) and public administration & defence sectors (92%). However, training is also commonly offered within financial services (89%) and business services (78%).
96 Open University (2017). The £2.2 Billion cost of the skills gap . Website article. https://www3.open.ac.uk/media/fullstory.aspx?id=31527
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Establishments in the primary and utilities sector (54%) and manufacturing sector (56%) are the least likely to have trained s taff in the last 12 months.
Establishments that have relatively few highly qualified 97 employees (i.e. where these employees account for less than one - fifth of the workforce) are less likely than those with higher shares of highly - qualified staff to train their employees (63% compared to 78% of established with between 20 to 80% of highly sk illed staff).
7.10. Barriers to training and employment
For employers who are not investing in skills training, what are the reasons? What are the main barriers to skills development?
Three in ten (30%) establishments operating in the Heart of the South West LEP area had not trained any staff during the 12 months preceding their participation in the UK Employer Skills Survey. This is slightly lower than the English figure of 34%.
Employers who had not offered any training were asked (unprompted) why they had not done so. While a wide range of reasons for mentioned by small numbers of respondents by far the most common – mentioned by 71% of non - trainers locally and 66% of non - trainers nationally, was the “all our staff are fully proficient” or they had “no need for training”. Other reasons included: “no particular reason” (6%), “training is not considered to be a priority for the establishment” (8%) and no money available for training (8%).
97 Staff with qualification at Level 4 or above.
107 Figure 38 Reasons for not providing training (unprompted), Heart of the South West LEP area and England, 2017
6% No particular reason 6% 0 Don't know 1% 5% Other 5% 2% Any staff training has been arranged AND funded… 3% 1% No new staff (only train new staff) 1% 2% Small firm/training not needed due to size of… 2% 0 Business not operating long enough/New business… 1% 2% Learn by experience/Learn as you go 2% Trained staff will be poached by other employers 1% 1% All our staff are fully proficient / no need for training 71% 66% 8% Training is not considered to be a priority for the… 9% 4% Employees are too busy to undertake training and… 2% 3% Employees are too busy to give training 1% 2% Managers have lacked the time to organise training 3% 2% External courses are too expensive 1% 8% No money available for training 7% 1% The start dates or times of the courses are… 0 1% I don't know what provision is available locally 0 0 Difficult to get information about the courses… 0 1% The quality of the courses or providers locally is… 0 1% The courses interested in are not available locally 1% 5% No training available in relevant subject area 4%
0% 10% 20% 30% 40% 50% 60% 70% 80%
Heart of the South West England
Source: UK Employers Skills Survey , 2017
Additionally, the UK Employer Skill Survey explored whether employers who did train would have provided more training for staff then they were able to over the last 12 months, if they could have done so. Within the South West LEP area, 46% of establishments who had trained would have provided more training for staff if they had been able to. The main barriers that had prevented them doing so were ( Table 24 ):
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lack of funds for training or training too expensive (56%) and can’t spare more staff time (having t hem away on training ) (52%).
Table 24 Barriers to providing MORE training (% of establishments who would have provided more training in the past 12 months if they could ), Heart of the South West vs comparator LEPs and England , 2017 Heart of the New Barrier C umbria England South Anglia West Lack of funds for training / training expensive 56% 48% 52% 51% Can't spare more staff time (having them 52% 52% 54% 49% away on training) Hard to find the time to organise training 12% 17% 16% 15% A lack of appropriate training / qualifications in 6% 4% 3% 5% the subject areas we need Staff not keen 3% 5% 4% 4% Difficulty finding training providers who can 6% 7% 5% 4% deliver training where or when we want it Staff now fully proficient / don't need it 3% 4% 3% 3% A lack of GOOD local training providers 3% 4% 2% 3% Other 1% 1% *% 3% Lack of provision (e.g. courses are full up) 4% 1% 2% 2% Lack of knowledge about training 2% 1% 2% 2% opportunities and/or suitable courses Staff turnover 1% 2% 1% 2% Decisions taken at head office 1% 3% *% 1% Training not a management priority 1% 1% 2% 1% Lack of suitable candidates / staff not ready 2% 1% 1% 1% for the training we had in mind None 2% 6% 4% 3% Source: UK E mployer Skills S urvey , 2017
7.11. Prospects for labour and skills demand
While employer surveys such as the BRES and UK Employer Skills Survey reveal important details about how the nature of employer demand for labour and skills has changed in the past, on their own they offer a ‘rear view mirror’ approach to policy making. D ecisions about resource allocation are typically based on some assessment on what the future will look like (even if these are based on the continuation of long - run trends). Economic forecasting models can help in this regard although their results will v ary depending on assumptions built into the model. This section compares the results of two models commissioned by Devon Country Council: the EMSI (Economic Modelling LLC) and the AMORE Database tool for modelling regional economies. The
109 regional results for occupational an d qualification demand, commissioned by the now defunct UKCES (UK Commiss ion for Employment and Skills) from Cambridge Econometrics and the Warwick Institute for Employment Research will also be reviewed .
7.11.1. Industry
Whilst not addressing the same time period exactly, the AMORE and EMSI models suggest how employment levels within industries are anticipated to change over the next 10 years. The EMSI model is the more pessimistic of the two, projecting only modest employment growth over the 2018 to 2019 period with contraction in overall employment levels, most notably in human health & social work but also manufacturing, wholesale & retail trade and transportation and storage. The EMSI model does however anticipate these losses will be ‘ba lanced’ out b y gains elsewhere, mostly within accommodation and food service activities, professional, scientific and technical activities, administration and support service activities, information and communication and education.
Table 25 Projected change in employment levels by industry generated by the AMORE and EMSI economic model, Heart of the South West LEP area; 2016 to 2026 and 2018 to 2027 Industry Amore EMSI 2018 - 2016 - 2026 2027 Agriculture, forestry & fishing - 28 - 329 Mining & quarrying and utilities 1 , 359 687 Manufacturing 3 , 975 - 2 , 193 Construction 370 257 Wholesale & retail trade; repair of motor vehicles 3 , 195 - 1 , 337 Transportation & storage 932 - 1 , 314 Accommodation & food service activities 4 , 797 3 , 701 Information & communication 2 , 755 1 , 730 Financial & insurance activities 1 , 448 246 Real estate activities 1 , 618 - 310 Professional, scientific & technical activities 9 , 403 2 , 702 Administrative & support service activities 6 , 248 2 , 670 Public administration & defence; compulsory social security - 1 , 898 - 1 , 892 Education 2 , 471 1 , 354 Human health & social work activities 7 , 449 - 4 , 580 Arts, entertainment & recreation 590 1 , 120 Total 44 , 684 2512 Source: Heart of the South West LEP area AMORE Model (Dr Stephen Brand) and EMSI
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By contrast, the AMORE model predicts that employment across the LEP areas will increase by almost 45,000 during the 10 year period to 2026. Most sectors are anticipated to expand but with professional, scien tific and technical activities, human health & social work activities, administrative & support service activities and accommodation and food service activities, manufacturing accounting for the bulk of this growth. In common with the EMSI model, AMORE al so anticipates employment contraction within the public administration & defence sector, and a small contraction within agriculture, forestry fishing.
Table 26 Industry Projections by Percentage Change, Heart of the South West LEP area , 2016 to 2026 and 2018 to 2027 Amore EMSI 2018 - Industry 2016 - 2026 2027 Agriculture, forestry & fishing 0% - 1% Mining & quarrying and utilities 11% 6% Manufacturing 5% - 3% Construction 1% 1% Wholesale & retail trade; repair of motor vehicles 3% - 1% Transportation & storage 3% - 5% Accommodation & food service activities 9% 5% Information & communication 16% 8% Financial & insurance activities 14% 2% Real estate activities 15% - 2% Professional, scientific & technical activities 22% 6% Administrative & support service activities 18% 6% Public administration & defence; compulsory social security - 5% - 7% Education 5% 2% Human health & social work activities 8% - 4% Arts, entertainment & recreation 5% 3% Total 6% 1% Source: Heart of the South West LEP area AMORE Model (Dr Stephen Brand) and EMSI
Table 26 presents the same data but expresses the change in employment in percentage terms. Overall, AMORE anticipates employment growth of 6 % over the period, and EMSI, 1 %. Both models suggest that professional, scientific & technical, administrative & support services, information & communication and mining & quarrying with be among the fastest growing although unlike AMORE, EMSI does not expect financial and insurance activities to feature among th is group.
111 7.11.2. Occupation
Looking towards the future and the likely changing nature of employment by occupation, forecast data from EMSI, suggests that most of the expansion for occupations will occur within elementary and sales and customer service occupatio ns. Taken together, high skill occupations are only expected to contribute an additional 1,600 employee jobs. The model anticipated that demand for administrative and secretarial jobs will contract modestly.
Table 27 Forecast Emplo yee Jobs Change by Occupation, Heart of the South West LEP area , 2018 to 2027 2018 - 2018 - 2018 2027 Description 2027 2027 % Jobs Jobs Change Change Managerial 65,521 66,214 693 1% Professional 123,210 123,754 543 0% Associate Professional 82,024 82,415 391 0% Administrative and Secretarial 80,733 80,344 (390) (0%) Skilled Trades 66,491 66,690 199 0% Caring, leisure and other service occupations 71,401 71,453 52 0% Sales and Customer Services 70,267 71,329 1,062 2% Process, plant and machine operatives 44,268 43,724 (544) (1%) Elementary Occupations 107,710 109,414 1,705 2% Total 711,625 715,336 3,711 1% Source: EMSI. Data only relates to employee jobs, not total employment.
7.11.3. Replacement demand
Th e projections above anticipate change s in overall employment ac ross industries and occupations. This is commonly referred to as expansion demand. However, total demand for labour includes the requirement to replace people who leave their jobs due to retirement (the cause of around 50% of rep lacement demand), migration, shifts between occupations, or by working temporarily leaving the workforce. Cedefop estimates that only 9% of the job openings across the EU between 2016 and 20 2 3 will be ‘new’ whilst 91% will be through replacement demand. Replacement demand can create a large number of employment opportunities in occupations that are otherwise in decline so that the net requirement may actually be positive.
The Government publishes periodic assessment of employment prospects through the Wo rking Futures series. The latest set of projections covering the 2017 to 2027 period are currently awaiting approval so this section reports regional data for 2014 to 2024 period. LEP level data is produced through the programme but access is restricted and cannot be reproduced in third party documents. This older, regional data is still useful in assessing key trends. Figure 39 , f or example, suggests that the net
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requirement for occupations – that is, the sum of expansion and replacement demand – will be greatest for:
Caring personal service occupations
Elementary administration and service occupations
Managers and directors
All p rofessional categories
Business and public service associate professional
Administrative occupations
Sales occupations
Skills construction trades.
113 Figure 39 Replacement Demand, Net Requirement, and Replacement demand as % of Net requirement, South West, 2014 - 2024
160 500%
450% 140 400% 120 350% 100 300%
80 250%
200% 60 150% 40 100% 20 50%
0 0%
Replacement demand Net requirement Replacement as % of Required Source: Working Futures 2014 - 2024 – South West Regional Workbook
Replacement demand makes a particularly large contribution to the net requirement of secretarial and related occupations and process plant and machine operatives even though, over the net requirement for these occupations is fairly small.
These statistic s also stress that where there is a high net requirement, there is typically a high replacement demand, with every occupation having a higher replacement than expansion dem and. They key message from this analysis, is that the skills system needs to provi de for a broad range of core and technical and professional skills; and that employment demand is far broader than that implied by conventional economic models that do not take replacement demand into account.
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7.11.4. Highest qualification
The CEDEFOP – Skills Panorama 98 report suggests that the proportion of the European population with a high level qualification is projected to increase by 9 percentage points between 2016 and 2030, reach ing 40% by 2030. The study anticipates that demand for high level qualific ations will outpace the supply in the decade to come.
The Working Futures projections for 2014 to 2024, unsurprisingly, share this expectation. Figure 40 illustrates how current qualification demand for all occupation categories within the South West region, will contrast with projected changes in total demand. The qualifications listed are per the government guidance 99 , with QCF8 representing the highes t level of qualification (e.g. PhD) and QCF1 representing the lowest (e.g. GCSE grades D - G). In 2014, employment levels were highest for employees with qualifications at QCF3 (e.g. A Level), QCF2 (e.g. GCSE grades A - C), QCF6 (e.g. University degree) and QCF1.
Perhaps more interestingly, the figure also reveals that the demand for qualifications at QCF3 and below is expected to contract between 2014 and 2014 while those at QCF4 and above, an d particularly at QCF6, is expected to expand. Ensuring that lo cal young people fulfil their potential and those that are capable of su cceeding within higher education are encouraged and supported to do so, will be a key challenge for the SAP, given that the area has a hist orically low level of progression at this lev el.
Figure 40 Q ualification Demand by Base Year and Projected Change in thousands for All Occupations, 2014 - 2024, South West
800 700 662 573 600 510 500 410 400 300 280 204 175 200 150 93 100 31 57 38 67 0 9 - 57 12 - 55 -100 QCF8 QCF7 QCF6 QCF5 QCF4 QCF3 QCF2 QCF1 No Q -200 - 171 -300
Base Year Qualifications - All occupations Projected Change - All occupations
Source: Working Futures 2014 - 2024 – South West Regional Workbook
98 https://skillspanorama.cedefop.europa.eu/en/analytical_highlights/skills - forecast - key - eu - trends - 2030#_demand_for_and_supply_of_skills 99 https://www.gov.uk/what - different - qualification - levels - mean/list - of - qualification - levels
115 However, as noted earlier this analysis is based exclusively on expansion demand and therefore does not consider the demand for qualifications due to people leaving their jobs 100 .
Exploring demand for undergraduate degree and equivalent qualification in more detail reveals that all occupa tions (at the 2 digit SOC level) are projected to increase demand for qualifications at this level although unsurprisingly, increase is predicted to be largest in volume terms among: managerial; (most) professional occupations including health occupations such as doctors, radiographers, pharmacists, midwives, dentists, and, as of 2013, nurses; and (some) associate professional and technical occupations. Interestingly, demand is also expected to rise for degree - level qualifications among people performing r oles jobs not traditionally associated with higher level skills: for example administrative, caring and personal service, sales and elementary and administration services. This could reflect some upskilling of some existing and new roles within these clas sifications.
Figure 41 QCF6 Expansion Demand by Occupation in Thousands, South West, 2014 to 2024
Elementary administration and service occupations 20.0 Elementary trades and related occupations 2.4 Transport and mobile machine drivers and operatives 3.2 Process, plant and machine operatives 1.2 Customer service occupations 6.1 Sales occupations 15.8 Leisure, travel and related personal service occupations 4.2 Caring personal service occupations 22.8 Textiles, printing and other skilled trades 3.2 Skilled construction and building trades 3.0 Skilled metal, electrical and electronic trades 3.4 Skilled agricultural and related trades 3.6 Secretarial and related occupations 2.4 Administrative occupations 19.0 Business and public service associate professionals 27.0 Culture, media and sports occupations 9.1 Protective service occupations 2.1 Health and social care associate professionals 10.2 Science, engineering and technology associate professionals 4.5 Business, media and public service professionals 18.7 Teaching and educational professionals 6.6 Health professionals 26.3 Science, research, engineering and technology professionals 17.6 Other managers and proprietors 17.0 Corporate managers and directors 30.4 0.0 5.0 10.0 15.0 20.0 25.0 30.0 35.0
100 https://warwick.ac.uk/fac/soc/ier/wf6downl oads/
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Source: Working Futures 2014 - 2024 – South West Regional Workbook
As noted earlier in this section, overall demand for qualificatio ns at QCF3 and QCF2 is expected to decline across the region between 2014 and 2024. This is expected to be replicated across almost all occupations ( Figure 42 ) with the exceptions of QCF3 among caring personal service occupations and to a lesser extent health professionals, health and social care associate professionals, transport and mobile machine drivers and operatives and sales occupations.
Figure 42 Change in number of people employed with qualifications at QCF3 and QCF2 and below by occupation (SOC2010) , South West of England, 2014 to 2024
92 Elementary administration and service… - 4.1 - 35.4 91 Elementary trades and related occupations - 1.2 - 6.5 82 Transport and mobile machine drivers and… 1.2 - 9.9 81 Process, plant and machine operatives - 14.2 - 2.7 72 Customer service occupations - 0.3 - 3.5 71 Sales occupations 0.3 - 24.4 62 Leisure, travel and related personal service… - 2.4- 5.5 61 Caring personal service occupations 15.0 - 18.2 54 Textiles, printing and other skilled trades - 1.1 - 7.7 53 Skilled construction and building trades - 5.4 - 4.6 52 Skilled metal, electrical and electronic trades - 7.4 - 10.1 51 Skilled agricultural and related trades - 1.7 - 6.2 42 Secretarial and related occupations - 5.4 - 12.1 41 Administrative occupations - 9.4 - 24.4 - 10.1 35 Business and public service associate… - 5.7 34 Culture, media and sports occupations - 2.3 - 0.7 33 Protective service occupations - 1.5 - 1.7 32 Health and social care associate professionals 0.2 - 1.3 31 Science, engineering and technology associate… - 1.4 - 3.2 24 Business, media and public service professionals - 1.1- 3.4 - 1.8 23 Teaching and educational professionals - 0.8 22 Health professionals 2.4 - 2.8 21 Science, research, engineering and technology… - 3.2 - 6.3 12 Other managers and proprietors - 9.3 - 7.9 11 Corporate managers and directors - 6.0- 7.4 20.0 10.0 0.0 -10.0 -20.0 -30.0 -40.0 Change in employment (Thousands) Below QCF2 QCF3
Source: Working Futures 2014 - 2024 – South West Regional Workbook
117 7.11.5. Skills
The accel erating pace of technological, demographic and socio - economic disruption is transforming industries and business models, changing the skills that employers need and shortening the shelf - life of employees’ existing skill sets in the process. For example, t echnological disruptions such as robotics and machine learning — rather than completely replacing existing occupations and job categories — are likely to substitute specific tasks previously carried out as part of these jobs, freeing workers up to focus on new tasks and leading to rapidly changing core skill sets in these occupations.
Even those jobs that are less directly affected by technological change and have a largely stable employment outlook may require very different skill sets just a few years fro m now as the ecosystems within which they operate change. In this new environment, business model change often translates to skill set disruption almost simultaneously and with only a minimal time lag. WEF 2016 101
In August 2018, Nesta launched a comprehensive public map of skills in the UK to help tackle skill shortages ahead of Brexit. To do this they analysed 41 million online job adverts – with the intention of enabling more informed decisions by policymakers, educators, busin esses, workers and students. Nesta’s analysis detected the skills needed for different jobs, and showed how those have changed over time. They also provided estimates of the market value they command. Skill groups with relatively high salaries and high growth were revea led to be:
Data engineering IT security operations Marketing research App development Web development
Skill groups with relatively low salaries and low growth include:
Shipping and warehouse operations Medical administration and coding Gen eral sales Archiving and libraries Journalism and writing
Several of the skill groups with relatively low salaries and low growth require engagement with digital technology for administrative purposes, rather than in a creative way. This is consistent wi th another recent Nesta’s study 102 which found that
101 The Future of Jobs Employment, Skills and Workforce Strategy for the Fourth Industrial Revolution. World Economic Forum. http://www3.weforum.org/docs/WEF_FOJ_Executive _Summary_Jobs.pdf 102 https://www.nesta.org.uk/report/which - digital - skills - do - you - really - need/
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the digital skills most likely to be needed in growing job sectors are ones that are used in non - routine tasks, problem - solving and the creation of digital outputs.
World Economic Forum (WEF) research 103 states that the Top 10 skills that will be in demand in the near future are:
Complex problem - solving Critical thinking Creativity People management Coordinating with others Emotional intelligence Judgment and decision - making Service orientation Negotiation Cognitive flexibility
The WEF (2016) report also stated:
“…over one - third of skills (35%) that are considered important in today’s workforce will have changed. By 2020, the Fourth Industrial Revolution 104 will have brought us advanced robotics and autonomous transport, artificial intelligence and machine learning, advanced materials, biotechnology and genomics.”
WEF (2016) asked chief human resources and strategy officers from leading global employers what the current shifts mean, specifically f or employment, skills and recruitment across industries and geographies.
Creativity will become one of the top three skills workers will need. With the avalanche of new products, new technologies and new ways of working, workers are going to have to bec ome more creative in order to benefit from these changes. Robots may help us get to where we want to be faster, but they can’t be as creative as humans (yet).
Whereas negotiation and flexibility are high on the list of skills now, in 2020 they will be gin to drop from the top 10 as machines, using masses of data, begin to make our decisions for us.
Respondents to the WEF survey stressed that the global workforce is expected to experience significant churn between job families and functions, with adm inistrative and routine white - collar office functions at risk of ‘being decimated’ and strong growth in Computer and Mathematical and Architecture and Engineering related fields. Manufacturing and Production roles are also expected to see a further bottom ing out
103 The Future of Jobs. World Economic Forum 2016 . https://www.weforum.org/reports/the - future - of - jobs 104 https://www.weforum.org/agenda/2016/01/the - fourth - industrial - revolution - what - it - means - and - how - to - respond
119 but might have the worst behind them and still retain relatively good potential for upskilling, redeployment and productivity enhancement through technology rather than pure substitution.
Employment growth is expected to derive disproportionately from smaller, generally high - skilled job families that will be unable to absorb job losses coming from other parts of the labour market:
“Even if they could, significant reskilling would be needed. This factor plus the increase in global unemployment du e to global population growth and slow job creation over the period 2015 - 2019 leaves no room for complacency. ” WEF (2016)
It is important to note that the WEF survey yielded only limited data around Care and Service sectors – as jobs in this field a re not typically found on a large scale among large multinational employers - the target for the survey. Logically with an ageing demographic these sectors are anticipated to expand – though with limited scope for well - paid and highly skilled employment, o ther than in associated eHealth and eWellbeing developments, which nonetheless will require personal support on the ground.
7.12. Vulnerability to technological change
What proportion of jobs are susceptible to technological changes (e.g. automation) and in what sectors/occupations?
Recent debates about the future of jobs have mainly focused on whether or not they are at risk of automation. Studies have generally minimized the potential effects of automation on job creation, and have tended to ignore other r elevant trends, including globalisation, population aging, urbanisation, and the rise of the green economy (NESTA 2017) 105 .
Industrial change is a major concern for the future and likely to be a driving force in the need for reskilling. As mentioned above, t he World Economic Forum considers this to be part of a Fourth Industrial Revolution. NESTA estimates that around 10% of the workforce are in occupations that are likely to grow as a percentage of the workforce, while approximately 20% are in jobs that will shrink 106 . This leaves us with a proportion more likely to be negatively affected than positively affected, as well as 70% of the working population where the future is unsure.
The findings of the 2017 NESTA report into the future of skills are positive about the future, but this does not mean that there will not be negative impact. While they predict that the Food Preparation and Hospitality Trades, Teaching and Education Profes sionals, Sports and Fitness Occupations, and Natural and Social Science Professionals are most likely to experience increased demand, they also note that, of
105 The Future of Skills: Employment in 2030 . NESTA. https://www.nesta.org.uk/project/f uture - skills/ 106 https://media.nesta.org.uk/documents/the_future_of_skills_employment_in_2030_0.pdf
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the minor occupation groups (or three - digit occupations), Mobile Machine Drivers and Operatives, E lementary Administration, Sales and Storage Occupations, and Customer Service Occupations (including managers and supervisors) are least likely to see notable increases in demand 107 .
According to the Office for National Statistics around 1.5 million jobs in England are at high risk of some of their duties or task being automated in the future 108 . Women, young people and those who work part - time are most likely to work in roles that are at high risk of automation. The analysis calculates the probability that e ach occupati on at the four digit SOC level is at risk of automation. As might be anticipation occupations typically requiring lower level skills (such as elementary occupations and process, plant and machine operatives) are most at risk of automation and those requiring higher level skills least likely At the two digit SOC, medical practitioners, higher education teaching professionals, senior professionals of educational establishments, secondary education teaching professionals, dental practitioners, psy chologists and medical radiographers were least at risk of automation. Occupations most at risk included: waiters and waitresses, shelf fillers, elementary sales occupations n.e.c., bar staff and kitchen and catering assistants and farm workers.
The ONS h as also prod uced a map showing which areas have the highest proportions of occupations at risk of automation. The map shows that within the LEP area, jobs in Exeter have the lowest risk of automation but with Torbay, large swathes of Devon and Sedgemoor a nd Mendip in Somerset in the second highest banding of risk nationally.
107 Ibid. 108 https://www.ons.gov.uk/employmentandlabourmarket/peopleinwork/employmentandemployeetypes/articl es/whichoccupationsareathighestris kofbeingautomated/2019 - 03 - 25
121 Figure 43 ONS Map by Percentage at Risk of Automation
Source: ONS - Which occupations are at highest risk of being automated? https://www.ons.gov.uk/employmentandlabourmarket/peopleinwork/employmentandemployeety pes/articles/whichoccupationsareathighestriskofbeingautomated/2019 - 03 - 25
Fu rther analysis reveals tha t Torridge and North Devon and to a lesser extent Sedgemoor, West De von , Mid Devon, South Hams and West Somerset have the highest percentages of job at high risk of automation. When ranked against all other lower tier local authority areas on this metric – where a ranking of 1 means the local authority has the highest perc entage of jobs at risk of automation, Torridge, North Devon and Sedgemoor rank 3 rd , 4 th and 5 th respectively. With 3% of jobs at risk, Exeter has one of the lowest proportions of jobs at risk (placing in 300 th in the local authority rankings).
Figure 44 Proportion of Jobs at High Risk of Automation and Ranking compared to other Local District Authorities across England, 2017
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25.0 350
19.4 19.9 300 20.0 16.1 250 14.6 15.0 13.0 12.5 12.5 200 10.9 11.1 9.4 9.1 150 10.0 8.2 5.5 100 5.0 2.9 3.5 50
0.0 0
Proportion of jobs at High Risk of automation 2017 Rank of Proportion at High Risk (where 319 is lowest)
Source: ONS - Which occupations are at highest risk of being automated?
Overall, across the LEP area, approximately 58,666 jobs are at risk of automation. Most of these jobs are in Plymouth, Sedgemoor and North Devon ( Figure 45 ) .
