Skills in Lancashire
A COMPREHENSIVE EVIDENCE BASE ON
SKILLS AND EMPLOYMENT
Full Report
2015
Contents
Executive Summary
1 Introduction
1
27
2
Economic, Labour Market, Education and Skills Context
32
3
Labour Supply
37
4
Economy, Workforce, Labour Demand
60
5
Employment Forecast and Future Demand for Labour
81
6
Performance of the Education, Skills and Employment System 89
7
Conclusions and Key Messages
Statistical Annexes
118
128
Executive Summary
Purpose of the Report
This report provides a comprehensive evidence base on skills and employment
covering the Lancashire Local Enterprise Partnership (LEP) area. The report has
been produced to provide the Lancashire Employment and Skills Board with an
overview of skills and employment issues within Lancashire, and support partners
as they develop a skills and employment strategy for Lancashire. The report
provides robust evidence and identifies key messages relating to skills and
employment in Lancashire, which can be used to agree strategic priorities and
determine priorities for future investment1.
Lancashire’s Strategic Economic Plan (SEP) sets out an ambitious plan to create
50,000 new jobs, 40,000 new houses and add £3bn of additional economic activity
to the Lancashire economy over a ten year period, representing a step change for
an economy which currently underperforms compared to the national average.
Ambitions for Lancashire and Investment Priorities
The overarching vision for Lancashire is to re-establish the area as an economic
powerhouse and to build on current strengths and capabilities in key sectors to
establish Lancashire as a national centre of excellence in advanced manufacturing.
The SEP targets if achieved, would enable Lancashire to outperform the national
employment growth rate and increase the value of the LEP economy by 10% over
the next 10 years.
The key features of the Growth Deal include:



Releasing Growth Potential: Includes transport improvements to support
job creation and enable the release of land for more homes and businesses
Supporting the Renewal and Growth of Blackpool: £9m to be invested in
Blackpool to boost the visitor economy and improve housing standards.
Growing the Local Skills and Business Base: Includes the development of
the skills infrastructure across Lancashire, and support for the Business
Growth Hub.
The Preston, South Ribble and Lancashire City Deal has secured £434m
investment in infrastructure to unlock key employment and housing sites. The
infrastructure will improve connections across Lancashire, including improvements
to the motorway network, access to city and town centres and improvements to
public transport. The target is to create 20,000 new private sector jobs, nearly £1bn
in GVA, 17,240 new homes and £2.3bn leveraged commercial investment.
The City Deal also includes infrastructure which will unlock two Enterprise Zone
sites: Samlesbury and Warton. The Enterprise Zone is expected to create 6,000
jobs, plus 5,000-7,000 in the local supply chain. The sites will build on the areas’
advanced manufacturing, aerospace and automotive specialisms, offering unique
opportunities for business based there.
1
Throughout the report, Lancashire is compared to the national average, excluding London.
This is to remove the distorting effects of London’s position as a global city from the analysis,
and provide a fairer comparison of Lancashire’s employment and skills performance.
1
Lancashire’s Relative Performance
Wider Economic and Labour Market Factors
Lancashire currently underperforms against the national average (excluding
London) on a number of key economic indicators:
There has been a gradual economic recovery from recession at national level,
although less so in the north of the country. While there is a broadly positive
economic outlook, a series of economic and political factors have the potential to
have an adverse effect on businesses and world markets, with a potential knock-on
effect for local economies within the UK.

There are fewer jobs than would be expected given the size of the working
age population

Gross Value Added levels per worker and per head are below the national
average

Fewer local people hold higher level skills

The number of businesses in the LEP area is lower than average.
Employment Density
67,252 jobs per 100,000
Working Age residents
Gap with National (minus
London): 1,000 jobs per
100,000 WA residents
GVA per FTE
£
The UK has seen employment increase beyond the pre-recession position to reach
record levels, but Lancashire is one of a number of areas where employment growth
has been limited.
A number of national factors will impact on the success of the Lancashire labour
market, and the ability of local people to enter and prosper in employment:
•
Low Wage Growth: alongside higher unemployment, labour market
adjustment in response to the downturn took place through lower real wage
growth, in both the public and private sector. Although there are some
signs of recovery, the effect has been to suppress household incomes.
•
Labour productivity: Despite strong employment growth at the national
level over much of 2013 and 2014, increases in labour productivity have
been limited. There are concerns about the quality of some of the jobs
that have been created over the past five years, many of which are lower
skilled and generate low levels of value added (and therefore low levels of
pay).
•
Self-employment: Self-employment is higher in the UK than at any point
over the past 40 years and has driven employment growth nationally since
the downturn in 2008. The most common roles are working in construction
and taxi driving, but in recent years there have been increases in selfemployment in higher level roles such as management consultants.
•
Older workers: The UK has seen rising numbers of older workers due to
a number of demographic, economic and policy factors including longer life
expectancy and lower birth rates, the impact of low interest rates on the
affordability of retirement, and the abolition of compulsory retirement.
•
Welfare Reform: The means-tested benefit system is undergoing
considerable change with the introduction and roll out of Universal Credit
The Government hopes Universal Credit will strengthen the financial
incentive to work. Evidence from the Institute of Fiscal Studies suggests
that this will be partially effective.
£49,580 in Lancashire
Compared to £59,939
Nationally (minus
London)
GVA per Head: £16,870
Compared to £23,475 Nationally
(minus London)
Business Density
54 businesses per
1,000 WA residents
Gap with National (minus
London): 5 businesses
per 1,000 WA residents
Skills
29% of residents
qualified to Level 4+
Compared to 32% Nationally
(minus London)
These factors highlight the challenge facing Lancashire, with a pressing need for
business to increase productivity and wage levels, and at the same time more
pressure for those not in employment to secure work, in an economy where
employment growth is limited.
2

Creative, digital, media and ICT, building on a number of emerging centres
as well as a strong presence in many rural parts of the County, with new
entrepreneurs taking advantage of the quality of life and the opportunity to
work from or close to home in inexpensive offices and workshops.

Logistics, taking advantage of the strategic road network and large sites
available for distribution and logistics centres, as well as the county’s
location as the gateway to the Scottish economy.

High quality tourism and leisure, combining coast, country, outdoor and
heritage, offering a product and support services which meet the increasing
demand, both domestic and international, for high quality leisure activities.

Construction, the source of the skilled workforce and business base which
will provide the infrastructure to underpin Lancashire’s economic growth.
New Economy, New Lancashire
The Ambition
For many parts of Lancashire, the 1980 and 1990s were characterised by local
partners, businesses and communities dealing with the after effects of major
industrial decline and dramatic employment losses. This period, in effect, set a new
challenge for Lancashire – how to move from the legacy of a historic industrial past,
to a modern, competitive economy, based on new products, services and trends in
living and leisure, innovation and creativity, in a world of both international
opportunities and competition.
Lancashire LEP has embarked on a 20-30 year journey to transform the Lancashire
economy, building on its many assets, to focus the new economy on sectors and
services where market demand is growing and long term prospects are positive.
Lancashire’s new economy is based on a world class and competitive manufacturing
sector, new opportunities for higher value added service sectors, and the natural
and heritage assets which underpin a strong leisure and visitor economy. It will be
built on many of the companies already here, and new inward investors keen to
locate in an economy where a great quality of life comes at an affordable cost.
The New Economy
The 21st Century Lancashire economy will be characterised by a business base
focussed on taking advantage of markets and innovation, looking to the future, not
the past, a business community building new glories, rather than reminiscing on
bygone days.
These sectors will be the principle source of wealth generation in the new Lancashire
economy, whilst other sectors, such as retail, health, education and transport will
provide the services which support strong local economies and communities.
Education, Skills and Knowledge
As the new economy of the 21st century increases the emphasis on a well qualified
and skilled workforce, Lancashire’s higher and further education centres are
attracting more students, both locally and from elsewhere in the UK and abroad.
New investment in facilities reflects the need for state of the art training for the new
economy
Lancashire’s Universities are leading the way:

University of Lancaster in the UK top ten research Universities, a result
of a major investment in the undergraduate campus, specialist research
centres and the attraction of leading researchers and post graduate
students, with a substantial new investment in the Health Innovation
Campus about to get underway.

The University of Central Lancashire, a major provider of new graduates
to Lancashire companies, with an ambitious new masterplan which will link
the campus into the Preston town centre plans, with new facilities such as
the Engineering Innovation Centre increasing student numbers and
business linkages.

Edge Hill University, based at Ormskirk West Lancashire and with three
faculties, Arts and Sciences, Education and Health and Social Care,
offering both undergraduate and postgraduates courses.

The University of Cumbria, with its largest campus based in Lancaster,
offering undergraduate and postgraduate courses in business and
management, health and social care and education, amongst othesr.
The major sectors will include:

Advanced engineering, building on world class Original Equipment
Manufacturers (OEMs) and an extensive supply chain, with aerospace
leading the way in using new materials and production processes to
maintain Lancashire’s exceptional contribution to UK trade.

Energy and environment, already an important employer, and with new
opportunities in energy production, waste management and environmental
services, likely to be a major source of new employment over the next
twenty years.

Professional, financial and business services, already the major source of
private sector employment, with clusters across the county including
Preston, South Ribble, Lancaster, Skelmersdale, Burnley and rural Fylde,
with both national and regional companies in key sub-sectors.
3
A network of modern, well equipped Further Education Colleges and other providers
are delivering high quality training, from skills for life and vocational qualification
including apprenticeships, to a substantial level of higher education provision,
helping to provide employers with a regular supply of well motivated, well qualified
young people.
Lancashire’s new economy will be characterised by businesses which invest in
human capital, with close working relationships between businesses, schools,
training providers, Colleges and Universities.
The Places
The new economy in Lancashire will benefit every town and village, as new and
better employment feeds in to more choices for young people and higher household
incomes. The new Lancashire will be reflected in the major economic centres with:



Preston, as a major north of England economic hub, with investment in the
town centre leading to retail, leisure and commercial development creating
a centre where people work and spend their leisure time, with a large
student community and major industrial presence at the nearby Enterprise
Zone.
Blackburn, the Gateway location to the M65 Growth Corridor, anchoring a
revitalised and better connected Pennine Lancashire, with industrial and
logistics investment taking advantage of the strategic road network, and
new office development providing a competitive offer to service based
businesses.
Blackpool reborn, one of the few remaining classic British resorts, with
ambitious plans to create a leading centre for year round tourism, with new
investment complementing the outdoor assets of the Fylde coast.

Lancaster: the jewel in the crown, one of the most popular heritage towns
in the north of England, at the centre of a thriving rural economy and a top
ten University with a large undergraduate and postgraduate population.

