West Midlands particularly vulnerable to public sector job cuts

Public sector employment has grown significantly in recent years across the UK and has been the key driver of the economy’s expansion. But proposals announced by the government to make £83bn worth of cuts in public sector spending are forecast to lead to the loss of up to 600,000 public sector jobs across the UK over the next 6 years, according to a study1 by Oxford Economics.

The West Midlands economy is particularly vulnerable to the impact of the cuts. Between 1998 and 2008 (latest available figures), the West Midlands saw the most significant increase in dependence on public sector employment in the country2.

The share of jobs accounted for by the public sector increased from 22% in 1998 to 27% in 2008, a rise of 5 percentage points, bringing total public sector employment to some 637,000.

We forecast that between 2010 and 2016 there will be a net loss of nearly 50,000 jobs across the West Midlands and, based on the ratio of the number of private sector jobs dependent on public sector spending and the associated supply chain nationally, a further 310,000 jobs are at risk at private sector firms directly or indirectly reliant on public sector spending3.

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Place Survey abolished

The Place Survey, one of the largest surveys in Europe that was due to be conducted by local authorities this autumn, was formally abolished yesterday by Local Government Minister, Grant Shapps.

This follows on from the scrapping of Comprehensive Area Assessments by Communities Secretary Eric Pickles in June 2010.

Read the announcement on Communities and Local Government.

Inward investment into the West Midlands 2009/10 – a local analysis

In 2009/10 there were 84 inward investment successes in the West Midlands and another four knowledge-based investments. These investments created over 1,500 new jobs and safeguarded another 4,300.

Although these 88 investments represented the lowest number of jobs created or safeguarded since 1992/93, they also represented the 7th highest total number of projects since 1991.

Pie chart shows 38 inward investments in West Midlands metropolitan areas and 49 inward investments in the shire counties over 2009 to 2010Inward investment is usually spread reasonably evenly between the West Midlands metropolitan areas and the shire counties. In 2009/10 the shire counties attracted the majority of inward investment projects (55%). See left.

However, the metropolitan areas of Birmingham, Coventry, Solihull, Dudley, Sandwell, Walsall and Wolverhampton have attracted perhaps just over half of the projects over the years – see below. The number of jobs created and safeguarded also generally follows a similar pattern.

Stacked bar chart shows percentage of inward investments into West Midlands metropolitan areas versus shire counties between 1991 and 2010

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Up-skilling and diversification are key to growth and job creation across the West Midlands

Targeting investment on higher value added sectors such as digital media and medical technologies, and developing a workforce with the right skills to service those sectors would significantly increase job growth and the prosperity of the West Midlands according to new research.

The research (pdf, 498kb), undertaken by the West Midlands Observatory, shows that the potential benefits of targeting investment are substantial. If workforce skill levels in the West Midlands were increased to match the England average, growth in Gross Value Added (GVA) — the measure of economic output per head of population — over the next 5 years would increase by 2 percentage points from 10% to 12% and net new job creation would nearly double from 11,000 to 21,000. If in addition more businesses in higher value added sectors and clusters were attracted to the West Midlands, so that their share of economic activity reflected the position nationally, GVA would grow by some 23% by 2015 and more than 200,000 net new jobs would be created.

Local authorities, business groups and other key partners across the West Midlands are looking to achieve sustainable economic growth in jobs and GVA over the next 5 years. This new research shows how, in a time of austerity and funding cuts, the Observatory can provide authoritative and objective research to help decision makers target limited resources and do more with less.

The research (pdf, 498kb) provides an insight into the region’s existing and likely future skill needs. It has been produced to inform the development of skills and investment priorities that focus shrinking levels of public sector investment in areas that will maximise  impact.

A range of key investment locations across the region, including Longbridge and Eastside in Birmingham, Ansty Park in Coventry, i54 in Staffordshire, Coventry and Wolverhampton city centres and Dudley, Telford, Walsall and West Bromwich town centres, can play a key part in diversifying local economies.

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NESTA offering local authorities £30k to spend with digital businesses on open data projects

Cutout figures connected by green light

Brian MacAulay, Director Innovation Index at NESTA, mentioned the Make It Local initiative to encourage collaboration between local authorities and digital media developers. It’s timely in the light of our open data: challenges and opportunities event last week and the government’s consultation on underlying data publication announced today.

Make It Local, the NESTA initiative, aims to:

…encourage collaboration between local authorities and digital media developers, to provide innovative, web-based services for their communities.

Make it Local is encouraging local authorities to release publicly-owned data in a linked way which allows developers an opportunity to build new services using the information.

Local authorities hold significant amounts of public data– such as transport, carbon emissions, population and crime data – which may help to power a range of useful, digital services. In developing partnerships between local authorities and digital media businesses, NESTA wants to show the value to local authorities of releasing their data to developers who can make use of it.

NESTA is calling for digital agencies with ideas for new applications to approach their local authority and encourage them to enter.

NESTA is offering three local authorities up to £30,000 to spend with a digital media business in their area.

The criteria for applications, application process and application form are available on the NESTA website.

ONS release revised local authority population estimates for 2002 to 2008

Office for National StatisticsThe Office for National Statistics (ONS) has released revised mid-2002 to mid-2008 population estimates for local authorities in England and Wales. The revisions have been produced as a result of improvements to ONS  methodology, introduced as part of the cross-government Migration Statistics Improvement Programme.

The new population estimates use an enhanced method for apportioning migrants to local authorities incorporating modelling using up-to-date survey and administrative data. Higher Education Statistics Agency data is utilised to improve estimates of student internal migration.

ONS have produced a population estimates analysis tool to help users understand the main patterns and trends in the population estimates. Users can select specific areas of interest and compare local estimates across time and with estimates at higher levels of geography.

Data users are also able to select specific age groups and view the components of population change for the chosen area.

Mid-2009 population estimates will be published on 24th June 2010, and will be based upon the new methodology.

Visit the ONS website for more information.

Local Economic Assessments: resource guide for the West Midlands

It became compulsory for Strategic Local Authorities to produce Local Economic Assessments (LEAs) on 1st April 2010. LEAs are intended to bring together economic intelligence to inform a range of local and regional strategies.

One of these is the new Regional Integrated Strategy for the West Midlands.

The West Midlands Joint Strategy and Investment Board steering the regional strategy has agreed with Chief Executives that LEA input will be on a sub-regional basis.

The LEA summaries will be structured around a series of questions relating to regional issues set out in a sub-regional framework document (doc, 578kb) drafted by Advantage West Midlands and the West Midlands Leaders Board.

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