Figure 45 Number of Jobs at High Risk of Automation and Ranking compared to other Local District Authorities across England, 2017
9000 8241 350 8000 300 7000 6290 6419 250 6000 5000 4681 200 3955 4257 4177 3743 3695 3653 4000 3161 150 3000 2132 100 2000 1437 1274 1551 1000 50 0 0
Number of (main) jobs at High Risk of automation 2017 Rank of number of main jobs at high risk (where 319 is lowest)
Source: ONS - Which occupations are at highest risk of being automated?
123 8. LABOUR SUPPLY
8.1. Introduction
In contrast to the previous section, this part of the report looks at the employee side demand for work. The primary issues this section considers are:
economic activity rate, and the population available to work;
employment rates – those who are already engaged in the w orkforce ;
retirement rates, as these are a concern for a region with an ageing population ;
self - employment, temporary and part - time work, increasingly common phenomena in the so - called “gig economy” ;
occupational structure and industrial structure , or whic h roles the existing workforce have and which industries they are working within.
By understanding the supply side challenges in light of high employment in the South West and Heart of the South West LEP area, strategy can be developed to best suit the iss ues of economic inactivity and take best advantage of existing skill sets while suggesting pathways for further upskilling and engaging with more precarious job situations and accompanying vulnerabilities and caution.
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8.2. Economic activity rates
Th e size of the labour force depends on the number of people who are either in work or who are actively looking for work. Within the Heart of the South West LEP, 833,100 residents aged 16 to 64 were economically active during the 12 month period July 2018 t o 2019. A further 54,000 residents aged 65 and over were also economically active during this period. When expressed as a percen tage of the resident population aged 16 to 64, the H eart of the South West (82.4%) performs well against the United Kingdom ( 78.7%) average and is placed 7 th among LEP areas when ranked according the highest economic activity rates.
While economic activity rates are higher for the Heart of the South West LEP than the UK average for both men and women, across the five broad age groups the biggest differences are for those aged 16 to 19 and particularly for women. This is a rather difficult statistic to interpret since students with part - time jobs will be classified as employed if they were working at the time they were intervie wed as part of the Labour Force Survey. The comparatively high percentage of economically active students could reflect lower than average staying - on rates among local young people, or a relatively high percentage of stu dents who combine their studies wit h part time work. Without further integration, it is impossible say which of these explanations is the more powerful.
In addition, economic activity rates among residents aged 50 to 64, are high, but reasonably close to UK average – given modest projected increases in the size of the working age population, it is these older workers, and women who offer one way to increase the size of the workforce – in addition to attracting new people from other parts of the UK and overseas.
Figure 46 Economic activity age by age and gender, Heart of the South West LEP area, July 2018 to June 2019
125 100 93.3 94 h
c 88.1 a 90 85.9 e 82.7 81.2 n 79.6 i
h 80 t
i 73.1 w 66.1 e 70 v i t c a p 60
u y
l 50.7 l o r a g
c 50
i e m g o a 40 n o c e
30 s t
n 16.5 e 20 d
i 11.3 s e
r 10
% 0 16 to 19 20 to 24 25 to 34 35 to 49 50 to 64 65 and over
Males Females
Source : Annual Population Survey (via nomis - https://www.nomisweb.co.uk/ )
The importance of both female and older workers becomes more apparent when the components of change are examined. Over the last decade, the economically active population of the Heart of the South West increased by 56,600 with the vast majority of this in crease occurring among the population aged 65 and over and women of working age.
Figure 47 Change in the resident and economically active population, Heart of the South West LEP area, 2008/9 to 2018/9 (July to June)
68,400 All aged 65+ 27,900
- 1,400 All aged 16 to 64 28,700
45,300 Males aged 65+ 15,700
2,800 Males aged 16 to 64 4,600
23,100 Females aged 65 + 12,200
- 4,200 Females aged 16 to 64 24,000
-10,000 0 10,000 20,000 30,000 40,000 50,000 60,000 70,000 80,000
Resident population (16+) Economically active
Source: A nnual Population Survey (via nomis https://www.nomisweb.co.uk/ )
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While the increase in the economically active population of working age women is exclusively the product of rising participation rates particularly among those aged 25 and over, rising participation rates have combined with a growth in the resident population to boost the number of residents aged 65 who are economically active. Given that, economic activity rates of women are already close to those of men and the population is ageing over time, the economic participation of people aged 50 and over and in particular, 65 and over, will constitute an important source of labour and s kills. Policy actions to extend healthy working lives are necessary to support this.
8.3. Employment rate
What are the levels of employment?
Most economically active Heart of the South West LEP residents of working age (79.6%) are in employment although the emplo yment rate among people aged 65 and over is unsurprisingly, signific antly lower than this (13.5%). Employment rates locally are higher than the UK average across all groups.
Figure 48 Percentage of economically active population in employment by age group, Heart of the South West LEP area and UK , July 2018 to June 2019
100.0 86.8 89.2 90.0 83.5 84.9 79.6 80.0 75.5 76.4 75.1 72.0 ) 70.0 67.3 % (
e t
a 60.0 r
t 50.7 n
e 50.0 m y
o 40.0 35.0 l p
m 30.0 E
20.0 13.5 10.7 10.0
0.0 16-64 16-19 20-24 25-34 35-49 50-64 65+
Heart of the South West United Kingdom
Source: Annual Population Survey (via nomis https://www.nomisweb.co.uk/ )
127 The employment rate for the Heart of the South We st LEP area is marginally below full employment 109 and is four percentages points higher than the UK average and is the 10 th highest of all the LEP areas.
The employment rate is one of the most commonly quoted indicators of labour market performance. Unfortunately, however, because the statistic is generated from sur vey data, local estimates have relatively large confidence intervals associated with them. The confidence intervals describe the 95 out of 100 times, if did survey again, the point estimate would fall within the parameters of the confidence interval, in t his case, for the Heart of the South West ± 1.3 percentage points. There is a high degree of confidence in saying that the employment rate for the LEP area as a whole in above the UK average. Ho wever, there is less confidence about differences in the emp loyment r ate within the LEP area.
The safest conclusions that can be drawn from Figure 4 is that North Devon and East Devon, are operating at full employment and that the employment rates in these areas are above those in Exeter, Plymouth and Torbay .
Figur e 49 Percentage Employment rate by local district authority : July 2018 to June 2019
100.0 87.4 86.2 84.5 90.0 82.7 82.4 81.8 80.9 77.0 76.7 74.5 79.6 77.9 77.8 75.8 80.0 75.5 74.4 %
s 70.0 a
e t
a 60.0 R
t
n 50.0 e m
y 40.0 o l p 30.0 m E 20.0 10.0 0.0
Source: Annual Population Survey accessed via NOMIS
What is the rate of retirement? Does this differ or compare in sectors/occupations?
109 Conventionally, an economy is thought to be operating at full employment, if the employment rate is 80% or higher.
128
There are no published official labour market statistics on retirement rates at the local level although this analysis could be undertaken using microdata from the Labour Force Survey. However, the online labour market statistics portal, NOMIS provides access t o Annual Pop ulation Survey estimates of the reasons for economic inactivity of which “retired” is one 110 . This source suggests that 29,800 people aged 16 and over were retired in the Heart of the South West LEP area during July 2018 to June 2019. Retired p eople locally account for 17% of the ec onomically inactive population. Students (23%), people looking after the family/home (20%) and the long - term sick (23%) account for greater shares.
Retirement can be tricky concept to define , as some people will conti nue to undertake some paid work - perhaps at a lower level than previously and/or at substantially reduced hours - whilst still considering themselves essentially “retired”. The retired population captured within the Annual Population Survey will only in clude those that do not engage in any form of economic activity (i.e. are not in paid work or looking for paid employment).
As figure 47 shows, participation in economic activity peaks at ages 35 to 49 (91%), falls away slightly at ages 50 to 64 (77%) an d then falls steeply within then 65 and over (14%) age group. Given the size of this older cohort relatively small increases in economic participation rates could generate sizeable increases in labour supply.
Figure 50 Economic status by age group, Heart of the South West LEP area, July 2018 to June 2019
450000 100
400000 90 80
350000 ) % ( s
t 70 e n 300000 t e a r d
i
60 y s t i e 250000 r v
i f 50 t o c
a r 200000 e c i
b 40 m m o
u 150000 n
N 30 o c E 100000 20
50000 10
0 0 16 to 19 20 to 24 25 to 34 35 to 49 50 to 64 65 and over
Employment Unemployment Inactive Economic activity rate
Source: Annual Population Survey access via NOMIS
110 Others are: student, looking after family or home, temporary sick, long - term sick, discouraged and other.
129 8.4. Self - employment
Most of the 857,600 residents aged 16 and above in employment across the Heart of the South West LEP area are employees (81%) with the self - employed making up the remainder (18%) 111 . Self - employment is more prevalent locally than both the England average (15%) and most other LEP areas 112 . The percentage of the employed population describing themselves as s elf - employed varies considerably across the LEP area , although the estimates should be treated with some caution due to the relatively large confidence intervals associated with them. For example, the South Hams (30%) and Torridge (28%) have the highest p ercentages of employed residents in self - employed but these estimates are subject to confidence intervals of ±10% and ±12% respectively. Notwithstanding this, it is clear that self - employment in these districts is considerably higher than in Plymouth (11% ) or South Somerset (13%) 113 .
As nationally, the proportion of those in employment who are self - employed has increased over time: increasing locally around 2 percentage points over a ten year period although the percentage has remained relatively stable at 18% over the last three years.
8.5. Part time working
What are the current working patterns (by demographic factors and hours worked)? Do you expect these to change?
The Annual Population Survey also provides information about residents’ working hours of work and whether they have non - permanent contracts. During July 2018 and June 2019, 30% of LEP residents in employment aged between 16 and 64 were working part time. This compares to just under a quarter (24%) of residents nationally. The Heart of the Sou th West has the highest percentage of part - time working among all LEP areas but again, differences in the estimates of the highest ranking LEPs are small and certainly well within the confidence intervals associated within them. It is clear, however, tha t part time employment is more common in the Heart of the South West LEP than in London, the Black Country or Oxfordshire where just 21% of employed residents work these hours. As nationally, part - time working is more common among women (47%) than men (14% ) and among young people aged 16 to 19 (66%) and those aged 50 and over (40%). The percentage of local residents working part time has fluctuated around 30% over the last decade and has not changed substantially.
111 APS, July 2018 to June 2019 accessed via NOMIS 112 Self - employment across LEP areas varies from 23% in Cornwall and the Isles of Scilly and 11% in the Liverpool City region, Black Country and Tees Valley LEPs. The Heart of the South West rates is at the hig her end of these extremes but sits within a cluster of 12 other LEPs with self - employment rates between 17% and 19%. 113 The estimates for Plymouth and South Somerset are subject to confidence intervals of ± 2% and ± 5% respectively.
130
8.6. Temporary contracts
Few residents in emplo yment are in non - permanent employment (5%) although the figure is marginally higher than the England average (4%) and is almost twice as high as the LEP with the lowest rate (i.e. Buckinghamshire Thames Valley). Non - permanent employment has become less pr evalent over time and is currently two percentage points lower than its last peak during July 2012 and June 2013. Notwithstanding this longer - term trend, the proportion of non - permanent contracts has risen marginally across the Heart of the South West ove r the last year.
8.7. Occupational structure
Employed Heart of the South West residents are distributed across occupations in similar proportions to the UK average but with an under - representation overall within high - skill occupations (43% of employment locall y compared to 47% across the UK) and minor over - representation within medium - skill (22% compared to 20%), service intensive (17% compared to 16%) and labour intensive (18% compared to 17%) occupations.
Examining the distribution in more detail reveals th at the largest sub - major classifications are for: elementary administration & service occupations (80,700), caring personal service occupations (70,000) and administrative occupations (60,000). Together these three groups account for one - quarter (25%) of occupations locally a similar proportion to the UK average (24%).
Compared to the UK, the Heart of the South West has a particularly high proportion of residents employed as: other managers and proprietors (reflecting the significance of self - employment lo cally), skilled agricultural and related trades and caring personal service occupations. At the same time, it has relatively low proportion of residents employed as corporate managers and directors, business media and public service professionals and busi ness & public service associate professionals
131 Figure 51 Employment by occupation: Heart of the South West LEP area, South West and United Kingdom, July 2018/June 2019
7 Corporate managers and directors 7 8 4 Other managers and proprietors 3 4 5 Science, research, engineering and… 6 6 4 Health professionals 4 4 5 Teaching and educational professionals 5 5 4 Business, media and public service… 5 6 2 Science, engineering and technology… 2 2 2 Health & social care assoc. professionals 2 1 Protective service occupations 1 1 3 Culture, media and sports occupations 3 3 6 Business & public service assoc.… 7 8 6 Administrative occupations 8 8 2 Secretarial and related occupations 2 2 3 Skilled agricultural and related trades 1 2 4 Skilled metal, electrical and electronic… 4 4 4 Skilled construction and building trades 3 4 2 Textiles, printing and other skilled trades 2 2 8 Caring personal service occupations 7 7 1 Leisure, travel and related personal… 2 2 6 Sales occupations 6 6 1 Customer service occupations 2 2 Process, plant and machines operatives 2 3 3 4 Transport & mobile machine… 4 4 2 Elementary trades and related… 2 2 9 Elementary administration & service occs 9 9 0 2 4 6 8 10 HotSW LEP SW UK
Source: Annual Population Survey (Residence based)
8.8. Industrial structure
The Annual Population Survey also generates estimates of employment by broad sector. People living in the Heart of the South West LEP area are employed across a wide variety of sectors and are distributed in broad terms, in similar p roportions to the South West and UK average. Given that most of the differences are within one or two percentage points , these are not necessarily critical variations. The main difference s are slightly greater percentages in distribution, hotels and restau rants and slightly
132
fewer in banking, financial and insurance , as well as m ore agriculture & fishing and manufacturing and public administ rat ion; and less transport & communications.
Figure 52 Employment by industry: Heart of the S outh West LEP area, South West and United Kingdom, July 2018/June 2019
3.1 Agriculture and fishing 1.9 Heart of the South 1.1 West
1.6 South West Energy and water 1.6 1.7
10.2 UK Manufacturing 9.5 9.1
7.2 Construction 7.4 7.2
Distribution, hotels and 20.9 19.1 restaurants 18
Transport and 6.5 7 communications 9
Banking, finance and 14.1 16.6 insurance 17.4
Public admin. education 31.1 31 and health 30
5.1 Other services 5.6 5.9
0 5 10 15 20 25 30 35
Source: Annual Population Survey (Residence based)
Taken together the districts and unitary authorities that make up the Heart of the South West, are not dramatically different to the S outh West and UK average. However, like the South West and UK, the LEP ‘average’ hides distinctiveness across the patch. Nonetheless , it is not necessarily easy to identify this using official statistics due to the confidence intervals associ ated with th e point estimates.
133 9. SKILLS INFRASTRUCTUR E
9.1. Introduction
The Skills Infrastructure primarily refers to the role played by institutions in the availability of skills. This section focuses on the following topics:
further education such as A levels, how this is delivered, the providers available and the number of enrolments across the Heart of the South West LEP area;
the destinations that further education leavers proceed to;
apprenticeship enrolments, participation and subject areas;
higher education pr ovision , at both undergraduate and postgraduate level
Looking at the institutional perspective allows for understanding of the opportunities available to learners as well as a baseline context for employers to take advantage of. Information on destinations from further education also provides valuable insight into how further education prepares learners for both the workforce and higher education.
9.2. Further education
9.2.1. Deli very of g overnment funded further education and skills
What courses and training provisio ns are on offer? Do these provide the current and future skills to satisfy demand from employers?
In the Heart of the South West, there are 7 General FE colleges, which between them had 56,700 further education & skills learners in 2017/18. By far the lar gest of these was Bridgwater and Taunton College, with almost 18,000 learners:
Bridgwater and Taunton College 17,740 learners
Exeter College 9,830
Petroc 9,170
South Devon College 7,700
City College Plymouth 5,760
Strode College 3,930
Yeovil College 3,470
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There is one Sixth Form College (Richard Huish College in Taunton), with around 2,500 learners. There are 9 other publicly funded providers with a total of 7,150 learners. The vast majority of these are funded through Community Learning, with Devon County Council and Plymouth City Council being the main providers.
There are also 23 private sector providers receiving public funding for skills delivery, with 17,500 learners between them in 2017/18. The largest of these were as fol lows:
Somerset Skills & Learning CIC 3,690 learners
Skills to Group Limited 2,980
South West Association of Training Providers Limited 2,350
Acacia Training and Development Ltd 2,240
Achievement Training Limited 1,090
Focus Training ( S W ) Limited 940
CSM Consulting Limited 810
GHQ Training Limited 670
PGL Training (Plumbing) Limited 560
Education and Training Skills Ltd 500
Quest Vocational Training Limited 400
By the type of learning delivered, of the 84,760 FE and Skills learners at Heart of the South West LEP area providers in 2017/18:
22,330 participated on English and Maths courses
13,140 participated on courses that were below Level 2 (excluding English and Maths)
39,000 participated on a Level 2 c ourse, of which 12,690 were on a Full Level 2 course;
28,120 participated on a Level 3 course, of which 25,600 were on a Full Level 3 course; and
2,620 participated on a Level 4+ course.
In terms of learner characteristics, 59% were female, 23% had self - reported learning difficulties and/or disabilities and 6% were from Black, Asian or Minority ethnic groups. By age, just over half were adult learners aged 25 and over, just under a third were under 19, and the remaining 17% were aged between 19 and 2 4.
135 9.2.1.1. Education and training
In 2017/18, there were a total of 123 providers accounting for 43,761 education and training enrolments across the Heart of the South West LEP area LEP area. 39 of these providers had over 100 apprentices on their books that year . The biggest education and training providers in the area are as follows:
Weston College of Further and Higher Education 5,945 enrolments in 2017/18
South Devon College 5,526
Bridgwater and Taunton College 3,877
City College Plymouth 3,502
Lear ndirect Limited 3,397
PETROC 2,264
Exeter College 1,893
Acacia Training and Development 1,870
Devon County Council 1,801
Yeovil College 1,089
Plymouth City Council 1,026
Cornwall College 848
As shown in the table below, over numbers of enrolments were down by over 30% compared to 2014/15 levels, with a year on year fall since then. There has been a shift in the levels of courses being undertaken, with strong growth in take up of higher level qualifications, particularly at level 5 and above. Numbers of enrolments at entry level through to level 3 were all down significantly.
Trends in education and training enrolments in the LEP area have broadly mirrored those seen nationally, although the decline in entry level to leve l 3 enrolments locally is greater than for England as a whole, and the growth in take up of courses at level 4 and above less strong.
Table 28 Education & Training Enrolments in the Heart of the South West (based on delivery postcode), 2014/15 – 2017/18 % change 2014/15 - Level 2014/15 2015/16 2016/17 2017/18 2017/18 Entry Level 14,193 10,644 9,361 9,174 - 35%
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Level 1 18,598 14,494 14,288 14,417 - 22% Level 2 22,549 17,314 14,632 13,765 - 39% Level 3 5,860 5,142 4,914 4,764 - 19% Level 4 561 649 613 605 8% Level 5 120 137 185 244 103% Level 6 / 7 9 3 19 44 389% Not Applicable/ Not Known 1,668 1,134 1,013 748 - 55% Total 63,558 49,517 45,025 43,761 - 31% Source: DfE FE Data Library
As shown in the f igure below, Plymouth accounts for the largest number of enrolments being delivered in the LEP area, at over 10,600 in 2017/18. The graph also shows that every district has seen a fall in education and training enrolments, with some districts – such as Mid Devon, South Hams and Torridge now seeing a fraction of education and training delivery compared with 2014/15 levels.
Figure 53 Education and Training Enrolments by Local Authority District, Heart of the South West LEP area , 2014/15 and 2017/18
18,000
16,000
14,000 2014/15 2017/18 s t n
e 12,000 m l o r 10,000 n E
f o 8,000 r e b 6,000 m u N 4,000
2,000
0
Source: DfE FE Data Library, Education and t raining participation (aims) by sector subject area, local authority district, provider and learning aim: 2014/15 to 2017/18
What is the proportion of education leavers start in high growth sectors/ occupations?
137 By sector subject area, the figure below shows that the take up of education and training is broadly similar to the national average, with some notable exceptions. The first is the lower than average proportion locally in Preparation for Life and Work, which accounts for almost half (49% of enrol ments nationally, compared to 42% locally). Locally, there is more of an emphasis on STEM subjects, with Science and Mathematics, Engineering and Manufacturing Technologies and ICT all accounting for a higher than average proportion of enrolments.
Figure 54 Education and Training Enrolments by Sector Subject Area, Heart of the South West LEP area and England, 2017/18
Social Sciences Science and Mathematics Retail and Commercial Enterprise Preparation for Life and Work Not Applicable Leisure, Travel and Tourism Languages, Literature and Culture Information and Communication Technology History, Philosophy and Theology Health, Public Services and Care Engineering and Manufacturing Technologies England HotSW Education and Training Construction, Planning and the Built Environment Business, Administration and Law Arts, Media and Publishing Agriculture, Horticulture and Animal Care
0% 10% 20% 30% 40% 50%
Source: DfE FE Data Library, https://eur03.safelinks.protection.outlook.com/?url=https%3A%2F%2Fassets.publishing.service. gov.uk%2Fgovernment%2Fuploads%2Fsystem %2Fuploads%2Fattachment_data%2Ffile%2F8 32103%2FEducationandTraining_Aim_enrolments_1415_1718_Final_2.xlsx&data=02%7C01% 7CHilary.J.Stevens%40exeter.ac.uk%7Ca00e036fdc2149327b1b08d74647724f%7C912a5d77f b984eeeaf321334d8f04a53%7C0%7C1%7C637055144993557771&sdat a=OUyTkyJZzc%2Bu GIml5uD%2F%2FbEmsaDHK7TXBTFoHkwCXfk%3D&reserved=0
By subject, the only growth areas in take up since 2014/15 are construction and Engineering and Manufacturing Technologies, while the falls across other subject areas have broadly mirrored t hose for England as a whole.
138
9.2.1.2. Apprenticeships
In 2017/18, there were a total of 325 providers delivering 30,226 Apprenticeship across the Heart of the South West LEP area LEP area. 39 of these providers had over 100 apprentices on their books that year. The biggest Apprenticeship providers in the area are as follows:
Apprentices in 2017/18
Bridgwater and Taunton College 2,272
Skills To Group Limited 2.230
Exeter College 2,171
South Devon College 1,543
City College Plymouth 1,415
Lifetime Training Group Limited 1,288
PETROC 1,072
Marr Corporation Limited 1,018
Babcock Training Limited 972
Royal Navy 958
Yeovil Colle ge 802
10 prov iders were delivering Apprenticeships exclusively, seven of which were private sector, the other three being Plymouth Hospitals National Health Service Trust, the University of Exeter and the University of Plymouth
As shown in the table below, over numbers of Apprenticeships were comparable to 2014/15 levels, although there has been an 11% drop in participation from 2016/17. There has been a shift in the levels of Apprenticeship being undertaken, with strong growth in take up of Higher Apprenticeships, good growth in Advanced Apprenticeships until 2017/18. Numbers of Intermediate Apprenticeships were fairly constant until 2017/18, when they fell by over 20%.
Trends in Apprenticeship take up in the LEP area have mirrored those seen nationally, although the g rowth in Higher and Advanced levels locally is greater than for England as a whole, and the decline at Intermediate level less pronounced.
139 Table 29 Apprenticeship Participation in the Heart of the South West (based on delivery postcode), 2014/15 – 2017/18 % change 2014/15 - Level 2014/15 2015/16 2016/17 2017/18 2017/18 Advanced 11,265 12,400 13,558 13,045 16% Higher 761 1,359 1,939 2,502 229% Intermediate 18,638 18,318 18,359 14,679 - 21% Total 30,664 32,077 33,856 30,226 - 1% Source: DfE FE Data Library https://www.gov.uk/government/statistical - data - sets/fe - data - library - appre nticeships#apprenticeship - and - traineeships - current - data
As shown in the figure below, Plymouth accounts for the largest number of Apprenticeships being delivered in the LEP area, at just over 6,000 in 2017/18. The graph also shows that very few districts h ave increased the number of Apprenticeships from 2014/15 levels, with the main exception being Exeter, where numbers increased by 35%. Sedgemoor and North Devon were the only other areas to see an increase in this period.
Figure 55 Apprenticeship Participation by Local Authority District, Heart of the South West LEP area , 2014/15 and 2017/18
7,000
6,000 s
e 2014/15 2017/18 c i
t 5,000 n e r
p 4,000 p A
f o 3,000 r e b
m 2,000 u N 1,000
0
Source: DfE FE Data Library https://www.gov.uk/government/statistical - data - sets/fe - data - library - apprenticeships#apprenticeship - and - train eeships - current - data
By sector subject area, the figure below shows that the take up of Apprenticeships is broadly similar to the national average, with two notable exceptions. The first is the higher than average proportion locally in Health, Public Serv ices and Care, which may
140
be driven by the older than average demographics of the local population and the second is the lower than average proportion in Business, Administration and Law.
Figure 56 Apprenticeship Participation by Se ctor Subject Area, Heart of the South West LEP area a nd England, 2017/18
Science and Mathematics Retail and Commercial Enterprise Leisure, Travel and Tourism England HotSW Information and Communication Technology Health, Public Services and Care Engineering and Manufacturing Technologies Education and Training Construction, Planning and the Built Environment Business, Administration and Law Arts, Media and Publishing Agriculture, Horticulture and Animal Care
0% 5% 10% 15% 20% 25% 30%
Source: DfE FE Data Library https://www.gov.uk/government/statistical - data - sets/fe - data - library - apprenticeships#apprenticeship - and - traineeships - current - data
By subject, growth areas in take up since 2014/15 include construction and ICT, while there has been a significant fall in Reta il and Commercial Enterprise, trends that have mirrored those for England as a whole.
9.2.2. Quality of Further Education Providers
A total of 34 providers in the Heart of the South West LEP area have had Ofsted inspections, the key results of which are summaris ed in the table below. It shows that 28 of the 34 provider were rated as ‘good’ or ‘outstanding’ in terms of their overall effectiveness, while just one (Cambian Lufton College in Somerset) was rated as inadequate. Cambian Lufton was also rated as inadequa te in terms of personal development, behaviour and welfare and the effectiveness of its leadership and management.