Burnley, with a renewed sense of purpose, building on its reputation as
one of the most enterprising places in the UK
Much of the initial and catalytic investment has already been secured. The Preston
and South Ribble City Deal, with £400m of investment agreed, will transform the city
centre’s investment prospects, with the Enterprise Zone providing a further
economic stimulus.
Blackburn has also advanced its plans for town centre renewal, with works on the
Cathedral development area, new market and retail centre at the final stages.
Elsewhere Burnley has led the way in using new investment to create a new platform
for inward investment.
Homes and Communities
The Lancashire economy, as for many other parts of the UK, needs to attract new
skilled labour to support its economic and employment growth plans. New housing
will be a key element in delivering economic growth in Lancashire over the next
twenty years and the importance of housing to productivity is now recognised in
Fixing the Foundations: Creating a More Prosperous Nation, published in July 2015,
which sets out the Chancellor’s plans for improving UK productivity.
In order to do this successfully, Lancashire plans to provide housing in attractive
locations where people want to live, close to employment centres and with good
transport links to other parts of the north.
Lancashire has a remarkably diverse housing offer, from coast, country and village
life to major towns and cities, such as Preston and Lancaster. As importantly
Lancashire has a breadth of housing offer from affordable family housing to
executive housing.
Lancashire will provide more housing in popular neighbourhoods and towns, while
at the same time, delivering major new housing developments in locations close to
the road and rail network to ensure the scale of new housing needed to support
economic growth is delivered.
The delivery of a consistently higher level of housing completions, underpinned by
supportive local planning policies, will allow Lancashire to support a growing
population and workforce, in contrast to the current policy off economic forecasts.
The Connected County
New transport investment in the rail network will lead to better services to the
Manchester conurbation, with a marked improvement in services from Blackburn
and Burnley, as well as an increase in services from Preston and Blackpool. These
and other investments will strengthen Lancashire’s links to both the Greater
Manchester and Merseyside economies.
New investment on the road network in and around Preston will improve access to
the city, strengthening Lancashire’s role as the central location between Greater
Manchester and Merseyside to the south and Scotland to the north.
While increased connectivity is partly about physical links, increased business and
institutional links will ensure that Lancashire contributes to the Northern
Powerhouse. Industry groups such as the Aerospace Alliance are already linked to
other business and supply chain networks, while the Universities collaborate closely
with other national and international organisations. These outward facing linkages
will be a feature of a connected Lancashire, with civic leaders working closely with
other combined authorities.
4
Phase One: 2015-2025
Lancashire LEP has set out its plans for the first stage of the transformation of the
Lancashire economy. Some 50,000 jobs over the next ten years in a more
competitive manufacturing sector, higher value added service sectors, and the
visitor and leisure economy will be based on the strength of the company base, the
skills of the workforce and a great quality of life at an affordable cost.
This initial phase will be linked to an outward facing economy making a significant
and recognised contribution to a resurgent north of England economy, with civic and
business leaders making the case for new investment to further increase
Lancashire’s economic contribution to the national economy.
It is in the context of these ambitions, that the challenges facing the Lancashire
economy and labour market should be considered.
5
A Challenging Labour Market Context
Population Projections, 000s, 2015-2025 - Working Age
Source: ONS Population Projections
Population Change
The Lancashire population is growing at a slower rate than nationally, with the
working age population in decline and out-migration amongst younger age groups.
As a result, Lancashire has experienced a decline in its working age population
since it reached a peak of 928,500 in 2010. These trends are reflected in the
current population and workforce forecasts, although these present a policy off
scenario and are influenced by the muted economic growth from 2008-2013. In
order to meet the employment aspirations of the LEP, Lancashire will need to attract
higher skilled workers. While this may be partly achieved through in-commuting,
there are implications for the Lancashire housing offer. Lancashire’s workforce
profile is likely to act as a constraint for inward investment.
945
940
935
930
925
920
915
910
905
900
895
890
2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025
Lancashire LEP
NW trend line
Eng (min. Lon) trend line
Population proje ctions, 000s, 2015 -2025 - Total
Net migration by age and sub-geography, 2013
Source: Internal Migration Statistics, ONS
1580
1,500
1560
1,000
1540
500
1520
1500
0
1480
-500
1460
-1,000
1440
-1,500
1420
-2,000
2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025
Lancas hire LEP
NW trend line
-2,500
Eng (min. Lon) trend line
Population change results from three factors: natural change (i.e. the excess of
births over deaths); net internal migration (the balance of people moving into and
out of Lancashire from the rest of the UK); and net international migration (the
balance of people moving into and out of Lancashire from the rest of the world).
Lancashire has a lower rate of population growth arising from natural change than
the North West or England minus London and while international migration is
contributing to population growth, it is at a lower rate than in the country as a whole.
Internal migration results in a net loss of population to Lancashire and this is a result
of younger people leaving. While there is an inevitable population loss when young
people attend University, Lancashire is also losing population in the 25-34 year old
group. The in-flow of residents to Blackpool, Fylde and Wyre from the rest of the
UK is offset by natural change, with the overall population stable.
While Central Lancashire and to a lesser extent Lancaster have experienced
population growth which is consistent with employment and economic growth, the
long term growth in Blackpool, Fylde, Wyre, West Lancashire and East Lancashire
has been more subdued.
Given the size of East Lancashire and its contribution to the Lancashire economy,
the declining population, focused on a falling working age population, is of particular
concern.
6
Economic Activity
Working Age Employment Rate, 2004-2014
Source: Annual Population Survey
Economic activity rates amongst the working age population (i.e. the proportion of
people of working age who are either in work or actively looking for work) have been
lower in Lancashire than nationally for the past ten years. The gap has widened
from circa 2% to 4% over the past year, as a result of falling economic activity rates
in Lancashire (particularly in Blackpool, Fylde and Wyre, West Lancashire and
Central Lancashire).
75%
70%
65%
60%
Economic activity as % of total working age population, 2004-2014
Source: Annual Population Survey
80.0%
55%
50%
2004
75.0%
2005
2006
2007
2008
Lancas hire LEP
2009
2010
North West
2011
2012
2013
2014
England m inus London
70.0%
The overall employment rate reflects the rate in each sub-geography, all of which
are below the national average. The employment rate amongst residents of East
Lancashire is particularly low, with less than two-thirds of the working age population
in employment.
65.0%
60.0%
55.0%
The employment rate has fallen in all areas since 2011, with the greatest
proportionate declines in Lancaster (-8%, -4,800), West Lancashire (-6%, -5,700)
and East Lancashire (-4%, -17,600).
50.0%
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Working age employment rate, Lancashire sub-geographies, 2014
Lancashire LEP
NW
England minus London
The employment rate measures the percentage of the working age population who
are in employment. Reflecting the lower than average economic activity rates, the
employment rate in Lancashire has also been lower than the national rate for most
of the past ten years.
The gap narrowed in 2010-2011, when Lancashire bucked the national trend and
saw employment rates rise, despite the recession. However, since 2011 the
employment rate has fallen in Lancashire whilst being on an upward trend nationally
and in the North West.
If Lancashire matched the national average employment rate, an additional 43,500
residents would be in employment. This would have an impact on household
incomes in Lancashire, and also on areas of multiple deprivation.
Source: APS
80%
70%
60%
50%
40%
30%
20%
10%
0%
73%
71%
70%
69%
68%
67%
67%
64%
The employment rate in East Lancashire is evidence of both a shortage of jobs
locally and the difficulties of out-commuting to access employment opportunities.
This is also reflected in the population decline and the loss of younger workers.
The employment rates for both males and females in the Lancashire LEP area are
below the national average, although both Central Lancashire and Blackpool, Fylde
and Wyre exceed the regional average and are close to the national average.
7
The greatest gap is in East Lancashire, where the male employment rate is 7
percentage points below the England minus London average, and the female rate
is 9 percentage points lower.
Source: APS
Working Age Unemployment Rate
Employment rate by gender and sub-geography, 2014
Source: APS
Unemployment rate, 2004-2014
Female
Male
East Lancs
West Lancashire
Lancaster
Blackpool, Fylde, Wyre
10%
9%
8%
7%
6%
5%
4%
3%
2%
1%
0%
Central Lancs.
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Lancas hire
North Wes t
England m inus London
Lancashire
Jobseeker Allowance Claimants
North West
England minus London
0%
20%
40%
60%
80%
Unemployment
There are 50,000 working age residents in Lancashire who are unemployed based
on the UK official measure of unemployment2. This equates to an unemployment
rate of 7.5% which is in line with the regional average (7.5%) but is higher than the
national average (6.6%). Far fewer people are eligible for the main unemployment
benefit – Jobseekers Allowance (JSA) – than are counted as unemployed. The
number of JSA claimants was 16,100 at the start of 20153.
2013
2014
% of WA
pop.
% of WA
pop.
2015
% of WA
pop.
No.
Blackpool, Fylde, Wyre
4.6
3.8
4,631
2.4
East Lancashire
4.0
3.1
6,154
1.9
Lancaster
3.1
2.7
1,547
1.7
Central Lancashire
2.9
2.3
2,891
1.2
West Lancashire
3.4
2.6
839
1.2
Lancashire
3.7
3.0
16,062
1.7
North West
4.4
3.4
1.9
England minus London
3.7
2.9
1.9
Source: DWP
Looking at trends over time, unemployment in Lancashire rose during the downturn
from 40,700 in 2008 (5.9%) to 57,400 in 2012 (8.2%). Unemployment fell between
2012 and 2013 but increased again in 2014. East Lancashire has seen the biggest
increase, with unemployment more than doubling, and both West Lancashire and
Central Lancashire have also seen significant increases.
The 16,100 unemployed claimants in Lancashire are known to the authorities and
receive support to help them find work. Those who are not claiming benefits may
not be receiving appropriate help to enter / re-enter the job market.
2
3
International Labour Organisation definition. Includes anybody who is not in employment, has
actively sought work in the last 4 weeks and is available to start work in the next 2 weeks, or
has found a job and is waiting to start in the next 2 weeks.
Comparing the numbers captured by the ILO and JSA measures of unemployment
in Lancashire indicates that unemployed women aged 16-24, men aged over 50
and unemployed people in West and East Lancashire are most at risk of missing
out on the employment-related support provided to benefit claimants.
NB The number of JSA claimants is reducing as people are being transferred to Universal
Credit. Combined data is not yet available at local level. JSA data allows finer grained
analysis of unemployment by age and gender at the local level, but only includes the
proportion of unemployed people which is eligible for and claiming JSA.
8
Economic Inactivity
Over 240,000 people of working age are currently economically inactive within
Lancashire, 27% of the total working age population. This is a higher rate than in
the region (25%) or England minus London (22%). The highest rates of inactivity
are in Lancaster (30%), West Lancashire (29%) and East Lancashire (28%).
Between 2004 and 2009 the number and proportion of economically inactive people
within Lancashire remained fairly stable. Over this period, the economic inactivity
rate was in line with the regional average. Economic inactivity in Lancashire
declined during the downturn (2009 to 2012) and the rate fell to be in line with the
England minus London average.
However, since 2012 economic inactivity in Lancashire has increased with 27,100
people becoming economically inactive and the rate increasing by 2% points. This
is reflected in the fall in the employment rate between 2012 and 2014.
Economic inactivity is most common amongst those aged 50 to 64, reflecting the
high number of retirees in this age group (100,300 residents, 41% of the total
inactive working age population). Compared to the England minus London average,
the economic inactivity rate in Lancashire is higher across all age groups particularly
amongst the 50-64 years and 20-24 years age groups (+7% points and +5% points
respectively). The economic inactivity rate across the age groups is broadly in line
with the North West average.
Economic inactivity in Lancashire is more likely than the national average to be due
to long-term sickness (26% of the economically inactive) and less likely to be due
to study (23% compared to 26% nationally).
Lancashire
%
North West
Eng. minus
London
%
%
Long-term sick
63,900
26%
26%
22%
Looking after family/home
56,400
23%
23%
25%
Student
56,000
23%
23%
26%
Retired
39,900
16%
16%
16%
Other
19,100
8%
8%
9%
Temporary sick
5,300
2%
3%
2%
Discouraged
1,600
1%
1%
1%
242,300
100%
100%
100%
Total
At the end of 2014, there were 2,700 young people not in education, employment
or training (NEET) in Lancashire. This equates to 5.2% of all young people who are
known to the local authorities, which is slightly higher than the national rate (4.7%).
In the last three years (2012-14), the number of young people classified as NEET
has fallen both in Lancashire (-0.8% points) and England (-1.1% points) as a whole.
Workless Households
A profile of worklessness at the household level shows that Lancashire has fewer
households (where there is at least one working age adult resident) where all adults
are in employment (-1.2% point) and fewer households with mixed worklessness
status (i.e. where at least one adult is in employment and others are either inactive
or unemployed) (-2.8%) compared to England. The share of workless households
is 4% points higher than in England as a whole.
Households by Economic Activity Status 2013
Lancashire
No.
England
%
%
Working households
247,000
52.8
54.0
Mixed households
125,000
26.6
29.4
96,000
20.6
16.6
Workless households
Economic Inactivity by Reason 2014
No.
The transition from education to employment is a crucial one, and it is important that
young people get off to a good start in their working lives. Evidence suggests that
those who experience a period of unemployment at an early age continue to suffer
poorer outcomes throughout their working lives and are also at risk of poorer
physical and mental health.
Source: Workless households for regions across the UK, ONS
Link between Skills and Deprivation
There is a clear link between skill levels and deprivation, with a very close alignment
between areas that are deprived in relation to education, skills and training, and
those which suffer from high levels of overall deprivation. This is unsurprising given
the link between skills levels, the likelihood of being in employment, and the average
level of earnings, all of which reinforce the importance of ensuring that all
Lancashire residents have the opportunities they need to acquire the skills and
qualifications that will allow them to be successful in the labour market.
Source: Annual Population Survey
Young People not in Education, Employment or Training (NEET)
9
Occupational Profile
Lancashire has a lower level of residents employed in highly skilled occupations
(39%) compared to the North West (41%) and England minus London (43%).
Residents employed in skilled trades are over represented compared to the North
West and England minus London (+1% point each respectively).
Occupational profile of residents in employment, 2014
Source: APS
Lancashire
20%
18%
16%
14%
12%
10%
8%
6%
4%
2%
0%
North West
England minus London
machine operative occupations (reflecting the decline of the manufacturing sector),
and a fall in the number of administrative and secretarial occupations (reflecting
changing work practices and the increased use of ICT within the workplace).
Skills Profile
Overall, the working age population in Lancashire is less well-qualified than the
national average, with the percentage holding qualifications at Level 4 and above
3% lower than the England minus London average. The percentage of working age
population with no qualifications (11%) is 2% higher than in England minus London
as a whole.
In order to meet the England minus London average, an additional 22,700 working
age Lancashire residents would need to be qualified to Level 2+, 26,400 qualified
to Level 3+ and 32,100 qualified to Level 4+.
Qualifications held by working age population, 2013
Source: APS
Changing occupation profile, 2004-2014
2014
Source: APS,
2004
Professional
40%
35%
30%
25%
20%
15%
10%
5%
0%
No quals
Skilled trades
Other
quals
L1
Trade
Apprent.
L2
L3
L4
Assoc. prof & tech
Lancashire
Admin & secretarial
North West
England minus London
Elementary
Care, leis. & other serv.
Managers & directors
Sales & customer serv.
Proc., plant & mach. op.
0%
5%
10%
15%
20%
Employment in highly skilled occupations has increased from 36% of the Lancashire
total in 2004, to 39%in 2014. This has been accompanied by a decline in the
proportion of the total workforce employed in skilled trades and process, plant and
10
A Challenging Economy
There are approximately 617,600 jobs within workplaces in Lancashire. This has
fallen since 2009 in contrast to low levels of growth in the North West and England,
reducing the number of employment opportunities for local residents.
While manufacturing has continued to decline in employment terms, it remains
highly represented when compared to the national economy and includes significant
concentrations of high value added manufacturing with specialist sub-sectors that
may offer employment growth opportunities. Other sectors that are highly
represented include health, construction and public administration.
Lancashire 10 Highest Net Employment Increases, 2009-2013
Workplace Employment in Lancashire LEP area, 2009-2013
Source: BRES
Employment Increase
610,000
600,000
590,000
580,000
570,000
9000
8000
7000
6000
5000
4000
3000
2000
1000
0
560,000
550,000
2010
2011
NW trend
2012
2013
England minus London trend
The net decline was driven by significant job losses in Blackpool, Fylde and Wyre,
while other parts of Lancashire experienced low levels of growth or slight decline.
This has created an uneven job market across Lancashire.
Employment Change by Sub Geography
2009
2013
Net
Change
Lancashire 10 Highest Net Employment Decreases, 2009-2013
%
West Lancashire
43,800
45,000
1,200
East Lancashire
205,900
209,000
3,100
1.5%
Central Lancashire
180,900
180,300
-500
-0.3%
Lancaster
Source: BRES
2.8%
54,000
53,700
-300
-0.6%
Lancashire LEP
622,600
617,600
-4,900
-0.8%
Blackpool, Flyde and Wyre
138,000
129,500
-8,400
-6.1%
Source: BRES
While Lancashire experienced high levels of employment growth and outperformed
the national average in a number of key private service sectors, this was insufficient
to compensate for the high levels of employment decline in manufacturing and retail.
The recent sectoral trends reflect longer term structural shifts in the Lancashire
economy, with manufacturing accounting for 13% of employment in 2013 compared
to 24% in 1998 and both the public sector and private services playing a greater
role. This has significant implications for workforce skills requirements.
0
Employment Decrease
2009
Lancashire LEP
-1000
-2000
-3000
-4000
-5000
-6000
-7000
-8000
Source: BRES
11
Sectoral Representation
Productivity
When compared with the national economy, both the public sector and
manufacturing are highly represented, accounting for a higher share of employment
(31% compared to 28% and 15% compared to 10% respectively).
Productivity (output per full-time equivalent worker) has been a long term challenge
for Lancashire and levels are currently equivalent to just 83% of the national
average. As a recognised driver of productivity, an increased focus and requirement
for higher level skills and occupations may help to address this challenge, although
GVA growth will have to significantly outpace the national average to close the gap.
In contrast, financial, professional and business services account for a smaller share
(15% compared to 20%). There is also a low presence of ICT related industries, in
spite of strong growth nationally.
Employment Specialisms 2013
No.
Location
Quotient
Manufacturing
81,700
1.4
Human health and social work activities
98,300
1.2
Construction
35,300
1.2
Public administration and defence
33,600
1.2
5,100
1.2
Utilities: Water
Wholesale and retail trade
105,800
1.0
Education
57,800
1.0
Accommodation and food service activities
40,800
1.0
Arts, entertainment and recreation
15,000
1.0
Other service activities
11,100
0.9
2,200
0.9
Administrative and support service activities
39,500
0.8
Professional, scientific and technical activities
34,400
0.8
Transportation and storage
21,500
0.8
9,100
0.8
Information and communication
14,400
0.7
Financial and insurance activities
10,900
0.6
Mining and quarrying
400
0.6
Agriculture, forestry and fishing
700
0.1
617,600
1.0
Utilities: Electricity
Real estate activities
Column Total
Source: BRES
Productivity levels vary by NUTS 3 area within the Lancashire LEP, although they
are consistently below the national average. Lancashire county generates the
highest level of GVA per FTE, followed by Blackpool and then Blackburn with
Darwen where productivity levels are equivalent to just 74% of the national average.
While productivity in part reflects the business structure of the Lancashire economy,
there is unlikely to be a significant shift in performance without:



