New research on economic inclusion in the West Midlands

Cover of economic inclusion baseline reportThe Observatory’s Economic Inclusion team has published a Baseline Report on Economic Inclusion (PDF, 2.16MB) pulling together regional analysis of key issues relating to worklessness, unemployment and economic inclusion in the West  Midlands.

This is the first comprehensive review of these key issues at regional level and the analysis enables consideration of the scale and distribution of worklessness problem within the region.

The report examines long and medium term trends and provides assessment of the reasons behind the region’s persistent worklessness problem.

The research reveals some worrying long-term challenges for the region:

A large scale problem of  ‘hidden’ unemployment has developed

Almost a quarter of a million people in the region are claiming incapacity benefits, compared with much smaller numbers claiming  Jobseeker’s Allowance and therefore actively seeking work  and counted as unemployed.

Mental health emerges as a major barrier to employment

58% of those in the region with a mental health problem are workless. 40% of Incapacity Benefit claimants are claiming because of a mental health problem.

Disengagement of young people emerges as a problem

1 in 3 claimants of Jobseekers Allowance in the region are aged 18–24.

These entrenched problems have the potential to become exacerbated by the current economic downturn, as the long-term unemployed compete for jobs with newly-unemployed people who have more recent work histories and more current skills.

The Government’s welfare reform programme, which aims to tackle the problem of incapacity benefits and was introduced in 2008, now faces the additional challenge of coinciding with the economic downturn and reduced demand for labour.

A combined response to both long and short term worklessness problems represents a considerable challenge for the region.

For further information, see our economic inclusion research page or download the reports:

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