All of the area’s 7 General FE Colleges (and its Sixth Form College) were rated as good or outstanding on all of the following measures (pers onal development, behaviour and welfare were not judged on the majority of colleges):
Overall effectiveness
141 Outcomes for learners
Quality of teaching, learning and assessment
Effectiveness of leadership and management
Table 30 Ofsted Ratings of Heart of the South West LEP area Providers (based on latest inspection) , 2018 to 2019 Quality of Personal Effectiveness Overall Outcomes for teaching, development, of leadership Rating effectiveness learners learning and behaviour and and assessment welfare management Outstanding 7 8 4 5 7 Good 21 19 24 11 21 Requires 5 7 6 2 5 improvement 114 Inadequate 1 1 1 Not judged 15 Total 34 34 34 34 34 Source: Ofsted https://www.gov.uk/government/statistical - data - sets/further - education - and - skil ls - inspections - and - outcomes - management - information - from - september - 2018 - to - august - 2019
Published MI from Ofsted also compares providers’ current inspection results to their previous one. Of the 24 providers who have had more than one inspection, 6 had impr oved, 10 stayed the same and 8 declined.
Of the 7 General FE Colleges, 3 had improved since their last inspection and 2 had declined (but still remained ‘good’). This data is of limited use however, given the range of dates that latest inspections covers ( 2012 to 2019), so there are no clear trends of providers improving or declining in any given period of time.
114 known as 'satisfactory' prior to 1 September 2012)
142
9.3. Higher education provision
During the 2017/18 academic year, almost 50,000 students were enrolled at higher education institutions within the Hea rt of the South West LEP area. These were distributed as follows:
24,045 at the University of Exeter
20,765 at the University of Plymouth
2,635 at the University of St Mark and St John
1,415 at the Plymouth College of Art
Local HEIs current have almost 5, 700 fewer students enrolled on their courses than in 2010/11. Both undergraduate and postgraduate student populations fell but with the latter contracting by a greater percentage, more than one - fifth (21%). Total student numbers have grown marginally in each of the last two years ( Figure 57 ).
Figure 57 Total number of students attending HEIs in the Heart of the South West LEP area: 2007/08 to 2017/18
60,000 Undergraduate 5 5 5 0 50,000 2 6 7 0 4 , 5 , 5 2 1 0 1 , 4 5 5 1 0 5 1 7 5 1 9 , 9 4 7 1 9 6 8 , 3 , 0 7 4 , 5 1 7 , , , , 8 1 8 7 9 9 40,000 8 s t n e d u
t 30,000 s
f o
5 0 0 r 5 0 0 9 5 5 8 0 5 5 0 e 1 4 5 3 4 5 8 6 5 0 0 , 9 , b , 0 8 , 6 4 9 , 6 7 3 , , , 2 , 2 , ,
20,000 1 1 4 0 m 0 0 4 9 4 9 9 4 4 4 4 4 u 3 3 3 N
10,000
0 2007/08 2008/09 2009/10 2010/11 2011/12 2012/13 2013/14 2014/15 2015/16 2016/17 2017/18 Academic Year Source: HESA Student Full Person Equivalent (FPE) v1 data accessed via Heidi Plus
9.3.1. Undergraduate provision
This section explores the subjects studied by the 14,735 first - year undergraduate students attending HEIs in the Heart of the South West LE P area. At the aggregate
143 level, the distribution of students across subjects, mirrors that of the UK with the four most commonly subjects broadly categorised as:
Subjects allied to medicine (16%)
Biological sciences (12%)
Social studies (11%)
Business & administrative studies (11%)
The profile of subjects undertaken at the institution level differ significantly reflecting their different characteristics. For example, Plymouth College of Art focuses exclusively on subjects within creative arts and design whilst more than three - quarters (76%) of first year undergraduates at the University of St Mark and St John are taking courses within biological sciences, creative arts and design or education. The University of Exeter and University of Plymouth offer a broader range of subjects with the former educating a particularly large share of undergraduates compared to the UK average in languages, social studies, biological sciences, physical sciences, mathematical sciences, historical and philosophical studies an d law and the latter, in subjects allied to medicine and the physical sciences. Notably, none of the HEIs in the Heart of the South West has a higher share of undergraduate students in computer science or engineering & technology than the UK average and on ly the University of Plymouth has a (marginally) higher share of students on business & administrative courses.
144
Table 31 Percentage of first year undergraduate students by JACS subject area: 2017/18 Heart of University Plymouth The University the South of St Mark All UK College of University of West LEP and St HEIs Art of Exeter Plymouth area LEP John area (1) Medicine & dentistry 0% 2% 2% 0% 2% 2% (2) Subjects allied to 0% 4% 31% 5% 16% 14% medicine (3) Biological sciences 0% 13% 8% 31% 12% 10% (4) Veterinary science 0% 0% 0% 0% 0% 0% (5) Agriculture & related 0% 0% 1% 0% 0% 1% subjects (6) Physical sciences 0% 7% 7% *% 6% 4% (7) Mathematical 0% 4% 1% 0% 2% 2% sciences (8) Computer science 0% 1% 5% 0% 3% 5% (9) Engineering & 0% 4% 6% 0% 5% 6% technology (A) Architecture, 0% 0% 3% 0% 1% 2% building & planning (B) Social studies 0% 18% 7% 5% 11% 10% (C) Law 0% 6% 3% 0% 4% 4% (D) Business & 0% 10% 14% 4% 11% 14% administrative studies (E) Mass communications & 0% 0% *% 9% 1% 2% documentation (F) Languages 0% 20% 1% *% 9% 5% (G) Historical & 0% 8% 2% 0% 4% 3% philosophical studies (H) Creative arts & 100% 2% 7% 31% 10% 8% design (I) Education 0% 0% 4% 14% 3% 5% (J) Combined 0% 2% 0% 0% 1% 3%
Number of students 505 6,395 6,840 995 14,735 666,365 Grand Total 100.0 100.0 100.0 100.0 100.0 100.0 Source: HESA Student Full Person Equivalent (FPE) v1 data accessed via Heidi Plus
*Data suppressed as per rounding rules due to low number of individuals.
Examining local provision in more detail reveals particularly high concentrations of undergraduate students compared to the UK average 115 in the following:
115 Each of these subjects area has at least 3 times the share of students than the UK average.
145 Crafts, cinematics & photography, d esign studies, fine art and drama at Plymouth College or Art
Others in linguistics, classics & related subjects, minerals technology, history by topic, Modern Middle Eastern studies, Others in European languages, literature & related subjects, classical st udies, zoology, physical geographical sciences, theology & religious studies, politics, archaeology, human & social geography, biology, law by area, geology, clinical medicine, physics, economics and medical technology at the University of Exeter
Maritime technology, pre - clinical dentistry, publishing, science of aquatic & terrestrial environments, geology, ophthalmics, anthropology and anatomy, physiology & pathology at University of Plymouth; and
Aural & oral sciences, music, sport & exercise science, com plementary medicines, therapies & well - being, training teachers, journalism, media studies and forensic & archaeological sciences at the University of St Mark and St John.
The number of first year undergraduate students enrolled at HEIs in the Heart of the South West fell by 2,650 between 2014/15 and 2017/18. Enrolments fell in almost all subject areas but particularly:
academic studies in education ( - 480) Sport & exercise science ( - 290) Social work ( - 270) Business studies ( - 220) Others in subjects allied to medicine ( - 175) Finance ( - 165) Maritime technology ( - 165) Training teachers ( - 135) Psychology ( - 110) Computer Science ( - 105)
Subjects recording the greatest growth in numbers were:
Anthropology (+120) Others in European languages, literature & related s ubjects (+120) Politics (+100) Others in linguistics, classics & related subjects (+80) Music (+70)
146
Nursing (+55)
9.3.2. Postgraduate provision
As with undergraduate provision, the profile of postgraduate students across subjects across the LEP area broadly mir rors that across all UK HEIs albeit with particular emphasis on education at the University of St Mark and St John but also University of Plymouth and the University of Exeter. Within institutions the most popular broad subjects for postgraduate study ar e:
Creative arts & design within Plymouth College of Art
Business & administrative studies, education, biological sciences and social studies at the University of Exeter
Education, subjects allied to medicine and business & administrative studies at Univer sity of Plymouth
Education at the University of St Mark and St John.
147 Table 32 Percentage of first year postgraduate s tudents attending HEIs in the Heart of the South West by subject: 2017/18 Heart of University Plymouth The University the South of St Mark All UK College of University of West LEP and St HEIs Art of Exeter Plymouth area LEP John area (1) Medicine & dentistry 0% 1% 4% 0% 2% 3% (2) Subjects allied to medicine 0% 3% 22% 0% 9% 12% (3) Biological sciences 0% 16% 5% *% 12% 7% (4) Veterinary science 0% 0% 0% 0% 0% 0% (5) Agriculture & related subjects 0% 0% 2% 0% 1% 1% (6) Physical sciences 0% 3% 5% 0% 3% 3% (7) Mathematical sciences 0% 1% *% 0% 1% 1% (8) Computer science 0% 1% 2% 0% 1% 3% (9) Engineering & technology 0% 6% 4% 0% 5% 6% (A) Architecture, building & planning 0% 0% *% 0% *% 3% (B) Social studies 0% 14% 5% 6% 11% 10% (C) Law 0% 2% *% 0% 1% 4% (D) Business & administrative studies 0% 22% 19% *% 20% 20% (E) Mass communications & documentation 0% 0% *% 0% *% 2% * (F) Languages 0% 5% % 0% 3% 3% (G) Historical & philosophical studies 0% 3% 2% 0% 2% 3% (H) Creative arts & design 100% 1% 3% 0% 3% 5% (I) Education 0% 22% 25% 84% 27% 14% (J) Combined 0% 0% 0% 0% 0% 0% Number of students 60 3,810 2,030 405 6,305 356,995 (=100%) Source: HESA Student Full Person Equivalent (FPE) v1 data accessed via Heidi Plus
*Data suppressed as per rounding rules due to low number of individuals.
Within these broad subject areas, the local institutions have particularly high shares of students compared to the national average 116 :
116 The subjects listed have three times the share of students than the UK average.
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Crafts, fine art, others in creative arts and design studies at Plymouth College of Art
Minerals technology, modern Middle Eastern studies, b iology, politics, classical studies, geology, human & social geography, archaeology, others in European languages, literature & related subjects, English studies and finance at the University of Exeter.
Maritime technology, nutrition, science of aquatic & terrestrial environments, hospitality, leisure, sport, tourism & transport, clinical dentistry, others in medicine & dentistry, animal science, others in historical & philosophical studies, others in subjects allied to medicine, human & social geography a nd anthropology and dance at University of Plymouth.
Training teachers, academic studies in education, sport & exercise science and social policy at University of St Mark and St John.
149 10. SKILLS PIPELINE
10.1. Introduction
The Skills Pipeline chiefly deals with the learner - side experience of education. This starts with GCSEs and Key Stage 4 attainment as this is an area where young learners have considerably less choice, both of subjects and of institutions. The Skills Pipeline section covers the following topics :
Attainment 8 scores for pupils in the Heart of the South West LEP area, including the difference with free school meals ;
destinations for Key Stage 4 learners ;
further education funding streams and post GCSE options for learners ;
level 3 attainment and p ositive destinations, including progression into higher education ;
locally domiciled higher education students and student outcomes and destinations ;
graduate retention in the area ;
adult learning, participation and barriers;
digital skills as part of life long learning and essential skillset.
The position of free school meals recipient pupils is a pressing issue for the SAP, as this is a vulnerable group of students with a distinctive gap in attainment between themselves and their peers. This is a complex a nd wide - ranging section tracking the progress of learners through their lives, and highlighting challenges at each stage.
10.2. School leavers
10.2.1. GCSE Attainment
Performance at GCSE level is lower than average in the Heart of the South West LEP area, with an average Attainment 8 score 117 per pupil of 45.3 in 2018/19, compared to 46.6 for the South West and 46.5 for England. Within the LEP area, only Devon achieved results that were broadly comparable the national and regional averages. Results were lowest in Pl ymouth.
117 Attainment 8 measures the achievemen t of a pupil across 8 qualifications including mathematics (double weighted) and English (double weighted), 3 further qualifications that count in the English Baccalaureate (EBacc) measure and 3 further qualifications that can be GCSE qualifications (inclu ding EBacc subjects) or any other non - GCSE qualifications on the DfE approved list. Each individual grade a pupil achieves is assigned a point score, which is then used to calculate a pupil’s Attainment 8 score.
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Figure 58 Average Attainment 8 score per pupil, Heart of the South West LEP area, its constituent higher tier local authority districts, South West and England, 2018/19
50.0 46.2 46.6 46.5 44.8 45.7 45.3 45.0 43.6 l i p
u 40.0 p
r e p
35.0 e r o
c 30.0 s
8
t
n 25.0 e m n
i 20.0 a t t A 15.0 e g a r 10.0 e v A 5.0
0.0 Devon Plymouth Somerset Torbay HotSW South West England
Source: DFE https://www.gov.uk/government/collections/statistics - gcses - key - stage - 4 . Note: Data for England is for the state funded sector only.
Figure 59 below shows that recent performance in the local area has been worsening, while the region as a whole has following the national trend, with a slight increase in the average score in 2017/18, followed by similar results in 2018/19. This figure shows that r ecent performance in the local area has been worsening, while the region as a whole has following the national trend, with a slight increase in the average score in 2017/18, followed by similar results in 2018/19. The fall across all areas between 2015/16 and 2016/17 was due a change in the system of points awarded to different grades. Locally, all 4 LEAs saw a dip in average scores achieved in 2017/18, and provisional data for 2018/19 shows that 3 of the 4 experienced a further fall in performance, with De von being the exception.
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Figure 59 Average Attainment 8 score per pupil, Heart of the South West LEP area , vs South West and England, 2014/15 - 2017/18
Source: DFE https://www.gov.uk/government/collections/statistics - gcses - key - stage - 4 . Note: Data for England is for the state funded sector only.
Figure 60 below shows differences in Attainment 8 scores by eligibility for free school meals (FSM), a useful indicator of deprivation. The gap in achievement between FSM pupils and others was 15.3 points in the Heart of the South West LEP area , compared to 13.9 points nationally. The achievement gap is wider than nationally across all 4 LEAs within the LEP area, and is highest in Torbay at 18.1 points. This is also elaborated on in section 12.5 under social mobility.
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Figure 60 Average Attainment 8 score per pupil by eligibility for Free School Meals, Heart of the South West LEP area, its constituent higher tier local authority districts, South West and England, 2017/18
Source: DFE https://www.gov.uk/government/collections/statistics - gcses - key - stage - 4 . Note: Data for England is for the state funded sector on ly.
In terms of performance at Level 3, the average point score per entry is very similar in Heart of the South West LEP area to regional and national averages, at 31.7 points. The figure below shows that performance locally is lowest in Plymouth (29.3 poi nts) and highest in Torbay (35.5 points). Torbay also has the highest average Attainment 8 score for the “All other pupils” category, higher than the average for Heart of the South West LEP area , the South West and England overall.
10.2.2. Key Stage 4 destinations
What proportion of school leavers go into Further Education or University?
Overall, 95% of pupils were in sustained education, employment or apprenticeships in the year after key stage 4, unchanged from 2016/17. This was one percentage point higher than t he national average.
85% of pupils were in sustained education, down from 86% from 2016/17. This was slightly below the national average, due to the fact that a higher proportion of KS4 leavers locally were going into Apprenticeships.
153 Table 33 Percentage of pupils in sustained destinations after key stage 4, Heart of the South West LEP area , vs South West and England, 2017/18 Number of Any sustained Any sustained pupils at the Area education or education end of key stage employme nt destination 4 in 2016/17 Devon 6,584 95 84 Plymouth 2,456 96 86 Somerset 4,788 95 85 Torbay 1,255 95 91 Heart of the South West LEP 15,083 95 85 area South West 49,416 95 86 England 517,634 94 86 Source: DFE https://www.gov.uk/government/statistics/destinations - of - ks4 - and - 16 - to - 18 - ks5 - students - 2018 Note: Data is for the mainstream sector only.
Within the H eart of the South West LEP area , there are some differences between local authority areas regarding destinations. The figure below shows that Torbay has a far lower proportion of KS4 leavers going into Apprenticeships or employment destinations, with a hig her proportion remaining in education. Plymouth has the highest proportion of leavers going into Apprenticeships at 8%, twice the national average.
Figure 61 Destinations of pupils in after key stage 4 (% of total cohort), by Heart of the South West LEP area LEA, 2017/18
HotSW 85 7
Torbay 91 3
Somerset 85 6
Plymouth 86 8
Devon 84 7
75% 80% 85% 90% 95% 100%
Sustained education Sustained apprenticeships Sustained employment Destination not sustained Not known
Source: DFE https://www.gov.uk/government/statistics/destinations - of - ks4 - and - 16 - to - 18 - ks5 - students - 2 018 Note: Data is for the mainstream sector only.
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10.3. G overnment funded further education and skills
The previous section explored the level and characteristics of training delivered by institutions and providers within the Heart of the South West LEP area. This section focuses on learners that are resident in the LEP area. During 2017/18, 84,760 Heart of the South West residents accessed government funded learning. This includes learners who studied on a course at a further education college (‘education an d training’), learners studying courses within their local community (‘community learning’), employees undertaking an apprenticeship (‘apprenticeships’), and employees undertaking other qualifications in the workplace.
In terms of learner characteristics, there is a greater proportion of female learners locally (59% of the total, compared to 55% for England), along with a greater proportion of learners aged under 19 (32% vs 29%). The proportion of learners with learning difficulties or disabilities is sign ificantly higher than nationally at 23% of the total, while the proportion from minority ethnic groups is much lower at 6%, reflecting the demographics of the Heart of the South West LEP area .
Table 34 Characteristics of FE & Skills Learners (% of total), Heart of the South West vs England, 2017/18
Learner Characteristics Heart of the South West LEP area England Gender Female 59% 55% Male 41% 45% Age Under 19 32% 29% 19 - 24 17% 17% 25+ 50% 54% Learners with Learning Difficulties and/or Disabilities Learning Difficulty and/or Disability 23% 18% No Learning Difficulty and/or Disability 73% 78% Not Known 3% 4% Ethnicity Black, Asian or Minority 6% 21% White 93% 77% Not Known/Not Provided 1% 2% Source: DfE FE Data Library https://www.gov.uk/government/statistical - data - sets/fe - data - library - local - authority - tables
In common with patterns natio nally, the vast majority of supported learners studied on a course at a further education college with much smaller percentages undertaking an apprenticeship or learning in the community.
155 Figure 62 Percentage of FE & Skills Learners by Funding Stream, Heart of the South West vs England, 2017/18
70% 63% 58% 60% s r
e 50% n r a e L 40% s l l i k S
& 30% 24% 26% E F
f o 20% 16% % 13% 10%
0% Education and Training Apprenticeships Community Learning
HotSW England
Source: DfE FE Data Library https://www.gov.uk/government/statistical - data - sets/fe - data - library - local - authority - tables
The number of learners accessing government - funded training has fallen over time and by a similar prop ortion locally as nationally . Within the Heart of the South W est, almost 15,000 fewer learners were supported in 2017/18 than three years previously. This is made up of almost 9,200 fewer community learners and almost 7,200 learners in further education. By contrast, apprenticeships expanded locally by almost 1,700 . The contraction in community learning represents an almost halving of learner numbers.
Table 35 FE & Skills Learners by Funding Stream, Heart of the South West vs England, 2014/15 – 2017/18
Heart of the South Wes t LEP area England Funding Stream 2014/15 2017/18 % change % change Education and Training 62,730 55,570 - 11% - 13% Apprenticeships 19,850 21,540 9% - 7% Community Learning 20,280 11,100 - 45% - 18% Total FE & Skills Learners 99,230 84,760 - 15% - 14% Source: DfE FE Data Library https://www.gov.uk/government/statistical - data - sets/fe - data - library - local - authority - tables
10.3.1. Education and training
Focusing on learners supporting in further education colleges first, there is little difference in the incidence of learning across qualification levels locally to the national
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average. Since learners can access learning opportunities at different levels, the percentages in the figure below will not equal 100.
Figure 63 Percentage of Education & Training Learners by Level, Heart of the South West vs England, 2017/18
60% s
r 52% e n
r 50%
a 45% e L
g
n 37%
i 40% n i 32% a 31% 30% r 30%
T 28% 30% 26% &
n 22% o i t 20% a c u d E
7% 7%
f 10% o 1%
% 1% 0% Below Level 2 English and Level 2 Full Level 3 Full Level 4+ (excluding Maths Level 2 Level 3 English and Maths)
HotSW England
Source: DfE FE Data Library https://www.gov.uk/government/statistical - data - sets/fe - data - library - local - authority - tables . Note Percentages will not equal 100%.
10.3.2. Apprenticeships
In A pprenticeships, the split of learners between Intermediate Level (45%), Advanced (47%) and Higher level (9%) is broadly comparable to the national average.
10.3.3. Community learning
In Community Learning, the figure below shows that almost a quarter of community learning locally is through Neighbourhood Learning in Deprived Communities (NLDC), compared to just 9% nationally, while more than three quarters of learners nationally are through Personal and Community Development Learning (61% locally).
Figure 64 Percentage of Community Learners by Stream, Heart of the South West vs England, 2017/18
157 90%
80% 76% s
r 70% e
n 61% r
a 60% e L
y t
i 50% n u
m 40% m o
C 30% 24%
f o 20% % 9% 10% 9% 10% 4% 6% 0% Personal and Neighbourhood Family English, Maths Wider Family Learning Community Learning in Deprived and Language Development Learning Communities
HotSW England
Source: DfE FE Data Library https://www.gov.uk/government/statistical - data - sets/fe - data - library - local - authority - tables
10.3.4. Learner outcomes
Through its ‘Further education outcome - based success measures’ publication, DfE now publishes data on the employment and learning outcomes of FE learners, along with estimates of the earnings outcomes of learners that achieved an apprenticeship or adult learners that achieved a skills course at full level 2, full level 3, level 4 or higher.
Across the Heart of the South West LEP area , of the 35,950 million learners that completed an eligible learning aim in academic year 2015/16:
78% had a sustained positive destination into either employment or learning, 2 percentage points higher than in 2013/14, compared to 75% for England;
71% were in sustained employment, compared to 65% nationally; and
22% were in sustained learning, compared to 23% nationally.
The sustained positive destination measure shows the proportion of learners who progress to a sustained destination in learning or employment (or both) following completion of an eligible FE learning aim. Beyond this, there are two further measures:
Sustained employment – learners must be in paid employment as recorded in Pay - As - You - Earn (PAYE) records in five out of six months between October and March i n the
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following academic year or have returned a self - assessment form stating that they have received income from self - employment during that financial year.
Sustained learning – learners must be learning in all six months between October and March in the following academic year. Figure 65 shows that there is significant variation in the sustained positive destination rates by local authority within the LE P area, from a low of 71% in Torridge to a high of 87% in East Devon. 11 of the 15 local authorities in the LEP area recorded a higher sustained positive destination rate than the national average, with just 2 below average.
Figure 65 Sustained positive destination rates of FE & Skills Learners, Heart of the South West local authorities vs England, 2015/16
100% 95% 90% 85% 80%
% 75% 70% 65% 60% 55% 50%
Sustained Positive Destination Rate
Source: DfE Further education outcome - based success measures https://www.gov.uk/government/statistics/further - education - outcome - based - success - measures - 2015 - to - 2016
Data on earning outcomes is published at national level only. Latest data shows that median ann ualised earnings one year after study for learners that achieved in academic year 2010/11 were:
£17,400 for higher (level 4) apprenticeships, rising 53% to £26,700 five years after study.
£19,000 for level 4 skills courses, rising 16% to £22,000 five year s after study.
£16,500 for advanced apprenticeships, rising 27% to £21,000 five years after study.
£15,500 for full level 3 skills courses, rising 17% to £18,200 five years after study.
159 £13,500 for intermediate apprenticeships, rising 33% to £17,900 five years after study.
£16,200 for full level 2 skills courses, rising 12% to £18,200 five years after study.
10.3.5. Attai nment at Level 3
Between 2017 and 2018, the general trend was for a slight decline in the APS per entry, both locally and nationally. However, To rbay was a notable exception to this, with its APS per entry increasing from 32.5 to 35.5, well above the national average of 31.8. This improvement has coincided with a significant fall in Level 3 student numbers in Torbay, from 1,312 in 2016 to just 832 in 2018.
Figure 66 Average Point Score per entry, Level 3 Qualifications, Heart of the South West LEP area , vs South West and England, 2017/18
Source: DFE https://www.gov.uk/government/collections/statistics - attainment - at - 19 - years#a - levels - and - other - 16 - to - 18 - results Note: Data fo r England is for the state funded sector only.
In a new measure introduced for 2017/18 results, 76.8% of Heart of the South West LEP area students achieved at least 2 substantial level 3 qualifications 118 , compared to 77.9% for the South West and 80.3% for England. The individual LEAs within Heart of the South West LEP area recorded the following results:
Devon 76.3%
118 Substantial level 3 qualifications are def ined as qualifications that are at least the size of an A level (180 guided learning hours per year), such as a BTEC subsidiary diploma level 3. If a qualification is equal in size to 2 A levels it is counted as 2 substantial level 3 qualifications.
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Plymouth 77.1%
Somerset 76.6%
Torbay 79.2%
10.3.6. Destinations at aged 18
Overall, 81% of 16 - 18 students in the Heart of the South West LEP area went on to sustained education or employment destinations 119 , similar to regional and national averages. The figure below shows that students who took level 3 qualifications during their 16 to 18 study were more likely to have a sustained destination (88%) than those who took courses at level 2 or below. The figure also shows that for students studying at level 2 and below, a higher proportion of local students had sustained destinations than the national av erage, although slightly below the South West average.