New inward investment, in both advanced manufacturing, science and
technology and professional and business services.
A significant up-skilling of the workforce, linked to plans to improve
productivity.
A move from low value, low cost activities to higher value activities in all
parts of the service economy.
In order to support increased productivity, Lancashire companies will need to recruit
experienced personnel to support growth and meet replacement demand, at a time
when there are industry wide shortages and competing sub-regions, also keen to
support business growth.
12
Hard to Fill and Skills Shortage Vacancies
The 2013 Employer Skills Survey showed that 12% of establishments in Lancashire
had a vacancy at the time of the survey, compared to 14% in England. Of
Lancashire establishments with a vacancy, 31% said the vacancy was hard to fill
(HTF), compared to 34% nationally. These vacancies were predominantly in highly
skilled occupations, with 66% of HTF vacancies in associate professional, skilled
trade and professional occupations. Nationally, whilst these occupations were also
the most highly represented amongst ‘hard to fill’ vacancies, they accounted for a
lower proportion of vacancies (52%).
The main cause of HTF vacancies reported by employers was a low number of
applicants with the required skills and 45% with a HTF vacancy cited this as a cause.
Other common reasons were a lack of work experience (31%), low numbers of
applicants with the required attitude, motivation or personality (28%), not enough
people interested in the type of job (27%) and lack of required qualification (27%).
Many of the vacancies which Lancashire employers find hard to fill are in sectors
where employment is expected to grow, including a number of the Lancashire LEP
priority sectors. This is likely to have implications for some types of new inward
investment. These issues will be exacerbated by an ageing workforce, creating high
levels of replacement demand.
A similar situation applies to skills shortages, with the added challenge of addressing
skills shortages in the construction industry. This specific skills challenge is likely to
impact on both residential and mixed use / commercial development and major
infrastructure works, particularly road schemes.
Feedback from employers consulted for the Priority Sector skills plans confirms the
current difficulties of recruiting experienced personnel in many sectors. These
appear to be industry wide in many cases, and not restricted to Lancashire. This
exacerbates the challenge for local employers.
Skills shortages are reported in sectors including construction, health and the visitor
economy, as well as senior managers in a wide range of sectors.
Of all employers with vacancies, 25% have a skills shortage vacancy (SSV, that is
a vacancy that is hard to fill due to skills shortages); slightly below the national
average of 27%. As presented below, the occupational profile of these vacancies
follows broadly the same pattern as that of HTF vacancies, with SSVs
predominantly occurring within highly skilled occupations.
The loss of older, experienced personnel is likely to increase the challenge in many
industries, including advanced manufacturing.
13
Forecast Employment Growth 2015-2025
Employment is forecast to grow by 4% in Lancashire between 2015 and 2025,
adding nearly 30,000 jobs (29,900) to the Lancashire economy. This equates to
two thirds of the LEP’s target.
The aggregate effect of sectors in decline will result in some 18,000 jobs being lost.
While the growth of almost 48,000 jobs cancels these losses out, any reduction in
the scale of job losses would make a significant contribution to economic growth.
The rate of employment growth in Lancashire is expected to be considerably lower
than that forecast for the UK as a whole (4% compared to 6%) as well as below the
average for the North West (5%).
The majority of employment decline will be in manufacturing and public
administration. With 10,300 jobs losses forecast for manufacturing (equivalent to a
12% decline), in both percentage and absolute terms the forecast decline in the
sector is significant, and is at odds with the ambitions set out in the LEP’s Strategic
Economic Plan.
Across the sub-geographies, employment growth is expected to vary considerably.
Lancaster and West Lancashire are forecast to experience employment growth
above the national average, whilst in East Lancashire, employment is expected to
increase by only 2% over ten years. The greatest numbers of jobs (over 10,000),
will be created in Central Lancashire.
While this scale of decline is not unusual for the manufacturing industry, Lancashire
has a number of very competitive manufacturing sub-sectors and a significant base
of advanced engineering companies. The LEP strategy includes a strong
commitment to strengthening manufacturing competiveness and attracting new
investment to the County, notably through the Enterprise Zone.
Forecast employment change by sector, 2015-2025
Employment growth forecasts, 2015-2025
Source: OE Forecasts
Source: OE Forecasts
8%
7%
2,092,300
+195,000
6%
5% +29,900
4%
3%
2%
1%
0%
Construction
Admin and support
Prof, sci & tech
Wholesale & retail
Accommodation & food
Transport & storage
Arts, ent. & recreation
Health & care
Information & communication
Other services
Real estate activities
Finance & insurance
Education
Public admin
Manufacturing
+4,500 +3,800
+10,700
5,500
+5,300
-15.0
Sectoral Change
The private service sector is expected to drive employment growth. Although the
net employment increase forecast for Lancashire between 2015 and 2025 is 29,900
jobs, in absolute terms an additional 47,900 jobs will be created in those sectors
where growth is forecast (offset by the loss of 18,000 jobs in sectors where
employment is expected to decline). In terms of actual growth in the numbers of
jobs, the construction sector is the most significant and this could increase as the
effects of City Deal transport and other infrastructure investment becomes apparent.
-10.0
-5.0
0.0
5.0
10.0
000s
Other important sectors supporting employment growth will be the tourism, visitor,
leisure economy (particularly important to the coastal and rural areas), and
distribution and logistics, linked to opportunities on the strategic road network.
There is also expected to be substantial job growth in financial, business and
professional services and scientific and technical employment (the majority of which
will be at graduate level, with a significant proportion at post-graduate level) and in
the visitor and leisure economy and retail and distribution of goods.
14
Skills Forecasts
At the broad occupational group level, the baseline forecasts suggest that there will
be relatively little change in the occupational profile of Lancashire’s employment
base between 2015 and 2025.
Occupations requiring level 4+ skills will account for 38% of employment in
Lancashire by 2025, up from 34% in 2015. This reflects both the type of employment
growth forecast, and the up-skilling or qualification inflation in other sectors, taking
advantage of a large pool of graduates nationally.
The skills forecasts suggests that there will be an up-skilling of the workforce within
most occupations and sectors, although there will be a reduction in middle range
skills, creating an hour glass effect in the workforce profile.
There will be a significant decline in the proportion of the workforce holding Level 2
and Level 3 skills, equivalent to five percentage points, from 38% of employment to
33%. This change in parts reflects the forecast decline in manufacturing
employment, and the subsequent decline in skilled trades.
By 2025, there will have been a reduction in employment requiring no qualifications
from 8% to 6% although Level 1 jobs will continue to account for 14% of employment;
a higher proportion than Level 2 jobs, reflecting the division of the labour market into
high end and low level occupations. The majority of employment at Level 1 and
below is likely to be low paid and a proportion will be insecure.
Skills Profile 2015 - 2025
Source: Oxford Economics
Lancashire 2015
34%
Lancashire 2025
22%
38%
North West 2015
20%
35%
North West 2025
21%
38%
20%
16%
13%
8% 8%
13%
14%
9% 6%
16%
13%
8% 8%
13%
14%
8% 6%
16%
13%
8% 7%
13%
14%
8% 6%
to be managerial, directors and senior occupations, professional occupations and
associate professional and technical occupations. In the latter group, the proportion
will increase to over 50%.
The proportion of the workforce with Level 4+ will also increase in administrative and
secretarial, skilled trades, care and leisure and customer services as part of a
general trend of an up-skilling of the workforce
Skills Profile by Sector
The increase in the proportion of the workforce at Level 4+ will be driven by the
public sector (education, health and public administration), with an important
contribution from professional and business services (including professional,
scientific and technical and administration and support sectors). The proportion of
the workforce qualified at Level 4+ will also increase in the industrial sector,
accounting for some 30% of employment.
Percentage of Employees Requiring L4+ Skills, by Industry
Source: Oxford Economics
2015
2025
80%
70%
60%
50%
40%
30%
20%
10%
0%
Note: Chart presents industries w ith over 10,000 employees
UK 2015
36%
UK 2025
40%
0%
Level 4+
21%
20%
20%
Level 3
40%
Level 2
60%
Level 1
80%
Other
100%
No quals
Skills Profile by Occupation
Sector Skills Needs
Focusing on the increasing requirement for Level 4+ qualifications, as would be
expected, the groups with the highest proportion of positions at Level 4+ will continue
15
Sector skills action plans have been produced by employer-led partnerships in
Lancashire’s six priority sectors, following analysis of the skills and employment
issues facing each sector and the delivery constraints that prevent providers from
responding as effectively as they might to these. The key skills needs identified
include:
Advanced Manufacturing: the advanced manufacturing sector already has one of
the highest levels of skills shortage vacancies in Lancashire and is affected by an
ageing workforce and high levels of replacement demand for labour. Technological
change, new markets, the continued fragmentation of the production chain and
increased dependence on skilled workers are all creating an increased need for a
flexible workforce with strong specialist skills in niche areas.
The sector skills action plan has four strategic objectives: inspiring and engaging
young people; recruiting and retaining a competitive workforce; developing a
responsive learning infrastructure system; and securing employer investment in
training.
Financial and Professional Services: drivers for change within the financial and
professional services sector include increased regulation and governance,
demographic and environmental change, globalisation, technological change and
customer demand. Whilst the sector is expected to grow in absolute terms in
Lancashire, replacement demand will be more significant, accounting for around
75% of the total labour requirement. Coping with an ageing workforce, and early
succession planning, will be crucial to the success of the sector in Lancashire.
The sector skills action plan identifies priorities within four thematic areas: meeting
the demand for skills, including addressing skills gaps and shortages and meeting
replacement demand requirements; developing the supply side, so that it can
address the changing needs of employers; increasing the attraction of the sector
and the location, to improve the retention of workers; and increasing intelligence by
tracking sector development, horizon scanning and articulating employer needs to
providers.
Health and Social Care: the health and social care sector is the largest, in
employment terms, in Lancashire. The sector has a highly skilled but ageing
workforce, and employers are finding it increasingly difficult to recruit appropriately
skilled staff. The transformation of health and social care services in response to an
ageing population, developments in medical technology and tightening public
finances, has implications for the organisation of health and social care jobs and the
provision of education and training. Many of the decisions about health and care
training provision are made outside Lancashire (e.g. by Health Education England),
and it is important that Lancashire employers are able to influence the provision of
training.
The sector skills action plan identifies four key objectives: strengthening employer
leadership of skills, by developing an infrastructure through which employers can
lead skills provision; prioritising and coordinating state investment in skills provision;
widening access to careers in health and social care by providing alternative entry
routes; and developing a strong, competitive provider base which can meet the
needs of employers, now and in the future.
Visitor Economy: there is a diverse visitor economy within Lancashire, offering a
wide range of job roles and occupations. The workforce tends to be younger and
less well-qualified than in other sectors, there are high levels of part-time
employment and employers experience high rates of staff turnover. Employment
growth is expected within the sector and levels of replacement demand are
significant.
The sector skills action plan has three key themes: preparing the future workforce,
aiming to attract more appropriately skilled young people into the sector; developing
the existing workforce, addressing skills gaps relating to management and
leadership, increasing online sales capabilities and ensuring the sector is prioritised
within workforce development programmes; and learning from good practice,
supporting the roll-out of innovative and effective practice.
Energy and Environmental Technologies: The sector accounts for around 40,000
jobs in Lancashire and there are particular specialisms in nuclear, offshore gas oil
and wind, onshore wind, waste recovery and environmental technology services and
manufacture. The sector is affected by international factors including globalisation,
environmental change and carbon emissions targets, plus national policy towards
the various energy sub-sectors. Forecasts for the sector vary, but replacement
demand is likely to be more significant than absolute growth due to the age of the
existing workforce.
The sector skills action plan has four thematic areas: meeting demand for skills,
including technical skills, softer skills and business skills; increasing the attraction of
the sector in Lancashire through changing perceptions of both the industry and the
location; improving intelligence by tracking developments in the sector; and
developing the supply side by ensuring availability of appropriately skilled FE staff
and adjusting provision to meet employer needs.
Creative and Digital Industries: The sector is estimated to account for around
36,000 jobs in Lancashire, including 22,000 within the creative industries and a
further 14,000 in creative occupations outwith the sector. Employment has been in
decline in Lancashire, in contrast to the position nationally. The sector is largely
made up of microbusinesses, with skills gaps and shortages relating to high level
digital skills.
The sector skills action plan sets out three key objectives: strengthening the digital
skills pipeline from schools to HEIs; gearing skills provision to be more appropriate
to the needs of the dynamic microbusinesses within the creative economy in
Lancashire; and improving recruitment and retention through addressing the
challenges and opportunities of the positioning of Lancashire.
16
Construction: the construction sector will be vital to Lancashire if it is to achieve its
economic ambitions over the coming years. The sector currently employs over
35,000 people in Lancashire, and forecasts suggest growth of 8,000 employees over
the next ten years. However, analysis undertaken to support the implementation of
the Preston, South Ribble and Lancashire City Deal suggests that this is likely to be
a significant underestimate.
Challenges facing the sector include a mismatch between the level of training
provision and the likely level of demand, particularly as technological advances and
demand for low carbon construction are increasing the demand for new, specific
skills. Management skills are also in demand amongst experienced construction
workers. The City Deal Employment and Skills Strategy has two strategic objectives
that directly relate to the construction sector. The first is to support the construction
industry and supply chain, through actions to encourage more well young people
into the sector, increase the number of apprenticeships, internships and graduate
recruitment, provide bespoke business support for the sector, including
management development, and consider the economic benefits arising from
construction related manufacturing and supply chain product development. The
second is to work with the construction sector to increase training and employment
opportunities for young people and older workers and increase social value.
Replacement Demand 2012 - 2022 (as % of current employment)
Source: Working Futures
Administrative and secretarial
Mangers, directors and senior officials
Professional occupations
Elementary occupations
Associate professional and technical
Process, plant and machine operatives
Sales and customer service
Skilled trades occupations
0%
The highest levels of replacement demand are in white collar jobs, including high
and medium level skills. This includes administrative and secretarial, managers and
directors and professional occupations. While the overall replacement demand
rates for process, plant and machine operatives, sales and customer services
occupations, and skilled trade occupations are lower at 3% per annum, numbers are
still significant.
Applying the level of replacement demand within each occupational group to the
2015 occupational figures for Lancashire shows that replacement demand is a
significant source of employment opportunities and demand for skills and training,
and in numbers terms, much more important than net employment growth.
20%
30%
40%
50%
Lancashire Occupational Demand 2015 - 2025
Employment Growth / Decline
Estimated
Total
Annual
Requirement
Requirement
(000’s)
(000’s)
Replacement Demand
Replacement demand typically runs at circa 4% per annum, as employees retire,
leave the workforce and/or move to other jobs. This can vary by sector, with some
sectors affected by staff turnover driven by low wages and/or terms of service.
10%
Replacement Demand
Estimated
Total
Annual
Requirement
Requirement
(000’s)
(000’s)
Professional occs.
4,000
400
43,670
4,370
Caring, leisure, other serv.
3,000
300
35,270
3,530
Admin/ secretarial
-5,000
-500
34,020
3,400
Elementary occ.s
3,000
300
32,690
3,270
Mangers, directors, senior
4,000
400
30,270
3,030
Skilled trades occ.s
2,500
250
29,950
3,000
Associate prof. / technical
Process, plant and
machine operatives
Sales / customer service
2,500
250
27,060
2,710
-1,000
-100
22,190
2,220
2,500
250
19,660
1,970
Source: Oxford Economics; ekosgen estimates based on Working Futures
Education and Training Provision
Schools
Educational performance in Lancashire falls away after Key Stage 2 (age 11), with
fewer than half of pupils achieving 5 A*-C GCSEs including English and Maths. A
significant number of schools face challenges to raise performance levels so that all
17
children obtain the skills they need to succeed in employment and / or further
learning.
Percentage of pupils making expected progress in English and Maths
between KS2 and KS4
Source: DfE
80
70
60
50
40
30
20
10
5+ A* - C Grades inc English and Maths, 2013/14
Source: DfES
Ribble Valley
Chorley
Wyre
Lancaster
Fylde
Rossendale
South Ribble
Preston
West Lancashire
Blackburn with Darwen
Hyndburn
Blackpool
Pendle
Burnley
0
0
2012
Lancashire
2013
Blackburn with Darwen
Blackpool
2014
North West
England
There is considerable variation in the proportion of students achieving 5+ GCSEs at
grades A*-C, with strong results in Ribble Valley, Chorley, Wyre Lancaster and
Fylde.
Results are, however, very poor in Blackburn, Hyndburn, Pendle and Burnley, with
the overall results in East Lancashire a major concern.
20
40
% of pupils
60
80
A significant number of schools fall below the floor target in Lancashire. In total some
one in eight schools fail to meet this measure, affecting a large number of school
students each year.
Percentage of secondary schools below the floor target, 2013/14
Source: SFR
16
14
12
10
8
6
4
2
0
England
Lancashire LEP
North West
Participation, Attainment and Destinations of Young People
There were over 36,600 young people aged 16-17 in Lancashire at the end of 2012,
and 90% of them were participating in some form of education or work-based
learning. This represents a considerable increase over the past ten years,
18
particularly in Blackpool. Whilst participation has increased (partly as a result of
Raising the Participation Age), there are still around 10% of the cohort who are not
participating in education or work-based learning.
At Key Stage 5, 70% of those who have been entered for at least one A level or
other level 3 qualification go into education or employment, with an above average
number entering higher education. However, Lancashire’s young people are less
likely to attend higher education institutions (HEIs) ranked as within the top third of
UK HEIs by the Department of Business, Innovation and Skills. Nearly 10% of those
who complete Key Stage 5 in in Blackpool and Blackburn with Darwen go onto
higher education within FE Colleges.
Partipcation of 16 & 17 year olds in education and WBL, 2012
Source: SFR
100%
90%
10%
11%
10%
11%
Just under 90% of Lancashire’s 16 year olds progressed into sustained education
destinations in 2012, with a further 4-6% entering apprenticeships. 8% did not have
a sustained destination after Key Stage 4.
12%
80%
70%
Trends in FE Participation
60%
50%
40%
81%
80%
79%
Some 106,000 Lancashire residents participated in learning and training in
Lancashire in 2013/14 of which 75% was in Further Education Institutions.
79%
78%
30%
Learner Participation in Further Education in Lancashire 2013/14
20%
No. of
Learners
10%
0%
BwD
Blackpool Lancashire North West
Full-time education
WBL
Part-time education
England
Not participating
Education and Training
76,750
71.9%
Community Learning
26,360
24.7%
Workplace Learning
Total
The proportion of young people who attain level 2 qualifications by the age of 19 has
also increased significantly. However, in 2014, from a total cohort of more than
16,000 across the LEP area, over 5,000 had not achieved level 2 including English
and maths by the age of 19, and over 2,000 (13%) had not achieved Level 2 at all.
Attainment at age 19, 2014
Achieved
L2 inc.
English &
Maths
Achieved
L2
Had not
achieved
L2
Total
Cohort
Lancashire
9,080
2,280
1,575
12,935
Blackburn w. Darwen
1,170
425
235
1,830
865
430
265
1,560
11,115
3,135
2,075
16,325
Blackpool
Lancashire LEP area
Source: DfE Level 2 and 3 Attainment by Young People in England
%
3,660
3.4%
106,770
100.0%
Source: SFA
NB – workplace learning does not include ESF funded delivery or apprenticeships
Some of the key features of provision are:

Over 60,000 people were provided with learning in the preparation for life
and work subject area, the majority of provision through Further Education.

While numbers in community learning were substantial, the emphasis was
on business and commerce, with much less emphasis on technical and
STEM related learning.

Workplace learning provided less than 4% of places, with the most
significant numbers in engineering and manufacturing, and construction
and built environment. Numbers were very low in retail and commercial
(given the number of workplaces).

Further Education colleges provided significant learning and training in the
industrial and productive sectors, taking account of manufacturing,
construction, and science and mathematics.
19
Substantial numbers of learners took up learning opportunities with regard
to new economy opportunities, including in Information and
Communications Technology and Arts, Media and Publishing
The volume of learning activity undertaken by Lancashire residents is considerable.
There were 284,000 starts on learning aims by Lancashire residents in 2013/14.
However, this represented a decline of 14% over the previous year, largely as a
result of a fall (of 31%) in the number of learning aim starts by 16-18 year olds (with
a higher proportion staying on in school / sixth form education and a move towards
funding on a per learner, rather than a per qualification basis, leading to a reduction
in the number of learning aims recorded). In contrast, the number of starts by people
aged 25+ remained steady, despite the introduction of Advanced Learning Loans
(see below).
Amongst 16-18 year olds, over 40% of starts were on provision at Level 3 or above.
Whilst the take up of this level of provision has fallen since 2012/13 (by 11%), the
decline has been less marked than that affecting provision at level 1 and below (37%). Young people are most commonly undertaking learning in the Preparation
for Life and Work subject area.
Amongst adults aged 19+, the number of starts has declined by 1% since 2012/13.
Adult learning is much more focussed on lower levels of learning, with 63% of starts
on learning aims at level 2 or below. Again, Preparation for Life and Work is the
most commonly studied subject area (39% of all starts).
In broad terms, the sector focus of FE provision in Lancashire aligns with the main
employment sectors in the economy, taking account of employment growth and
replacement demand numbers.
Success Rates
The quality of further education provision in Lancashire has been recognised by
Ofsted through its inspection regime and is reflected in the high levels of satisfaction
reported by employers and learners. Success rates are nearly 90% across all
provider types, but vary across Lancashire’s local authority areas.
Education and Training success rate by institution
Source: SFA
Success rate (%)

100
90
80
70
60
50
40
30
20
10
0
Lancashire
General FE
and Tertiary
College
Sixth Form
College
Specialist
College
England
All Institution Other Public Private Sector
Type
Funded
Public Funded
Education and Training sucess rates by LA
Source: SFA
Fylde
Blackpool
Ribble Valley
Pendle
Burnley
Lancashire LEP
Rossendale
West Lancashire
South Ribble
Wyre
Chorley
Hyndburn
Blackburn with Darwen
Preston
Lancaster
0
20
40
60
80
100
Success rate (%)
Apprenticeships
Nearly 29,000 Lancashire residents are currently undertaking apprenticeships, and
there has been a marked increase in apprenticeships in Lancashire since 2010, in
line with national policy. Numbers peaked in 2012/13, and fell to 14,000 starts in
2013/14.
20
Apprenticeship Starts: Change 2005/6 to 2013/14
Lancashire Learner Profile by level: Apprenticeships
Source: SFR
20,000
18,000
16,000
14,000
12,000
10,000
8,000
6,000
4,000
2,000
0
2012/13
2013/14
% of total
% of total
% Change
Intermediate Level Apprenticeship
52%
64%
+0.3%
Advanced Level Apprenticeship
46%
33%
-42%
3%
3%
-23%
100%
100%
-19%
Higher Apprenticeship
Total
Lancashire Learner Profile by age : Apprenticeships
Under 16
2005/6 2006/7 2007/8 2008/9 2009/102010/112011/122012/132013/14
Lancashire LEP
England trend line
In terms of apprenticeship starts by sector, Lancashire has a similar profile to the
national situation, with the exception of business, administration and law, where the
proportion of total apprenticeships is higher.
Business, administration and law; health, public services and care; and retail and
commercial dominate apprenticeship provision in Lancashire, accounting for almost
75% of provision.
Manufacturing apprenticeships remain very important to Lancashire, accounting for
15% of the total. With over 2,000 starts in 2013/14, manufacturing has seen the
number of starts increase between 2011/13 and 2013/14, unlike the other main
sectors of provision. The number of construction apprenticeships is quite small
given the importance of the sector.
2012/13
2013/14
% of total
% of total
% Change
0%
0%
30%
16-18
21%
28%
11%
19-24
31%
36%
-7%
49%
36%
-40%
100%
100%
-19%
25+
Total
Source: Data Cube. Numbers cannot be disclosed
Lancashire has above average success rates in its apprenticeship provision, with
over 70% of apprentices successfully completing their qualification. Levels of
success vary considerably across the sub-geography, with highest levels of
achievement in Ribble Valley, and lowest in Blackpool. Pendle and Burnley have
some of the highest rates of apprenticeship success, despite relatively poor GCSE
performance.
Apprenticeship numbers are dominated by Intermediate Level Apprenticeships,
which account for 60% of provision. There was a substantial reduction in Advanced
Level Apprenticeships between 2012/13 and 2013/14, believed to be a result of the
introduction (and subsequent withdrawal) of Advanced Learning Loans for those
aged 24+ wanting to undertake an advanced apprenticeship. Higher Apprenticeship
numbers are minimal at 365 in the 2013/14 year.
Apprenticeship numbers are split fairly evenly between 16-18 year olds, 19-24 year
olds and those aged 25 and over. Changes in funding have led to a significant fall
in the older age category, and the number taking Advanced Apprenticeships.
21
Higher Education
Work Programme Performance
The proportion of young people who enter higher education varies considerably
across Lancashire, ranging from less than 27% to over 40% of the cohort.
Over 48,000 Lancashire residents have been attached to the Work Programme
since it began. Attachments closely align with the share of JSA unemployment in
each sub-geography.
Work Programme Attachments by Local Authority, to Dec 2014
Source: Work Programme: Local Authority cumulative figures
E Lancs
6%
B'pool, Fylde, Wyre
9%
Central Lancs
Lancaster
39%
W Lancs
20%
26%
Lancashire LEP = 48,440
One in five Work Programme participants have gone into work, although the job
entry rate varies considerably. This is slightly lower than the England average (22%
compared to 24% of all attachments), and in part reflects a more challenging
environment in Lancashire (i.e. lower levels of job creation than nationally). If the
Work Programme in Lancashire matched the England average job outcome level,
an additional 4,400 people would have moved into sustained employment.
The four Higher Education providers within the Lancashire LEP area – the University
of Lancaster, the University of Central Lancashire, Edge Hill University and the
University of Cumbria which has a large Lancaster campus – have over 66,000
students enrolled on their courses, over 20% of whom are postgraduates. Nearly
90% are UK-domiciled, but over one-third of full-time postgraduate students are
from outside the EU. Nearly 6,500 full-time equivalent students are undertaking HE
courses within Lancashire’s FE Colleges.
Nearly 60% of young first degree students at Lancashire’s HEIs are from the North
West region and the proportion amongst older students and those studying parttime for postgraduate qualifications is likely to be even higher. This may explain
why such a high proportion of Lancashire’s graduates find employment in the North
West (73% of those who go into employment, one of the highest levels in the
country).
Job outcomes (as a % of attachments)
35%
30%
25%
20%
15%
10%
5%
0%
Source: Work Programme: Local Authority cumulative f igures Ref errals
22
Conclusions
Employability
Fundamental Challenges
The Lancashire economy currently has too few jobs to provide the employment
opportunities to increase employment rates to a level which would significantly raise
low household incomes in many communities.
The Lancashire workforce is ageing, as it is elsewhere in England, and combined
with modest population growth, this presents the biggest challenge to the LEP
meeting its economic targets.
The current population, demographic and skills profile will make it more difficult for
Lancashire to attract some types of the inward investment needed to support the
employment targets set out by the LEP, although new development plans, including
residential development and the presence of hotspots / clusters in particular
industries will attract new investment.
Although a significant number of young people from Lancashire go on to higher
education, there is an out-flow of population in the 20-24 and 25-34 age groups.
This is partly a result of insufficient relevant graduate entry jobs, and the low
numbers in the workforce aged 21-34 years old is a serious weakness in the
workforce profile. This is not unique to Lancashire.
For the foreseeable future, Lancashire will need to attract workers in the key
occupations needed to support employment growth in the LEP priority sectors and
this will require a good employment and housing offer, as well as effective marketing
of the county as an attractive place to live and work.
Many employers are already finding it difficult to recruit higher skilled and
experienced personnel, and this includes a broad range of important sectors,
including health. Increasing demand for construction is likely to lead to more severe
skills shortages in skilled trades, with the potential for the displacement of skilled
workers from other sectors. The high level of replacement demand across sectors,
as workers retire or move on in the labour market, also creates an on-going
challenge of providing a sufficient number of trained workers with the required skills.
There are major challenges in creating new employment opportunities in East
Lancashire, and without more jobs, further population decline is likely. There are
also considerable challenges with regard to Blackpool, Fylde and Wyre. Slowing
the decline in manufacturing employment is a challenge across Lancashire.
There is a strong link between successful local economies and growing populations,
as increased employment attracts working households. While Lancashire has the
combination of employment and housing plans to support its economic aspirations
it is important that the contribution of housing growth to the availability of a skilled
workforce is recognised by all stakeholders.
A considerable number of people are without employment in Lancashire, and this
number has been affected by the very slow employment recovery compared to other
parts of England.
A lower employment rate, particularly amongst certain age groups (particularly older
people) and the doubling of unemployment since the onset of recession, with 50,000
currently unemployed, presents a challenge in an economy where employment
growth has been limited. The success in lowering the JSA unemployment rate has
masked the challenge of worklessness.
While the workforce is ageing, many people will need to remain in employment for
longer due to changes in pension arrangements. This will indirectly lead to fewer
employment opportunities for young people, unless new jobs are created in the
economy.
At the same time, many employers will not want to lose older workers, particularly in
those skills and occupations where there is a shortage of replacements.
There is a strong link between qualifications and employment, and too many people,
including those affected by Welfare Reform, have qualifications below Level 2.
These people are vulnerable to becoming trapped in low-paid and insecure
employment, leaving some communities experiencing low incomes and multiple
deprivation.
Whilst parts of the pre-19 education system perform strongly, there is a need to
improve the educational performance of school students in many parts of
Lancashire. With current attainment levels, too many school students will be unable
to take up the employment and training opportunities in the sectors which will create
new jobs.
Eighty thousand residents currently commute out of Lancashire to work, and
increasing this number through better public transport is likely to be part of a solution
to increase the employment rate and make more opportunities available to
residents.
East Lancashire in particular faces very severe problems, exacerbated by a falling
population and challenging employment situation.
23
Skills and Employment Provision
Lancashire has a number of highly regarded Further Education Colleges providing
substantial training each year to young people and adults. While providers attempt
to match market demand, and there is no evidence of a significant mismatch in
provision, there are some areas identified through the sector skills actions plans
where increased provision could be considered, including digital skills (including
online sales and marketing, social media and higher level technical skills), leadership
and management competencies, higher level STEM skills and specialist engineering
and technical skills, including short courses for people seeking to apply their existing
skills in new sectors.
Considerable numbers each year are provided with life and work skills.
Apprenticeships continue to provide work based training opportunities, although
again numbers are limited, and without further incentives it is not clear if employer
participation can be increased substantially, or if a significant number of young
people with the required capabilities and attitudes can be attracted into
apprenticeships as a vocational alternative to higher education. There is an
opportunity to use higher level and degree-level apprenticeships to help meet the
demand for higher level skills although, again, there may be a need for incentives to
increase employer participation until this route becomes established and valued by
employers.
The Work Programme is one of the largest back to work programmes in Lancashire,
although less than one in four of the substantial number of participants successfully
attain a job outcome.
Employment Growth and the Lancashire Workforce
Growth sectors in the Lancashire economy are forecast to create nearly 48,000 jobs
over the next ten years, offset by a decline of c. 18,000 in sectors which are expected
to contract (net growth of 29,900). If the LEP’s employment ambitions are met, net
employment growth will be 50,000 (two-thirds higher than the baseline forecast). In
terms of recruitment and skills to support this employment growth:

A marked increase in construction employment is likely to be inhibited by
skills and recruitment challenges.

