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Private Sector Jobs Growth: Implications for Employment and Skills Chris Evans Hilary Stevens :

Private Sector Jobs Growth: Implications for Employment and Skills Chris Evans Hilary Stevens

Issues:

Issues What are the overall trends in employment and what do they mean in terms of the demand for skills? What are the prospects for rebalancing in terms of skills and to what extent will the existing skills base provide a foundation for private sector growth? In the context of youth unemployment, what are the opportunities for new entrants into the labour market? With worklessness on the rise, to what extent will new opportunities be accessible to workless people?

Key messages: Jobs :

Key messages: Jobs

LEP analysis :

LEP analysis LEP area Employment (BRES) 2008-2010, % People in employment (Workplace based APS) 2007/8 to 2010/11, % Gloucestershire +4.3 -5.5 West of England +0.6 +0.6 Cornwall & Isles of Scilly +0.6 -1.2 Heart of the South West -0.1 -1.0 Dorset -0.4 +0.3 Swindon & Wiltshire -1.4 -3.4 South West +0.2 -1.3

Change in no. of workforce jobs by industry SW, recession and recovery :

Change in no. of workforce jobs by industry SW, recession and recovery

Distribution of vacancies in the UK economy by broad sector, Q3 2005 to Q3 2011:

Distribution of vacancies in the UK economy by broad sector, Q3 2005 to Q3 2011

What jobs have been lost?:

What jobs have been lost? UK redundancy rates by industry

Key messages: skills:

Key messages: skills

UK occupational trends :

UK occupational trends Top 3 (Growth) Secondary education teaching professionals Care assistants and home carers Educational assistants Bottom 3 (Decline) Retail and wholesale managers Labourers, builders and woodworking trades Accounts and wages clerks, book-keepers

% change in employment by occupation: Recession and recovery:

% change in employment by occupation: Recession and recovery

Prospects for re-balancing?:

Prospects for re-balancing? Official statistics and published research tells us relatively little about the skills available within local labour markets. Qualifications are used as a proxy for skills and highest qualification an indicator of skills intensity. Gathered by household survey so sample sizes relatively small at local level – potential for 2011 Census. At broad level we can compare on how well qualified residents are compare this to distribution of vacancies.

Qualifications by occupation, UK (Q1 2011) :

Qualifications by occupation, UK (Q1 2011)

Qualifications by LEP, 2010 :

Qualifications by LEP, 2010

:


What jobs do the UK unemployed want?:

What jobs do the UK unemployed want?

Jobs sought by JSA claimants in the SW:

Jobs sought by JSA claimants in the SW Half were looking for sales-related or unskilled, ‘elementary’ occupations One-fifth (22%) specifically for sales/retail assistants. Also: Other goods handling and storage occupations (7%) General office assistants/clerks (7%) Cleaners, domestics (3%) Van drivers (3%) Care assistants and home carers (3%) Kitchen and catering assistants (2%) Bar staff (2%)

Unemployment rates by occupation, UK; Q4 in each year:

Unemployment rates by occupation, UK; Q4 in each year

Unemployment rate, UK:

Unemployment rate, UK

JSA claimants per vacancy, South West: September 2011:

JSA claimants per vacancy, South West: September 2011

Claimants by vacancy:

Claimants by vacancy

Public to private sector are the skills transferable?:

Public to private sector are the skills transferable? Emerging evidence, from the recruitment sector, that private sector employers may be reluctant to employ public sector staff. Public sector staff lack confidence that their job skills are transferable to this sector. Financial Times (Feb 2011) found over half (57%) of private sector businesses were unwilling to take on redundant public sector workers. CIMA (Jan 2011) - UK mid-size firms were unlikely to recruit ex-public sector workers. Hays Recruitment and the London Chamber of Commerce (June 2011) - (83%) of private sector employers regarded previous private sector experience as “very important” or “quite important” when recruiting

LEPs and recovery:

LEPs and recovery Better-insulated from the economic impact of the spending squeeze (i.e. have lower vulnerability to public sector job losses); Have high potential to create private sector jobs (based on a record of private sector growth); A strong higher-level skills base; A relatively low claimant unemployment.