Figure 67 Student destinations after 16 to 18 study by level of study, Heart of the South West LEP area , vs South West and England, 2017/18
100 88 88 90 88 81 82 81 77 80 76 74 70 59 61 60 56
% 50
40
30
20
10
0 HotSW South West England
All Level 3 Level 2 L1, entry level and other Column2
Source: DFE https://www.gov.uk/government/statistics/destinations - of - ks4 - and - 16 - to - 18 - ks5 - students - 2018 Note: Data is for the mainstream sector only.
The Heart o f the South West LEP area suffers from surprisingly low levels of progression into higher education. Looking specifically at the progression of level 3 students into higher education, the figure below shows a lower level of progression locally than nation ally – 38% compared to 49%. All areas within the Heart of the South
119 To c ount as a ‘sustained’ destination, the young person has to be participating for ‘two terms’ or ‘six months’ in the academic year following their last recorded attendance at the institution to which they were allocated. Young people are counted as being in an apprenticeship if they participate in relevant training for at least six consecutive months at any point in the destination year.
161 West LEP area have a lower than average level of progression into HE, but this is because a higher proportion of leavers are progressing into other sustained destinations (such as further FE at Level 3, Apprenticeships or employment) rather than a less positive rate of sustained destinations.
Figure 68 Progression of Level 3 Students into Higher Education (% of Level 3 cohort), Heart of the South West LEP area , vs South West and England, 2017/18
60
49 50
42 40 s 39 t 40 38
n 37 37 e d u t s
3
l 30 e v e L
f o 20 %
10
0 Devon Plymouth Somerset Torbay HotSW South West England
Source: DFE https://www.gov.uk/government/statistics/destinations - of - ks4 - and - 16 - to - 18 - ks5 - students - 2018 Note: Data is for the mainstream sector only.
TUNDRA data (for tracking underrepresentation by area) tracks the proportion of state - funded mainstream school pupils who at age 16, on completion of their GCSEs in 2010 to 2014, participated in higher education in 2017 - 2018, when they were aged 18 or 19.
The data, from the Office for Students, shows which quintile each Middle Layer Super Output Areas falls in. MSOAs in quintile one have the lowest rate of progression into higher education and those in quintile five have the highest. The main use of the da ta is to help policy makers and outreach programmes identify and target areas of low participation. Data is based on students’ home post - code, not school location.
Figure 69 below shows that 58 (or 26%) of Heart of the South West LEP area ’s 227 MSOAs fall in quintile one, with the lowest rates of HE participation. Only eight (4%) fall into the quintile with the hi ghest rate of progression. Alarmingly, 60% of Heart of the South West LEP area ’s MSOAs are in the bottom two quintiles.
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Figure 69 Proportion of mainstream state school students aged 16 progressing into Higher Education , 2019
90 40% 77 34% 80 35% 70 30% 58 26% 60 25% 50 46 20% 38 17% 20% 40 15% 30 10% 20 8 4% 10 5% 0 0% 1 2 3 4 5
No of MSOAs % MSOAs
Source: Office for Students Figure 70 breaks this data down for smaller geographical areas. Heart of the South West LEP area ’s two major cities have the highest proportion of MSOAs in quintile 1, with the lowest rate of participat ion in Higher Education. At the other end of the spectrum, Exeter also has the highest proportion of MSOAs in quintile 5, but at 13% even this remains below the national average (20%). However, this is a problem that doesn’t only impact on cities. Only 16 % (or 11 of 71) MSOAs in Somerset sit in the top two quintiles, far below the national average (40%).
Figure 70 Proportion of mainstream state school students aged 16 progressing into Higher Education, local areas , 2019
Exeter 40% 27% 13% 7% 13%
Plymouth 38% 25% 16% 16% 6%
Somerset 30% 34% 21% 13% 3%
Torbay 29% 35% 24% 12% 0%
Devon (ex Exeter) 15% 38% 22% 23% 2%
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
1 2 3 4 5
Sourc e: Office for Students
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POLAR4 provides the same information, but does not limit the student population by school type. Once private schools are included the picture improves. The proportion of MSOAs in quintiles 1 and 2 falls from 26% to 21% and from 34% to 23%, respectively. At the other end of the spectrum, the proportion of MSOAs in quintile 5 rises from 4% to 12%. However, these improvements in the overall picture also point to an educational system that fails to deliver equality of opportunity to all young people across our area.
Figure 71 POLAR4 proportion of students aged 16 in local areas progressing into Higher Education , 2018
60 23% 24% 25% 21% 50 54 20% 53 20% 47 46 40 15% 12% 30
27 10% 20
5% 10
0 0% 1 2 3 4 5
No of MSOAs % MSOAs
Source: Office for Students
10.4. Higher education
10.4.1. S tudents
During the academic year 2017/18, 17,110 students domiciled in the Heart of the South West were in their first year of study at a UK higher education institution. This included:
7,825 students from Devon
5,075 from Somerset
2,985 from Plymouth
1,225 from Torbay
Within this group almost three - quarters (72%) were pursu ing undergraduate study and more than one - quarter (28%), postgraduate study. The 12,360 locally - domiciled
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undergraduates were broadly split between those who chose to enter higher education immediately after finishing further education at age 18 or 19 (5 4%) and those that chose to take at least one, and usually many more years, ‘out’ before resuming their education (46%). For older students, this is more commonly part - time, reflecting their need to juggle their education with work, and often, family comm itments 120 .
Older students are also more likely than 18 to 19 year olds to choose institutions within the LEP area 121 . Overall, almost half (48%) of all locally domiciled first year undergraduates chose to study at institutions within the South West region and more than one - quarter (29%) within the Heart of the South West LEP area. During the 2017/18 academic the number of locally - domiciled first year undergraduates were distributed across providers as follows:
University of Plymouth (2,480)
The University of Exeter (435)
University of St Mark and St John (445)
Plymouth College of Art (200)
Overall, almost a quarter (24%) of first year undergraduates enrolled at Heart of the South West HEIS during the 2017/18 academic year were domiciled in the LEP area. Th is percentage varied considerably by institution:
University of Exeter (7%)
University of Plymouth (36%)
Plymouth College of Art (44%)
University of St Mark and St John (47%)
The number of locally - domiciled first year undergraduates has fallen over the last 10 years with the most notable drop coinciding with the £9,000 tuition fees cap which was introduced for the 2012/13 academic year ( Figure 72 ). The number of locall y - domiciled undergraduates attending UK higher education institutions in 2017/18 was 25% lower than that recorded in the year before the introduction of the higher cap for tuition fees. By age group, numbers fell across the board but particularly among ol der students 122 .
120 Just 2% of locally domiciled 18 to 19 year olds in the first year of undergraduate courses during the 2017/1 8 academic year were studying part time compared to 71% of student age 30 and over. 121 36% of locally domiciled students aged 25 and over in their first year of undergraduate courses during the 2017/18 academic year were enrolled at the University of Exete r, the University of Plymouth or the Plymouth College of Art. 122 Between 2011/12 and 2017/18, the number of locally - domiciled first year undergraduate students fell by 14% among 18 and 19 year olds, 25% for 20 to 24 year olds and 38% among students aged 25 and over.
165 Figure 72 Number of Heart of the South West LEP area - domiciled fir st year undergraduates at UK i nstitutions by broad age group, 2007/8 to 2017/18
20,000 Aged 25 and over
18,000 Aged 20 to 24 e t a
u 16,000 Aged 18 and 19 d 5 a 0 0 r 0 1 2 6 g 2
14,000 8 7 , 0 2 r , 0 , , 6 1 e 6 5 6 0 4 0 0 d , 1 0
12,000 5 7 7 6 n 0 9 6 5 6 s 0 , 0 , u , t 4 2
3 , 5 2 , 3 4 r , n 3 5 5 3
10,000 5 5 a 4 e 6 1 5 8 5 0 , e 0 5 0 5 d 2 1 2 2 8 , 3 y , 1 5 8 , 3 u 0 6 6 3 3 7 3 3
t t 8,000 3 6 , , , 3 , , , s s 2 2 2 5 2 2 2 r , i f 2
6,000 f o 0
5 0 5 5 0 0 0 9 0 5 r 1 8 4 0 9 6 3 2 4,000 7 4 5 e , 2 1 0 4 7 7 7 7 , , 5 , 5 , , , , b 7 , , 8 7 7 7 , 6 6 6 6 6 6 5 m 2,000 u N 0 2007/08 2008/09 2009/10 2010/11 2011/12 2012/13 2013/14 2014/15 2015/16 2016/17 2017/18 Academic Year
Source: HESA Student Full Person Equivalent (FPE) v1 data accessed via Heidi Plus
Interestingly, the number and percentage of locally domiciled students choosing to study at higher education institutions within the LEP area has fallen over time albeit wit h a brief interruption of this trend in the 3 years following the introduction of the £9,000 cap ( Figure 73 ).
Figure 73 Number and percentage of locally - domiciled first year undergraduate students attending HEIs in the Heart of the South West LEP area , 2007/8 to 2017/18
6000 % attending HotSW institution Number attending HotSW institution 40% s
35% s e e t 5000 t a a u u
d 30% d a a r r
g 4000 g r
25% r e e d d n n u
3000 20% u
r r a a e e y
y
t 15% t s
2000 s r i r f i
f f 10% f o
o
r
e 1000 %
b 5% m u
N 0 0% 2007/08 2008/09 2009/10 2010/11 2011/12 2012/13 2013/14 2014/15 2015/16 2016/17 2017/18 Academic year
Source: HESA Student Full Person Equivalent (FPE) v1 data accessed via Heidi Plus
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During the 2017/18 academic year, 4 ,745 locally domiciled students were in the first year of postgraduate study at a UK higher education institution. More than one - third (35%) of these students were aged between 20 and 24 and had therefore continued within their students soon after complet ing their undergraduate education. However, rather more, two thirds (65%) were aged 25 and over.
Broadly, the postgraduate cohort was broadly equally split between full time (52%) and part time (48%) students but with a much greater share of older (aged 25 an over) postgraduate students choosing to study part - time (66%) than those aged between 20 and 24 (15%). Three - fifths (59%) of these postgraduate students elected to study at an institution within the South West and two - fifths (44%) at an institutio n within the Heart of the South West. Within the LEP area, first year enrolments on postgraduate courses were distributed as follows:
University of Plymouth (835)
University of Exeter (810)
University of St Mark and St John (200)
Plymouth College of Art ( 35)
The number of locally - domiciled first year postgraduate students enrolled at UK HEIs during the 2017/18 academic year is close to the previous peak of 4,925 recorded in 2009/10 ( Figure 74 ). The rise over the last two years follows a period of five years were levels were broadly stable at around 2,500.
Figure 74 Number of locally - domiciled first year postgraduate students attending UK HEIs, 2007/9 to 2017/18
6,000 Under 25 25 and over 5,000 s t n e d u t
s 4,000
e t a 0 5 0 u 0 7 5 7 0 0 d 2 6 0 3 , 1 , , a 2 0 , 3 , r 3 3
3,000 4 3 3 0 0 0 g 5 9 t 5 , 5 2 1 5 s 8 2 4 5 6 4 , , , o 4 , , 2 2 2 2 p 2
f o 2,000 r e b m u 5 0 0 0 N 5
1,000 5 7 0 5 3 0 1 0 5 5 9 1 6 7 6 6 6 6 2 5 8 , , 4 , , 4 , 3 3 3 3 , 2 1 , 1 , , 1 , 1 , 1 1 1 1 1 1 1 0 2007/08 2008/09 2009/10 2010/11 2011/12 2012/13 2013/14 2014/15 2015/16 2016/17 2017/18 Academic Year
Source: HESA Student Full Person Equivalent (FPE) v1 data accessed via Heidi Plus
167 The number of locally - domiciled postgraduates electing to study at local institutions fell by 43% between 2008/09 and 2014/15. Numbers have recovered somewhat since then but are still 26% below the 2008/09 peak. Similarly, at 40%, the Heart of the South West’s ‘market share’ of local postgraduate students is significantly lower than the 52% it had secured in 2008/09.
Figure 75 Number and percentage of locally - domiciled first year postgraduate students attending HEIs in the Heart of the South West LEP area , 2007/08 to 2017/18
3000 60% % attending HotSW institution Number attending HotSW institution 2500 50% s t n s e t
d 2000 40% n u e t d s
u e t t s
a e u
1500 30% t d a a u r d g a t r s g o t
p 1000 20% s
f o o p
r f e o
b %
m 500 10% u N
0 0% 2007/08 2008/09 2009/10 2010/11 2011/12 2012/13 2013/14 2014/15 2015/16 2016/17 2017/18 Academic year
Source: HESA Student Full Person Equivalent (FPE) v1 data accessed via Heidi Plus
10.4.2. Destinations
The Destinations of Leavers from Higher Education (DLHE) survey provides first phase information about patterns of employment and further study or training at a point about six months after completion.
168
Table 38 present destinations data for first degree, other undergraduate and postgraduate students respectively for each of the HEIs in the Heart of the South West LEP are a. The results show that the vast majority of students attending a HEI in the Heart of the South West are in work or further study (or both) six months after graduating.
Table 36 Destinations of UK and other EU domiciled first de gree leavers by HE provider and activity , 2016/17 Work Total and Further Un - Work Other first further study employed degree study The University of Exeter 60% 6% 22% 4% 7% 3,310
Plymouth College of Art 76% 2% 8% 8% 6% 250
University of Plymouth 70% 4% 15% 7% 4% 3,105 University of St Mark and 71% 2% 13% 7% 5% 455 St John Total England 68% 5% 17% 5% 5% 222,170 Source HESA https://www.hesa.ac.uk/data - and - analysis/publications/destinations - 2016 - 17 . Main table 1
Table 37 suggests that a relatively high proportion of students completing undergraduate courses (other than first degrees) in the LEP area either progress into work or further study (or both).
Table 37 Destinations of UK and other EU domiciled other undergraduate leavers by HE provider and activity 2016/17 Work Un - Total and Further other Work employe Other further study under - d˜ study graduate The University of Exeter 67% 0% 33% 0% 0% 15
Plymouth College of Art 50% 0% 0% 0% 0% 10*
University of Plymouth 61% 7% 21% 7% 4% 280 University of St Mark and 36% 9% 55% 0% 0% 55 St John Total England 54% 13% 25% 4% 4% 26,555 Source HESA https://www.hesa.ac.uk/data - and - analysis/publications/destinations - 2016 - 17 . Main table 1
Employment rates for the post - graduates are also favourable compared to nation al standards.
169 Table 38 Destinations of UK and other EU domiciled postgraduate leavers by HE provider and activity , 2016/17 Work Un - and Further Total Work employe Other further study degree d˜ study The University of Exeter 80% 4% 9% 4% 4% 1,115 University of Plymouth 82% 6% 4% 4% 4% 570 University of St Mark and 92% 3% 3% 3% 3% 195 St John Total England 82% 4% 6% 4% 4% 83,675 Source HESA https://www.hesa.ac.uk/data - and - analysis/publications/destinations - 2016 - 17 . Main table 1
What is the proportion of education leavers start in high growth sectors/ occu pations?
Table 39 provides more detailed information about the employment of students graduating from a HEI or FEC in the sub - region. More specifically, it shows the percentage of students in sustained employme nt or study 3 years after gaining their first degree by subject and institution.
170
Table 39 Percentage of 201 2/213 in sustained employment or further study (or both) 3 years after graduation: 2016/17 tax year
Bridg - Exeter Plymouth The University University Total water and College College of University of of St GB T aunton Art of Exeter Plymouth Mark and College St John Agriculture, food and 90.2 86.4 related studies Architecture, building and 92.6 87.6 planning Biosciences 84.8 84.0 87.8 Business and management 77.8 88.1 88.3 75 84.3 Chemistry 78 88.8 Combined and general 84.9 81.6 studies Communications and media 72.7 86 84.8 Computing 62.5 66.7 87.1 84.2 Creative arts and design 92.9 77.8 86.7 84.4 84.9 84 Economics 89.2 81.8 84 Education and teaching 90.8 88.2 89.5 Engineering 83.5 86.8 86.3 English studies 84.2 87.3 82.7 85.1 Geographical and 91.8 89.2 87.7 environmental studies Health and social care 89.5 93.6 89.9 History and archaeology 89.7 84.2 85.4 Languages, linguistics and 79.7 79.7 classics Law 85.6 88 85.7 Mathematical sciences 86 91.6 87.8 Medicine and dentistry 85 87.2 89.5 Nursing 94 93.5 Philosophy and religious 90.1 81.9 studies Physical, material and 87.5 84.3 85.9 forensic sciences Physics and astronomy 84 87.9 Politics 87.9 76.1 81.8 Psychology 85.4 87.6 87.5 Sociology, social policy and 80.6 89.9 86.3 anthropology Sport and exercise sciences 90 86.4 87.6 88.2 Subjects allied to medicine 93.9 88.4 89 not otherwise specified Technology 44.8 72.6 83.8 Source: Department for Employment: https://www.gov.uk/government/statistics/graduate - outcomes - leo - subject - by - provider - 2016 - to - 2017
171 10.4.3. Outcomes
Table 40 Median total earnings of 2012/213 of graduates in PAYE employment or self - employment (or both) 3 years after completing first degree: 2016/17 tax year
Bridg - Exeter Plymouth The Uni versity University Total water and College College of University of of St GB Taunton Art of Exeter Plymouth Mark and College St John Agriculture, food and 16,500 19,600 related studies Architecture, building and 26,300 29,600 planning Biosciences 23,200 19,100 21,800 Business and management 24,100 33,600 22,200 0 24,100 Chemistry 22,700 25,100 Combined and general 26,800 22,100 studies Communications and media 0 18800 20,200 Computing 0 17,700 0 26,400 25,700 Creative arts and design 15,800 14,900 19,200 17,800 16000 18,400 Economics 37,000 27,900 31,700 Education and teaching 0 20,200 23300 22,100 Engineering 0 30,300 30,000 30,800 English studies 0 24,800 18,600 16700 21,300 Geographical and 27,600 21,500 24,200 environmental studies Health and social care 19,200 16200 21,900 History and archaeology 27,500 19,100 22,500 Languages, linguistics and 25,100 0 24,100 classics Law 28,700 20,300 22,400 Mathematical sciences 29,900 24,100 0 28,000 Medicine and dentistry 44,200 43,700 43,200 Nursing 27,200 27,000 Philosophy and religious 24,500 23,200 studies Physical, material and 21,900 22,000 22,300 forensic sciences Physics and astronomy 32,200 29,100 Politics 30,200 23,200 25,000 Psychology 24,400 19,300 20,600 Sociology, social policy and 0 26,000 18,900 20,900 anthropology Sport and exercise sciences 24,200 19,600 18,400 21,100 Subjects allied to medicine 0 28,300 23,100 0 24,200 not otherwise specified Technology 0 30,100 21,700 Source: Department for Employment: https://www.gov.uk/government/statistics/graduate - outcomes - leo - subject - by - provider - 2016 - to - 2017
172
10.4.4. Graduate retention
What attracts graduates to the area?
Unfortunately, data is not readily available to assess the extent to which the students attending HEIs in the LEP area decide to remain in the area to work, or the extent to which locally - domiciled students w ho choose to study elsewhere, return to work.
The figures for the South West presented in Figure 76 however suggest that while the region loses slightly more locally - domiciled graduates than it attracts from elsewhere b oth to HE providers and employers in the region, the difference is relatively small. In 2015/16, 19,805 UK domiciled higher education leavers were working in the South West region, 6% fewer than the number of leavers in work who were domiciled in the regi on. Almost two - fifths (39%) of graduates domiciled in the South West chose to study and work in the region suggesting that a significant minority of students have strong links to the area. Furthermore, half (50%) of South West domiciled students who chose to move away to study, returned to work in the region. More than a quarter (27%) of locally domiciled students chose to study and work outside the region.
Figure 76 UK domiciled higher education leavers in work in the UK by reg ion of domicile, region of HE provider and region of employment: 2015/16
Source: HESA https://www.hesa.ac.uk/news/29 - 06 - 2017/sfr245 - destinations - of - leavers
173 10.4 Adult Learning
10.5.1. Participation rate s
At the local level the Annual Population Survey is the principal source of information about adult learning. This provides an incomplete picture of residents’ participation in learning because it focuses exclusively on job - related training but nevertheles s providers a useful monitor of participation in this activity. The figure below presents select statistics for the percentage of the population participating in job related training in the last 13 weeks for the Heart of the South West LEP area and the UK . It shows that overall almost one - quarter (23%) of residents aged 16 to 64 had accessed job related training over this period with rates tending to be higher locally than the UK average across the broad range of characteristics.
Long established patterns of training participation are evident in the figure: participation in training in highest among public sector workers, those already holding high level qualifications and those working in managerial and professional occupations. Overall, women are more l ikely to have trained than men and full time workers, more likely than part time workers. Particularly low levels of training are revealed among residents working in the production sector.
174
Figure 77 Percentage who received job related training in the last 13 weeks by selected characteristics, Heart of the South West LEP area and UK, July 2018 to June 2019
23.4 Aged 16 to 64 18.6
23.8 Aged 25 to 64 19.2
29.4 Employees & self-employed 24.6
34.3 In managerial and professional occupations 29.8
31.9 In service industries 26.1
23.8 In private services 19.4
20.4 In production 19.9
43.6 Public sector 37.1
37.7 NVQ Level 4 + 30.2
24.1 NVQ Level 3+ 19.6
31 Working full-time 25.4
26.2 Working part-time 22.3
20.8 Males aged 16 to 64 17.6
25.9 Females aged 16 to 64 19.5
0 5 10 15 20 25 30 35 40 45 50
Heart of the South West UK
Source: Annual Population Survey
Encouragingly, participation in job related training locally has increased over the last five years, contrasting with a long - term decline nationally ( Figure 78 ).
175 Figure 78 Percentage of residents aged 16 to 64 who have undertaken job - related training in the last 13 weeks, Heart of the South West LEP area and UK, July 2004 - June 2005 to July 2018 - June 2019
30.0 Heart of the South West LEP area 25.0
20.0
15.0
10.0
5.0
0.0
Source: Annual Population Survey accessed via NOMIS
Other sources of information on adult learning in clude the Adult Education Survey 123 (formerly the National Adult Learning Survey) and the Adult Participation in Learning Survey (APLS) 124 . The latter notes a recent decline in the number of adults participating in skills training and publicly - funded learning . Participation rates measures through the AES are higher than those captured by APLS. Headline results from both surveys suggest that:
A fifth of adults (19%) are currently learning, with a further 17% who have done so within the previous years (APLS, 2017)
Three - quarters of respondents reported engagement in any learning in the last 12 months. One - in - ten (10%) had participating in formal learning 125 and four in ten respondents had participated in non - formal learning or training 126 and two - thirds (66%) had engaged in informal learning 127 . (AES, 2016)
123 https://www.gov.uk/government/publications/adult - education - survey - 2016 124 https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/735438/Participati on_in_Learning_Survey_2017.pdf 125 Learning that is intended to lea d to a nationally recognised qualification. 126 A course or taught class that does not lead to a nationally recognised qualification 127 Self - directed learning with the aim of improving knowledge of a subject.
176
The AES reveals that while all ages similarly engage in informal learning participation in formal and non - formal learning declines with age.
Figure 79 Percentage of those surveyed with Le arning undertaken in the last 12 months, by age and type , 2016
80.0
70.0
60.0
50.0
40.0
30.0
20.0
10.0
- 19 to 24 25 to 34 35 to 44 45 to 54 55 to 64 65 and over Formal Non-formal Informal
Source: Adult Education Survey 2016
These statistics from the Adult Education Survey give an indication of how adult learning is distributed across different demographics, with the report noting that there was no significant difference dependent on gender 128 . Differences were however found on employment and income related factors, with lower income correlated with lower participation in learning, as well as respondents in employment, whether full time or part time more likely to have participated in any learning in the last twelve months, followed by the economically inactive, and then the unemployed. They also found that degree holders were most likely to have undertaken any type of learning in the last twelve months. The same trend was true when applied to the qualifications held by at least one of the respondent’s parents.
When looking at the rates of participation by report, the South West does comparatively well, only behind London and the South East. Having noted the correlation between learning participation and income, it should not be surprising that higher income areas of England such as London and the South East do well here.
128 Ibid.
177 Figure 80 Percentage participatin g in any type of learning in the last 12 months by region of residence , 2016
90.0 83.7 82.4 80.2 76.0 75.9 80.0 75.7 75.3 75.0 73.6 70.0 s t n
e 60.0 d n o
p 50.0 s e r
f 40.0 o
% 30.0
20.0
10.0
- London South East South East of West North East Yorkshire North East West England Midlands West Midlands and the Humber
Source: Adult Education Survey 2016
10.5.2. Barriers to training
What are the barriers to take up courses and other training provisions?
As part of the Adult Education Survey, respond ents were asked to identify which obstacles they felt percentage them from participating in education and training in the last 12 months. Two barriers stood out as being particular important: “I don’t have the time or training takes too long” was selected by over half (54%) of respondents, and “the cost/too expensive” which was selected by 42% of respondents.
Respondents in full - time employment most frequently reported not having the time or training takes too long (69%), while cost was cited as the biggest barrier for unemployed respondents (50%). Ill - health was report as a barrier among 40% of respondents wi th no qualifications but only 4% of respondents with degrees or equivalent. By contrast, those with a degree or equivalent were twice as likely to cite time as a barrier (66%) compared to those with no qualifications (33%); this was one of the few barriers that increased in prevalence as education attainment level increased.
The Adult Education Survey also found that just over half (52%) of respondents said they were likely or very likely to undertake job - related training or education in the next two or th ree years.
178
10.5.3. Highest qualification held
What qualifications and skills do the population hold? Are they sector/occupational specific? What qualification do the active workforce hold in comparison to the inactive?
Economically active residents within in th e Heart of the South West LEP area are less likely than the UK average to hold a degree or equivalent qualification or above (28% compared to 31%) but are also less likely to hold no, or ‘other qualifications’. Rather, they are more likely to hold interme diate qualifications at GCSE or A level (50% compared to 42%). Overall, Heart of the South West residents are more likely to hold a qualification at level 2 (79%) or above than the UK average (77%). According to UKCES 129 , intermediate skills is an area of weakness for the UK overall compared to its international peers, so this is still important.