A large proportion of the recruitment for the forecast increase in logistics
and distribution, the visitor economy and leisure can be met by local
residents supported by relevant occupational training.

labour market. Replacement demand will create much greater requirements for
skills and training provision than absolute employment growth, and much of it will be
in higher level occupations.
The economic forecasts suggest that manufacturing employment will decline by
some 10,000 jobs over the next ten years. Initiatives are underway to ensure this
does not happen and that manufacturing sub-sectors with the potential to grow are
fully supported. This will require:

New inward investment linked to Lancashire’s manufacturing specialisms
and supply chain.

The continual upskilling of the workforce.

A long term programme to bring new apprentices and graduates into the
industry.
Given the need for Lancashire to address the ageing of its workforce and to stop the
talent drain of younger workers, Lancashire needs to develop best in class
apprenticeship and graduate recruitment programmes.
Key Messages and Emerging Priorities
The overall competitiveness and sustainability of the Lancashire economy is linked
to a wider move to a higher skilled and more productive workforce in both
manufacturing and the service sector. This will require, at every level, a better
educated and qualified workforce, with both life and vocational skills.
The provision of training needs to take account of both the challenges in supporting
employment growth and the need to strengthen the existing business base through
a better skilled workforce. The emerging priorities with regard to young people and
the education and training system are:

Schools: improving the attainment rate of those schools where students
are seriously lagging behind.

IAG and Careers Advice: providing more advice at a younger age to
school students, highlighting the new opportunities and requirements in a
changing economy and highlighting the strengths of various routes to
industry qualification, training and employment, particularly vocational
routes.

16-19 year olds: ensuring all young people have the opportunities and
support they need to achieve a minimum of Level 2 qualifications by the
age of 19, including English and maths, and raising the proportion who
achieve Level 3.

Apprenticeships and vocational training: increasing the number and
quality of apprenticeships, and encouraging greater levels of provision at
The expected growth in business and professional services and ICT related
employment is likely to be affected by a limited pool of well qualified
younger people, and this may have an impact on inward investment.
Many of the challenges facing companies recruiting for new jobs will be exacerbated
by the need to replace existing workers as they retire, change jobs or leave the
24
higher levels, reaching more employers and introducing strengthened
mechanisms to help employers deliver apprenticeships.

Increase the number of young people going on to higher education:
Lancashire needs to increase the number of young people from all of its
communities going on to higher education. There is an opportunity to work
closely with and support the access work of the four Universities

FE Provision: work with Further Education Colleges, other providers of
education and training, and employers to target vocational training
opportunities at areas of high replacement demand and genuine
employment growth, and ensure that adults have the opportunity to re-train
to meet the needs of the economy and progress in the labour market.

FE Estate Renewal and New Facilities: continue to upgrade the FE
Estate and provide new facilities and equipment which reflect the new
economy priority sectors.

Employer Engagement: increase employer engagement in skills, and
encourage greater commitment to workforce development, as well as
encouraging employers to work with education providers to influence
vocational provision. Providers need to make better collective and
individual use of the soft intelligence on skills needs that they gather
through their employer engagement activities.
ensure public funds are directed towards areas of high replacement
demand and genuine employment growth.

Advanced Manufacturing: given the ageing workforce and high levels of
replacement demand, the priorities are to attract more young people into
the sector by inspiring and engaging them at a young age, to recruit and
retain a competitive workforce by ensuring the sector and the location are
attractive to people, to develop a responsive learning infrastructure system
which can adapt to changes within the industry and responds to employer
demand, and to secure employer investment in training by ensuring
employers are able to influence provision.

Financial and Professional Services: address skills gaps and shortages
and meet the expected high levels of replacement demand, develop a more
responsive supply of training provision, improve sector intelligence, and
increase the attractiveness of Lancashire as a place to work in the financial
and professional services sector.

Health and Social Care: as society ages, demands on the health and
social care sector increase. In order to meet these needs, challenges
within the health and social care workforce will have to be tackled, through
strengthening employer influence over skills and training provision, coordinate the use of public investment in skills, widen access through
alternative entry routes, and develop a stronger provider base able to meet
employer needs.

Visitor Economy: to ensure the sector can play its full role in meeting
Lancashire’s growth ambitions, there is a need to attract more appropriately
skilled young people into the sector; address skills gaps within the existing
workforce, including management and leadership; and learn from good
practice, supporting the roll-out of innovative and effective practice.

Energy and Environmental Technologies: meet demand for technical,
softer and business skills; increase the attraction of the sector in Lancashire
through changing perceptions of both the industry and the location; improve
intelligence by tracking developments in the sector; and develop the supply
side by ensuring availability of appropriately skilled FE staff and adjusting
provision to meet employer needs.

Creative and Digital Industries: increase the pipeline of digital skills,
working from schools to HEIs, in order to tackle skills gaps and shortages
relating to digital skills; ensure the skills enhancement system is more
appropriate to the needs of dynamic microbusinesses in Lancashire; and
improve recruitment and retention through addressing the challenges and
opportunities of the position of the sector in Lancashire.
The emerging priorities with regard to employers and workforce development are:

IAG and Careers Advice: support the careers work of local schools as part
of the process of making young people more aware of opportunities and
progression routes in key sectors.

Apprenticeships and vocational training: invest in the workforce and
address future skills shortages by increasing the number and quality of
apprenticeships.

Graduate Recruitment: work with local stakeholders to develop new and
innovative mechanisms to increase internships and graduate placements
across the Lancashire business base.

Workforce progression and up-skilling: support progress within the
workforce, through up-skilling and career changes, and access to higher
education, in order to anticipate future recruitment challenges and alleviate
potential skills shortages.

Influence vocational training provision: develop mechanisms through
which employers can work with Further Education Colleges, other providers
of education and training, to influence vocational training provision and
25

Construction: given the need to complete major infrastructure works and
increase residential development, develop a super initiative, based on
arrangements already in place and working with industry bodies, to address
requirements and skills changes in construction, encourage the industry to
recruit older workers and increase the number of apprenticeships in skilled
trades.
The emerging priorities with regard to helping people into employment are:

Young People and Employability: there is a need to increase efforts to
link young people and those seeking employment with the regular
opportunities made available through replacement demand, to tackle
employability issues before they become entrenched by reducing the
number of young people becoming NEET; and to work with those at risk of
redundancy to re-train or transfer their skills to other sectors / employers.

Work Programme: Lancashire needs a more effective Work Programme
capable of generating higher than average outcomes for local residents.
This Programme remains the largest Government funded initiative of its
type and it needs to be improved as a matter of urgency.

Understanding worklessness: there are 50,000 people looking for
employment, while only 16,000 are in receipt of Job Seekers Allowance.
More work is needed to understand this hidden unemployment group and
determine the types of support which could help more people back into
employment.
These priorities need to sit alongside efforts to increase indigenous business growth
and new inward investment to provide additional employment. This will include the
development of strategic sites, employment land and commercial floorspace, and
provision of more housing to increase the Lancashire population, with a focus on
more and preferably younger working households. At the same time, there are a
number of challenges which relate to place and these need to be taken into account
in developing skills and learning priorities.
In the light of the importance of skills and training, the significant amounts of monies
invested each year by national agencies and the move to devolution, Lancashire
needs to consider how more local control and influence over key areas of activity
and funding could advance the economic and skills agenda.
26
1
Introduction
are highlighted where relevant. An annex, providing headline data and identifying
key issues, is provided for each sub-geography.
Purpose of the Report
1.1
This report provides a comprehensive evidence base on skills and
employment covering the Lancashire Local Enterprise Partnership (LEP) area. The
report has been produced to provide the Lancashire Employment and Skills Board
with an overview of skills and employment issues within Lancashire, and support
partners as they develop a skills and employment strategy. The report provides
robust evidence and identifies key messages relating to skills and employment in
Lancashire, which can be used to agree strategic priorities and determine priorities
for future investment4.
Background
1.2
Lancashire’s Strategic Economic Plan (SEP) sets out an ambitious plan to
create 50,000 new jobs, 40,000 new houses and add £3bn of additional economic
activity to the Lancashire economy over a ten year period, representing a step
change for an economy which currently underperforms compared to the national
average. It is recognised within the county that skills will play an important part in
achieving these ambitions, both through driving up productivity in existing sectors
and by encouraging job creation within the growing and developing sectors
identified within the Lancashire economy.
1.3
A considerable amount of research into skills needs in Lancashire has
been undertaken in recent years, particularly focussing on specific sectors and
wider economic and employment forecasts. The county also benefits from an
impressive skills and employment infrastructure, with high-performing Further and
Higher Education institutions and many employers who are committed to investing
in the skills of their workforce.
1.4
The LEP has established an Employment and Skills Board, bringing
together senior representatives from the private, higher education, further
education, and group training association sectors to work with industry and training
providers to ensure a more co-ordinated and demand-led approach to skills delivery
in Lancashire.
1.5
The skills and employment evidence base supports the Employment and
Skills Board in this intention by bringing together the existing evidence base, filling
gaps in the understanding of skills needs, and contrasting the position in Lancashire
with the North West and England (excluding London), whilst identifying specific local
issues within Lancashire. Variations in performance across five sub-geographies
An Introduction to Lancashire
1.6
Lancashire LEP has one of the largest economies in the North, with over
617,000 people in employment and 1,468,800 residents. The area is geographically
diverse, with a network of urban centres surrounded by areas of countryside and
rural fringe and particular economic strengths in the towns of Lancaster and
Preston.
1.7
The LEP area has a large business base, with over 40,000 businesses,
and generates £24.7bn Gross Value Added (GVA) per annum. The economy has
strong roots in industry and particular strengths in the advanced manufacturing,
aerospace and nuclear sectors. The presence of four high quality Universities within
Lancashire also helps contribute to the LEP’s growth potential.
1.8
As noted above however, the Lancashire economy underperforms
compared to the national average, with lower levels of employment, GVA, higher
level skills and a smaller business base.
4
Throughout the report, Lancashire is compared to the national average, excluding London.
This is to remove the distorting effects of London’s position as a global city from the analysis,
and provide a fairer comparison of Lancashire’s employment and skills performance.
27

Relative performance
Employment Density
67,252 jobs per 100,000
Working Age residents
Gap with National (minus
London): 1,000 jobs per
100,000 WA residents
GVA per FTE
£
£49,580 in Lancashire
Compared to £59,939
Nationally (minus
London)
54 businesses per
1,000 WA residents
Gap with National (minus
London): 5 businesses
per 1,000 WA residents
1.12
The Preston, South Ribble and Lancashire City Deal has secured £434m
investment in infrastructure to unlock key employment and housing sites. The
infrastructure will improve connections across Lancashire, including improvements
to the motorway network, access to city and town centres and improvements to
public transport. The target is to create 20,000 new private sector jobs, nearly £1bn
in GVA, 17,240 new homes and £2.3bn leveraged commercial investment.
GVA per Head: £16,870
Compared to £23,475 Nationally
(minus London)
Business Density
Skills
29% of residents
qualified to Level 4+
Compared to 32% Nationally
(minus London)
1.13
The City Deal also includes infrastructure which will unlock two Enterprise
Zone sites: Samlesbury and Warton. The Enterprise Zone is expected to create
6,000 jobs, plus 5,000 – 7,000 in the local supply chain. The sites will build on the
areas advanced manufacturing, aerospace and automotive specialisms, offering
unique opportunities for business based there.
1.14
Lancashire’s economy is diverse, but the key centres of economic activity
are found in an ‘Arc of Prosperity’, which sweeps across Lancashire, capturing an
array of Lancashire’s industrial hotspots, key strategic sites, clusters of high value
activity and internationally recognised centres of excellence in research and
innovation.
1.15
Key strengths include:

Ambitions for Lancashire and Investment Priorities

1.9
The overarching vision for Lancashire is to re-establish the area as an
economic powerhouse and to build on current strengths and capabilities in key
sectors to establish Lancashire as a national centre of excellence in advanced
manufacturing.


1.10
The Strategic Economic Plan targets of 50,000 new jobs, 40,000 new
houses and £3 billion additional economic activity, if achieved, would enable
Lancashire to outperform the national employment growth and increase the value
of the LEP economy by 10% over the next 10 years.
1.11
Growing the Local Skills and Business Base: Includes the development of
the skills infrastructure across Lancashire, and support for the Business
Growth Hub.


Lancaster: a key driver of economic and housing growth, heightened by
the presence of Lancaster University and the renewed city centre.
Wyre and Flyde: the presence of a growing cluster of polymer science,
nuclear and renewable energy companies
Blackpool: as a leading UK visitor destination
Enterprise Zone sites at Samlesbury and Warton driving advanced
manufacturing growth
Central Lancashire: with a strong presence of leading automotive
companies
Preston: as the LEP’s largest urban centre and the focus of the City Deal
programme
The key features of the Growth Deal agreed with Government include:


Releasing Growth Potential: Includes transport improvements to support
job creation and enable the realease of land for more homes and
businesses
Supporting the Renewal and Growth of Blackpool: £9m to be invested in
Blackpool to boost the visitor economy and improve housing standards.
New Economy, New Lancashire
The Ambition
1.16
For many parts of Lancashire, the 1980 and 1990s were characterised by
local partners, businesses and communities dealing with the after effects of major
industrial decline and dramatic employment losses. This period, in effect, set a new
challenge for Lancashire – how to move from the legacy of a historic industrial past,
28

to a modern, competitive economy, based on new products and services, trends in
living and leisure, innovation and creativity, in a world of both international
opportunities and competition.
1.17
Lancashire LEP has embarked on a 20-30 year journey to transform the
Lancashire economy, building on its many assets, to focus the new economy on
sectors and services where market demand is growing and long term prospects are
positive. Lancashire’s new economy is based on a world class and competitive
manufacturing sector, new opportunities for higher value added service sectors, and
the natural and heritage assets which underpin a strong leisure and visitor economy.
It will be built on many of the companies already here, and new inward investors
keen to locate in an economy where a great quality of life comes at an affordable
cost.
The New Economy
1.18
The 21st Century Lancashire economy will be characterised by a business
base focussed on taking advantage of markets and innovation, looking to the future,
not the past, a business community building new glories, rather than reminiscing on
bygone days.
1.19
1.20
These sectors will be the principle source of wealth generation in the new
Lancashire economy, whilst other sectors, such as retail, health, education and
transport will provide the services which support strong local economies and
communities.
Education, Skills and Knowledge
1.21
As the new economy of the 21st century increases the emphasis on a well
qualified and skilled workforce, Lancashire’s higher and further education centres
are attracting more students, both locally and from elsewhere in the UK and abroad.
New investment in facilities reflects the need for state of the art training for the new
economy.
Lancashire’s Universities are leading the way with:
1.22

University of Lancaster in the UK top ten research Universities, a result of
a major investment in the undergraduate campus, specialist research
centres and the attraction of leading researchers and post graduate
students, with a major new investment in the Health Innovation Campus
about to get underway.

The University of Central Lancashire, a major provider of new graduates to
Lancashire companies, with an ambitious new masterplan which will link
the campus into the Preston town centre plans, with new facilities such as
the Engineering Innovation Centre increasing student numbers and
business linkages.

Edge Hill University, based at Ormskirk West Lancashire and with three
faculties, Arts and Sciences, Education and Health and Social Care,
offering both undergraduate and post graduates courses

The University of Cumbria, with its largest campus based in Lancaster,
offering undergraduate and post graduate courses in business and
management, health and social care and education, amongst others.
The major sectors will include:



Advanced engineering, building on world class Original Equipment
Manufacturers (OEMs) and an extensive supply chain, with aerospace
leading the way in using new materials and production processes to
maintain Lancashire’s exceptional contribution to UK trade.
Energy and environment, already an important employer, and with new
opportunities in energy production, waste management and environmental
services, likely to be a major source of new employment over the next
twenty years.
Professional, financial and business services, already the major source of
private sector employment, with clusters across the county including
Preston, South Ribble, Lancaster, Skelmersdale, Burnley and rural Fylde,
with both national and regional companies in key sub-sectors.

Creative, digital, media and ICT, building on a number of emerging centres
as well as a strong presence in many rural parts of the County, with new
entrepreneurs taking advantage of the quality of life and the opportunity to
work from or close to home in inexpensive offices and workshops.

Logistics, taking advantage of the strategic road network and large sites
available for distribution and logistics centres, as well as the county’s
location as the gateway to the Scottish economy.
High quality tourism and leisure, combining coast, country, outdoor and
heritage, offering a product and support services which meet the increasing
demand, both domestic and international, for high quality leisure activities.
1.23
A network of modern, well equipped Further Education Colleges and other
providers are delivering high quality training, from skills for life and vocational
qualification including apprenticeships, to a substantial level of higher education
provision, helping to provide employers with a regular supply of well motivated, well
qualified young people.
1.24
Lancashire’s new economy will be characterised by businesses which
invest in human capital, with close working relationships between businesses,
schools, training providers, Colleges and Universities.
29
The Places
1.25
The new economy in Lancashire will benefit every town and village, as new
and better employment feeds in to more choices for young people and higher
household incomes. The new Lancashire will be reflected in the major economic
centres with:


Preston, as a major north of England economic hub, with investment in the
town centre leading to retail, leisure and commercial development creating
a centre where people work and spend their leisure time, with a large
student community and major industrial presence at the nearby Enterprise
Zone.
Blackburn, the Gateway location to the M65 Growth Corridor, anchoring a
revitalised and better connected Pennine Lancashire, with industrial and
logistics investment taking advantage of the strategic road network, and
new office development providing a competitive offer to service based
businesses.

Blackpool reborn, one of the few remaining classic British resorts, with
ambitious plans to create a leading centre for year round tourism, with new
investment complementing the outdoor assets of the Fylde coast.

Lancaster: the jewel in the crown, one of the most popular heritage towns
in the north of England, at the centre of a thriving rural economy and a top
ten University with a large undergraduate and postgraduate population.