Opportunities for growth by LEP area:

Opportunities for growth by LEP area

Young People:

Young People Unemployment when young has long term impact on earnings and careers patterns Evidence behind the rise in youth unemployment since suggests partly explained by reduced opportunities and the changing nature of the labour market Just under a quarter of employers recruited young people directly from education; this falls to just 6% taking on school leavers. Most young people enter the labour market in low-paying occupation/industry combinations, in which there has been a modest growth in employment. The route from lower-quality to better-quality jobs is becoming more difficult.

Young people:

Young people Numbers receiving training whilst in work has declined. Underemployment is also an issue with 18 to 24 year olds in jobs; 17.6% are under-employed and, for 16 to 17 year olds, the proportions climb to 22.4% overall and 28.6% for males. Earnings gap is widening. More likely to be in part time or temporary employment. Young people’s employment dominated by certain sectors.

Youth Employment by Sector, April 2010 - March 2011 :

Youth Employment by Sector, April 2010 - March 2011

Youth unemployment by local authority, September 2011:

Youth unemployment by local authority, September 2011

Apprenticeships:

Apprenticeships A sharp growth (84%) in the take-up of Apprenticeships in the last three years. 35,020 Apprentices started in the South West in 2009/10. Apprenticeship take-up has increased across all local authorities in the South West but to differing levels. The sectors with the most Apprenticeship starts were: Science, Engineering & Manufacturing Technologies (8.2% of the total); Customer Service & Contact Centre (8.1%); Adult Social Care/Healthcare (8.0%); Business, Administration & Governance (7.1%); Retail (7.1%); Business IT & Telecoms (6.5%); and, Hospitality, Leisure, Travel & Tourism (6.5%).

Sector Penetration Rates of Apprenticeships, SW vs England, 2009/10 :

Sector Penetration Rates of Apprenticeships, SW vs England, 2009/10

Graduate employment:

Graduate employment Young graduates important in the knowledge economy. Benefits extend beyond the highly skilled. Higher proportion of public sector workers were graduates than private sector. Link between the location of young graduates and the proportion of young graduates employed in the public sector. ‘non ring fenced’ public sector jobs account for 37,000 graduate jobs a year nationally . Public sector cuts could threaten the ability of areas to retain graduates (if only one fifth of the 39,000 ‘non front line’ public sector jobs that graduates go into each year were cut, the graduate unemployment rate would double).

Graduate labour markets:

Graduate labour markets Of the 18,780 graduates from South West HEIs in 2008/09 who are employed, around 60% remain in the region. Just under 7000 graduates who studied outside the South West came here to work. Net loss of around 500-600 graduates each year. Although the labour market for graduates has become more difficult, the proportion of unemployed graduates has fallen from 6.6% to 6.0% (7.4%). Graduate labour markets are complex. Study of West of England showed: The largest group of graduates were ‘Incomers’; imported some of their best paid new graduates; ‘stayers’ employed in the public sector, Incomers in the private sector-oriented.

Challenge of Worklessness:

Challenge of Worklessness Employment fallen sharply and unemployment and inactivity has risen. Rise in Jobseeker’s Allowance (JSA) claims continues to be the result of a decline in leavers rather than a rise in new claims. JSA flows into long-term unemployment are continuing to rise. Welfare reforms will see increasing numbers of ‘inactive benefit’ claimants move onto JSA. Work Programme up and running – providers reporting increasing difficulty finding jobs..

25+ JSA Claimants 12 months + unemployed :

25+ JSA Claimants 12 months + unemployed

IB and ESA Claimants :

IB and ESA Claimants

Welfare programme success:

Welfare programme success

Addressing worklessness:

Addressing worklessness Local labour markets: the geographical areas within which people look for work, vary significantly, by income, transport availability/cost and by skill level. Lower skilled – median distance within three kilometres. Professional occupations - around seven kilometres. Help with job search most cost-effective. Training. Job creation. Work first versus training. Making work pay. Engagement with employers.

Conclusions:

Conclusions Prospects for employment are challenging. Local labour markets are complex. Evidence base does not provide all the answers. Limited resources to address the problems. We know “What Works”

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