Figure 81 Percentage of economically active residents with highest qualification at each level, Heart of the South West LEP area and United Kingdom, January to December 2018
40 35.5 35 HotSW UK 30 30 28.7
25 21.6 22.6 19.7 20
15 9 10 7.9 8.9 6.8 5.3 4 5
0 No qualifications Other GCSE grades A-C GCE A level or Higher education Degree or qualifications or equivalent equivalent below degree equivalent and level above
Source: Annual Population Survey (via nomis - https://www.nomisweb.co.uk/ )
Examination of qualification levels within the LEP area is frustrat ed by the relatively large confidence intervals associated with the point estimates. As the figure below demonstrates , whilst the percentage of residents holding a qualification at Level 2 or above is higher in the Heart of the South West LEP area than the UK average differences be tween the higher tier local authority areas are not statistically significant. The difference between Torbay and Devon – the highest and lowest performing in
129 https://www.gov.uk/government/publications/skills - and - employment - in - the - uk - the - labour - market - story
179 terms of qualification – is however statistically significant with respect to qualifications held at Level 4 and above.
Figure 82 Percentage of residents aged 16 to 64 with highest qualification at each level, Heart of the South West LEP, constituent higher tier local authority areas and the UK, January to December 2018
% with NVQ4+ % with NVQ2+ % with no qualifications 90.0 80.7 78.2 78.9 80.0 75.6 77.0 74.9 4 6
o 70.0 t
6 1
d 60.0 e g a
n 50.0 o i
t 40.1
a 39.2 l 35.9 u 40.0 33.7 p 31.4 o 30.1 p
t 30.0 n e d i
s 20.0 e r
% 8.0 10.0 6.9 5.2 6.6 5.7 5.1
0.0 Torbay Plymouth Somerset Heart of the UK Devon South West LEP area
S ource: Annual Population Survey (via nomis - https://www.nomisweb.co.uk/ )
We can also use data from the Annual Population Survey to compare qualification levels between the overall population and those that are e conomically active.
180
Figure 83 Number of economically active resident who do not have a qualification at Level 2 or above, Heart of the South West, January to December 2018
80,000 70,600 70,000
60,000
50,000
40,000 28,500 30,000 26,900
20,000 12,200 9,800 10,000 7,700
0 Aged 16 to 19 Aged 20 to 24 Aged 25 to 29 Aged 30 to 39 Aged 40 to 49 Aged 50 to 64
Source: Annual Population Survey (via nomis - https://www.nomisweb.co.uk/ )
It is also significant to consider the age distribution of lower qualification levels, as this may influence future policy and funding decisions. The greatest number of members of the wor kforce without at least a level 2 qualification is in the age 50 - 64 age group, including when consolidating the 16 to 29 age groups. This figure is also just under 15,000 lower than all of the remaining groups put together. This suggests a degree of econom ic vulnerability amongst this demographic in case of economic shock, and a need for consideration of later life learning and reskilling, especially as the state pension age continues to rise.
181 10.4.4 Digital Skills
For informal learning, the most popular field of study was computer use (including use of the internet), with 13% of all respondents and 22% of respondents aged 65 and over engaging in informal learning in this field 130 . This is clearly a pressing issue, but while formal qualifications tel l us a lot about skills, the informal acquisition of digital skills should not be overlooked, ranging from the so - called ‘digital natives’ to informal learning by those at the end of their careers. Considering that Heart of the South West is one of the fou ndational areas for the Local Digital Skills Partnerships (see section 2.6 ) , the importance of this issue should not be underestimated. From an emplo yer perspective, a survey by the British Chamber of Commerce in 2017 of over 1,400 firms found that 84% say digital and IT skills are more important to their business than two years ago and 76% expressed at least a slight shortage of digital skills amongst their workforce 131 .
Ipsos MORI produces regular statistics on behalf of Lloyds Bank concerning digital skills . The Regional Summary provided for the South West is generally positive, highlighting that 53% of people have what they define as Essential Digital Skills for the workplace, 6 percentage points higher than the national average. 132 However, there are some issues with disengagement.
Figure 84 Percentage of people who are Digitally Disengaged by region , SW, and UK Average, 2019
15% 14% 14%
14% 13% 13% 13% 13%
13% 12% 12% 12%
12%
11% Devon Cornwall and Isles Dorset and Gloucestershire, South West Total UK Average of Scilly Somerset Wiltshire and Bath/Bristol area
130 https://www.gov.uk/government/publications/adult - education - survey - 2016 131 https://www.britishchambers.org.uk/news/2017/04/bcc - shortage - of - digital - skills - hampering - business - productivity - and - growt h 132 https://www.lloydsbank.com/banking - with - us/whats - happening/consumer - digital - index.asp
182
Source: UK Consumer Digital Index 2019 – South West Spotlight
The South West is slightly above UK average for people who are disengaged (defined as showing little or no digital behaviour), and 23% of those offline don’t use the internet due to perceived p oor connectivity, compared to an average of 20% in this position across the UK. 87% of those who aren’t online stated that they had no interest in doing so . 133 In an increasingly digital world, the combination of barriers and disinterest poses a problem for employability and upskilling, especially as across the country almost half of those that are entirely offline (8% of the population both across the South West and England) are under 60 134 . Projections suggest that by 2030 there will still be 4.5 million (8%) of UK adults considered digitally disengaged . 135
This is further tied in to the skills agenda due to the increased proportion of benefit claimants that are digitally disengaged compared to the general population, 16% across both the UK and the South West. A t higher levels of digital skill, the gaps become more apparent in terms of both prior qualification and age for what the report defines as essential digital skills for life, while there is a 5% percentage point gap in favour of men having this skill set.
Figure 85 P ercentage with Digital Skills for Life by education, UK, 2019
Degree/Masters/PhD 91%
A-level or equivalent 86%
GCSE/O-Level/CSE/NVQ12 75%
No formal qualification 36%
0% 20% 40% 60% 80% 100%
Source: UK Consumer Digital Index 2019
133 https://www.lloydsbank.com/banking - with - us/whats - happening/consumer - digital - index.asp 134 Ibid. 135 Ibid.
183 Figure 86 P ercentage with Digital Skills for Life by age group , UK , 2019
100% 94% 93% 89% 90% 85%
80% 72% 70%
60%
50% 45%
40%
30%
20%
10%
0% 15-24 25-34 35-44 45-54 55-64 65+
Source: UK Consumer Digital Index 2019
For those holding less qualifications, the problem of digital skills poses a greater issue. This is also the case for older workers, with much more dramatic gaps when moving from 45 - 54 to 55 - 64 to 65+. This links into discussion regarding low qualifications in the Heart of the South West LEP area : the number of people in the Heart of the South West LEP area with qualifications below level two is much higher for older workers than for other demographics. In combination, these factors allow for decreased digital skills in otherwise relatively vulnerable groups, which is especially concerning if there is an economic shock.
D isa bility plays a major role as well, as the proporti on of those with an impairment with Digital Skills for Life is only 53%, compared to 82% of those without. As with
184
Figure 87 showing that lower income an d lack of take up of learning are related, similar dynamics are also apparent in Digital Skills . 136
136 https:/ /www.lloydsbank.com/banking - with - us/whats - happening/consumer - digital - index.asp
185 Figure 87 Proportion with Digital Skills for Life by household income, UK 2019
£25,000 plus 89%
£11,500 - £24,999 72%
Up to £11,499 57%
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
Source: UK Consumer Digital Index 2019
For a skil ls focus, the final category is key: that of Essential Digital Skills for work. 17.3 million people (53% of the working population) do not have this skill set, despite, as noted by then Minister for Digital and the Creative Industries Margot James MP, digi tal skills in the workplace now being a near - universal requirement . 137 The South West is second only to London for people having work - related skills (53%), and joint third with the North East for life skills (79%). This is good news, but there is also clearly room for a lot of improvement.
This is an area that the Heart of the South West LEP has taken a particular interest in with the Digital Skills Partnership, launched in 2018 by the Department for Digital, Culture, Media and Sport 138 . This Digital Ski lls Executive Summary proposes engaging on 6 key themes of Developing world - class skills for productivity and growth, Responsive skills and employment system, Transitions to employment – Young People, Transitions to Employment – Inclusion, Employer invest ment in digital skills, and Retaining and attracting talent 139 . Further analysis is available in the main DSP report 140 . These themes and the data provided above provide a starting point for further policy development.
137 https://www.lloydsbank.com/banking - with - us/whats - happening/consumer - digi tal - index.asp 138 https://heartofswlep.co.uk/about - the - lep/strategies - and - priorities/digital - skills - partnership/ 139 https://heartofswlep.co.uk/wp - content/uploads/2018/12/181121 - Digital - Skills - Review - EXECUTIVE - SUMMARY - FINAL - HoSW.pdf 140 https://heartofswlep.co.uk/wp - content/uploads/2018/12/181121 - Digital - Skills - Review - MAIN - REPORT - FINAL - HoSW.pdf
186
11. IMBALANCES IN SUPPLY AND DEMAND
11.1. Intr oduction
This section includes :
a ssessment of the types of skills gaps and the causes
a scertain ing whether learning provision and business development meets demand
a ssessment of the likelihood in meeting future demand through current supply
In particular, it attempts to answer:
What evidence is there of skills issues, now or in the future (skills shortages, mismatches and underutilization)?
187 11.2. Unemployment
11.2.1. ILO measure of unemployment
11.2.1.1. Headline
What are the levels of unemployment and inactivity?
According to the widest measure of unemployment 141 specified by the International La bour Organisation (ILO) 142 , 29,400 Heart of the South West residents were unemployed during the 12 months to June 2019.
The ILO unemployment rates expresses the number of unemployed as a percentage of the economically active population. Latest estimates put the Heart of the South West unemployment rate at 3.3% - slightly above the regional average but below the UK rate of 4 .0% ( Figure 91 ).
11.2.1.2. Age
The unemployed are distributed across age group as illustrated in Figure 88 .
Figure 88 Number of people unemployed by age group, Heart of the South West LEP area, July 2018 to June 2019
8,000
7,000 6,800
6,000 d
e 6,000
y 5,600 o l
p 5,100
m 4,800
e 5,000 n u
s t
n 4,000 e d i s e r
f 3,000 o
r e b
m 2,000 u N
1,000
0 0 16-19 20-24 25-34 35-49 50-64 65+
141 https://ilostat.ilo.org/resources/methods/description - unemployment - rate/ 142 This ILO definition defines unemployed people as being: without a job, have been actively seeking work in the past four weeks and are available to start work in the next two weeks out of work, have found a job and are waiting to start it in the next two weeks This definition is used by most other countries, by the Statistical Office of the European Union (Eurostat), and by the Organisation for Economic Co - operation and Development.
188
Source: Annual Population Survey accessed via NOMIS
Some unemployment in frictional in nature, and is symptomatic of a healthy labour market as people voluntarily and temporarily change jobs or enter the workforce for the first time. It is imposs ible to know exactly how many residents l ocally are long - term unemployed: however, UK data suggests that currently (July to September 2019), the following had been unemployed for 12 months or more:
7.1% of 16 to 17 year olds
15.6% of 18 to 24 year olds
26.5% of 25 to 49 year olds
35.1% of unemployed people aged 50 a nd over.
Almost half of unemployed people in the Heart of the South West LEP area (14,200 people) have a health condition or illness that has lasted more than 12 months.
Figure 89 Percentage Unemployment Rate by Age in England, SW and Heart of the South West LEP area , 2018 to 2019
1.2 Unemployment rate - aged 65+ 1.4 2.1 2.1 Unemployment rate - aged 50-64 2.9 2.5 2.0 Unemployment rate - aged 35-49 2.6 1.9 2.9 Unemployment rate - aged 25-34 3.7 3.3 7.4 Unemployment rate - aged 20-24 9.8 5.8 11.6 Unemployment rate - aged 16-19 17.0 13.0 3.1 Unemployment rate - aged 16+ 4.0 3.3
0.0 5.0 10.0 15.0 20.0
South West England HotSW
Source: Annual Population Survey (via nomis https://www.nomisweb.co.uk/ )
Figure 90 Percentage by Age and Gender in Unemployment in Heart of the South West LEP area , 2018 to 2019
189 18 15.8 16 14
12 10.7 10 8.4 8
6 4.7 3.8 3.6 3.2 4 3 2.8 2.6 2.5 2.6 2 1.2 0 0 16+ 16-19 20-24 25-34 35-49 50-64 65+
Male Female
Source: Annual Population Survey (via nomis https://www.nomisweb.co.uk/ )
Where a figure of 0 is given, the gro up sample size is unreliable or disclosive.
When looking at the unemployment rate by age and gender, the most immediately concerning rate is that of men between 16 and 24. The estimate for men over 65, meanwhile, is suppressed due to small sample size. The difference flattens out between 50 and 64, while women unemployed s urpass men between the ages of 2 5 and 34. This may be influenced by the balance of childcare or the perception thereof.
11.2.1.3. Geography
Geographically, the unemployed are distributed across the LEP area as follows: Devon (12,100), Plymouth (6,200), Somerset (8,400) and Torbay (2,700).
Figure 91 Percentage of the economically active population aged 16+ who are unemployed, Heart of the South West LEP area, constituen t higher level local authority districts, South West and UK, July 2018/June 2019
190
5 4.6 4.4 4.5
+ 4 6 1
4 n o i t
a 3.5 3.3 l
u 3.1
p 3 3
o 3 p
e v i
t 2.5 c a
y l l 2 a c i
m 1.5 o n o c
e 1
% 0.5
0 Somerset Devon South West Heart of the UK Torbay Plymouth South West LEP area
Source: Annual Population Survey (via nomis - www.nomisweb.co.uk )
11.2.1.4. Trends
Up until recently unemploymen t had been on a downward trend but the latest results suggest that it has increased over the last 12 months ( Figure 92 ).
Figure 92 Number of unemployed residents aged 16+, Heart of the South West LEP area, 2004/05 to 2018/19
70,000
60,000
d 50,000 e y o l
p 40,000 m e n u
30,000 r e b
m 20,000 u N 10,000
0
Source: Annual Population Survey
191
11.2.2. Claimant Count
The claimant count – the number of people registered for the unemployment - related benefit – Jobseekers Allowance or Universal Credit – is another measure of unemployment. It is a narrower measure than the ILO definition since not all people who are without work are eligible for, or indeed claim, these welfare benefits. As the claimant count is based on ad ministrative data the figures are not subject to the confidence intervals associated with survey - based data. This means the source is useful for small - area based analysis. It is also updated monthly , making it one of the most up - to - date indicators of labo ur market performance
Claimant count does have a small risk of overestimation, however, due to factors such as failure to remove recent claiman ts from the register and that Universal Credit can be applicable to those who have had some but not sufficient w ork and are thus underemployed, not unemployed , but also benefits from being externally reported, as opposed to self - declared, and thus is more easily verifiable.
11.2.2.1. Headline
In November 2019, 22,775 people living in the Heart of the South West LEP are were claiming Jobseeker’s Allowance. The count is distributed across broad age groups as follows: aged 16 to 24 ( 4,58 0 ), aged 25 to 49 ( 12,350 ) and aged 50+ ( 5,845 ).
When expressed as a percentage o f the economically active population aged 16 and over, the claimant count in the Heart of the South West LEP area ( 2.6 % ) is comparable to the regional rate ( 2.5 % ) and is lo wer than the UK ( 3.6 % ) average.
Within the LEP area, the claimant count rate is highest in Plymout h ( 4.0 % ) and Torbay ( 3.9 %). The lowest rate is in the South Hams ( 1.5 %).
Figure 93 Claimant Count as percentage of economically active residents aged 16+ , by England, SW, Heart of the South West LEP area Council Authority and District Authority , November 2018 to November 2019
192
England 3.6 2.7 South West 2.5 2 Heart of the South West 2.6 2.1 Torbay 2.5 3.9 2.6 Somerset 2.5 Plymouth 4 3.6 1.9 Devon 1.2 West Devon 1.9 1.4 2.6 Torridge 2 Torbay 3.9 2.5 Teignbridge 2 1 South Somerset 2.3 2.1 South Hams 1.1 1.5 Somerset West and Taunton 2.6 2.5 Sedgemoor 3 3.1 4 Plymouth 3.6 1.9 North Devon 1.3 Mid Devon 1.2 1.7 Mendip 2.7 2.7 Exeter 1.1 1.9 1.6 East Devon 1 0 0.5 1 1.5 2 2.5 3 3.5 4 4.5
November 2019 November 2018
Source: Claimant Count (via Nomis) www.nomisweb.co.uk
193 11.2.2.2. Gender
Men ( 13,095 ) account for a slightly larger share of the Claimant Count than women (9,68 0) across the LEP area. This is the case across all constituent higher tier local authority districts. Men account for a particularly large share of the count in Torbay. It is worth noting, however, that the claimant count deals with those specificall y seeking Jobseeker’s Allowance or Universal Credit, and does not handle other factors such as one - income households, which may contribute to this gap. This data does not account for rates of unemployment among non - binary people, but data collection for th is demographic is currently limited 143 .
Figure 94 Pe rcentage Rate of Claimants by Gender in all residents aged 16 - 64 by Local District Authorities, November 2019
1.2 East Devon 1.7 1.2 Exeter 1.8 2.1 Mendip 2.7 1.3 Mid Devon 1.8 1.5 North Devon 2.2 2.7 Plymouth 3.8 2.6 Sedgemoor 3 1.9 Somerset West and Taunton 2.5 South Hams 1.3 1.4 South Somerset 2.2 1.5 Teignbridge 1.9 2.3 Torbay 3.9 1.7 Torridge 2.6 1.3 West Devon 1.6
0 0.5 1 1.5 2 2.5 3 3.5 4 4.5
Female Male
Source: ONS Claimant Count (via Nomis) www.nomisweb.co.uk
143 https://www.ons.gov.uk/methodology/classificationsandstandards/measuringequality/genderidentity/genderidentityupd ate
194
Figure 95 Percentage of Claimant Count by Gender , County Authority, Heart of the South West LEP Area, England and the South West, November 2018 to November 2019
70.0% 62.0% 59.4% 57.2% 57.5% 57.1% 57.4% 60.0% 54.9%
50.0% 45.1% 42.9% 42.8% 40.6% 42.5% 42.6% 38.0% 40.0%
30.0%
20.0%
10.0%
0.0% Devon Plymouth Somerset Torbay Heart of the South West England South West
Men Women
Source: ONS Claimant Count (via Nomis) www.nomisweb.co.uk
By consid ering the rates of claimants against the general population with regards to gender, it is possible to get an idea of the scale of unemployment and the role gender plays in this. Typically the male proportion of the claimant count is higher, and this is consistent across England, although the degrees of difference vary: it is worth noting that the proporti ons of the Torbay claimant count are considerably skewed towards men. The same is true in the earlier Figure 94 , where the proportion of male claimants is almost twice that of women. For South Hams, however, there is only 0.1 percentage point difference. The difficulty in response to this is determining whether this is a gap caused by economic inactivity, such as career breaks when raising children : according to the ONS , in April to J une 2019 women with dependent children had an emp loyment rate of 75.1 % compared to 92.6 % for men with dependent children 144 . Women are statistically more likely to work both part time and in lower paid sectors 145 , which may play an additional rol e.
11.2.2.3. Age
Unfortunately the claimant count is not available as a rate for different age groups but analysis of the age distribution of claimants ( Figure 96 ) s uggests that the mode age group is 18 to 24 year olds. The number reduces among progressively older age groups partly due to people entering economic inactivity as they approach their desired retirement age.
144 https://www.ons.gov.uk/employmentandlabourmarket/peopleinwork/employmentandemployeetypes/articles/familiesa nd thelabourmarketengland/2019 145 Ibid.
1 95 Figure 96 Number of resident s claiming Jobseeker’s Allowance or Universal Credit, Hea rt of the South West LEP area, November 2019
5,000 4,495 4,500
4,000
3,500 3,050 3,000 2,850
2,500 2,375 2,095 2,095 1,980 1,885 2,000 1,680 1,500
1,000
500 80 185 0 16-17 18-24 25-29 30-34 35-39 40-44 45-49 50-54 55-59 60-64 65+
Source: ONS Claimant Count (via Nomis) www.nomisweb.co.uk
196
11.2.2.4. Geography
We can also evaluate unemploym ent on the ward level, which points towards clusters of concern in Torquay and Paignton (Torbay), Wellington and Williton (West Somerset), Barnstaple and Bideford (North Devon and Torridge) and Newton Abbot and Teignmouth (Teignbridge) 146 . To draw out the areas where there are major issues, it makes sense to compare the claimant rate and the percentage increase. This is potentially affected by the fact that Universal Credit can be paid to those who are underemployed rather than unemployed a nd still be counted.
Table 41 Above national average claimant count rate and percentage increase wards, 2018 to 2019 Claimants as a proportion of Ward Claimant count residents % Nov 18 Nov 19 Increase Nov 18 Nov 19 Bushell 1.5 3 100% 70 140 Teignmouth East 1.5 3 100% 40 80 Ellacombe 3.1 5.7 84% 150 270 Blatchcombe 1.7 3.1 82% 115 210 Watcombe 2 3.6 80% 85 145 Taw Vale 1.9 3.3 74% 20 30 Glastonbury St. John’s 2.6 3.9 50% 40 60 Central Town 3.5 5.1 46% 110 160 Roundham - with - Hyde 3.5 5 43% 165 240 Wellington East 2.1 3 43% 55 80 Williton 3 4.2 40% 40 60 Wellswood 2.3 3.2 39% 95 130 Bideford North 2.7 3.7 37% 100 135 Tormohun 4.6 6.3 37% 360 500 Wells Central 2.9 3.9 34% 35 45 Yeovil East 3.3 4.2 27% 165 210 UK 2.3 2.9 26% 945,630 1,209,260 England 2.2 2.9 32% 778,325 1,008,855 Source: Annual Population Survey and Claimant Count (via Nomis) www.nomisweb.co.uk
These wards are likely areas of concern for further assistance, as they have higher claimant rates and their unemployment has increased proportionally faster than the UK and England. This data is also very recent and so this is an issue with immediate presence.
146 Annual Population Survey (via nomis https://www.nomisweb.co.uk/ )
197 At the level of LSOAs (lower super output area s , small regions consisting of approximately 1500 people or 650 households each ), rather than regions, counties, countries or LEPs, there are certain dynamics at play. The majority of the top 20 LSOAs for highest percentage increase in the number of claima nts from September 2018 to September 2019 in the Heart of the South West LEP area are located in Torbay (60 percent), as depicted below:
Figure 97 Highest Percentage Increase in Claimant Count LSOAs, Torbay Map , 2018 to 2019
Source: ONS Claimant Count (via nomis - www.nomisweb.co.uk )
With regards to the highest numerical increase, rounding guidelines mean that it is difficult to draw a top 20, but a top 30 is fortunately possible. Of t hese, 12 are in Torbay, higher than any other single area. In Figure 98 there are clear similarities with Figure 97 in terms of the at risk areas. Central Paignton and Torquay are key focal points.
Figure 98 Highest Numerical Increase in Claimant Count LSOAs, To rbay Map, 2018 t o 2019
198
Source: ONS Claimant Count (via nomis - www.nomisweb.co.uk )
However, putting a focus on the twenty areas with the total highest number of claimants as of November 2019, the largest proportion (4 0%) are found in the Plymouth area, as pictured here: Figure 99 Highest Claimant Count LSOAs, Plymouth Map , November 2019
199
Source: ONS Claimant Count (via nomis - www.nomisweb.co.uk )
In both cases there is a n observable trend towards higher claimant counts and increasing claimant counts in urban areas. However, it is worth noting that LSOAs are very small areas and there is a risk of inaccuracy based on standard rounding procedures, as well as more pronounced effects of anomalous results.
Figure 100 Numerical Change by Percentage Change in Claimant Count, LSOAs in the Heart of the South West LEP area, 2018 to 2019
60
50
40
30
20
10
0 -200% -100% 0% 100% 200% 300% 400% 500% 600% -10
-20
-30
Figure 100 shows the numerical changes by the percentage changes. As expected, these are correlated, but it is worth noting the outliers, such as the increase of approximately 55 claimants in Torbay 008A and Exeter 008C, and the 500% increase in the Torbay 006B area . However, changes are predominantly small and the percentage changes are inflated by both the small number of claimants originally and the rounding rules on this data changing it to the nearest 5, leaving a 5 point range on what the original value is.
11.2.2.5. Tre nds
Figure 101 shows how the claimant count has changed over time in the Heart of the South west LEP area and the UK. The main observation is that the co unt has followed a generally upward trend since summer 2015. The count locally has remained fairly stable across the LEP area however during 2019, in contrast to the rel a tively sharp increase locally.
200
Figure 101 Claimant Count in numbers and as percentage of the residents aged 16+, Heart of the South West LEP area and England, 2013 to 2019
30,000 4.0 HotSW: Level HoTSW: % England: % 3.5 25,000 3.0 20,000 2.5
15,000 2.0
1.5 10,000 1.0 5,000 0.5
0 0.0 3 3 3 3 4 4 4 4 5 5 5 5 6 6 6 6 7 7 7 7 8 8 8 8 9 9 9 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2
l l l l l l l r r r r r r i y i y i y i y i y i y i y y y y y y y y l l l l l l l r r r r r r r r r r r r r r e e e e e e u u u u u u u a a a a a a a p p p p p p p b b b b b b J J J J J J J u u u u u u u A o A o A o A o A o A o A t t t t t t n n n n n n n c c c c c c a a a a a a a J J J J J J J O O O O O O
Source: ONS Claimant Count (via nomis - www.nomisweb.co.uk )
Figure 102 Heart of the South West LEP area Claimant Count by Age Group
201 All categories: Age 16+ 21845 17145 80 Aged 16-17 40 Aged 18-24 4,330 3,365 2915 Aged 25-29 2260 Aged 30-34 2715 1940 Aged 35-39 2275 1655 Aged 40-44 1995 1510 Aged 45-49 1995 1680 Aged 50-54 1990 1760 Aged 55-59 1830 1545 Aged 60-64 1565 1350 Aged 65+ 155 10 0 5000 10000 15000 20000 25000
September 2019 September 2018
Source: ONS Claimant Count (via Nomis) www.nomisweb.co.uk
Looking at the claimant count across age groups in the Heart of the South West LEP area as of September 2019, it becomes apparent that there has been an increase across all age groups. Proportionately the 16 - 17 and 65+ age groups have had the largest increases, but they were also at the lowest level originally. The 65+ group are also affected by t he changes in the state pension age, which has been slowly increasing from 65 since December 2018. Numerically the highest increase is in the 18 - 24 age group, followed by the 30 - 34 age group, suggesting that there may be issues for recent college and unive rsity graduates in finding work, as well as for those in one of the most economically active age groups across both England and the South West. The lowest numerical increase outside of the 16 - 17 and 65+ age groups was the age 60 - 64 age group.