Burnley, with a renewed sense of purpose, building on its reputations as
one of the most enterprising places in the UK.
1.26
Much of the initial and catalytic investment has already been secured. The
Preston and South Ribble City Deal, with £400m of investment agreed, will
transform the city centre’s investment prospects, with the Enterprise Zone providing
a further economic stimulus.
1.27
Blackburn has also advanced its plans for town centre renewal, with works
on the outstanding Cathedral development area, new market and retail centre at the
final stages. Elsewhere Burnley has led the way in using new investment to create
a new platform for inward investment.
Homes and Communities
1.28
The Lancashire economy, as for many other parts of the UK, needs to
attract new skilled labour to support its economic and employment growth plans.
New housing will be a key element in delivering economic growth in Lancashire over
the next twenty years.
1.29
In order to do this successfully, Lancashire plans to provide housing in
attractive locations where people want to live, close to employment centres and with
good transport links to other parts of the north.
1.30
Lancashire has a remarkably diverse housing offer, from coast, country
and village life to major towns and cities, such as Preston and Lancaster. As
importantly Lancashire has a breadth of housing offer from affordable family housing
to executive housing.
1.31
Lancashire will provide more housing in popular neighbourhoods and
towns, while at the same time, delivering major new housing developments in
locations close to the road and rail network to ensure the scale of new housing
needed to support economic growth is delivered.
1.32
The delivery of a consistently higher level of housing completions ,
supported by supportive local planning policies, will allow Lancashire to support a
growing population and workforce, in contrast to the current policy off scenario.
The Connected County
1.33
New transport investment in the rail network will lead to better services to
the Manchester conurbation, with a marked improvement in services from
Blackburn and Burnley, as well as an increase in services from Preston and
Blackpool. These and other investments will strengthen Lancashire’s links to both
the Greater Manchester and Merseyside economies.
1.34
New investment on the road network in and around Preston will improve
access to the city, strengthening Lancashire’s role as the central location between
Greater Manchester and Merseyside to the south and Scotland to the north.
1.35
While increased connectivity is partly about physical links, increased
business and institutional links will ensure that Lancashire contributes to the
Northern Powerhouse. Industry groups such as the Aerospace Alliance are already
linked to other business and supply chain networks, whilst the University of
Lancaster and UCLan collaborate closely with other national and international
organisations. These outward facing linkages will be a feature of a connected
Lancashire, with civic leaders working closely with other combined authorities.
Phase One: 2015-2025
1.36
Lancashire LEP has set out its plans for the first stage of the transformation
of the Lancashire economy. Some 50,000 jobs over the next ten years in a more
competitive manufacturing sector, higher value added service sectors, and the
visitor and leisure economy will be based on the strength of the company base, the
skills of the workforce and a great quality of life at an affordable cost.
1.37
This initial phase will be linked to an outward facing economy making a
significant and recognised contribution to a resurgent north of England economy,
30
with civic and business leaders making the case for new investment to further
increase Lancashire’s economic contribution to the national economy.
1.38
It is in the context of these ambitions, that the challenges facing the
Lancashire economy and labour market should be considered.
Coverage of the Report
1.39
The report is structured in the following way:






Chapter 2 provides an overview of the economic and labour market context
in which Lancashire’s skills and employment position should be assessed;
Chapter 3 looks at the current and future labour supply in Lancashire,
including population, economic activity and the skills profile;
Chapter 4 examines labour market demand, including workplace
employment (by sector), productivity levels, the business base and
employer demand for skills;
Chapter 5 sets out the economic forecasts for Lancashire and considers
the implications for skills needs. It also considers some alternative growth
scenarios;
Chapter 6 presents data on the performance of the skills and employment
system in Lancashire, from primary education to higher education;
Chapter 7 draws out the implications of the data analysis and research, and
sets out some issues to be considered as the Lancashire partners begin
the process of developing a skills and employment strategy for the Local
Enterprise Partnership area.
31
2
Economic, Labour Market, Education and
Skills Context
Key Messages
•
The national economy is experiencing a gradual economic recovery
from recession. There is a broadly positive economic outlook, but a
series of economic and political factors have the potential to have an
adverse effect on businesses and world markets, with a potential knockon effect for local economies within the UK.
•
The UK has seen employment increase beyond the pre-recession
position to reach record levels, although there are concerns about the
quality of some of the jobs being created
•
Low Wage Growth Alongside higher unemployment, labour market
adjustment in response to the recent downturn took place through lower
real wage growth, and this is only just starting to change.
•
Labour productivity Despite strong employment growth over much of
2013 and 2014, increases in labour productivity have been subdued.
•
Self-employment is higher in the UK than at any point over the past 40
years and has driven employment growth nationally since the downturn
in 2008. The most common roles are working in construction and taxi
driving, but in recent years there have been increases in self
employment in higher level roles such as management consultants.
•
•
Older workers The UK has seen rising numbers of older workers due
to a number of demographic, economic and policy factors including
longer life expectancy and lower birth rates, the impact of low interest
rates on the affordability of retirement, and the abolition of compulsory
retirement.
Welfare Reform The means-tested benefit system is undergoing
considerable change with the introduction and roll out of Universal Credit
The government hopes Universal Credit will strengthen the financial
incentive to work, although roll-out is still in its early stages.
•
Numerous changes are affecting the education and skills sector. The
national curriculum has been revised, with changes to the content of
courses and the way in which they are assessed, with the aim of
matching the best performing education systems in the world.
•
GCSEs, A levels and AS levels have been re-designed with more end
of course examination AS levels no longer counting towards A level
achievement.
•
The Further Education sector has been hit hard by changes to the
funding regime and an overall decline in funding. The impact of the
introduction of Advanced Learning Loans for those aged 24+
undertaking study at level 3 and above is yet to be fully understood, but
there has been a considerable fall in the number of people, particularly
young people, starting FE learning.
•
Apprenticeships are an important part of the Government’s strategy for
meeting employer skills needs, but there are concerns that the term is
being devalued and considerable challenges involved in meeting the
Government’s target of 3 million apprenticeships by 2020.
Economic Trends and Outlook
2.1
Following a number of years of weak global economic performance, the
outlook for the world economy over the coming years will have a major influence on
the economic prospects of the Lancashire LEP area, affecting business and
consumer confidence, investment decisions and export levels. The prospects
appear mixed, with commentators such as the IMF expecting the gradual recovery
from the financial crisis of 2008 to continue, driven by growth in the US, and boosted
by the decline in the price of oil.
2.2
However, a number of risks are apparent which, if realised, could depress
growth rates and have a significant impact on economic growth both locally and
nationally. The major risks include:
32

Oil prices. Whilst the recent decline has contributed to world economic growth
through reduced costs for businesses and increased consumer spending power,
a prolonged spell of low oil prices could cause turbulence in the global economy
as a result of the pressures imposed on major oil exporting nations, and the
potential impact on the shale gas sector in the US.

On-going weakness in the eurozone. There is still little sign of economic
recovery across much of the eurozone, with deflation an increasing risk as
businesses and consumers delay investment decisions and spending plans, and
the Greek debt crisis creating a considerable amount of uncertainty. As a major
destination for UK exports, this weakness has the potential to constrain UK
growth.



The performance of the Chinese economy. Growth is expected to continue
to slow in China (although will still be considerably higher than in the western
economies). This will affect demand for oil and other commodities, hitting
commodity-exporting nations. Countries which import Chinese goods, including
the US and the eurozone, will experience an increased likelihood of deflation as
the price of imports from China falls.
Expected increase in US interest rates. Rates of growth in the US economy
mean that the Federal Reserve is expected to raise interest rates from their
current record low during 2015. The uncertainty over when this will occur may
cause volatility in global markets, and higher US rates could lead to movements
in capital from emerging markets back to the US.
Economic uncertainty arising from the UK’s referendum on membership of
the EU. The election of a Conservative government means a referendum on EU
membership will go ahead, and it is likely to be brought forward from 2017. This
will give rise to a period of uncertainty for businesses, including the many
exporters located within Lancashire.
2.3
The UK economy grew strongly in 2014, with ONS reporting that the
recovery gathered pace as a result of growth in both public and private sector
investment and higher household spending. Overall the outlook for the UK economy
in 2015 is positive, although growth is expected to slow slightly from the rate of
nearly 3% achieved in 2014. Growth over the past two years has been supported
by rising consumer spending, fuelled by the increasing proportion of the population
in employment and rising house prices (and despite little growth in real wages).
Over the past year, business investment began to strengthen and there are signs
that businesses’ spare capacity has reduced.
5
Labour Productivity - Q3 2014, ONS.
2.4
Inflation has fallen in the UK and has now been below the 2% target since
January 2014. Whilst this is expected to continue in the short term, inflation could
begin to increase if commodity prices are pushed up through global economic
growth or wages rise without an accompanying improvement in productivity within
the UK. It is expected that UK interest rates will finally begin to rise during 2015
and, whilst the timing of any rise is still uncertain, in the medium-term the cost of
investment is likely to increase.
2.5
There are clear regional differences in the pace of recovery, with the
Centre for Cities highlighting a widening divergence in growth rates between
southern cities and the rest of the UK, in relation to employment, business and
population growth. Employment recovery in Lancashire has been much slower than
in other parts of the UK, as is highlighted in chapter 3 and 4 of this report.
2.6
There are a number of uncertainties affecting the UK economy, not least
the issues affecting the eurozone, and the potential disruption arising from the
referendum on EU membership. The health of the UK economy will have an
important influence on the economic performance of the Lancashire LEP area and
the extent to which the ambitious targets set by the LEP will be achieved.
Labour Market Context
2.7
The UK economic recovery has gathered pace over the last 12 months and
independent forecasts of economic growth for 2015 are relatively strong. There is
now a record number of people in work and unemployment has fallen, with the
headline rate of unemployment on a downwards trend since the start of 2013,
although it remains above its 2000-2007 average. Beyond the headline indicators
of employment and unemployment, a number of trends which have emerged which
will shape future economic growth and the labour market.
2.8
Labour productivity Despite strong employment growth over much of
2013 and 2014, increases in labour productivity have been subdued. The most
recent labour productivity data5 shows some improvement, with output per hour
rising by 0.6% in Q3 2014 compared with the previous quarter. This is the strongest
rise seen since 2011, driven by improvements in both the production and services
sectors. However the level of output per hour remains below the level reached in
the last growth period, with implications for wages, output and the overall strength
of economic performance.
2.9
Self-employment6 is higher in the UK than at any point over the past 40
years and has driven employment growth nationally since the downturn in 2008.
This boom in self employment is predominantly due to fewer people leaving self
employment rather than an increase in the number becoming self employed. This
fall in outflow is thought to be due to social and economic factors such as people
6
Self-employed workers in the UK – 2014, ONS.
33
choosing to work for longer rather than to retire and fewer opportunities to work as
an employee during the downturn. The prolonged downturn has also led to changes
in the profile of self-employed workers: generally they tend to be older than
employees, but those who are newly self employed (self employed for three months
or less) tend to be younger compared to the profile of all self employed people. The
most common roles are working in construction and taxi driving, but in recent years
there have been increases in self employment in higher level roles such as
management consultants.
2.14
Low Wage Growth Alongside higher unemployment, labour market
adjustment in response to the recent downturn took place through lower real wage
growth. The fall in economic activity during this period put downward pressure on
nominal wage rises at a time when price inflation picked up.
2.10
In terms of hours and earnings, self employed workers are more likely to
work a longer (over 45 hours) or shorter (8 hours or less) working week than
employees. The average income from self employment is estimated at just over
£200 per week and self employed workers’ income has fallen by 22% since 2008/09.

2.11
Zero-hours contracts are employment contracts in which an employer
does not guarantee the individual any work and the individual is not obliged to
accept any work offered. There are an estimated 697,000 employees in the UK
employed on a zero-hours contract and their use has risen dramatically in recent
years, with three times as many employees engaged on these terms than in 2012.

2.12




2.15
Leading up to the recession, wages grew considerably. The UK has since
experienced the biggest fall in real wages (5.1%), which have been falling
consistently since 2010, the longest such period since at least 19648. A number of
factors have contributed to this trend9, including:
Key features of the zero-hours contract workforce are:
Younger people are more likely to be employed on a zero-hours contract (34%
are held by those aged 16-24), reflecting the fact that these types of contracts
may be more suitable for those seeking to undertake part-time work alongside
study;
Nearly two thirds of employees on these contracts work part time (66%) and
employees on zero-hours contracts are more likely to want more hours than
those who are not (31% compared to 12%);
Zero-hours contracts are predominantly held by employees in the
accommodation and food sector (23%) and health and social care (21%);
Those employed on zero-hours contracts receive lower gross-weekly pay, and
workplaces that utilise zero-hours contracts have a higher proportion of staff on
low pay (between the national minimum wage of £6.19 per hour and £7.50 per
hour) than those who do not7.
2.16
Overall, low wage growth reflects low levels of productivity growth within
the economy and has had knock on effects including lower than expected tax
revenues for the government, which has slowed deficit reduction.
2.17
Older workers The UK has seen rising numbers of older workers due to a
number of factors including longer life expectancy, the impact of low interest rates
on the affordability of retirement, and the abolition of compulsory retirement. The
key features of the older workforce (aged 50+) are10:



7
9
A matter of time: The rise of zero hours contracts, Resolution Foundation 2013.
How have labour markets changed across the G7 countries?, ONS 2014.
Older workers are more likely to be self-employed than their younger
counterparts (32% compared to 13%).
Around two-thirds of older workers work part time and eight in every ten older
workers have been with their employer for five years or more.
Men working later in life tend to stay on in higher skill roles while women tend to
stay on in lower skill roles.
Just over half (51%) of older workers are employed in small organisations (25
employees or fewer).

2.13
Zero-hours contracts offer flexibility for both the employer and employee,
which can work well in some circumstances, although the rise of low paid and part
time zero hours contracts may partly explain the trend of rising employment but
falling real wages (see below) and is contributing to the low levels of productivity
growth.
8
Fewer hours worked: Changing working patterns, particularly a reduction in the
number of hours worked since 2008, have had an impact on real average weekly
earnings. Part time working has increased and the lower number of hours worked
has reduced weekly earnings;
Labour market composition: The long-term shift in employment away from
relatively higher paid manufacturing jobs towards relatively lower paid service
sector employment has had a downward effect on wage levels. Since the
recession, the composition of employment within the service sector has also
changed, with lower paid occupations within sector growing faster than higher
paid occupations, generating a small negative influence on real wage growth.
2.18
The trend of increasing numbers of older workers is set to continue and
older workers are projected to account for a third of the workforce by 2020.
An examination of fall real wages 2010-2013, ONS, Jan 2014
Older workers in the labour market – 2012, ONS.
10
34
2.19
Welfare Reform The means-tested benefit system is undergoing
considerable change with the introduction and roll out of Universal Credit. Those
receiving income-based jobseeker's allowance, income-related employment and
support allowance, income support, child tax credit, working tax credit and housing
benefit will receive a single benefit which is designed to be flexible and responsive
to changing working patterns and circumstances. The government hopes Universal
Credit will strengthen the financial incentive to work. Evidence from the Institute of
Fiscal Studies suggests that this will be partially effective and while Universal Credit
will strengthen the incentive for couples to have someone in work, it will weaken the
incentive to have a second earner. It will however remove many of the weakest
work incentives11.
Education and Skills Policy Context
2.20
There have been numerous policy changes affecting the education and
skills sector which have implications for Lancashire’s labour market. These range
from changes to the curriculum for those in statutory education to the introduction
of loans for learners aged 24+, and are summarised below.
2.21
Numerous changes to statutory education have been announced since the
election of the Coalition Government in 2010. These have included the introduction
of changes to the national curriculum, beginning in September 2014 for pupils
aged 5-14 and 2015 for GCSE students.
2.22
The new curriculum is designed to ensure England’s education system
matches the performance of the best around the world, with a strong focus on
essential knowledge and skills. It is being accompanied by changes in the
assessment process, with pupils’ progress no longer being assessed a series of
‘levels’. There are also significant changes underway to the education system, with
growing numbers of Academies (which are not under Local Education Authority
control, and do not have to follow the national curriculum), as well as University
Technical Colleges (including UTC Lancashire in Burnley, specialising in
Construction and Engineering) and Free Schools being established (including three
to date in Lancashire, at least five in Blackburn with Darwen and one in Blackpool).
2.23
New GCSE courses are being introduced from September 2015. The new
courses have more demanding content, and are designed as one programme of
study, rather than a series of modules. The contribution of coursework to the final
mark will be reduced, with all exams taken at the end of the two year course. A new
9 to 1 grading scale will be introduced, with 9 the highest grade possible.
2.24
New A level and AS level courses are also being introduced from
September 2015 onwards. Again, the content of the courses has been reviewed
11
Do the UK government’s welfare reforms make work pay?, Institute for Fiscal Studies
2013.
and updated, with greater input from universities. Assessment, which will be mainly
by means of exam, will take place at the end of the course, with no modules and no
January exams, and AS levels will no longer count towards an A level.
2.25
Changes to study programmes for 16-19 year olds were implemented
in September 2013. These required that all pupils had the opportunity to follow a
study programme tailored to their specific needs and learning goals, and that those
who had not achieved GCSE English or maths at grade C or above by the end of
Key Stage 4 continued these subjects post-16. Changes to funding were also
introduced, with funding now linked to the learner, rather than the individual
qualifications that they undertake.
2.26
The Raising of the Participation Age, which came into effect in summer
2013, means that all young people are required to participate in either: full-time
study in a school, college or with a training provider; full-time work or volunteering
combined with part-time education or training; or an apprenticeship. Local
authorities are required to identify young people and support young people who are
not participating.
2.27
There have also been changes to the careers guidance system, with the
National Careers Service launched in 2012. This provides advice over the phone
and online for those aged 13 and over (and their parents). Schools were given the
statutory duty of securing access to impartial careers guidance for all pupils in years
8-13, but following concerns that many were not meeting this duty effectively, new
statutory guidance was issued in March 201512. This re-stated the requirement and
provided detailed guidance to schools on how this should be met.
2.28
Apprenticeships are the government’s flagship programme for meeting
employer skills needs. Apprenticeships involve both on and off the job training, and
lead to nationally recognised vocational qualifications. New apprenticeship
standards have been developed, with employers closely involved in designing the
standards and topics studied, and higher level apprenticeships have been
introduced, leading to qualifications at levels 4, 5 and 6.
Funding for
apprenticeships has been protected, and the Government has announced a target
of 3 million apprenticeships by 2020. There has been concern that the term
‘apprenticeship’ is being diminished and the government is to introduce legal
protection to ensure it is only used to refer to scheme which provide at least a year’s
training, as well as meeting other requirements.
2.29
Traineeships were introduced in 2013 to provide a route into an
apprenticeship for young people aged 16-23 who wish to work but need extra help
before being able to access an apprenticeship place or job. Provided by college or
12 Careers guidance and inspiration in schools, statutory guidance for governing bodies,
school leaders and school staff, DfE, March 2015
35
work-based learning providers, they give young people the opportunity to develop
skills which will be valued by employers.
2.30
The further education sector has been severely affected by funding cuts
in recent years, with a further 24% reduction in the adult skills budget this year. The
budget for adult FE is around £4bn per annum, with £498m set aside for FE loans
(see below). The funding cuts are having a profound impact on the provision of
adult skills training, other than that related to basic skills and those seeking
employment, with the number of advanced and higher level apprenticeships falling
significantly, a reduction in the level of workplace learning, and falls in the number
of starts in sectors including arts, media and publishing, leisure, travel and tourism
and social sciences.
2.31
Advanced Learning Loans were introduced in 2013/14 for those aged
24+ studying courses at Level 3 and above, with grant funding withdrawn from this
group, and learners and employers expected to contribute to the costs of advanced
level learning. Originally, advanced level apprenticeships were covered by the
loans, but this has subsequently been overturned. Little research is available so far
on the impact of Advanced Learning Loans at local level.
Conclusions
The economic, labour market and policy context will have a profound influence on
the performance of Lancashire’s labour market over the coming years, and have an
impact on the LEP’s ability to meet its employment and GVA growth targets.
Lancashire partners need to be aware of and respond to the wider economic and
policy environment, as well as making the case for changes which will support the
LEP in its aims.
36
3
Labour Supply
Introduction
Key Findings
3.1
This section looks at the supply of labour which is available in the
Lancashire LEP area. It is based on datasets which cover residents of the
Lancashire LEP area, wherever they are employed.
•
3.2
•
•
•
•
•
The Lancashire population is growing more slowly than nationally, the
working age population is in decline and there is net out-migration amongst
younger age groups.
As a result of the low level of population growth, Lancashire has experienced
a decline in its working age population since it reached a peak of 928,500 in
2010. The decline of the working age population is expected to continue over
the next ten years, and has implications for Lancashire’s economic growth
potential and its ability to meet its employment targets.
A lower employment rate, particularly amongst certain age groups (especially
older people) and the doubling of unemployment since the onset of
recession, with 50,000 currently unemployed, presents a challenge in an
economy where employment growth is limited.
Of the 50,000 unemployed, only 16,000 are claiming Jobseekers Allowance.
Over 30,000 Lancashire residents experiencing unemployment may
therefore not be known to the employment-related authorities, and may not
be benefiting from the support available to help people into work.
A lower proportion of employment in higher level occupations than nationally
will make it difficult for employers to recruit skilled workers.
There is a strong link between successful local economies and growing
populations, as increased employment attracts working households. It is not
clear if Lancashire has the combination of employment and housing growth
to support its economic aspirations.
There is a strong link between qualifications and employment, and too many
people have qualifications below Level 2.
•
While 80,000 commute out to work, increasing this number through better
public transport is likely to be part of a solution to increase the employment
rate and make more opportunities available to residents. Whilst the GVA
generated by these out-commuters will be captured elsewhere, the
Lancashire economy will benefit from the wages earned by these people
elsewhere, which are spent in Lancashire.
•
East Lancashire faces severe problems, exacerbated by a falling population
and challenging employment situation.

