Skills

Background

BCI Position

It is vital that people have the appropriate levels of numeracy, literacy and IT skills for the jobs of the future, and a range of other transferable skills, so they can find employment in a variety of fields.

BCI has identified the following as its five main skills policy priorities:

1. Diplomas: BCI will be working to ensure that key Diploma stakeholders (young people, their parents, teachers and employers) are informed and equipped with the necessary information required to fully understand the benefits that a Diploma qualification offers.

2. Apprenticeships: BCI will work with the National Apprenticeship Service (NAS) to raise employers awareness of the Apprentice programme but also to highlight members concerns to NAS at the practical difficulties businesses face with this initiative.

3. NEETS: As employment is the ultimate aim for all Government attempts to deal with the NEET phenomenon, BCI - as part of the British Chambers of Commerce (BCC) – is currently investigating employers views and perceptions of NEETs.

4. Graduate Employment: BCI believes the ‘Graduate Advantage’ initiative should be built upon and developed – including introducing measures which will address the barriers so often cited by SMEs such as a lack of time and expertise to offer placements - to support Birmingham and the region in its efforts to tackle graduate and higher level skills shortages.

5. Adult Skills: BCI waits to hear further details from the Coalition Government on the new Work Programme which will replace the current back to work schemes and aim to simplify and co-ordinate a package of support for people out of work, regardless of the barriers they face or the benefits they claim.

In June 2010, the West Midlands Regional Observatory published ‘The West Midlands Economy Post Recession: Key Issues and Challenges’ which outlined the regional economy’s strengths and weaknesses as well as the deepening skills gaps and shortages. This research highlighted a continuing under-representation of higher value added sectors, a lower proportion of high growth firms and lower rates of innovation and enterprise than in many other regions – which are all limiting the demand for higher level skills and the creation of higher skilled, well paid jobs in the West Midlands.

One of the key factors contributing to towards the region’s poor economic and skills performance is a relatively weak industrial structure. Lower value added private sector activities such as some business services, wholesale & retail, hotels & catering and cultural, recreational & sporting activities make a particularly significant contribution to the regional economy – accounting for more than half of GVA and employment. In contrast higher value added activities such as the specialist business & professional services cluster, the environmental technologies cluster and the medical technologies generate much more limited levels of GVA and employment. These weaknesses within the region’s industrial structure, with a poor representation of fast growing high value added sectors, have also led to relatively slow growth in private sector employment in recent years. Over the 1998 – 2008 period employment increased by just 30,000 (growth of 2% which compares to an increase of 19% across the UK as a whole).

After rising in the second half of 2009 recruitment activity has faltered in the early months of 2010. Net growth in employment between 2010 and 2015 is very modest at approximately 5% - representing the creation of just over 11,000 net new jobs. Whilst job shedding is set to continue particularly in traditional private sector industries such as engineering and manufacturing and public sector activities such as education, public administration and health & social care. In terms of brand new job creation, it is suggested around 930,000 jobs will be created between 2010 and 2015 through new firms relocating to the region and the expansion of existing firms. At the same time, just over 908,000 jobs are likely to be lost due to firms leaving the region and the contraction of existing firms. In addition some 860,000 job vacancies are expected to over the 5 year period 2010 – 2015 due to ‘replacement demand’ – with net new jobs created by the region’s businesses accounting for only 2% of total employment demand. It is estimated nearly 510,000 jobs (58% of all job vacancies) will be due to labour turnover and more than 350,000 (40%) will be due to retirement of older workers.

Kiran Virk is your Policy Manager for Skills. If you have an issue on this subject you would like to discuss, call 0121 607 1781 or email k.virk@birminghamchamber.org.uk.