11.3 Underemployme nt
What are the levels of underemployment?
With unemployment being low and still falling, it could be argued that the labour market is functioning efficiently. However, it could be suggested that the opposite is true and underemployment is a significant pr oblem, with part - time workers wanting full - time jobs, inactive workers wanting to return to the labour market, and newer forms of working such as the gig economy and zero - hours contracts becoming more widespread.
202
Current data estimates that 3.25 million pe ople in the UK are underemployed, 7.6% of all those in employment. Underemployment levels had been steadily increasing between 2008 and 2014 (peaking at 10.6% in 2012), but have since steadily fallen. Conversely, overemployment (those who want to work fewe r hours) has been increasing in recent years, and now accounts for over 10% of all those in employment.
203 Figure 103 Underemployment and Overemployment, UK, 2002 - 2019
14
12
10
8
6
4
2
0 2 2 3 3 4 4 5 5 6 6 7 7 8 8 9 9 0 0 1 1 2 2 3 3 4 4 5 5 6 6 7 7 8 8 9 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2
r r r r r r r r r r r r r r r r r r p p p p p p p p p p p p p p p p p a a a a a a a a a a a a a a a a a a e e e e e e e e e e e e e e e e e S S S S S S S S S S S S S S S S S M M M M M M M M M M M M M M M M M M ------l l l l l l l l l l l l l l l l l n n n n n n n n n n n n n n n n n n u u u u u u u u u u u u u u u u u J J J J J J J J J J J J J J J J J a a a a a a a a a a a a a a a a a a J J J J J J J J J J J J J J J J J J
Underemployment rate Overemployment rate
Source: ONS https://www.ons.gov.uk/employmentandlabourmarket/peopleinwork/employmentandemployeety pes/datasets/underemp loymentandoveremploymentemp16
The Labour Force Survey (LFS) collects data on the number of people in employment who:
want more hours in their current jobs
want replacement jobs with longer hours
want additional jobs
Of all the workers that fell in these three categories in the second quarter (Apr to June) of 2019, just under 80% wanted more hours in their current jobs, 12% wanted replacement jobs with longer hours and 9% wanted additional jobs.
The number of people on zero hours contracts in the UK has g rown rapidly in recent years, from 190,000 in 2011 (0.6% of people in employment), to 896,000 in the second quarter of 2019 (2.7% of employment). The numbers and rate of zero hours contracts have remained reasonably constant in the last 2 - 3 years.
In the S outh West, there were an estimated 83,000 people working on zero hours contracts in the second quarter of 2019 (2.9% of employment), up slightly from 80,000 in 2018. Although underemployment is more likely among people working on zero hours contracts, this is far from universal among people working in this way. Only just
204
over a quarter of people on zero hours contracts wanted to work more hours, compared to 7% of those with different working arrangements.
11.4. Skills shortages
Identifying skills shortages is im portant. Skill shortages are costly and can hamper growth, with the Open University 147 estimating that they cost the UK £2bn a year in higher salaries, recruitment costs and temporary staffing bills.
The UK Employers Skills Survey asks employers about recruitment difficulties and skills lacking from applicants; skill shortages from existing employees as well as the opposite, underutilisation of employee skill sets; their anticipated needs for skill development over the coming year; the nature and scale of training that they have available, including how much they spend, and about the relationship between working practices, business strategy, skill development and skill demand 148 .
Employers in the Heart of the South West LEP area reported that 11,880 of the 26,504 vacancies were providing hard to fill, 45% of the total. 10% of all employers locally had at least one hard to fill (HTF) vacancy, compared to 8% nationally. Perhaps surprisingly, locally it is not the highest skilled vacancies that are proving har dest to fill – over half of all vacancies classed as ‘labour intensive’ were hard to fill (only 32% nationally), while only 37% of high skill vacancies were reported as hard to fill. Vacancies were reported as being harder to fill locally than nationally a cross most occupations.
147 The Open University (2017), ‘The £2.2 Billion cost of the skills gap’. https://www3.open.ac.uk/media/fullstory.aspx?id=31527 148 https://www.gov.uk/government/collections/uk - employer - skills - survey - 2017
205 Table 42 Hard to Fill Vacancies by Occupation as a % of all Vacancies, Heart of the South West vs comparator LEPs and England Heart of Occupation the South Cumbria New Anglia England West All Occupations 45% 49% 41% 34% Managers 31% 55% 37% 24% Professionals 50% 74% 54% 43% Associate professionals 25% 53% 25% 29% Administrative/clerical staff 31% 23% 39% 21% Skilled trades occupations 68% 49% 55% 53% Caring, leisure and other services 56% 54% 60% 40% staff Sales and customer services staff 23% 28% 33% 23% Machine operatives 46% 59% 44% 44% Elementary staff 55% 48% 34% 28% Unclassified staff 76% 0% 20% 23% Total HTF Vacancies 11,880 3,532 10,190 286,818
HIGH - SKILL 37% 63% 36% 34% MIDDLE - SKILL 52% 40% 48% 39% SERVICE - INTENSIVE 38% 39% 49% 32% LABOUR - INTENSIVE 52% 51% 36% 32% Source: ESS, 2017
When employers have vacancies, potential employees may or may not be able to meet employer requirements. Where employers struggle to fill vacancies, this may be due to a lack of skills, qualifications or experience amongst applicants. Collectively these ar e known as ‘skill - shortage vacancies’ (SSVs). The incidence of establishments with SSVs vacancies in the Heart of the South West LEP area was 7%, compared to 6% for England. In volume terms, this equated to just over 7,000 SSVs.
The experience of skill - shortage vacancies varied by sector. Reflecting the relative size of the sector, skill - shortage vacancies were most numerous locally in the Health and Social Work and Business Services sectors. However, as a proportion of all vacanc ies in the sector, the density of skill - shortage vacancies was highest in ICT and Transport & Storage where almost half of vacancies (48%) were proving hard to fill due to difficulties in finding applicants with appropriate skills, qualifications or experi ence. Construction was also higher than the average for all sectors, at 43% of all vacancies. For all three sectors, the density of SSVs was higher for Heart of the South West LEP area than nationally.
206
Table 43 Density of SSVs by sector (% of all vacancies that are SSVs). Heart of the South West vs comparator LEPs, South West and England Heart of the New Occupation Cumbria England South West Anglia Primary Sector & Utilities 34% 29% 48% 36% Manufacturing 35% 21% 27% 29% Construction 43% 28% 44% 36% Wholesale & Retail 19% 13% 20% 18% Hotels & restaurants 24% 32% 15% 16% Transport & Storage 48% 36% 41% 29% Information & Communications 48% - 63% 29% Financial Services 12% - 31% 19% Business Services 28% 39% 37% 24% Public admin. 8% - 24% 15% Education 21% 65% 28% 23% Health & social work 26% 39% 20% 22% Arts & Other Services 28% 40% 31% 26% Total 27% 31% 28% 23% Total number of SSVs 7,015 2,242 6,928 193,842 Source: ESS, 2017 https://www.gov.uk/government/publications/employer - skills - survey - 2017 - england - and - local - toolkit
By occupation, employers were most likely to have experienced skills - related difficulties when recruiting for Skilled Trades positions. Over half of all vacancies for such roles (both locally and regionally) were proving hard to fill for skills related reasons (skill - shortage vacancy densities of 51% and 53% respectively, both significantly higher than the national average). This occupation has had the highest density of skill - shortage vacancies in all previous iterations of the ESS series. At a national level, the specific job roles that account for the largest proportion of all Skilled Trades skill - shortage vacancies include:
Chefs (17% of all skill - shortage vacancies for Skilled Trades)
Vehicle technicians, mechanics and electricians (13%)
Metal working production and maintenance fitters (13%)
Metal machining setters and setter - operators (5%)
Electricians and electrical fitters (5%).
207 Table 44 Density of SSVs by occupation (% of all vacancies that are SSVs). Heart of the South West vs comparator LEPs, South West and Engla nd Heart of the Occupation Cumbria New Anglia England South West Managers 23% 28% 24% 17% Professionals 32% 49% 40% 30% Associate professionals 16% 51% 23% 23% Administrative/clerical staff 25% 6% 34% 15% Skilled trades occupations 51% 32% 46% 42% Caring, leisure and other services 27% 32% 28% 24% staff Sales and customer services staff 16% 13% 22% 16% Machine operatives 23% 37% 32% 31% Elementary staff 24% 23% 15% 14% Unclassified staff 59% 0% 9% 14% Total 27% 31% 28% 23% Total SSVs 7,015 2,241 6,928 193,843
HIGH - SKILL 24% 48% 29% 25% MIDDLE - SKILL 40% 23% 41% 30% SERVICE - INTENSIVE 21% 21% 26% 20% LABOUR - INTENSIVE 24% 27% 19% 19% Source: ESS, 2017
Also at the national level, there were several emerging pockets of skill - shortage vacancies, including:
Associate Professionals in Primary Sector and Utilities (including job roles such as ‘Inspectors of standards and regulations’ and ‘Business sales executives’).
Skilled Trades in Primary Sector and Utilities (‘Farmers’ and ‘Agricultural and fishing trades’), and Education (‘Chefs’ and ‘Cooks’ in education settings).
Caring, Leisure and Other Services occupations in the Arts and Other Services sector (including ‘Hairdressers and barbers’ and ‘Beauticians’).
Sales and Customer Services occupations in Financial Services, Manufacturing, and Health and Social Work sector.
Machine Operatives in Primary Sector and Utilities (‘Scaffolders, stagers and riggers’ and ‘Agricultural machinery drivers’).
Elementary staff in Primary Sector and Utilities (such as ‘Farm workers’).
208
The Employer Skills Survey collected data on the particular skills that employers have found to be lacking among applicants for vacancies. Employers with skill - shortage vacancies (SSVs) were read a list of skills an d asked, for each occupation in which they reported skill - shortage vacancies, which skills were lacking. The specific skills that employers perceive to be lacking among applicants can be broadly grouped into two categories, described by DfE as:
Technical a nd practical skills – these are the specific skills required to perform the specific functions of a job role.
People and personal skills – these are the ‘softer’, less tangible skills required to manage oneself and interact with others in the workplace.
T he skills lacking across these two categories of skills are shown in Table 45 and Table 46 .
Table 45 The main skill(s) found difficult to obtain from applicants (prompted) (% of employers with SSVs), England and South West Skill Area England South West Any Technical or Practical Skills 59% 57% Any People and Personal Skills 33% 36% Complex Analytical Skills 6% 4% Operational Skills 9% 7% Digital Skills 5% 5% Management and Leadership Skills 5% 3% Sales and Customer Skills 11% 16% Self - Management Skills 12% 11% Employers with SSVs 95,249 13,490 Source: ESS 2017
Table 46 The main skill(s) found difficult to obtain from applicants (prompted) (% of all SSVs), England and South West Skill Area England South West Any Technical or Practical Skills 57% 59% Any People and Personal Skills 34% 33% Complex Analytical Skills 5% 4% Operational Skills 7% 5% Digital Skills 6% 8% Management and Leadership Skills 6% 5% Sales and Customer Skills 10% 12% Self - Management Skills 12% 10% Total SSVs (followed up) 190,632 25,207 Source: ESS 2017
209 11.4.1.1. Technical and practical skills
Considering first technical and practical skills, it is possible to group some of the skills. For instance, a lack of ‘complex analytical skills’ were cited by 7% of the South West’s employers as a cause of skill - shortage vacancies (9% for England), with this skill area accounting for 5% of all SSVs. A lack of complex analytical skills was most prevalent among Business Services, Construction and Information and Commun ication.
5% of all skill - shortage vacancies regionally (7% for England) were attributed, at least in part, to a lack of ‘operational skills’ including knowledge of products and services offered and/or knowledge of how the organisation works. Shortages of o perational skills were most prevalent among employers in Wholesale and Retail and Hotels and Restaurants.
8% of all skill - shortage vacancies were attributed, at least in part, to a lack of ‘digital skills’, compared to 6% nationally. This includes both bas ic computer literacy and/or more advanced or specialist IT skills. Unsurprisingly, a lack of digital skills was most acute for the Information and Communications sector.
11.4.1.2. People and personal skills
People and personal skills can be less tangible than techni cal and practical skills, but they can have a big impact on the ability of a potential employee to adapt to the workplace and be an effective member of staff.
As was the case in the previous ESS in 2015, the most common skill of this type lacking in the la bour market were ‘self - management’ skills (12% of all SSVs nationally, 10% in the South West), including the ability to manage ones’ own time and task prioritization. Skills related to ‘sales and customer skills’ were commonly reported to be lacking, cite d as a cause for 12% of all skill - shortage vacancies (10% nationally). This grouping includes customer handling skills and sales skills. A lack of sales and customer skills were particularly prevalent in Financial Services, Arts and Other Services and Whol esale and Retail.
Another grouping of skills that were commonly lacking were ‘management and leadership’ were commonly reported to be lacking, including: managing or motivating other staff, persuading and influencing others, and setting objectives and/or p lanning resources. A lack of management and leadership skills were most prevalent for employers in Hotels and Restaurants and Financial Services.
11.5. Skil ls gaps
210
A skills gap is said to exist when an employer has an employee that lacks the required proficiency or proficiencies to fulfil their role effectively. 149
A majority of employers in the Heart of the South West LEP area (83%) reported that all of their staff were fully proficient at their job, lower than the national average of 87%. As shown in Table 47 , the total number of skills gaps locally in 2017 was just under 39,000.
Skills gap density refers to the number of staff perceived to be lacking proficiency, as a proportion of all staff. This proportion has fallen from 5.5% in 2011 to 4.4% in 2017. In total, 1.27 million employees across the UK were felt to be lacking proficiency.
Table 47 Prevalence of Skills Gap s. Heart of the South West vs comparator LEPs, South West and England , 2017 Heart of the New Measure England SW Cumbria South Anglia West % of establishments with any staff 13% 17% 17% 17% 17% not fully proficient Number of skills gaps (Absolute 1,060,004 130,418 38,958 15,142 35,296 figures) Number of staff not fully proficient as 4% 6% 6% 6% 5% a % of employment Source: ESS, 2017
By occupation, labour - intensive and service - intensive occupations were more likely to experience skills gaps than managerial and professional occupations, a pattern that is broadly consistent with surveys of previous years.
Skilled trades occupations had the highest density of skills gaps, at 11% in 2017. This was in contrast to the national picture, where sales and customer service occupations had the highest density of skills gaps.
149 https://www.gov.uk/government/publications/employer - skills - survey - 2017 - uk - report
211 Figure 104 Skills Gaps Density by Occupation (% of staff that are not fully proficient) Heart of the South West vs comparator LEPs, South West and England
12% t n e 10% m y o l 8% p m e
6% f o
% 4%
s a
s 2% p a g 0% s l l i k S
England South West Heart of the South West Cumbria New Anglia
Source: ESS, 2017
The majority of skills gaps were caused, at least in part, by transient factors – factors which would be expected to be resolved in time. The fact that staff were new to the role contributed to nearly two - thirds (61%) of all skills gaps locally, and a broadly similar proportion of skills gaps (62%) were caused at least in part by the fact that employees’ training was only partially complete. Combined, these transient factors contributed to three - quarters (77%) of all skills gaps, similar to nationally. However, a majority of employers with skills gaps also suggested additional causes. Staff lacking motivation remains the most common non - transient cause of skills gaps (32% locally).
As previous surveys have highlighted, issues related to training remain a significant cause of skills gaps. Staff having been on training but their performance not improving sufficiently contributed to nearly three in ten skills gaps (29%, compared to 26% nationally). Staff not receiving appropriate training co ntributed to 30% of skills gaps, again higher than the national average of 25%. Nationally, this was identified as an issue that was more prevalent in the public administration and manufacturing sectors (31% and 30% respectively), as well as among managers (39%).
30% of skills gaps locally were caused at least in part by an inability to recruit staff with the required skills. Nationally, this factor was identified as most common in sectors and occupations with particularly high levels of skill - shortage vaca ncy density such as: the Manufacturing sector, Skilled Trades occupations and Machine Operatives.
There are some workplace activities which, although a cause of skills gaps in the short - term, represent a positive tendency for employers to invest in future growth. The
212
introduction of new working practices contributed to 24% of skills gaps, while the introduction of new technology was a factor in 18%, and the development of new products and services 14%.
Table 48 Causes of Skills Gaps. Heart of the South West vs comparator LEPs, South West and England (% of employers with skills gaps) Heart of the New Cause Cumbria England South West Anglia Their training is currently only 61% 50% 58% 62% partially completed They are new to the role 62% 65% 58% 61% Staff lack motivation 32% 29% 25% 26% They have been on training but their performance has not improved 29% 28% 22% 26% sufficiently They have not received the 30% 24% 24% 25% appropriate training Unable to recruit staff with the 30% 40% 28% 25% required skills The introduction of new working 24% 21% 21% 22% practices The introduction of new technology 18% 13% 21% 18% The development of new products 14% 14% 13% 15% and services Problems retaining staff 15% 14% 13% 13% Lack of other skills e.g. 3% 1% 3% 3% communication, interpersonal* Non - work related problems e.g. 1% *% 2% 2% health or personal problems* Lack of aptitude to do job/reached 1% 1% 2% 1% maximum potential* Staff are too old to carry out the work 1% 3% 1% 1% required* Language barrier - English not first 1% *% 1% *% language* Other 0% 0% *% 2% No particular cause *% *% *% 1% Don't know 1% 4% 1% 1%
NEW TO THE ROLE/TRAINING 77% 78% 74% 78% NOT COMPLETE TRANSIENT SKILLS GAPS 23% 22% 29% 28% Source: ESS, 2017 https://www.gov.uk/government/publications/employer - skills - survey - 2017 - england - and - local - toolkit
213 11.6. U nder utilis ation of skills
What proportion of employees have higher qualification level or skills than those required in their current jobs? Is the local population over or under qualified?
Are people employed in a sector/occupation that is aligned with their formal qualifications?
The 2017 Employer Skills Survey found that around 45% of employers in Heart of the South West LEP area reported that they had one or more member of staff with qualifications more advanced than required for their current role. Figure 105 below shows the proportion of staff members who were overqualified at these establishments. It shows that at around 9% of establishments local and nationally 100% of staff were perceived to hold qualifications that were more advanced than required for the ir current role and 11% reported that between 50% and 99.9% were over qualified.
While the Heart of the South West LEP area has a generally well - qualified population , especially at the intermediate level as discussed in section 10.5.3 and lower than average employment in the knowledge intensive sectors , such as Research and experimental development on natural sciences and engineering and Computer progr amming, consultancy and related activities ; 150 and knowledge intensive market services 151 , the prevalence of over - qualification in the Heart of the South West LEP area is not significantly different to that found nationally.
Figure 105 Proportion of staff with qualifications more advanced than required for their current job role, Heart of the South West LEP area & England, 2017
150 BRES data for Heart of the South West LEP area 3 digit SICs compared against average across all LEP areas. Intensity level based on R&D intensity as set by the OECD at https://www.oecd - ili brary.org/science - and - technology/oecd - taxonomy - of - economic - activities - based - on - r - d - intensity_5jlv73sqqp8r - en 151 https://he artofswlep.co.uk/wp - content/uploads/2019/02/Driving - Productivity - in - Heart of the South West LEP area - Green - Paper - AC - Updates - 030719.pdf
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12% 11% 11%
10% 9% 9% 8% 8% 7% 7% 7% 7% 6% 6% 6% 5%
4% 3% 2% 2%
0% 5 - 9.9% 10 - 19.9% 20 - 29.9% 30 - 49.9% 50 - 99.9% 100% Don't know
England *% Heart of the South West *%
Source: Employer Skills Survey, 2017
A variety of factors may underlie these employer perceptions. Some st aff might, for example hold humanities degrees that may confer reasoning, writing or other abilities that are not perceived as relevant to that person’s employment. Others may have valuable technical qualifications which they simply don’t use as a result o f having failed to find a job where they can apply these skills. The latter could be regarded as a greater waste of potential than the former. Unfortunately, the data does not illuminate issues such as this.
Qualifications are, of course, only a broad pro xy for skills. The Employer Skills Survey also asks employers about whether they have staff who are more generally ‘under - utilised’: i.e. whether they have both qualifications and skills that are more advanced than required for their current job role. The proportion of employers who respond that they have staff whose skills and qualifications are under - utilised is smaller than the proportion report staff with under - utilised qualifications. Once again, the proportion of employers in Heart of the South West LEP area who report having staff who are under - utilised (36%) is slightly higher than the national average (34%).
The proportion of staff at each place of employment who are under - utilised in Heart of the South West LEP area is not significantly different to the national average, but the broad picture, of there being a significant number of employers, locally and nationally, where a significant number of employees have talents that are not fully utilised, remains.
Figure 106 Pro portion of staff that are under - utilised, 2017
215 10% 9% 9% 9% 9%
8% 7% 7% 7% 7% 6% 6% 6% 6% 5% 5% 5% 4% 4% 3% 3% 2% 2%
1%
0% 5 - 9.9% 10 - 19.9% 20 - 29.9% 30 - 49.9% 50 - 99.9% 100% Don't know
England Heart of the South West
Source: Employer Skills Survey
Recent regional data on individuals perceptions of the extent to which their skills are fully used at work is, unfortunately, not available. However, research by Ewart Keep 152 and by Wright and Sissons 153 suggests that between 35 per cent and 45 percent of individual workers believe that they have skills that were not being fully used at work. The inference is that any response to regional skills challenges must go beyond exhorti ng or incentivising the supply side to behave differently and should extend to a consideration of management practice and the extent to which these fully exploit the skills already available.
11.7. Preparedness of education leavers for work
The table below sho ws that overall recruitment levels were lower in the Heart of the South West LEP area compared to the national average, with 30% of local employers having taking on at least one young person in the last 12 months.
Table 49 Recruitment of young people, Heart of the South West vs comparator LEPs, South West and England (% of employers) Heart of the South New Englan Recruited anyone… Cumbria West Anglia d LEP area
152 Keep, E, 2016, Improving Skills Utilisation in the UK – Some Reflections on What, Who and How?, SKOPE Research Paper N o. 123 153 Wright, J., and Sissons, P. 2012. ‘The Skills Dilemma, Skills Under - Utilisation and Low - Wage Work’, A Bottom Ten Million Research Paper, London: Work Foundation
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In the last year 46% 50% 42% 49% Aged 16 - 18 in the past 12 months 13% 16% 13% 12% Aged 19 - 24 in the past 12 months 25% 23% 23% 28% Any young person in the past 12 months 30% 31% 27% 32% Source: EPS 2016 https://www.gov.uk/government/publications/employer - perspectives - survey - 2016
A key issue for employers, education providers and policymakers is the extent to which education leavers entering the workplace for the first time are deemed to be well - prepared for their job role. The table below shows perceived levels of preparedness of each type of education leaver.
Overall, the majority of employers find their education leavers to be well prepared, and this level of preparedness increases with the level of edu cational attainment. A minority of employers found university graduates poorly prepared for work (14% in the South West compared to 16% for England), while in contrast almost half of the region’s employers (47%) found 16 year old school leavers to be poorl y prepared (44% for England as a whole).
Table 50 Percentage of employers saying young recruits are poorly / very poor prepared, South West and England South Young recruits England West 16 year old school leavers 47% 44% 17 - 18 year olds recruited to first job from school 37% 37% 17 - 18 year olds recruited to first job from FE college 30% 27% Higher education leavers recruited to first job from 14% 16% University Source: EPS 2016 https://www.gov.uk/government/publications/employer - perspectives - survey - 2016
11.8. NEET
The government provides a framework and funding to raise participation in educatio n and training and reduce the proportion of 16 and 17 year olds who are not in education, employment or training (NEET).
However, accountability and responsibility for encouraging, enabling or assisting young people’s participation in education or training is devolved to Local Authorities who must also collect information to identify young people who are NEET or at risk of becoming NEET and target their resources on those who need them most. This area is a particular focus due to the concern that young peo ples’ social and economic prospects will be damaged due to their non - participation at this formative stage.
217 In March 2019, 2,290 16 and 17 year olds in the Heart of the South West LEP area were identified by their local authority as being either NEET or with a ‘Not Known’ destination , 154 of whom 960 were in Somerset, 840 in Devon, 330 in Plymouth and 160 in Torbay. Figure 107 below shows the proportion of young people both NEET and Not Known in each local authority. The two are treated together as the prevalence of young people who are NEET among the Not Known grou p is high.
A concern for the area is that the proportion of young people who are NEET is higher than the England average across all of Heart of the South West LEP area ’s upper tier authorities. Plymouth has the highest concentration of young people who ar e NEET (3.9%), followed by Torbay (3.2).
Somerset has a particularly high number of young people whose destination at age 16 and 17 is Not Known. Time series data (see footnote) 155 suggests that a change in Somerset’s approach to data collection in the year to December 2017 may underlie this feature, to some extent. However, it is notable that: the proportion of young people in the overall target group in Somerset (8.8%) is 60% above the England average; and, all Heart of the South West LEP area Local Author ity areas have a higher proportion in the two groups taken together than the England average.
Figure 107 16 - 17 year olds recorded as NEET by local authority, 2019
10.0% 8.8% 9.0% 8.0%
7.0% 6.4% 6.1% 6.1% 6.0% 5.6% 5.5% 5.0% 3.9% 4.0% 3.2% 2.9% 2.9% 3.0% 3.0% 2.7% 2.5% 2.5% 2.6% 2.0% 1.0% 0.0% Somerset Plymouth Torbay Devon England
% NEET (inc not known) of which known to be NEET of which activity not known
154 Not known includes those whose current situation not known, who cannot be contacted, who have no current address or who refuse to disclose their activity Dec16- Dec17- Dec18- Feb17 Feb18 Feb19 Devon 5.7% 5.5% 5.6% Plymouth 5.7% 6.8% 6.4% Somerset 6.0% 9.0% 8.8% Torbay 6.4% 5.3% 6.1% England 6.0% 6.0% 5.5% 155
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Source: Local Authority Client databases via DfE
Table 51 below breaks the data down further. It shows that:
young males of all ages in in all areas are slightly more likely to be NEET or Not Known than young females
17 year olds are significantly more likely to be NEET or Not Known than 16 year olds.