Population trends and projections

Economic activity, employment and self-employment

Unemployment, inactivity and NEET young people
Lancashire’s Population
3.3
Lancashire’s population of 1.468m accounts for 21% of the North West
total, and 3.2% of the England minus London total.
3.4
The sub-geographies vary considerably in the share of the Lancashire
population they account for – with one in three Lancashire residents living in East
Lancashire (over 530,000 people), whilst the population of West Lancashire is
111,000.
Population by Sub-Geography 2013
Change
2001-2013
% of LEP
Total 2013
531,000
2.5%
36%
359,800
7.4%
24%
321,400
326,100
1.6%
22%
134,000
140,600
4.9%
10%
108,500
111,300
2.6%
8%
1,417,200
1,468,800
3.6%
100%
2001
2013
East Lancs.
518,400
Central Lancs.
334,900
Blackpool, Fylde, Wyre
Lancaster
West Lancashire
Total
•
It covers:
Source: Mid Year Population Estimates
3.5
Both Central Lancashire and Lancaster have seen strong population
growth, while Blackpool, Fylde and Wyre in particular have seen the population
flatline, with growth of only 1.5% in a ten year period.
37
Population Aged 16 – 64
Age Profile and Working Age Population
3.6
The age profile of the population is broadly in line with the England minus
London average. The main variations are a slight under representation of those
aged 25 to 34 (-1% point) and a slight over representation of those aged 65+ (+1%
point).
3.7
This results in a working age population which accounts for a slightly
smaller share of the Lancashire total than is the case nationally: 64% compared to
65%. The 1% smaller working age population, is equivalent to 14,600 people of
working age.
2001
No.
Central Lancashire
Lancaster
Aged
15-19
92
Aged
20-24
99
Aged
25-34
175
Aged
35-49
291
Aged
50-64
278
Aged
65+
275
Lancashire
18%
6%
7%
12%
20%
19%
19%
Eng-Lon
18%
6%
7%
13%
20%
19%
18%
Lancashire, 000s
Source: Mid Year Population Estimates
Working age population, as % of total population
64%
65%
231,500
64%
64%
90,400
64%
-
63%
-
64%
-
63%
-
63%
Lancashire
888,900
63%
918,400
63%
East Lancashire
322,700
62%
332,000
63%
69,500
64%
69,000
62%
193,900
60%
195,500
60%
Source: Mid Year Population Estimates
3.9
The share of residents aged 65+ ranges from 23% in Blackpool, Fylde and
Wyre to 17% in East Lancashire and Central Lancashire, which is slightly below the
England minus London average (18%). The older population is growing across
Lancashire and this will have implications for health and care provision at the local
level.
Population Aged 65+
Source: Mid Year Population Estimates
70%
% of total
85,300
England minus London
Blackpool, Fylde, Wyre
Aged
0-14
257
No.
217,600
North West
West Lancashire
Population Age Structure 2013
2013
% of total
2001
65%
60%
No.
2013
% of total
No.
% of total
Blackpool, Fylde, Wyre
68,100
21%
75,900
23%
50%
West Lancashire
17,000
16%
22,700
20%
40%
Lancaster
23,900
18%
26,900
19%
30%
Lancashire
235,200
17%
275,600
19%
20%
England minus London
6,938,400
16%
8,344,800
18%
North West
1,081,700
16%
1,252,600
18%
Central Lancs.
49,500
15%
61,400
17%
East Lancs
76,700
15%
88,900
17%
10%
0%
Lancashire
England minus London
Source: Mid Year Population Estimates
3.8
Across the sub-geographies, the highest number of working age residents
is in East Lancashire (332,000 residents), followed by Central Lancashire (231,500
residents), whilst the areas where the working age population accounts for the
highest proportion of the total population are Central Lancashire and Lancaster
(64%).
38
Ethnicity Profile
Population by age and ethnicity
3.10
One in ten Lancashire residents is from an ethnic minority background, the
same proportion as in England minus London as a whole. However, the make-up
of the ethnic minority community in Lancashire is different to that in England as a
whole, with the vast majority of ethnic minority residents from an Asian or Asian
British background and a small number from mixed / multiple ethnic backgrounds.
Less than 1% are Black/African/Caribbean/Black British or from other ethnic groups.
White
Source: Census 2011
Other ethnicity
100%
90%
80%
70%
60%
50%
BAME Population by Ethinicity
40%
Lancashire LEP
Source: Census 2011
England (minus London)
30%
20%
10%
Asian/Asian British
0%
0 - 14
Mixed/multiple ethnic
15 to 19 Age 20 to 25 to 34
24
35 to 49
50 - 64
65+
Population Change
Black/African/Caribbean/
Black British
3.13
The population in Lancashire has increased by 3% (+41,100 residents)
over the past ten years (2003-2013). This is a slower rate of growth than that
experienced in the region as a whole (+4%) and much lower than the growth rate in
England minus London (+7%).
Other ethnic group
0%
2%
4%
6%
8%
10%
3.11
Residents from an ethnic minority background make up a significant
proportion of the population in East Lancashire.
BAME Population, Lancashire Sub-Geographies
No.
% of population
East Lancashire
89,888
17%
Central Lancashire
34,319
10%
Lancaster
6,033
4%
Blackpool, Fylde, Wyre
8,536
3%
West Lancashire
Lancashire
2,082
2%
140,858
10%
Source: Census 2011
3.12
The ethnic minority population is younger than the Lancashire average,
and accounts for 17% of those aged 0-14 and 16% of those aged 25-34, compared
to only 2% of those aged over 65.
3.14
Central Lancashire experienced the greatest increase (+6%), and
Blackpool, Fylde and Wyre the lowest (+1%).
3.15
As a result of the low level of population growth, Lancashire has
experienced a decline in its working age population since it reached a peak of
928,500 in 2010. This is common to many other northern areas, although it is
noticeable that Lancashire’s working age population has grown very little since
2007, in contrast to the national and regional picture, and there has also been in a
steeper decline since 2010.
3.16
The decline of the working age population has implications for Lancashire’s
economic growth potential and its ability to meet its employment targets.
3.17
It is likely that while some employment growth will be met by people in the
workforce currently seeking employment, higher level skills job growth will need to
be met by recruitment from outside Lancashire. This is likely to be the case for
higher skilled jobs requiring some experience.
3.18
The challenges facing employers in recruiting in the context of a falling
working age population also has implications for housing. Lancashire will have to
import skilled workers to meet the needs of employers, and this will require attractive
housing to avoid higher levels of in-commuting.
39
Population Change in Lancashire, 2003-2013
Source: MYPE
1,550,000
1,500,000
1,450,000
1,400,000
1,350,000
1,300,000
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
Lancashire
North West (trend)
Population Change in Lancashire, 2003 - 2013 - WA
Source: MYPE
960,000
950,000
940,000
930,000
920,000
910,000
900,000
890,000
880,000
870,000
2003 2004 2005 2006 2007 2009 2010 2011 2012 2013
Lancashire LEP
NW trend line
Eng (min. London) trend line
40
Components of Population Change
3.19
Population change results from three factors: natural change (i.e. the
excess of births over deaths; net internal migration (the balance of people moving
into and out of Lancashire from the rest of the UK); and net international migration
(the balance of people moving into and out of Lancashire from the rest of the world).
3.20
3.23
International migration is an important component of change, and some
employment sectors, notably health, continue to require skilled international workers
to fill vacancies.
3.24
Blackpool, Fylde and Wyre experience net in-migration from the UK,
arising from people retiring to the coast / rural areas, as well as the more transient
population which is attracted to Blackpool.
Taking each of these in turn:



Lancashire has a lower rate of population growth arising from natural
change than the North West or England minus London as a whole
Internal migration results in a net loss of population from the LEP area
International migration is contributing to population growth, but at a lower
rate than in the country as a whole.
3.25
The movement of graduates is apparent in the loss of population from
Central Lancashire and Lancaster, although East Lancashire experiences the
greatest net outward migration, with nearly 2,000 residents moving out to other parts
of the UK in 2013. The population loss in East Lancashire is significant.
Net migration by age and sub-geography, 2013
Source: Internal Migration Statistics, ONS
1,500
Components of Population Change, 2013
1,000
Source: ONS Population Change
Lancashire LEP
North West
Eng - Lon
500
0.30%
0
0.25%
-500
0.20%
-1,000
0.15%
-1,500
0.10%
-2,000
0.05%
-2,500
0.00%
-0.05%
Natural Change
Internal Migration (net)
International Migration
(net)
-0.10%
-0.15%
3.21
Net migration to the rest of the UK affects particular age groups and subgeographies within the LEP area. Lancashire is a net gainer of young people aged
under 19, but lost circa 1,500 20-24 year olds and 25-34 year olds to the rest of the
UK in 2013. This is likely to reflect the movement of graduates and well qualified
younger people out of the area in search of employment (despite the fact that the
North West is relatively successful in retaining its graduates – see chapter 6).
3.22
The availability of a younger workforce, aged 19-34 years old, is an
important determining factor for inward investors, particularly in key growth areas
such as business services.
41
3.26
The LEP’s population has become older in recent years. Between 2003
and 2013, the number of residents aged 65+ increased by 37,500, while the working
age population increased only slightly (16,100) and the number of residents aged 0
to 15 declined (-12,500).
1580
1560
Population Change by Age 2003-2013
1540
Change 2003-2013
Lancs. LEP
2013
Population projections, 000s, 2015-2025 - Total
Lancs. LEP
No.
1520
Eng
%
1500
%
Broad age groups
1480
Aged 0 - 15
274,800
-12,500
-4%
4%
Aged 16 - 64
918,400
16,100
2%
7%
Aged 65 and over
275,600
37,500
16%
17%
Aged 0-14
257,300
-10,100
-4%
4%
Aged 15-19
92,000
-4,000
-4%
2%
Aged 20-24
99,300
14,400
15%
13%
Aged 25-34
175,100
0
0%
7%
Aged 35-49
291,200
-12,100
-4%
2%
Aged 50-64
278,400
15,600
6%
10%
Aged 65+
275,600
37,500
16%
17%
Detailed age groups
Source: Mid Year Population Estimates
3.27
Given the changes in pension arrangements and the reducing welfare
budget, the increasing 50-64 year old population will need to stay in employment for
longer.
3.28
This older age group now make up a large part of the workforce – 36% of
the 25 plus workforce are in this older age group.
Population Projections
3.29
The population projections produced by the Office for National Statistics
indicate that the population in Lancashire will grow more slowly than in the region
as a whole or England minus London over the next ten years (2% compared to 4%
and 6% respectively).
3.30
The working age population is expected to fall by nearly 2% over the same
period, in contrast to a 2% increase nationally. This will equate to 18,000 fewer
residents of working age by 2025.
3.31
In order to meet the employment aspirations of the LEP, Lancashire will
need to attract higher skilled workers. While some of this may be achieved through
in-commuting, there are implications for the Lancashire housing offer.
1460
1440
1420
2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025
Lancashire LEP
NW trend line
Eng (min. Lon) trend line
Population Projections, 000s, 2015-2025 - Working Age
Source: ONS Population Projections
945
940
935
930
925
920
915
910
905
900
895
890
2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025
Lancashire LEP
NW trend line
Eng (min. Lon) trend line
Economic Activity, Employment and Self-Employment
Economic Activity
3.32
Economic activity is a measure of those who are active within the labour
market, i.e. employed, self-employed or unemployed but actively seeking work.
42
3.33
Economic activity rates amongst the working age population have been
lower in the Lancashire LEP area than nationally for the past ten years. The gap
has widened from c. 2% to 4% over the past year, as a result of falling economic
activity rates in Lancashire (particularly in Blackpool, Fylde and Wyre, West
Lancashire and Central Lancashire).
3.34
If economic activity rates in Lancashire matched the England minus
London average, an additional 39,200 people of working age would be active within
the labour market.
Economic activity as % of total working age population, 2004-2014
Source: Annual Population Survey
80.0%
75.0%
70.0%
Employment Change 2004-2014
Source: Annual Population Survey
670,000
660,000
650,000
640,000
630,000
620,000
610,000
600,000
590,000
580,000
570,000
560,000
550,000
Lancashire LEP
England minus London trend
NW trend
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
65.0%
3.38
The number of residents in employment varies considerably across the
sub-geographies, from 210,600 in East Lancashire to 45,400 in West Lancashire.
Employment is below its peak level in all the Lancashire sub-geographies, with
particularly large percentage declines in West Lancashire, East Lancashire and
Lancaster.
60.0%
55.0%
50.0%
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Lancashire LEP
NW
England minus London
3.35
Lower levels of economic activity contribute to lower household incomes in
Lancashire, and also to areas of multiple deprivation.
Employment
3.36
Employment (as measured by the Annual Population Survey, which
measures residents in employment, wherever their workplace is located) has
reached record levels nationally and has recovered to pre-recession levels in many
parts of the country.
3.37
In contrast, resident employment in Lancashire peaked at 654,100 in
2010, and has subsequently fallen by nearly 40,000 (6%) to 614,100. This is a
particularly disappointing performance.
43
Employment Rate
Working age employment rate, Lancashire sub-geographies, 2014
3.39
The employment rate measures the percentage of the working age
population who are in employment. Reflecting the lower than average economic
activity rates, the employment rate in the Lancashire LEP area has also been lower
than the national rate for most of the past ten years.
3.40
The gap narrowed in 2010-2011, when Lancashire bucked than national
trend and saw employment rates rise, despite the recession. However, since 2011
the employment rate has fallen in Lancashire whilst being on an upward trend
nationally and in the North West.
Source: APS
80%
70%
60%
50%
40%
30%
20%
10%
0%
73%
71%
70%
69%
68%
67%
67%
64%
3.41
If Lancashire matched the national average employment rate, an additional
43,500 residents would be in employment.
Working Age Employment Rate, 2004-2014
Source: Annual Population Survey
75%
70%
Working Age Population Employment Rate Change 2011-2014
Employment rate
65%
2011
60%
55%
50%
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Lancashire LEP
North West
England minus London
3.42
The overall employment rate reflects the rate in each sub-geography, all of
which are below the national average. The employment rate amongst residents of
East Lancashire is particularly low, with less than two-thirds of the working age
population in employment.
3.43
The employment rate has fallen in all areas since 2001, with the greatest
proportionate declines in Lancaster (-8%, -4,800), West Lancashire (-6%, -5,700)
and East Lancashire (-4%, -17,600).
2014
Employment change
Residents. in
employment
(No.)
Employment
rate (% pts)
East Lancashire
69%
64%
-17,600
-4%
West Lancashire
73%
67%
-5,700
-6%
Blackpool, Fylde, Wyre
71%
70%
-5,700
0%
Lancaster
75%
67%
-4,800
-8%
Central Lancashire
73%
71%
-4,200
-2%
Lancashire
71%
68%
-38,000
-6%
North West
68%
69%
6,600
0%
England minus London
71%
73%
526,100
3%
Source: Annual Population Survey
3.44
The employment rate increases with age up to the 35 to 49 age group, with
a peak in Lancashire of 83%. It then falls significantly amongst the population aged
50 to 64 (61%) and relatively few people aged 65+ are in employment (8%).
3.45
The profile of employment rate by age in Lancashire is broadly similar to
the North West. Compared to the England minus London average, Lancashire
matches the employment rate for 35-49 year olds, and is close to the average
amongst 16-19s and 20-24 year olds.
44
3.46
However, the employment rate lags behind the national average amongst
50-64 year olds (8 percentage points lower) and 25-34 year olds (6 percentage
points lower).
3.47
Increasing employment rates amongst the older working age population –
keeping more people in work for longer – will be important as the size of the working
age population declines.
Lancashire
Employment rate by age, 2014
North West
England
Employment rate by gender and sub-geography, 2014
Source: APS
Male
East Lancs
West Lancashire
Lancaster
Source: APS
Blackpool, Fylde, Wyre
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
Central Lancs.
Employment Rate
Female
Lancashire
North West
England minus London
0%
Aged 1619
Aged 2024
Aged 2534
Aged 3549
Aged 5064
Aged
65+
Lancashire
31%
61%
74%
83%
61%
8%
North West
31%
63%
77%
81%
63%
8%
England
33%
63%
80%
83%
69%
10%
20%
40%
60%
80%
Full-Time and Part-Time Employment
3.49
A slightly higher proportion of Lancashire residents work full-time (30+
hours per week) than is the case nationally (75% compared to 74% in England
minus London). There is considerable variation across Lancashire, with 80% of
West Lancashire’s employed residents working full-time, compared to 71% of those
in Lancaster. Female residents are more likely to be employed full-time in
Lancashire (61%) than is the case nationally (57%).
3.48
The employment rates for both males and females in the Lancashire LEP
area are below the national average. The greatest gap is in East Lancashire, where
the male employment rate is 7 percentage points below the England minus London
average, and the female rate is 9 percentage points lower.
45
Self-Employment
Self Employed Working Age Population by Geography
3.50
Nationally, the number of people who are self-employed has reached its
highest level for 40 years, and the increase in self-employment is one of the factors
which has caused employment to rise to record levels. A similar number of people
are entering self-employment as was the case before the recession, but fewer
people are moving out of self-employment (either to retire or into employment) each
month, causing the total number to rise.
3.51
Compared to the existing self-employed workforce, those newly entering
self-employment are more likely to be:



Younger
Female
In higher level occupations
2014
No.
Blackpool, Fylde, Wyre
Change 2004-2014
% of total
No.
%
20,400
15%
1,700
2%
West Lancashire
6,400
14%
1,100
4%
East Lancashire
28,500
14%
1700
2%
Central Lancashire
20,800
13%
4,500
3%
7,400
12%
600
0%
83,400
14%
9,500
2%
Lancaster
Lancashire LEP
North West
13%
2%
England minus London
14%
2%
Source: Annual Population Survey
3.52
In Lancashire, self-employment is on a long-term upward trend, although
it has fluctuated year on year, reaching a peak of 90,000 in 2011.
100,000
90,000
80,000
70,000
60,000
50,000
40,000
30,000
20,000
10,000
0
16%
14%
12%
10%
8%
6%
4%
Self Employment Rate
WA Pop. in Self Employment
Self-Employment in Lancashire LEP area, change 2004-2014
2%
0%
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Lancs. No.
Lancs. %
North West %
Eng. minus Lon. %
3.53
The self-employment rate ranges from 15% in Blackpool, Fylde and Wyre
to 12% in Lancaster, with West Lancashire having seen the largest percentage
increase since 2004.
3.54
The self employment rate is higher amongst males (18%) than females
(9%), which is in line with the profile regionally and nationally excluding London.
The only notable variation at the sub-geography is in East Lancashire where the
male self employment rate is relatively high (20%) and the female self employment
rate is relatively low (6%).
46
Unemployment and the Claimant Count
3.55
Unemployment is damaging both to the economy, which operates below
its full potential, and to the individuals affected and their families, who experience
both short-term and long-term impacts.
3.56
Two measure of unemployment are commonly used13. The first is the ILO
unemployment measure, which is based on the ILO’s definition of unemployment
and allows international comparisons to be made. The estimate of ILO
unemployment is generated from the Labour Force Survey / Annual Population
Survey, which is a regular survey of approximately 41,000 households (80,000
people) across the UK. As it is based on a sample survey, the ILO unemployment
estimate can be subject to sampling variation, particularly when sub-groups of the
population are considered, or at small geographies.
3.57
The second is the Claimant Count, which measures the number of people
who are receiving benefits principally because they are unemployed, i.e.
Jobseeker’s Allowance or National Insurance Credits as a result of being
unemployed14. The claimant count is based on an administrative dataset and
therefore provides an accurate figure of the number receiving benefit as a result of
unemployment, as well as the number flowing into and out of unemployment each
month.
3.60
The following sections present data on ILO unemployment and the
claimant count, and then consider the relationship between the two in Lancashire.
ILO Unemployment
3.61
There are 50,000 working age residents in Lancashire who are
unemployed based on the UK official measure of unemployment (ILO) 15. This
equates to an unemployment rate of 7.5% which is in line with the regional average
(7.5%) but is higher than the national average (6.6%).
3.62
Looking at trends over time, unemployment in Lancashire rose during the
downturn from 40,700 in 2008 (5.9%) to 57,400 in 2012 (8.2%). Unemployment fell
between 2012 and 2013 but increased again in 2014. Since 2004, unemployment
has increased by nearly 60% in the Lancashire LEP area.
3.63
East Lancashire has seen the biggest increase, with unemployment more
than doubling, and both West Lancashire and Central Lancashire have also seen
significant increases.
Unemployment rate, 2004-2014
Source: APS
Working Age Unemployment Rate
Unemployment and Economic Inactivity
3.58
The ILO estimate provides a much higher estimate of the number of
unemployed than the claimant count. This is because many people who are not
claiming or are not entitled to unemployment-related benefits are classed as
unemployed on the ILO measure. This includes:

People whose partner is working;

Students looking for work whilst studying full-time;

People who are at or beyond state pension age who are still looking for
work.
10%
9%
8%
7%
6%
5%
4%
3%
2%
1%
0%
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Lancashire
North West
England minus London
3.59
Overall there is a large degree of overlap between ILO and claimant
unemployment. However there may be a small number of cases where those who
are claiming unemployment-related benefits would not qualify as ILO unemployed,
e.g. if they are not immediately available for or seeking work, or if they have a small
level of earnings from part-time work.
13
Unemployment and the Claimant Count, ONS
In future, those who are claiming Universal Credit (UC) due to unemployment will be
included in this measure, as people are moved from JSA to UC.
14
15
International Labour Organisation definition. In the UK anybody who is not in employment,
has actively sought work in the last 4 weeks and is available to start work in the next 2 weeks,
or has found a job and is waiting to start in the next 2 weeks, is considered to be unemployed.
47
the claimant rate in Lancashire did not rise quite as high as the England (excluding
London) average.
Change in unemployment by sub-geography, 2004 and 2014
Source: APS
JSA Claimant Count Rate, 2005-2015
2004
Source: DWP
% working age population
5%
2014
0
10,000
West Lancashire
Lancaster
20,000
30,000
Blackpool, Fylde, Wyre
40,000
Central Lancs.
50,000
East Lancs
Lancashire
England minus London
4%
3%
2%
1%
3.64
The DWP Jobseekers Allowance (JSA) claimant count provides another
measure of unemployment and this data shows a similar performance and trend
profile to the ILO data. At the start of 2015, there were 16,100 JSA claimants in
Lancashire, an unemployment rate of 1.7% compared to an England (excluding
London) and North West average of 1.9%.
Jobseekers Allowance Claimants
2013
2014
% of WA
pop.
% of WA
pop.
2015
% of WA
pop.
No.
Blackpool, Fylde, Wyre
4.6
3.8
4,631
2.4
East Lancashire
4.0
3.1
6,154
1.9
Lancaster
3.1
2.7
1,547
1.7
Central Lancashire
2.9
2.3
2,891
1.2
West Lancashire
3.4
2.6
839
1.2
Lancashire
3.7
3.0
16,062
1.7
North West
4.4
3.4
1.9
England minus London
3.7
2.9
1.9
Source: DWP
Jan-05
Jun-05
Nov-05
Apr-06
Sep-06
Feb-07
Jul-07
Dec-07
May-08
Oct-08
Mar-09
Aug-09
Jan-10
Jun-10
Nov-10
Apr-11
Sep-11
Feb-12
Jul-12
Dec-12
May-13
Oct-13
Mar-14
Aug-14
Jan-15
0%
JSA Claimant Count
Relationship between ILO unemployment and the Claimant Count
3.66
Unemployed people who are eligible for and claiming benefits are known
to the authorities and receive support to help them find work. Those who are not
claiming benefits may not be known to support services and therefore may not be
accessing appropriate help to enter / re-enter the job market. It is therefore useful
to look at how the two groups compare in order to understand who might be missing
out on employment-related support.
3.67
The total number of JSA claimants equates to just under 40% of the
number of ILO unemployed people in Lancashire16. Looking at how the two totals
split by age and gender, younger women are particularly under-represented within
the claimant population compared to their overall level of unemployment.
3.68
Amongst men, it is those aged over 50 who are least likely to be captured
within the claimant count, perhaps indicating a high level of people classed as early
retired who are actually looking for work.
3.65
Over recent years Lancashire’s JSA claimant count rate has been broadly
in line with the national average. The main difference is during the recession, where
16
Although, as noted above, the two groups do not entirely overlap. Data from 2014 is used
as this is the latest available for ILO unemployment.
48
Comparison of ILO and Claimant Unemployment, 2014 (latest APS data)
ILO unemployed
JSA Claimants
Comparison of ILO and Claimant Unemployment, 2014 (latest APS data)
JSA as % of ILO
ILO unemployed
JSA Claimants
JSA as % of ILO
Males 16-24
8,300
3,115
38%
East Lancashire
25,300
7,663
30%
Males 25-49
14,800
6,705
45%
Central Lancs
Males 50+
6,900
2,480
36%
Females 16-24
9,600
1,760
18%
Females 25-49
7,900
3,740
47%
Females 50+
3,000
1,225
41%
Source: APS, Claimant Count
Comparison of ILO and Claimant Unemployment in Lancashire, 2014
Source: APS and Claimant Count
13,000
3,627
45%
B'pool, Fylde & Wyre
6,700
4,923
36%
West Lancashire
2,900
1,144
18%
Lancaster
2,200
1,681
47%
Source: APS, Claimant Count
Comparison of ILO and Claimant Unemployment in Lancashire, 2014
Source: APS and Claimant Count
100%
100%
Females 50+
90%
80%
Females 25-49
70%
Females 16-24
60%
90%
Lancaster
80%
70%
West Lancashire
60%
50%
50%
Males 50+
40%
B'pool, Fylde & Wyre
40%
Central Lancs
30%
30%
Males 25-49
20%
10%
Males 16-24
0%
ILO unemployment
Claimant Count
3.69
A comparison can also be made at sub-geography level. Lancaster has
the highest number of claimants compared to its ILO unemployed population, whilst
in West Lancashire claimants account for fewer than one in five of the total number
of unemployed people.
20%
East Lancashire
10%
0%
ILO unemployment
Claimant Count
3.70
Significant numbers of unemployed people in East and Central Lancashire
are not part of the claimant count and therefore not eligible for a range of
unemployment-related support programmes.
49
Economic Inactivity
Economic Inactivity by Age
3.71
Over 240,000 people of working age are currently economically inactive
within Lancashire, 27% of the total working age population. This is a higher rate
than in the region (25%) or England minus London (22%). The highest rates of
inactivity are in Lancaster (30%), West Lancashire (29%) and East Lancashire
(28%).
Economic Inactivity as % of woring age population, 2004-2014
Aged
20-24
Aged
25-34
Aged
35-49
40,100
29,000
31,800
41,200
100,300
17%
12%
13%
17%
41%
Lancashire
56%
30%
18%
14%
36%
North West
57%
27%
17%
15%
34%
England minus London
53%
26%
15%
13%
29%
Lancashire (No.)
Lancashire (%)
Aged
50-64
Economic inactivity rate by age
Economic inactivity rate by age by sub-geography
300,000
30%
250,000
25%
200,000
20%
150,000
15%
100,000
10%
50,000
5%
0
0%
Economic Inactivity Rate
Economically Inactive WA Pop.
Source: APS
Aged
16-19
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Lancashire
Lancashire rate
North West rate
England minus London rate
West Lancashire
80%
22%
15%
16%
39%
Lancaster
63%
52%
18%
8%
36%
Blackpool, Fylde, Wyre
60%
19%
19%
17%
32%
East Lancashire
53%
30%
20%
16%
39%
Central Lancashire
44%
26%
16%
11%
36%
Source: Annual Population Survey
3.74
Economic inactivity in Lancashire is more likely than the national average
to be due to long-term sickness (26% of the economically inactive compared to 22%
nationally) and less likely to be due to study (22% compared to 26% nationally).
Economic Inactivity by Reason 2014
Lancashire
No.
3.72
Between 2004 and 2009 the number and proportion of economically
inactive people within Lancashire remained fairly stable. Over this period, the
economic inactivity rate was in line with the regional average. Economic inactivity
in Lancashire declined during the downturn (2009 to 2012) and the rate fell to be in
line with the England minus London average. However, since 2012 economic
inactivity in Lancashire has increased with an additional 27,100 people becoming
economically inactive and rate increasing by 2% points. This is reflected in the fall
in the employment rate between 2012 and 2014.
3.73
Economic inactivity is most common amongst those aged 50 to 64,
reflecting the high number of retirees in this age group (100,300 residents, 41% of
the total inactive working age population). Compared to the England minus London
average, the economic inactivity rate in Lancashire is higher across all age groups
particularly amongst the 50-64 years and 20-24 years age groups (+7% points and
+5% points respectively). The economic inactivity rate across the age groups is
broadly in line with the North West average.
%
North
West
Eng. minus
London
%
%
Long-term sick
63,900
26%
26%
22%
Looking after family/home
56,400
23%
23%
25%
Student
56,000
23%
23%
26%
Retired
39,900
16%
16%
16%
Other
19,100
8%
8%
9%
5,300
2%
3%
2%
Temporarily sick
Discouraged
Total
1,600
1%
1%
1%
242,300
100%
100%
100%
Source: Annual Population Survey
Benefit Receipt
50
3.75
The degree of long-term sickness affecting those within Lancashire’s
labour market is evident from the data on benefit receipt by working age people in
the LEP area. Nearly 8% of the working age population in Lancashire were in
receipt of Employment and Support Allowance or Incapacity Benefit in 2014, over
two-thirds of those receiving out of work benefits, compared to around 50% of the
total out of work benefit claimants in the North West or England as a whole.
Economic Inactivity by Reason 2014, % of working age population
Lancashire
No.
%
NW
Eng. minus
London
%
%
Young People not in education, employment or training
Source: DWP
3,500
7%
3,000
6%
2,500
5%
2,000
4%
1,500
3%
1,000
2%
1%
Job Seeker
16,480
1.8
2.0
1.9
500
ESA and Incapacity Benefits
72,670
7.9
8.1
6.0
-
Lone Parent
10,670
1.2
1.3
1.1
Carer
16,390
1.8
1.8
1.4
3,640
0.4
0.4
0.3
Disabled
12,080
1.3
1.3
1.1
Bereaved
1,870
0.2
0.2
0.2
Out of work benefits
103,460
11.3
11.8
9.4
Total
133,790
14.6
15.1
12.1
Others on Income Related Benefit
Source: DWP Benefits, NOMIS, Note: Does not round as negligible figures relating to
unknown groups are unavailable
Young People not in Education, Employment or Training (NEET)
3.76
The transition from education to employment is a crucial one, and it is
important that young people get off to a good start in their working lives. Evidence
suggests that those who experience a period of unemployment at an early age
continue to suffer poorer outcomes throughout their working lives and are also at
risk of poorer physical and mental health.
3.77
In 2014, there were 2,700 young people who were not in education,
employment or training (NEET) in Lancashire. This equates to 5.2% of all young
people who are known to the local authorities, which is slightly higher than the
national rate (4.7%). In the last three years the number of young people classified
as NEET has fallen both in Lancashire (-0.8% points) and England (-1.1% points)
as a whole.
0%
2012
Lancashire No.
2013
2014
Lancashire %
England %
Workless Households
3.78
A profile of worklessness at the household level shows that Lancashire has
fewer households (where there is at least one working age adult resident) where all
adults are in employment (-1.2% point) and fewer households with mixed
worklessness status (i.e. where at least one adult is in employment and others are
either inactive or unemployed) (-2.8%) compared to England. The share of workless
households is 4% points higher than in England as a whole.
Working Age Households by Economic Activity Status 2013
Lancashire
No.
England
%
%
Working households
247,000
52.8
54.0
Mixed households
125,000
26.6
29.4
96,000
20.6
16.6
Workless households
Source: Workless households for regions across the UK, ONS
3.79
Nearly 50,000 children aged under 16 live in workless households in
Lancashire, 18.2% of the total. This is considerably higher than the national
average, 14.1%. The largest concentration of children living in workless households
is in East Lancashire, but the highest in proportionate terms is in Lancaster, where
one quarter of children live in households where no adult is in work.
51
Children living in workless households, 2013
No.
%
Lancashire
49,649
18.2
North West
236,325
17.9
1,406,108
14.1
East Lancashire
21,280
21%
Blackpool, Fylde, Wyre
12,498
22%
Lancaster
7,082
25%
Central Lancashire
5,087
8%
West Lancashire
2,075
10%
England
Source: Workless households for regions across the UK, ONS
Link between Skills and Deprivation
3.80
There is a clear link between skill levels and deprivation. The two maps
show the local areas in Lancashire which experience the highest levels of
deprivation (top map), and those that have the highest levels of deprivation in
relation to education, skills and training. The education, skills and training measure
reflects achievements by children and young people in statutory education, and the
level of skills within the adult population.
3.81
It is clear that there is a very close alignment between areas that are
deprived in relation to education, skills and training, and those which suffer from
high levels of overall deprivation. This is unsurprising given the link between skills
levels, the likelihood of being in employment, and the average level of earnings, all
of which reinforce the importance of ensuring that all Lancashire residents have the
opportunities they need to acquire the skills and qualifications that will allow them
to be successful in the labour market.
52
Occupations and Skills
Occupational Profile

3.82
The occupations in which people are employed reflect both the skills and
qualifications that they hold, and the employment opportunities that are open to
them within the local economy.
3.83
Lancashire has a lower level of residents employed in highly skilled
occupations17 (39%) compared to the North West (41%) and England minus London
(43%). The proportion of residents employed in skilled trades is higher than the
North West and England minus London levels (+1% point each respectively).
under represented in West Lancashire (4%, -4% points) and Lancaster
(4%, -4% points);
Administrative and secretarial occupations: A higher proportion of
residents in Central Lancashire are employed in this occupational group
(14%, +3% points).
3.85
Lancaster has the lowest proportion of its residents working in highly skilled
occupations – 37% compared to the LEP average of 39%.
Resident Occupation by Sub-Geography 2014
Lanca
shire
Central
Lancs.
West
Lancs.
Blackpool,
Fylde, Wyre
East
Lancs.
Lancast
er
Occupational profile of residents in employment, 2014
Mgers & directors
10%
12%
6%
11%
10%
6%
Source: APS
Professional
18%
16%
25%
18%
16%
21%
Assoc. prof & tech
12%
14%
10%
10%
12%
10%
Admin & secreta.
11%
14%
12%
13%
9%
9%
Skilled trades
12%
12%
10%
12%
13%
13%
Caring, leisure and
other service
10%
8%
13%
11%
10%
10%
Sales & cust.
8%
7%
4%
8%
11%
4%
Pro, plant &
machine op.
7%
6%
7%
6%
8%
8%
Elementary
11%
10%
10%
11%
10%
17%
39%
42%
42%
39%
38%
37%
20%
18%
16%
14%
12%
10%
8%
6%
4%
2%
0%
Lancashire
North West
England minus London
Highly skilled occupations
Highly skilled
Source: Annual Population Survey
Across the LEP area, the key points to note are:
3.84



Professional occupations: A high proportion of residents in West
Lancashire (25%) and Lancaster (21%) are employed in professional
occupations (+7% and +3% points above the LEP average);
Elementary occupations: A higher than average proportion of residents
are employed in elementary occupations in Lancaster (17%) compared to
the LEP average (+6% points);
Sales and customer service occupations: Residents employed in this
line of work are over represented in East Lancashire (11%, +3% points) but
3.86
There are significant variations in the occupations held by males and
females in Lancashire:

Females are over-represented in caring, leisure and other service
occupations, and in administrative and secretarial occupations

Males are dominant in the process, plant and machine operative
occupations, and in the skilled trades.
17
Highly skilled occupations are those classified as managers and directors,
professional and associate professional.
53
Occupational Profile by Gender, 2014
Females
Source: APS
Care, leis. & other serv.
86%
Admin & secretarial
14%
75%
25%
Sales & customer serv.
54%
46%
Professional
54%
46%
Assoc. prof & tech
47%
53%
Elementary
45%
55%
Managers & directors
Proc., plant & mach. op.
36%
64%
13%
87%
Skilled trades 6%
0%
Males
40%
60%
80%
3.88
They are over-represented in sales roles, process, plant and machine
operative occupations, and caring and leisure occupations, all of which tend to have
lower than average skills and pay levels.
Ethinic minority
Skilled trades
97%
3%
Assoc. prof & tech
96%
4%
Managers & directors
96%
4%
Professional
95%
5%
Admin & secretarial
93%
7%
Total
92%
8%
Elementary
91%
9%
Care, leis. & other serv.
88%
12%
Proc., plant & mach. op.
88%
13%
83%
0%
100%
3.87
There are also differences in the occupational profile of white and ethnic
minority residents. Residents from an ethnic minority background are underrepresented in all highly skilled occupations, and account for a very small proportion
of the total employed in skilled trade occupations.
White
Source: APS
Sales & customer serv.
94%
20%
Occupational Profile by Ethnicity, 2014
20%
40%
17%
60%
80%
100%
Change over Time
3.89
Employment in highly skilled occupations has increased from 36% of the
Lancashire total in 2004, to 39% in 2014. This has been accompanied by a decline
in the proportion of the total workforce employed in skilled trades and process, plant
and machine operative occupations (reflecting the decline of the manufacturing
sector), and a fall in the number of administrative and secretarial occupations
(reflecting changing work practices and the increased use of ICT within the
workplace).
54