Table 51 Number and percentage of 16 and 17 year olds NEET or Not Known by gender and local authority, March 2019 16 year olds 17 year olds All Male Female All Male Female No % No % No % No % No % No % Devon 300 4.0% 170 4.4% 130 3.6% 540 7.1% 290 7.3% 250 6.8% Plymouth 110 4.2% 70 5.0% 40 3.4% 220 8.6% 120 8.7% 100 8.5% Somerset 290 5.4% 160 5.8% 130 5.2% 670 11.9% 340 12.3% 330 11.7% Torbay 60 4.4% 30 4.4% 30 4.3% 100 8.0% 60 9.0% 40 6.9% England 3.6% 4.1% 3.1% 7.4% 8.3% 6.5% Source: Local Authority C lient databases via DfE
11.9. Job mobility
There is considerable debate in management and labour market theory about the extent to which staff turnover within enterprises is beneficial or damaging to businesses and the wider economy. On the one hand, the movemen t of staff between companies can promote the sharing of ideas and spread of effective practices from one enterprise to another. On the other hand constantly losing staff and their knowledge and having to recruit and train replacements is costly.
Levels of staff turnover are influenced by many factors, macro as well as micro, ranging from the industrial sector, the average age of employees, management practices and prevailing economic conditions. It is reasonable to suppose that geographical location is an important factor and that individuals in sparse labour markets, where comparable jobs are few and far between, are likely to remain in an occupation for longer than jobs - rich labour markets. This may limit the exchange of skills between organisations and p lace greater emphasis on the need for enterprises in some parts of Heart of the South West LEP area to develop and make best use of the talents of existing staff and local populations.
At national level, the ONS’ Economic Review analysis of job leavers an d stayers, reports that average, around 9% of people changed jobs each year between 2000 and 2018. However, this average ranged from a post - recession low of around 5.7% in 2010 to a high of around 10.9% in both 2017 and 2018. Unofficial statistics from Mon ster put
219 the figure higher, reporting average UK employee turnover rate is approximately at c.15% a year, with the highest levels found in private sector organisations in retailing, catering, call centres, construction and media.
Young people, aged 35 and under are significantly more likely to change jobs, than older people. Figure 108 below shows that in 2018, between 25% and 30% of young people changed job within two years of taking part in a survey, compared to around 5% of those aged 50 or over .
Figure 108 Percentage of employees who have changed job in the last two years, 2001 to 2018, UK 35.0 30.0 25.0
20.0
15.0
10.0
5.0
0.0 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
16 to 20 years 23.7 21 to 24 years 20.7 25 to 34 years 13.0 35 to 49 years 8.2 50 to 64 years 5.4 65 years and over 5.7
Source: ONS / ASHE
An increase in labour market mobility by younger people (or ‘job hopping’) is a commonly perceived feature of the modern labour market. Media reporting of a global survey by Deloitte which found that 43% of Millennials planned to leave their current jobs within 2 years and only 28% planned to sta y beyond five years received is a typical example 156 .
Figure 108 above shows that this is, to an extent, borne out by official statistics, in that there has been a dramatic rise in labour turnover among young people since the last recession. However, the long - term trend is not quite as dramatic as sometimes made out, with the proportion of young people changing job within the two years rising by 18% among 16 to 20 year olds, 24% among 21 to 24 year olds and 26% among 25 to 34 year olds between 2001 and 2018.
156 See for example https://www.independent.co.uk/life - style/millennials - jobs - career - work - salary - quit - young - people - study - a8361936.html
220
Figure 109 shows that the median rate of growth in the hourly earnings of those who change job is higher than it is for those who stay in the same job. It is not unreasonable to expect this. Securing a pay rise is a common reason for changing job. However, where emp loyees are changing jobs in pursuit of higher pay, there may be upward pressure on wages across the board as employers who are losing staff feel pressured into paying higher wages to retain workers. The extent to which peripheral regions with sparse labour markets are immune from such pressures, which has a dampening impact on pay, is difficult to say.
Figure 109 Median growth of hourly earnings for job changers and stayers, 2000 to 2018, UK
12.0
10.0
8.0
6.0
4.0
2.0
0.0
Stayers Changers
Source: ONS / ASHE
A further and in teresting feature of the data is that the earnings growth experienced by job changers was far greater for upper - skilled and upper - middle - skilled workers than for those with lower skilled levels.
In the two years to 2018, low - skilled workers taking part in the survey experienced the same rate of median earning growth whether they changed or remained in the same job. This contrasts with upper - skilled workers whose appear to have the greatest financial incentive for changing job.
221 Figure 110 Median growth of hourly earnings for job changers and stayers, by skill level, 2018, UK
10.00 9.00 8.00 7.00 6.00 5.00 4.00 3.00 2.00 1.00 0.00 Low Lower-middle Upper-middle Upper
Stayers Changers
Source: ONS / ASHE
This data includes those who move to new jobs within their existing firm (c. 25% of respondents) and those who move t o new jobs in a new firm (c. 75%). While both groups of job changers experience earnings growth, job changers moving between firms have consistently higher pay growth (around one third higher) than those moving within firms.
Recent regional data on indivi duals perceptions of the extent to which their skills are fully used at work is, unfortunately, not available. However, research by Ewart Keep 157 and by Wright and Sissons 158 suggests that between 35 per cent and 45 percent of individual workers believe tha t they have skills that were not being fully used at work. The inference is that any response to regional skills challenges must go beyond exhorting or incentivising the supply side to behave differently and should extend to a consideration of management p ractice and the extent to which these fully exploit the skills already available.
157 Keep, E, 2016, Improving Skills Utilisation in the UK – Some Reflections on What, Who and How?, SKOPE Research Paper No. 123 158 Wright, J., and Sissons, P. 2012. ‘The Skills Dilemma, Skills Under - Utilisation and Low - Wage Work’, A Bottom Ten Million Research Paper, London: Work Foundation
222
12. CROSS CUTTING ISSUES
12.1. Place
The map below ( Figure 111 ) provides a brief overview of some of the key economic factors in Heart of the South West LEP area , including assets such as airports, universities and strategic environmental areas.
Figure 111 Map of Heart of the South West LEP with key economic factors
Source: Heart of the South West LEP
12.2. Transport
Transport and digital connectivity is one of four key p riorit y areas identified in the Heart of the South West LEP area 2018 Productivity Strategy 159 . Poor transport links to education and work opportunities are a barrier to social mobility, with West Somerset identified as the worst performing area for social mobility in the whole of England 160 . Key infrastructure – such as broadband, employment land, transport, intercity connectivity and connectivity with the rest of the region, the rest of the country and internationally – has historically been a significant barrier to productive business.
159 Stepping up to the Challenge. Productivity Strategy , Heart of the South West LEP area Partnership 2018 160 State of the Nation_2017 – Social Mobility in Great Britain, Social Mobility Commission, November 2017
223 Inter - area and international tr ansport routes are vital to the region’s success, as well as secondary corridors and the broader arterial road network and rail network. A key issue for road and rail is resilience, with the region’s strategic transport infrastructure vulnerable to floodin g. Capacity and journey times are also considerations for meeting the transport needs of people and businesses.
Primary routes into the region include road and train, and Table 52 and Table 53 below illustrate the approximate journey times to major locations. Evaluation by the Heart of the South West LEP notes that the two main road routes from London into Heart of the South West LE P area are prone to congestion, road traffic incidents and adverse weather conditions 161 , which means that these statistics may underestimate journey times.
Table 52 Estimated road journey times between selected locations: 2016
Sour ce: Heart of the South West LEP – Driving Productivity Green Paper
Table 53 Estimated train journey times between selected locations: 2016
Source: Heart of the South West LEP – Driving Productivity Green Paper
T here are several congestion hotspots in the region. Exeter city centre is considered one of the busiest cities to navigate at peak times, and drivers can spend a quarter of their time in congestion at an average speed of 4.6mph. Congestion and delays to
161 https://heartofswlep.co.uk/wp - content/uploads/2019/02/Driving - Productivity - in - Heart of the South West LEP area - Green - Paper - AC - Updates - 030719.pdf
224
journeys a re a barrier to growth but also have severe air quality and health implications.
The Heart of the South West LEP area Partnership Productivity Strategy pledged to secure a bigger proportion of national investment in transport infrastructure and will work more cohesively as an area to agree priorities that will unlock growth and to look to exploit opportunities in electric and autonomous vehicles, whilst also encouraging existing sustainable modes of transport (such as cycling).
Although not up to date, dat a showing the number of households with good transport access to key services or work, show that while Plymouth and Torbay has better or comparable figures than the 2010 England index value, Devon and Somerset’s data suggests access to transport in these r egions are significantly below par.
Table 54 Households with good transport access to key services or work by local authority 162 , England, 2007 to 2011 Local 2007 3 2008 3 2009 3 2010 2011 Authority England 110 102 104 100 97 Plymouth 163 155 156 154 148 Torbay 131 124 128 128 100 Devon 56 50 52 50 49 Somerset 78 69 71 71 70 1. Values are indexed with a base of 100 for 2010 England value. 2. Values for 2007 - 2009 are published as experimental statistics only. Source: Department for Transport - Availability of transport to key services or work, among households (ACS01)
162 https://www.gov.uk/government/statistical - data - sets/acs01 - availability - of - transport - to - key - services - or - work - among - households
225 Table 55 Journey to key services 163 – Travel time to town centres Commented [AL1]: I’m not sure what to say about these data – I can’t find the national average, so can’t really compare them with anything, and the car journey time is not an accurate reflection of peak travel time anyway!! Travel time to Travel time to Travel time to nearest town nearest town nearest town centre by PT / centre by centre by car LA Name Population Walk (mins) bicycle (mins) (mins) Plymouth 112 , 349 19 16 12 Torbay 6 0 , 836 16 12 10 Devon 337 , 868 27 13 13 East Devon 62 , 050 24 19 12 Exeter 52 , 628 16 14 12 Mid Devon 33 , 732 29 24 13 North Devon 40 , 909 29 25 14 South Hams 38 , 009 31 22 13 Teignbridge 56 , 881 27 25 15 Torridge 29 , 882 35 26 14 West Devon 23 , 777 36 30 14 Somerset 224 , 906 26 13 13 Mendip 45 , 449 20 17 11 Sedgemoor 48 , 593 27 24 14 South Somerset 67 , 969 26 25 13 Taunton Deane 47 , 503 26 19 13 West Somerset 15 , 392 39 41 19 Source: Department for Transport - Availability of transport to key services or work, among households (ACS01)
12.3. Housing
Housing affordability varies across the Heart of the South West LEP area region, but with the exception of Plymouth, Torbay and Sedgemoor, the ratio of median house price to median gross annual residence - based earnings 164 in 2018 was higher in all re gions than in England as a whole. West Somerset, South Hams and East Devon are the least affordable areas in the region with affordability ratios of 10.55, 10.53 and 10.04 respectively, compared with 8.76 in the South West and 8.0 in England. Housing has b ecome less affordable over the last decade in the majority of regions, in line with England as a whole, while housing has become more affordable in Torbay, and all parts of Devon with the exception of Exeter.
The picture is similar for the ratio of median house price to median gross annual workplace - based earnings 165 , with houses less affordable in all regions of the Heart of the South West LEP area than in England as a whole, with the exception of Plymouth.
163 https://www.gov.uk/government/statistical - data - sets/journey - time - statistics - data - tables - jts#data - tables 164 https://www.ons.gov.uk/peoplepopulationandcommunity/housing/datasets/ratioofhousepricetoresidencebasedearning slowerquartileandmedian 165 https://www.ons.gov.uk/peoplepopulationandcommunity/housing/datasets/ratioofhousepricetoresidencebasedearning slowerquartileandmedian
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Similarly, based on workplace - based earnings, hous es have become less affordable in all regions across the south west except rural Devon.
Table 56 Ratio of median house price to median gross annual (where available) earnings by local authority district, England and Wales, 20 08 and 2018 Ratio of median Ratio of median house price to house price to median gross median gross annual residence - annual workplace based earnings based earnings Local authority name 2008 2018 2008 2018 Plymouth 6.34 6.32 5.89 6.09 Torbay 8.48 7.97 8.67 8.80 East Devon 10.31 10.04 10.63 9.97 Exeter 8.59 8.87 7.92 8.67 Mid Devon 9.59 8.4 9.51 8.95 North Devon 10.33 9.96 10.09 9.80 South Hams 9.51 10.53 11.22 11.72 Teignbridge 8.02 9.99 9.27 10.50 Torridge 8.9 9.11 10.82 9.76 West Devon 9.48 8.75 12.53 9.86 Mendip 8.12 8.58 9.06 10.99 Sedgemoor 7.38 7.83 8.33 9.07 South Somerset 8.04 8.03 8.22 8.19 Taunton Deane 8.01 8.51 7.93 8.53 West Somerset 8.65 10.55 : :
South West 7.14 8.76 8.03 8.90 England 6.39 8.00 6.96 8.00 Source: ONS - House price to residence - based earnings ratio
12.4. Low income indicators
12.4.1. Relative and absolute low income
The Department for Work and Pension monitors the UK income distribution in the Households Below Average Income (HBAI) report 166 .This incorporates an analysis of household income, income inequality and low income measures. The report distinguishes between relative and absolute low income:
166 https://assets.publishing.service.gov.uk/government/upl oads/system/uploads/attachment_data/file/789997/household s - below - average - income - 1994 - 1995 - 2017 - 2018.pdf
227 Relative low income sets a threshold as a proportion of the UK average (median) income and mov es each year as average income changes. It is used to measure the number and proportion of individuals who have income below this threshold (typically 60 per cent of the median)
Absolute low income takes the 60 per cent median income threshold from 2010/11 and moves this in line with inflation. This is designed to assess how low incomes are faring with reference to inflation. It measures the number and proportion of individuals who have income belo w this threshold.
Both measures of low income are produced before and after housing costs are taken into account. Taking relative low income first, across the UK as a whole, 17% of individuals are in relative low income before housing costs are taken into account and 22% after their income has been adjusted to reflect their housing costs. The figures for absolute low income are 15% before housing costs and 19% after. Patterns over the part twenty years show how yea r - on - yea r changes tend to be relati vely modest although the incidence of absolute low income has fallen over time.
Figure 112 Relative and Absolute Poverty in the UK , 2007 to 2018
25 22 22 22 22 22 22 22 22 22 22 22 21 21 21 21 21 21 21 20 20 20 19 19
n 18 18 18 o
i 17 17 17 17 t a
l 16 16 16 16 16 16 16 16 16
u 15 15 15 15 15 p
o 15 14 P
e h t
f o
e
g 10 a t n e c r e P 5
0 2007/08 2008/09 2009/10 2010/11 2011/12 2012/13 2013/14 2014/15 2015/16 2016/17 2017/18
Pre housing costs: Relative low income Pre housing costs: Absolute low income After housing costs: Relative low income After housing costs: Absolute low income
Source: DWP Households below Average Income ( https://www.gov.uk/government/statistics/households - below - average - income - 199495 - to - 201718 )
12.4.2. Social security benefits
228
In the absence of local income data, administrative sources such as take - up of state welfare benefits can provide a useful insight into the prevalence of low income locally.
When handling issues of poverty within the area, it is important to look at the benefits programme such as Employment and Support Allowance (ESA), Income Support (IS) and Housing Benefit.
Table 57 ESA Claimants by County, Heart of the South West LEP area , SW and England, November 2017 - November 2018
Devon Plymouth Somerset Torbay Heart of South England the South West West November 23,080 11,110 12,990 6,970 54,150 157,970 1,745,240 2018 November 23,940 12,980 14,240 7,240 58,390 174,360 1,893,290 2017 Change - 860 - 1,870 - 1,250 - 270 - 4,240 - 16,390 - 148,050 Source: DWP Benefits (via nomis - www.nomisweb.co.uk )
Figure 113 South West Housing Benefit Claimants over Time , 2008 to 2018
South West Housing Benefit Claimants 400000 350000 300000 250000 200000 150000 100000 50000 0 8 9 9 9 0 0 0 1 1 1 2 2 2 3 3 3 4 4 4 5 5 5 6 6 6 7 7 7 8 0 0 0 0 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 ------l l l l l l l l l r r r r r r r r r r v v v v v v v v v v u u u u u u u u u a a a a a a a a a a o o o o o o o o o o J J J J J J J J J N N N N N N N N N N M M M M M M M M M M
Source: DWP Housing benefit caseload statistics ( https://www.gov.uk/government/statistics/housing - benefit - caseload - statistics )
Figure 114 ESA/IS Claims (Income - Related) across Great Britai n , 2009 to 2017
229 2500 160 150 2420 2390 140 2400 2380 120 100 2300 100 2230 80 2200 60 2130 2100 40 40 2100 30 20 0 2000 -20 - 30 1900 -40 2009/10 2012/13 2013/14 2014/15 2015/16 2016/17
Thousands Change
Source: Income - related benefits: estimates of take - up: financial year 2016 to 2017 ( https://www.gov.uk/gover nment/statistics/income - related - benefits - estimates - of - take - up - financial - year - 2016 - to - 2017 )
In Table 57 and Figure 113 there is a steady decrease in benefit claimants for both ESA and Housing Benefit. This is an interesting trend in light of increasing unemployment as mentioned in the previous section, and contrasts with the statistics regarding combined Income - related ESA and IS up to 2017 (the most recent data in this form available) for Great Britain as a whole. It is also worth noting that the transition period to Universal Credit may have had additional impact in claimant counts.
There is another factor relevant to considering p overty and benefits, and that is Jobseeker’s Allowance (JSA): while the role of claimant counts is explored in the Unemployment section, in terms of the eligibility criteria for ‘new style’ JSA, it notes that you must either “not be working at the moment, or be working less than 16 hours per week on average " 167 , supported by the issue that working households form a large proportion of all households in poverty 168 . This means that JSA is a factor in understanding poverty in the area based on underemployment as w ell as unemployment.
Table 58 JSA Payments , England, SW and Local Authorities, 2018 to 2019
May - 18 May - 19 Change Percentage Change England 349,806 176,877 - 172,929 - 49.4% South West 17,758 8,680 - 9,078 - 51.1% Plymouth 1,438 802 - 636 - 44.2% Torbay 1,092 479 - 613 - 56.1% East Devon 413 198 - 215 - 52.1%
167 https://www.gov.uk/jobseekers - allowance/eligibility 168 https://www.jrf.org.uk/report/inclusive - growth - monitor
230
Exeter 617 257 - 360 - 58.3% Mid Devon 288 138 - 150 - 52.1% North Devon 347 104 - 243 - 70.0% South Hams 186 78 - 108 - 58.1% Teignbridge 423 178 - 245 - 57.9% Torridge 269 123 - 146 - 54.3% West Devon 167 61 - 106 - 63.5% Mendip 90 80 - 10 - 11.1% Sedgemoor 121 79 - 42 - 34.7% South Somerset 158 79 - 79 - 50.0% Taunton Deane 118 83 - 35 - 29.7% West Somerset 30 15 - 15 - 50.0% Source: DWP – Job Seekers Allowance (via Stat - Xplore - https://stat - xplore.dwp.gov.uk/ )
JSA Payments have dropped both across the South West and across the country, as with ESA, based on the most recently available Stat - Xplore Data. However, this conflicts with th e more recent unem ployment data.
12.4.3. The Indices of Deprivation
The Indices of Deprivation (2019) provide valuable insight into poverty and barriers across the country, including an overview weighted across seven domains under the Index of Multiple Deprivation (IMD): Income Deprivation (22.5%); Employment Deprivation (22.5%); Education, Skills and Training Deprivation (13.5%); Health Deprivation and Disability (13.5%); Crime (9.3%); Barriers to Housing and Services (9.3%), and Living Environment (9.3%). As defi ned by the IoD technical report, the distinction between poverty and deprivation is that poverty means a lack of financial resource to meet one’s needs, while deprivation refers to a lack of all manner of resources, not only income 169 . The Indices of Depriva tion are specifically designed to measure the amount of deprivation within an area and so unlike other measurements, do not take into account other factors such as high - end incomes. Less deprived does not necessarily imply more affluent overall. This is im portant to avoid assuming that results are contradictory when the measurements are instead focused differently. There are also two additional Indices, IDACI and IDAOPI, that stand for Income Deprivation Affecting Children Index and Income Deprivation Affec ting Older People Index 170 .
169 https://www.gov.uk/government/statistics/english - indices - of - d eprivation - 2019 170 Further details on how these categories are defined and calculated available in the technical and research reports at https://www.gov.uk/governm ent/statistics/english - indices - of - deprivation - 2019
231 Figure 115 Deprivation Rankings of Local Authorities in Heart of the South West LEP area , 2019
Ranking of 317 Local Authorities, where 1 is most deprived 350 300 250 200 150 100 50 0
244 195 East Devon 271 189 195 Exeter 168 184 173 Mendip 225 176 195 Mid Devon 247 132 122 North Devon 149 64 50 Plymouth 56 125 117 Sedgemoor 121 146 142 Somerset West and Taunton 164 229 195 South Hams 289 172 182 South Somerset 187 194 195 Teignbridge 210 48 58 Torbay 65 99 195 Torridge 160 162 195 West Devon 295
IMD - Rank of average score IMD - Rank of proportion of LSOAs in most deprived 10% nationally IMD 2019 - Rank of extent
Source: English Indices of Deprivation ( https://www.gov.uk/government/statistics/english - indices - of - deprivation - 2019 )
The English Index of Multiple Deprivation (IMD) is based on 32,844 LSOAs, lower super output areas, which are small regions of approximately 1500 people or 650 households. The three rankings illustrated here are based on the average deprivation score of LSOAs over the area, the proportion of LSOAs in the area in the most deprived 10% across the country, and the proportion of the area’s population living in the most deprived LSOAs in the country. The closer the rank is to 1, the greater the deprivation, and the highest rank by Local Authority District is 317.
232
The rank of extent is least conc erning for areas such as West Devon, South Hams, Mid Devon and East Devon, but this contrasts with their overall deprivation levels based on proportion of LSOAs in the top decile of most deprived and their positions based on average scores. East Devon has the lowest average rank based on score in our area, at 244, leaving 73 Local Authority Districts across the country less deprived. East Devon is also one of the lowest ranked for proportion of LSOAs in the most deprived 10%, equal with Exeter, Mid Devon, S outh Hams, Teignbridge, Torridge and West Devon.
The areas that should be highlighted for immediate concern are Torbay and Plymouth, who are consistently higher ranked across all three of the above indicators than any other area in the region, with the oth er districts averaging out across these three indicators to over 100 each, and only Torridge under 100 on a single statistic (average score).
Figure 116 Heart of the South West – Deprivation Rank 2015 to 2019
35 8 d
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25 t 24 5 s 25 o 22 22 4
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i 19 19 19 20 18 18 18 3 1
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HotSW Rank of Average Score - 2015 HotSW Rank of Average Score - 2019 Change
Source: English Indi ces of Deprivation ( https://www.gov.uk/government/statistics/english - indices - of - deprivation - 2019 )
We can also look at the different factors over the entirety of t he LEP area and how these have changed over time. Importantly, the rank is between 1 and 39 for the 2015 data, and between 1 and 38 for the 2019 data, as this is covering a wider area. The closer the rank to 1, the greater the deprivation in this field. In this graph, the overall ranking is described under IMD, as well as the seven domains. The final two entries,
233 IDACI and IDAOPI, are the Income Deprivation Affecting Children Index and Income Deprivation Affecting Older People Index. These are interesting i n relation to the later focus in this section on the Education and Skills, which is split into Children and Young People, and Adult Skills, and so they have been included here.
The most positive data here is Crime, where the position of the LEP has moved 5 places away from having the worst deprivation rating for Crime, and Barriers to Housing and Services, which has seen the greatest improvement. The most obvious issue is Living Environment, which has improved since 2015 but is still by far the closest entr y to 1. Living Environment measures two categories of factors: Indoors, whether houses have central heating and meet the Decent Homes standard; and Outdoors, which covers air quality and road traffic accidents where pedestrians and/or cyclists are injured. Heart of the South West’s position has worsened a small amount in comparison to the rest of England on Income, Education, Skills and Training, and IDACI. This suggests a focus on these may be worthwhile.
This data is fundamentally comparative and so chan ges between 2015 and 2019 cannot necessarily be pinned down to increases or decreases in deprivation in these LSOAs due to the role played by the rest of the country. If there have been major changes elsewhere, this can drastically alter the position of an LSOA that has, in real terms, remained relatively consistent. In the same sense, a widespread rise or fall in deprivation levels that is consistent across the country would not cause major ranking changes, and worth remembering when comparing the findings of the Unemployment section to the stable position of Heart of the South West in comparison with other LEPS when measured with the Index of Employment Deprivation. This section ought to be considered in combination with the rest of the report as a result, rather than on its own.
12.4.4 Deprivation and Education
Education, Skills and Training deprivation is an area relevant to the work of the Skills Advisory Panel , and since the IMD indicates increased deprivation in this area across Heart of the South West LEP area , data on this domain has been provided separately below.
Figure 117 Education, Skills and Training Deprivation
234
Ranking of 317 Local Authorities, where 1 is most deprived 350 300 250 200 150 100 50 0 232 229 East Devon 182 161 Exeter 188 243 Mendip 150 169 Mid Devon 138 213 North Devon 100 89 Plymouth 104 108 Sedgemoor 162 157 Somerset West and Taunton 299 243 South Hams 146 152 South Somerset 215 243 Teignbridge 102 129 Torbay 114 161 Torridge 245 243 West Devon
Rank of average score Rank of proportion of LSOAs in most deprived 10% nationally
Source : English Indices of Deprivation ( https://www.gov.uk/government/statistics/english - indices - of - deprivation - 2019 )
This is also split into two further subdomains: Children and Young People, and Adult Skills. This allows us to look at where deprivation is having greatest impact on skill availability , as per Figure 118 below .
Figure 118 Adult Skills and Children and Young People , local district authorities in the Heart of the South West LEP area, 2019
235 9.0 7.9 d
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Average of Adult Skills Sub-domain Decile (where 1 is most deprived 10% of LSOAs) Average of Children and Young People Sub-domain Decile (where 1 is most deprived 10% of LSOAs)
Source: English Indices of Deprivation – Subdomains ( https://www.gov.uk/government/statistics/ english - indices - of - deprivation - 2019 )
This graph shows us the averages of where the LSOAs in the South West sit in comparison to each other as of 2019, and contrasts the impact of Education and Skills Deprivation. With this data, 1 is the most deprived and so a higher score is better: the South West has consistently greater Education and Skills Deprivation affecting Children and Young People, although there is certainly scope for improvement in Adult Skills and there is noticeable variation by area, with So uth Hams standing out as least deprived in this area. In comparison with the IDACI and IDAOPI figures shown earlier where the deprivation levels for Children were getting worse and the deprivation levels for Older People were improving, this dynamic betwee n Adult Skills and Children and Young People implies an issue in this area in comparison to the rest of the country. These are, however, averages and will flatten outliers at both the top and bottom of the range .
Figure 119 Childre n and Young People – LSOAs by Decile , where 1 is most deprived , in Heart of the South West LEP Area , 2019
236
3% 8% 1 8% 2 12% 10% 3 4 5 10% 12% 6 7 12% 8 13% 9 12%
Source: English Indices of Deprivation – Subdomains ( ht tps://www.gov.uk/government/statistics/english - indices - of - deprivation - 2019 )
Figure 120 Adult Skills – LSOAs by Decile , where 1 is most deprived , in Heart of the South West LEP area, 2019
3% 2% 1 7% 11% 2 9% 3 4 14% 5 10% 6 7 8 16% 14% 9 10 14%
Source: English Indices of Deprivation – Subdomains ( https://www.gov.uk/government/statistics/english - indices - of - deprivation - 2019 )
One of the most obvious differences also supports the data on average de ciles: the percentage of Heart of the South West LSOAs in the first decile and thus most deprived is six points higher for children and young people than for adults. The proportion in the 8 th and 9 th deciles is also notably higher, with a 4 and 3 point gap respectively. This also allows for some comparison on a country - wide level, as this is how the LSOAs have been split into deciles. As with the averages, the greater proportion of LSOAs in the Heart of the South West LEP area are focused around the middle deciles, rather than predominantly high or predominantly low.
237 12.5. Social Mobility
In 2017, the Social Mobility Commission created the ‘Social Mobility Index’ to identify the most and the least socially mobile areas of the country. It does this by examining t he opportunity that young people from poorer backgrounds across 324 local authority areas in England have to a) get the educational qualifications they need to succeed in life b) to convert those qualifications into a good job and a standard of living.
In total, sixteen indicators are used, across four stages of life: early years, school, youth and adulthood. These indicators are also brought together to give scores for each life stage and for each local authority as a whole.
Table 59 shows the rank and decile for each of Heart of the South West LEP area ’s fifteen Local Authority areas. It shows that:
Nine areas were among 50% of English LA areas with lower than average social mobility;
Six were in the bottom three deciles;
West Somerset is the local authority with the lowest social mobility ranking in the country.
Table 59 : Social Mobility, overall ranking and decile, Heart of the South West LEP area LA areas, 2017
Rank (out of 324 Local Authority Local Authority Rank - Decile areas) South Hams 49 2 Exeter 81 3 East Devon 123 4 Torbay 137 5 West Devon 143 5 Teignbridge 153 5 Plymouth 164 6 Mid Devon 194 7 Taunton Deane 206 7 South Somerset 229 8 Mendip 231 8 North Devon 238 8 Sedgemoor 258 8 Torridge 283 9 West Somerset 324 10 Source: Social Mobility Index, 2017
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Nationally, patterns of social mobility are relatively disparate. Affluent areas tend to outperform deprived areas, but a number of affluent places (such as Cotswold and West Berkshire) buck the trend, offering limited mobility to their more deprived residents. Conversely, some of the most deprived areas provide good education, employment opportunities and housing for their most disadvantaged residents.
In broad terms, London i s the biggest social mobility ‘hotspot’ (delivering good opportunities for disadvantaged residents) while ‘coldspots’ are concentrated in remote rural or coastal areas and in former industrial areas.
Across England, 14 per cent of young people in remote ru ral coldspots progress to university compared with 27 per cent in hotspots. Many of these places combine poor educational outcomes for young people from disadvantaged backgrounds with weak labour markets that have a higher than average share of low - skilled , low - paid employment. Just one - quarter of residents of these coldspots have managerial and professional jobs compared with over one - third in hotspots.
239 Table 60 shows the composite score for each life stage. Perhaps the primary feature is that the opportunities available to disadvantaged people in their Early Years and at Schools are broadly in line with or even slightly better than the national average, w ith nine of the fifteen (or 60%) geographies in the top five (or 50% of) deciles. Thereafter, the opportunities decline, with only six areas offering better than average opportunities for disadvantaged ‘Youth’ and just one for opportunities in ‘Adulthood’.
The picture within individual authority areas is disparate. There appears to be a group including West Devon, Teignbridge and to a lesser extent Plymouth and Exeter, that offer good opportunities in the Early Years and at a School, which decline in Yout h and Adulthood. In some rural areas, such as West Somerset, Torridge, Sedgemoor and North Devon the opportunities are fairly limited at all life stages.
240
Table 60 : Social Mobility at different life stages for Heart of the South West LEP area LA areas, Deciles, 2017
Local Authority Early Years Schools Youth Adulthood
South Hams 2 2 4 8 Exeter 2 3 6 6 East Devon 5 5 5 4 Torbay 1 7 4 10 West Devon 2 2 8 9 Teignbridge 3 2 9 9 Plymouth 4 4 7 8 Mid Devon 4 8 5 7 Taunton Deane 8 6 5 6 South Somerset 7 5 8 8 Mendip 9 4 5 8 North Devon 3 6 9 10 Sedgemoor 6 7 8 9 Torridge 7 5 9 10 West Somerset 10 7 7 10 Source: Social Mobility Index, 2017
To make better sense of this data, it is important to drill down and understand how the indices are constructed.
The ‘Early Years’ measure is somewhat crude, examining only the p ercentage of nursery providers rated 'outstanding' or 'good' by Ofsted. This clearly affects the life chances of all nursery users, not just those who are disadvantaged.
The ‘School’ stage indicator takes in four measures, two relating to the quality of s chools attended by students who are eligible for free school meals (FSM) and two relating to the attainment of these students at these schools.
The picture varies from area to area, however in broad terms:
Eleven (or 73%) of the 15 Heart of the South West LEP area areas of have a higher than average proportion of children eligible for FSM attending high quality Primary Schools (rated ‘outstanding’ of ‘good’ by Ofsted)
Nine (60%) areas have a higher than average proportion of children eligible for FSM atte nding Secondary Schools rated as ‘outstanding’ or ‘good’
A higher than average proportion of students on FSM fail to attain:
the expected level of reading, writing and maths at the end of Key Stage 2 in ten (or 66% of) Heart of the South West LEP area LA areas
241 average attainment at GCSE in nine (60%) Heart of the South West LEP area LA areas
In short, one could conclude that while disadvantaged students attend relatively good schools, they don’t tend to perform as well as their classmates at these schools.
Table 61 Social Mobility indicators for ‘School’, Heart of th e South West LEP area LAs, 2017
School Primary school Secondary school KS2 attainment KS4 (GCSE) quality quality attainment
% of children % of children % of children eligible for FSM eligible for FSM eligible for FSM achieving at least Local Authority attending a primary attending a the expected level school rated secondary school in reading, writing Average attainment 'outstanding' or rated 'outstanding' and maths at the 8 score for pupils 'good' by Ofsted or 'good' by Ofsted end of Key Stage 2 eligible for FSM South Hams 3 5 1 3 Exeter 1 3 8 4 East Devon 1 3 10 4 Torbay 4 9 6 6 West Devon 1 1 5 7 Teignbridge 2 2 7 3 Plymouth 8 4 2 7 Mid Devon 10 1 7 6 Taunton Deane 6 6 9 3 South Somerset 5 3 8 5 Mendip 2 4 9 6 North Devon 4 7 5 6 Sedgemoor 7 6 6 9 Torridge 3 6 4 8 West Somerset 1 6 9 9 Source: Social Mobility Index, 2017
The ‘Youth’ indicator takes in five measures, of which the two relating to HE participation are only available at the Upper Tier Authority area. Again, in broad terms, Table 62 shows:
Nine (or 60% of) areas within Heart of the South West LEP area have a lower than average proportion of young people eligible for FSM who are NEET, but
In ten (67% of) areas attainment at KS5 (A level or equivalent) is below average;
242
In 11 (73% of) areas attainment of Level 3 qualifications by age 19 is below average;
In all areas, apart from Torbay, the proportion of young people eligible f or FSM to enter higher education by age 19 is below average, with Devon falling within the 8 th decile and Somerset in the 9 th .
Table 62 Social Mobility indicators for ‘Youth’, Heart of the South West LEP area LAs, 2017
Youth Positive destination KS5 attainment (A Level 3 attainment HE participation Top selective HE after KS4 level or equivalent) participation
% of young people eligible for FSM that Average points % of young people % of young people are not in score per entry for eligible for FSM at eligible for FSM at education, young people age 15 achieving 2 % of young people age 15 entering Local Authority employment or eligible for FSM at or more A-levels or eligible for FSM at higher education at training (positive age 15 taking A- equivalent age 15 entering a selective destination) after level or equivalent qualifications by the higher education by university by the completing KS4 qualifications age of 19 the age of 19 age of 19 South Hams 2 8 2 8 4 Exeter 3 5 8 8 4 East Devon 3 4 6 8 4 Torbay 2 6 5 5 4 West Devon 8 8 6 8 4 Teignbridge 10 6 7 8 4 Plymouth 3 7 8 6 10 Mid Devon 3 3 7 8 4 Taunton Deane 8 1 4 9 4 South Somerset 8 7 9 9 4 Mendip 5 4 5 9 4 North Devon 10 6 8 8 4 Sedgemoor 2 10 10 9 4 Torridge 6 9 9 8 4 West Somerset 3 8 6 9 4 Source: Social Mobility Index, 2017
As stated at the start of this section, the composite / summary indicators (in Table 62 above) seem to suggest that opportun ities for social mobility diminish in many parts of Heart of the South West LEP area diminish Adulthood.
Table 63 below shows that low earnings are a critical factor in the region’s poor performance against the Adulthood indicator. A clear driver of this is that fact that:
Ten of our fifteen LA areas are in the bottom two deciles (or 20% of local authorities) for median earnings; and
Six (or 40%) of our fifteen LA areas are among the 10% of LAs with the highest proportion of jobs paid less than the living wage
243 The region also performs poorly with respect to housing affordability 171 , having only two areas (Plymouth and Sedgemoor) where houses are more affordable than the national average. The proportion of families with children who own their own homes is also either average (with 7 LAs in the 5 th or 6 th qui ntile) or lower than average (7 LAs in the bottom 40%), compared on one LA in the top 40%).
Table 63 Social Mobility indicators for ‘Adulthood’, Heart of the South West LEP area LAs, 2017
Adulthood Wages House affordability Occupation Living wage Family home ownership
% of people that Median weekly Average house live in the local area salary (£) of prices compared to who are in % of jobs that are Local Authority employees who live median annual managerial and paid less than the in the local area, all salary of employees professional applicable Living % of families with employees (FT and who live in the local occupations (SOC 1 Wage Foundation children who own PT) area and 2) living wage their home South Hams 8 9 3 8 5 Exeter 9 7 5 2 8 East Devon 7 8 2 5 5 Torbay 10 6 9 10 8 West Devon 9 7 5 10 5 Teignbridge 10 8 5 9 4 Plymouth 8 4 9 3 9 Mid Devon 8 6 5 8 6 Taunton Deane 6 6 6 5 7 South Somerset 9 6 8 5 7 Mendip 9 6 3 10 5 North Devon 10 8 8 7 7 Sedgemoor 9 5 7 10 6 Torridge 10 7 6 10 6 West Somerset 10 7 9 10 9 Source: Social Mobility Index, 2017
12.6. Equa lities
The role of gender and age have been mentioned in prior sections of this report, but there are other factors affecting vulnerability in the workforce.
12.6.1. Disability
As mentioned in section 3.3 on the Disability Employment Gap, the employment situation for disabled people can be quite difficult and there is a significant gap in employment rates. 19% of the working age population acro ss the UK is considered to have a disability, approximately 7.7 million people, of whom an estimated 4.1 million were in employment 172 .
171 For more information and 2018 data, please see section 8.2 – Housing. 172 https://researchbriefing s.parliament.uk/ResearchBriefing/Summary/CBP - 7540#fullreport
244
The Equality Act (EA) 2010 aims to protect people who have a disability, from discrimination in the workplace. According t o the Act, disability is “a physical or mental impairment that has a ‘substantial’ and ‘long - term’ negative effect on your ability to do normal daily activities.” 173 Within the Heart of the South West LEP area, 203,800 people aged 16 to 64 are disabled acco rding to this “core definition”. This is equivalent to more than one - fifth (22%) of the population aged 16 to 64. Incidence of disability is higher than the UK average both overall and in particular in Torbay (30%), Torridge (27%), Plymouth (26%) and Wes t Devon (25%).
Figure 121 Percentage of the population aged 16 - 64 who are EA core or work - limiting disabled July 2018 - June 2019
United Kingdom 20.9
England 20.7
South West 21.5
Heart of the South West 22.2
West Devon 25.2
Torridge 27
Torbay 29.5
Teignbridge 18.2
South Somerset 20.5
South Hams 14.5
Somerset West and Taunton 21.4
Sedgemoor 22.9
Plymouth 26
North Devon 14.5
Mid Devon 19.9
Mendip 21.3
Exeter 20.8
East Devon 22.9
0 5 10 15 20 25 30 35
Source: Annual Population Survey – via NOMIS
This data should be considered for purposes such as accessibility for skills programmes.
173 https://www.gov.uk/definition - of - disability - under - equality - act - 2010
245 People that have a disability are less likely to be in employment than those th at do not ( Figure 122 ). Using a wider definitio n of disability to include “core” disabled and individuals who have a long - term disability which affects the kind or amount of work they might do, reveals an ‘employment gap’ of almost 24 percentage points across the LEP area as a whole, rising to 28 perce ntage points in Somerset and Torbay. The ‘employment gap’ is significantly narrower in Devon (18 percentage points). Variations within the LEP area could reflect differences in the employment opportunities offered locally and/or the nature of disability r eported in these areas.
Figure 122 Employment rate aged 16 - 64 as percentage by disability, and disability employment gap , July 2018 - June 2019
100 30 86.2 90 85.3 82.7 83 85 84.4 81.3 81.2 80 25 67.4 70 61.3 61.3 56.9 58 20 60 55.1 55.4 54.1 50 15 40 30 10 20 5 10 0 0 Devon Plymouth Somerset Torbay Heart of the South West England United South West Kingdom
Employment rate aged 16-64 - EA core or work-limiting disabled Employment rate aged 16-64 - not EA core or work-limiting disabled Gap between Disabled and Non-Disabled
Source: Annual Population Survey – via NOMIS
The number of Heart of the South West LEP residents aged 16 to 64 who are EA core of work - limiting disabled increased by 33,400 between 2013/14 and 2018/19 174 . Equivalent to a percentage increase of 18% this compared to a fall in the number of residents who were not disabled. Em ployment rates for disabled people also increased (from 51% in 2014/15 to 61% in 2018/19) and the employment gap vis - à - vis non - disabled people narrowed by almost five percentage points.
Employment alone is not a measurement of prosp erity: while there is a gap regarding employment, income also has an impact , especially in light of the fact that on average, disabled adults face extra costs of £583 per month 175 . Data below is up to 2018 due to availability.
174 July to June 175 https://www.scope.org.uk/campaigns/extra - costs/disability - price - tag/
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12.6.2. Ethnic origin
Another form of inequality is that based on ethnic origin. This varies by area of the UK, as different regions have different demographic makeup . It is worth starting by looking at a profile of the H eart o f t he S outh W est LEP area compared to statistics for the South West and England. Data below this level is unfortunately unreliable for ethnicity demographics and often suppressed due to the risk of disclosure.
Figure 123 Percentage Rate of Employment by Ethnic Minority or White, England, South We st and H eart o f t he S outh W est LEP area, 2016 to 20 1 7 and 2018 to 2019
64.3 2016-2017 - ethnic minority 67.6 64.2
76.5 2016-2017 - white 78.6 76.8
66.1 2018-2019 - ethnic minority 70.2 69.8
77.7 2018-2019 - white 79.8 79.9
0 10 20 30 40 50 60 70 80 90
England South West HotSW
Source: Annual Population Survey via NOMIS
We can then look at the impact of ethnicity on outcomes by looking at the employment rates for ethnic minorities in comparison with the employ ment rates for white residents. Data is available on the county level, but this data has serious confidence issues that mean that it would be difficult and likely inaccurate to draw conclusions from it.
What becomes apparent very quickly is that across En gland, the employment rate for white residents is higher than that of those belonging to an ethnic minority. This same dynamic is apparent in both the South West and Heart of the South West, with a typical difference of approximately 10%. Both the South We st and Heart of the South W est have smaller gaps than England overall, but it is important to note the potential role of confidence here. Bearing this in mind, returning to the data for 2016 to 2017 rather than 2018 to 2019 allows us to look at the immediate history of this dynamic and observe that there has been a small improvement in the gap across each level. This comparison point works as a useful contrast with potentially aggravated tensions in light of the 2016 Brexit referendum.
Despite the lo w proportion of ethnic minorities in the Heart of the South West, the dynamic in employment rates mirrors that of the wider environment. This highlights an
247 area of concern, and care should be taken to ensure that upskilling programmes and similar initiativ es are accessible regardless of ethnic background.
12 .6.3 Family Structure
Family structure plays a role in social inequality: it is not for no reason that both marriage and civil partnership and pregnancy and maternity and pregnancy are protected charact eristics under the Equality Act 2010 176 . The time and care involved in looking after children places additional stressors and expenses on the family unit. From a skills - based perspective, this can form an additional barrier to education, training and further employment that an individual without caring responsibilities would not have. This particularly apparent for lone parent families. There is also the factor that the employment rate for men with dependent children has been higher than that for those withou t since comparable records began in 1996 , while this became consistently true for women in 2008 177 . Despite the obligations, those with dependent children are more likely to be employed.
Figure 124 Proportion of households with depen dent children, Regions and Constituent Countries of the UK, 2019
Source: ONS - Families and households in the UK: 2019
The South West has the lowest proportion of households with dependent children in the whole of the UK. This is likely linked to the age ing population and older demographic as mentioned in section 5.1 . While a notably smaller proportion than
176 https:/ /www.equalityhumanrights.com/en/equality - act/protected - characteristics 177 https://www.ons.go v.uk/employmentandlabourmarket/peopleinwork/employmentandemployeetypes/bulletins/working andworklesshouseholds/octobertodecember2019
248
average, this does not mean that this factor is not importa nt, as this is still over a third of households.
Figure 125 Percentage of Families by Family type , Regions and Constituent Countries of the UK, 2019
North West London North East Yorkshire and The Humber East Midlands West Midlands Wales England UK Scotland South West East South East Northern Ireland
0.0 20.0 40.0 60.0 80.0 100.0 120.0
Lone parent families Cohabiting couple families Married or Civil partner couple families
Source: ONS - Families and households in the UK: 2019
The South West, as with th e rest of the UK, has a family structure predominantly made up of Married or Civil partner couple families. Interestingly, the South West also has the lowest proportion of lone parents, in contrast with London, which has the most. Again, this does not mean that this area is not worth focus, but is worth bearing in mind. This group is disproportionately female and disproportionately likely to experience poverty , even when working , and is more likely to have more complex childcare needs such as working at weekends 178 .
12.7. EU exit
12.8. Market strategies
Nationally, one in four employers (25%) reported that they sell products to, or serve the populations of, the EU (outside the UK), compared to 23% for the South West. 9% of all employers in England described the EU as t heir primary market, with the proportion again being slightly lower in the South West, at 8%. The region’s employers were more likely to have a local or regional focus than was the case nationally (61% vs 54%).
178 https://www.jrf.org.uk/blog/women - should - not - be - held - back - because - vital - care - they - provide
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250
Table 64 Geographical Markets Served (% of employers), South West and England, 2017 Geographical Market Served South West England Locally 47% 42% Regionally 14% 12% Nationally 11% 13% Within the UK 16% 18% Internationally (primarily within the EU) 8% 9% Internationally (primarily outside of the EU) 3% 4% Internationally (ALL) 12% 15%
Sell into EU at all (excluding UK)? 23% 25% Source: ESS, 2017
High Performance Working (HPW) is a general approach to managing organisations that aims to maximise employee involvement and commitment in order to achieve high levels of performance. The ESS asked a number of questions on a set of 21 recognised HPW practices, ranging from having a business plan to providing employees with task discretion and autonomy, w hich were grouped into five ‘factors’:
planning;
organisation;
skills;
rewards; and
autonomy.
Overall, 7% of employers are regarded as HPW employers – defined as those adopting at least 14 of the 21 HPW practices covered in the survey. Nationally, thi s proportion was 9%, and at an average of just 7.6 out of 21 HPW practices adopted, the South West is the worst performing English region on this measure. The table below shows that the adoption of most groups of practices is lower than the national averag e, other than in skills.
251 Table 65 Adoption of High Performance Working Practices (% of employers), South West and England, 2017
Area of HPW Practice England South West Planning 95% 93% Autonomy 73% 73% Skills 67% 70% Rewards 60% 53% Organisation 43% 40% 14+ out of 21 HPW practices 9% 7% Mean Number of HPW practices 8.1 7.6 Source: ESS, 2017
Nationally, HPW adoption varies widely by sector. While 25% of employers in Public Administration and 18% of employers in Education are HPW, this falls to just 3% of employers in both Construction and Primary Sector and Utilities.
12.9. Technological change
Concerns about automation are a factor in skills development across the world, but technological change is a wider factor than automation alone. As technology changes, so do the skills that are needed and older skills become outdated. This is particularly visible in areas such as Digital Skills. Research and development are the key d rivers of technolog ical change. The UK govern ment’s Industrial Strategy includes commitment to increase investment in R& D in the UK from the current proportion of 1.69 % of GDP 179 to 2.4% by 2017, with a longer term goal of 3%. The business sector accounted for 1.2% of GDP in 2018 180 . Encouragingly, business investment in R&D increased by 2.5% per annum in real terms since 2007 and 3.9% per annum since 2017.
The majority of business expenditure in the UK is undertaken by foreign - owned businesses 181 . Sectors (or ‘product groups’) performi ng the most R&D in 2018 were: pharmaceuticals (18% of all business R&D expenditure), motor vehicles (15), computer programming and information services activities (8%), aerospace (7%), miscellaneous business activities; technical testing and analysis (7%), software development (6%), research & development services (5.1%)) and machinery and equipment (4%).
179 https://www.ons.gov.uk/economy/governmentpublicsectorandtaxes/researchanddevelopmentexpenditure/bulletins/uk grossdomesticexpenditureonresearchanddevelopment/2017 180 https://www.ons.gov.uk/economy/governmentpublicsectorandtaxes/researchanddevelopmentexpenditure/bulletins/bu sinessenterpriseresearchanddevelopment/2018 181 In 2018, the proportion of R&D performed by UK - owned businesses declined from 48% to 47%.
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Unfortunately, business investment in R&D statistics are not routinely published by the ONS at the LEP level 182 but examination of NUTS2 level data pub lished on Eurostat reveals that that Dorset & Somerset and Devon do not perform strongly on this measure. The percentage of business investment in R&D as a percentage of GDP increased strongly across Devon between 2010 and 2016 but from a very low base. The statistics has remained fairly stable in Dorset and Somerset over the period.
Figure 126 Business investment in R&D as a percentage of GDP, Dorset & Somerset and Devon (NUTS2 areas), South West and UK, 2010 to 2018
1.4
1.19 1.2 1.2 1.15 1.13 1.13 1.1 1.09 1.11 1.11 1.05 1.04 1.07 1.06 1.05 1 1 1
0.8 0.78 0.78 0.74 0.8 0.7 0.7 0.73
0.6 0.48 0.47 0.41 0.4 0.35 0.21 0.21 0.17 0.2
0 2010 2011 2012 2013 2014 2015 2016 2017 2018
Dorset & Somerset Devon South West UK Source: Eurostat Intramural R&D expenditure (GERD) by sectors of perfo r m a n ce and NUTS 2 region
Results from the 2015 UK Innovation Survey reveal that employers in the Heart of the South West LEP area were less likely than firms nationally (UK) to 183 :
Be “innovation active’ (50.5% compared to 55.1%) . This includes businesses that had, during the survey period: introduced a new or significantly improved product or process; engaged in innovation projects not yet completed, scaled back, or abandoned; and/or adopted new and significantly improved forms of organisation, business structure or practices and marketing concepts or strategies.
182 The Mapping Comparative Advantage report (published in 2015) found that the Heart of the South West LEP area ranks 31 st of 39 LEP areas for business expenditure on R&D per full time employee (2013 data) and 33 rd of all LEP areas for the proportion of firms engaged in product or process innovation (2009 - 10) , where 1 st is the best. https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/546999/bis - 15 - 344 - mapping - local - comparative - advan tages - in - innovation - framework - and - indicators.pdf 183 https://www.gov.uk/government/publications/uk - innovation - survey - 2015 - analysed - by - local - enterprise - partnerships
253 Undertaken research and development (14.4% compared to 18.3%)
Have innovated by introducing a new or significantly improved product or service (16.6% compared to 21.0%), introducing a new to market product or service (6.2% c ompared to 16.5%) or have introduced new strategic and/or marketing approaches (40.2% compared to 43.7%).
However firms locally were more likely than those nationally to :
Co llaborate with respect to innovate (58.7% compared to 46.5%)
Have introduced a new or significantly improved process (14.3% compared to 14.1%)
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13. CONCLUSIONS
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