Changing occupation profile, 2004-2014
2014
Source: APS,
2004
A high proportion of the workforce in Lancaster has no qualifications (14%)
(11% in the North West and 9% in England minus London)
Professional
Qualifications held by working age population, 2013
Skilled trades
Source: APS
Assoc. prof & tech
40%
35%
30%
25%
20%
15%
10%
5%
0%
Admin & secretarial
Elementary
Care, leis. & other serv.
Managers & directors
Sales & customer serv.
Proc., plant & mach. op.
0%
5%
10%
15%
No quals
20%
Lancashire
Qualifications of the Working Age Population
3.90
The qualifications held by the workforce are used as a proxy indicator for
skills levels. Overall, the working age population in Lancashire is less well-qualified
than the national average, with the percentage holding qualifications at Level 4 and
above 3% lower than the England minus London average. The percentage of
working age population with no qualifications (11%) is 2% higher than in England
minus London as a whole.
3.91
In order to meet the England minus London average, an additional 22,700
working age Lancashire residents would need to be qualified to Level 2+, 26,400
qualified to Level 3+ and 32,100 qualified to Level 4+.
3.92
The skills profile varies across the sub-geographies, the key points are:



There is a relatively high proportion of highly skilled working age people in
West Lancashire, with 34% qualified to NVQ Level 4+ this is higher than
the regional and England minus London average.
Although Lancaster has a low level of NVQ Level 4+ qualified workforce
(28%), the proportion qualified to Level 3+ is relatively high (55%,
compared to 52% in the North West and 54% in England minus London).
Blackpool, Fylde, Wyre and East Lancashire both have a low proportion of
the workforce qualified to Level 4+ (28% and 27% respectively) and Level
3+ (50% and 49%).
Other
quals
L1
Trade
Apprent.
North West
L2
L3
L4
England minus London
Working Age Population Skills Profile by Sub-Geography 2013
L4+
L3+
L2+
Trade
App.
L1+
Other
quals
No
quals
West Lancs.
34%
52%
73%
3%
84%
4%
11%
Central Lancs.
30%
53%
71%
4%
84%
7%
9%
B’pool, Fylde, Wyre
28%
50%
70%
4%
84%
6%
11%
Lancaster
28%
55%
68%
2%
83%
3%
14%
East Lancs.
27%
49%
67%
4%
83%
6%
12%
Source: Annual Population Survey
Change Over Time
3.93
Over time the Lancashire skills profile has improved with more people
becoming more highly qualified; however the rate of increase is below that seen
regionally and nationally:

Higher level skills (Level 4+): The prevalence of higher level skills in
Lancashire has increased in recent years, with a 5% point increase in the
proportion of working age residents qualified to this level between 2004 and
2014 (from 24% to 29%). This is equivalent to an increase of 56,500 of the
55



workforce with higher level skills. However this increase is below the
increase seen across the North West and England minus London (+8%
each).
Level 3+: The proportion of the workforce with Level 3+ skills has
increased by 5% points (from 46% to 51%), with an additional 61,000
working age residents qualified to this level, however the rate increased
more quickly across the North West and England minus London (7% and
8% points respectively).
Level 2+: The proportion holding Level 2+ skills has increased by 7%
points, with an additional 85,100 working age residents with this basic level
of qualification. Again, this was below the level of change in the North West
and England minus London (8% and 10% points respectively).
No qualifications: The reduction in the proportion of working age people
with no qualifications was smaller in Lancashire (-5% points), compared to
the North West (-7% points) and England minus London (-6% points).
Increase in Working Age Population holding qualifications at L4+, 20042014
Source: APS
35%
30%
25%
20%
15%
10%
Lancashire
5%
North West
England minus London
0%
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
Working Age Population Skills Profile 2004-2013
Lancashire
2013
Change 2004-2013
No.
%
% pt
North West
Eng. minus Lon.
Change 20042013
Change 2004-2013
%
% pt
%
% pt
L4+
260,000
56,500
28%
5%
41%
8%
40%
L3+
461,800
61,000
15%
5%
22%
7%
26%
8%
L2+
628,100
85,100
16%
7%
21%
8%
24%
10%
No
quals.
100,000
-38,100
-28%
-5%
-35%
-7%
-32%
-6%
8%
Source: Annual Population Survey
3.95
Across the sub-geographies, Blackpool, Fylde and Wyre experienced the
greatest percentage point change in the workforce with higher level skills (+7%
points), followed by East Lancashire and Central Lancashire (+5% points each).
These three sub geographies also saw a relatively high net increase in the number
of highly skilled members of the workforce. By contrast, Lancaster and West
Lancashire both experienced a relatively low net and percentage point change.
Higher Level Skills by Sub-Geography
2013
No.
3.94
Between 2004 and 2013, Lancashire has often been behind the North
West and England minus London average in terms of higher level skills. The current
under performance is due to a fall in the proportion of the workforce with higher level
skills between 2012 and 2013 (-2% points), at a time when the regional and national
economies were experiencing a slight increase in the proportion of workers holding
higher level skills.
Change 2004-2013
%
No.
% pt
change
%
East Lancashire
88,500
27%
20,400
6%
5%
Blackpool, Fylde, Wyre
54,500
28%
14,800
8%
7%
Central Lancashire
69,700
30%
14,500
7%
5%
Lancaster
24,500
28%
4,100
5%
3%
West Lancashire
22,900
34%
2,900
4%
4%
Source: Annual Population Survey
56
Skills Profile by Gender
Qualifications of the Employed Population
3.96
Females account for a slightly higher proportion of the population with
Levels 2+, 3+ and 4+ skills (54%, 55% and 58%) than of the population as a whole.
This variation is evident In the North West and England minus London, although the
difference is more marked in Lancashire. Males account for a higher proportion of
those with no qualifications (52%), in contrast to the North West and England minus
London where most of those with no qualifications are female.
3.98
The qualifications held by residents in employment in Lancashire are
slightly higher than the working age population as a whole. The continued
importance of skilled trade occupations is reflected in the higher than average
proportion of workers who hold qualifications at Level 3.
Lancashire Working Age Population Skills Profile by Gender 2013
Lancashire
Males
North West
Females
Males
England minus London
Females
Males
Females
3.99
The employed workforce has become more skilled over time, with higher
numbers in employment with Level 3 and Level 4+ qualifications (+22% and +18%
respectively) and fewer with Level 1 qualifications or no qualifications (-18% and 45% respectively) than ten years ago. However, Lancashire has experienced a
slower increase in the share of the workforce with higher level skills compared to
the regional and England minus London increase (18% in Lancashire compared to
34% in the North West and 35% in England minus London).
L4+
42%
58%
48%
52%
48%
52%
L3+
45%
55%
49%
51%
49%
51%
L2+
46%
54%
47%
53%
47%
53%
Source: APS
No qual.s
52%
48%
48%
52%
48%
52%
40%
35%
30%
25%
20%
15%
10%
5%
0%
Source: Annual Population Survey
Skills Profile by Age
3.97
The working age population tends to become more skilled with age, and
this is reflected in the data when the qualifications held by people in different age
bands are considered. The exception is those with no qualifications, where 45% of
those with no qualifications are aged 50 to 64 years. This profile is broadly in line
with the North West and England minus London average.
Qualifications held by residents in employment, 2013
No quals
Other
quals
L1
Trade
Apprent.
L2
L3
L4
Lancashire Working Age Population Skills Profile by Age 2013
Lancashire
Aged
16-19
Aged
20-24
Aged
25-29
Aged
30-39
Aged
40-49
North West
England minus London
Aged
50-64
Skills Profile of Residents in Employment 2004-2013
L4+
0%
8%
10%
23%
27%
32%
L3+
4%
13%
10%
21%
25%
28%
L2+
8%
13%
10%
20%
23%
27%
10%
5%
8%
17%
16%
45%
2013
No qual.s
% of W / Age pop
5%
Source: Annual Population Survey
11%
10%
20%
24%
30%
Lancashire
Change 2004-2013
Lancashire
England
minus
London
%
%
No.
No.
L4+
177,400
32,600
18%
34%
35%
L3
103,600
22,400
22%
14%
19%
L2
105,600
7,800
7%
6%
8%
51,900
28,000
-54%
-47%
-38%
Trade Aps
%
North
West
57
L1
97,600
17,900
-18%
-19%
-23%
Other quals.
37,100
-2,300
-6%
3%
-16%
No quals.
69,400
31,200
-45%
-51%
-48%
Source: Annual Population Survey
Travel to Work
3.100 The flow of people commuting out of Lancashire for work is slightly greater
than the flow commuting in for work. Based on the 2011 Census, 14% of residents
(80,600 people) work outside the LEP but 12% of employment (66,900 people) is
accounted for by in-commuters. These patterns in part reflect the LEP’s
employment gap, which will result in residents looking for work elsewhere. The key
flows out of Lancashire are to Manchester and Bolton (7,500 people each), followed
by Sefton and Wigan (6,700 and 6,400 people respectively).
Travel to Work Patterns 2011
Residents and place of work
Total Residents in Work
Residents –
No.
Residents – %
Inside Lancs.
Outside Lancs.
556,742
476,105
80,637
100%
86%
14%
542,956
Lancs.
Residents
476,105
Reside Outside
Lancs.
66,851
100%
88%
12%
Workers and place of residence
Total Workers in Lancs.
Workers – No.
Workers – %
Source: Census 2011
3.101
The key points at local authority level are:

Lancaster has the highest net and proportionate level of labour market
containment with 77% of residents (39,800 people) working in the local
authority. Preston (34,100 people, 62%), Blackpool (32,600 people, 65%)
and Blackburn with Darwen (31,800 people, 62%) also have relatively high
levels of containment;

Few residents in Blackpool (2,100 people, 4%) and Preston (4,600 people,
8%) travel to work outside Lancashire;
58



The highest net and proportionate commuter flows out of Lancashire are
from West Lancashire (17,500 people, 41%), Rossendale (10,200 people,
39%) and Chorley (10,200, 23%).
Lancashire TTW by Qualification and Occupation
L2 and below
51%
21%
23%
Work
mainly at
or from
home/other
5%
L3 (inc. apprenticeships)
40%
21%
35%
4%
100%
L4+
30%
19%
47%
3%
100%
Other
45%
22%
28%
5%
100%
40%
30%
12%
17%
100%
32%
29%
18%
22%
100%
28%
38%
21%
13%
100%
30%
32%
20%
19%
100%
48%
35%
9%
8%
100%
30%
24%
8%
37%
100%
53%
28%
7%
13%
100%
57%
26%
9%
7%
100%
41%
30%
10%
18%
100%
West Lancashire has the highest net and proportionate flow of commuters
coming into the local authority to work (17,000 people, 42%).
Comparing the number of workers coming into each local authority from
outside the LEP and to the number of resident leaving the local authority to
work outside the LEP:
o
o
o
10 of the 14 local authorities have a net outflow of commuters;
Rossendale and Chorley have the greatest net outflow (-6,600
and -4,000 people respectively);
Preston is the only local authority with a significant net inflow
(5,100 people), primarily from Wigan (1,200 people) and Bolton
(1,000 people).
3.102 The distance people are likely to travel to work varies considerably by
qualification level and occupation. Over half of those qualified to Level 2 or below
work within 5km of their home, compared to 30% of those with qualifications at Level
4 and above. Nearly half of those with higher level qualifications travel 20km or
more.
Less than
5km
Managers, directors and
senior officials
Professional occupations
Associate professional and
technical occupations
Administrative and
secretarial occupations
Skilled trades occupations
Caring, leisure and other
service occupations
Sales and customer service
occupations
Process, plant and machine
operatives
Elementary occupations
520km
20+ km
Total
100%
Source: Census 2011
59
4
Economy, Workforce, Labour Demand
Key Findings
•
•
•
•
•
•
•
There are approximately 617,600 jobs across workplaces in Lancashire, and
this number has fallen since 2009 in contrast to low levels of growth in the
North West and England. This has reduced the number of employment
opportunities for local residents as evidenced by the decline in residentbased employment in Chapter 3.
The net decline was driven by significant job losses in Blackpool, Fylde and
Wyre, while other parts of Lancashire experienced low levels of growth or
decline. This will have created an uneven job market across Lancashire.
While Lancashire experienced high levels of employment growth and
outperformed the national average in a number of key private service sectors,
this was insufficient to compensate for the high levels of employment decline
in manufacturing.
The recent sectoral trends reflect longer term structural shifts in the
Lancashire economy, with manufacturing accounting for 13% of employment
in 2013 compared to 24% in 1998 and both the public sector and private
services playing a greater role. This has significant implications for workforce
skills requirements.
While manufacturing has continued to decline in employment terms, it
remains highly represented when compared to the national economy and
includes significant concentrations of high value added manufacturing with
specialist sub-sectors that may offer employment growth opportunities. Other
sectors that are highly represented include health, construction and public
administration. The area’s high and possibly unsustainable level of public
sector employment could undermine future employment growth
Productivity has been a long term challenge for Lancashire and levels are
currently equivalent to just 83% of the national average. As a recognised
driver of productivity, an increased focus and requirement for higher level
skills and occupations may help to address this challenge, although GVA
growth will have to significantly outpace the national average to close the gap.
There is evidence of employer difficulty in recruiting to higher level
occupations, with implications for key sector growth and inward investment.
Introduction
4.1
This section looks at the demand for labour from employers based within
the Lancashire LEP area. Specifically, this section covers:

Workplace employment and recent trends

Sectoral employment and change

Output and productivity

Business and enterprise

Employer demand for skills
Workplace Employment
4.2
In 2013, total employment in Lancashire stood at approximately 617,600.
East Lancashire, Central Lancashire and Blackpool Fylde and Wyre are the largest
sub geographies in employment terms, collectively accounting for 84% of
employment in Lancashire.
Employment by Sub-Geography, 2013
No.
%
East Lancashire
209,000
34%
Central Lancashire
180,300
29%
Blackpool, Flyde and Wyre
129,500
21%
Lancaster
53,700
9%
West Lancashire
45,000
7%
617,600
100%
Lancashire
Source: BRES
*Note: May not sum due to rounding
Workplace Employment Trends
4.3
This employment level in 2013 was lower than the figure recorded for
2009, following a net loss of 4,900 jobs (equivalent to a 0.8% decline) in contrast to
low levels of growth in the North West and nationally.
4.4
The net loss resulted from fluctuating employment levels between 2009
and 2013. Mirroring the resident-based employment data, the number of jobs in
Lancashire workplaces fell between 2009 and 2012. While there were net losses in
the North West and national economy over this period, the decline was more
pronounced in Lancashire.
4.5
Between 2012 and 2013, there were signs of recovery with employment
growth of 1.1% in Lancashire and 1.4% in the North West and nationally. However,
in Lancashire a combination of the more pronounced employment decline between
2009 and 2012 and lower levels of growth 2012- 2013 means that employment has
60
not yet returned to 2009 levels. Overall, the recovery in Lancashire has not kept
pace with employment growth regionally or nationally.
Workplace Employment in Lancashire LEP area, 2009-2013
Source: BRES
610,000
600,000
social work; administration and support service activities; and professional scientific
and technical activities, although this was insufficient to compensate for the high
levels of decline experienced in other sectors. The manufacturing sector lost over
11,000 jobs, equivalent to a 12% decrease, compared to -4% nationally. Both the
art, entertainment and recreation; and accommodation and food services sectors
experienced employment decline in Lancashire in contrast to low levels of growth
nationally (resulting in a combined loss of approximately 7,000 jobs).
Sectoral Employment Change 2009 - 2013
590,000
Lancashire LEP
Change (no.)
580,000
England -London
Change (%)
Change (%)
Human health and social work activities
7,400
8%
7%
570,000
Administrative and support service
6,700
20%
10%
560,000
Professional, scientific and technical
4,500
15%
8%
Education
2,300
4%
4%
Transportation and storage
800
4%
-2%
Utilities: Electricity
700
45%
-1%
Utilities: Water
500
12%
19%
Information and communication
400
3%
3%
Agriculture, forestry and fishing
-100
-17%
-10%
Mining and quarrying
-100
-23%
-15%
Real estate activities
-200
-2%
5%
2.8%
Wholesale and retail trade
-600
-1%
-2%
550,000
2009
2010
Lancashire LEP
2011
NW trend
2012
2013
England minus London trend
Employment Change by Sub Geography
2009
2013
Net
Change
%
West Lancashire
43,800
45,000
1,200
East Lancashire
205,900
209,000
3,100
1.5%
Construction
-1,300
-4%
-14%
Central Lancashire
180,900
180,300
-500
-0.3%
Financial and insurance activities
-2,000
-15%
-8%
54,000
53,700
-300
-0.6%
Other service activities
-2,200
-16%
-7%
Lancashire LEP
622,600
617,600
-4,900
-0.8%
Accommodation and food service
-3,500
-8%
3%
Blackpool, Flyde and Wyre
138,000
129,500
-8,400
-6.1%
Arts, entertainment and recreation
-3,500
-19%
2%
Public administration and defence;
-3,700
-10%
-15%
-11,100
-4,900
-12%
-1%
-4%
0.2%
Lancaster
Source: BRES
*Note: May not sum due to rounding
4.6
Employment trends varied significantly by sub-geography and total
employment change across the LEP area was influenced by a sharp employment
decline in Blackpool, Flyde and Wyre, where 8,400 net jobs were lost between 2009
and 2013. There were also low levels of employment decline in Lancaster and
Central Lancashire. In contrast, West Lancashire and East Lancashire experienced
employment growth of 2.8% and 1.5% respectively (a collective increase of 4,300
jobs).
Manufacturing
Total
Source: BRES
4.8
Examining the data at the two digit Standard Industrial Classification level
provides further insight into the underlying dynamics of Lancashire’s broad
employment sectors. Key points to note include:

Wholesale and retail: The retail sector experienced the highest level of net
decline in actual terms at the sub-sector level, while wholesale experienced
the highest level of net growth.

Manufacturing: Whilst there was an increase in food manufacturing
employment, Lancashire’s declining manufacturing sector was driven by high
Drivers of 2009-2013 Trends
4.7
Between 2009-2013 Lancashire experienced high levels of growth and
outperformed the national average in a number of key sectors, including health and
61
levels of net employment decline in the manufacture of other transport
equipment and the manufacture of fabricated metal products.
Public Sector: Although public sector employment declined significantly
overall, the human health, education and residential care sub-sectors all
experienced employment increases between 2009 and 2013.

Construction: Overall decline in the sector was driven by job losses in
specialised construction activities and the construction of buildings.
Source: BRES
0
Employment Decrease

Lancashire 10 Largest Net Employment Decreases, 2009-2013
Lancashire 10 Largest Net Employment Increases, 2009-2013
Source: BRES
9000
Employment Increase
8000
7000
4000
3000
2000
1000
0
-2000
-3000
-4000
-5000
-6000
-7000
-8000
6000
5000
-1000
Sectoral Employment in 2013 and Shifts Since 1998
4.9
In 2013, the public sector (comprising education, health and public
administration) was the largest employment sector in Lancashire, followed by
wholesale and retail and finance, professional and business services.
4.10
Reflecting both change in recent years and longer-term, more substantial
change since 1998, there have been significant shifts in the sectoral composition of
employment in Lancashire, including:

A fall in the representation of manufacturing employment; from almost a
quarter of total employment (24%) in 1998 to 13% in 2013

An increase in public sector employment across this period, from 27% in 1998
to 31% in 2013

An increase in the share of construction employment from 4% in 1998 to 6%
in 2013
62
Lancashire LEP Employment = 617,600
2%
2%
3%
Public sector
Wholesale & Retail
Finance, Professional &
Business Services
4%
Manufacturing
31%
Accommodation & Food
6%
Construction
chart below, which shows the scale, representation and recent growth trends in key
sectors across Lancashire.
Employment Specialisms 2013
No.
Manufacturing
81,700
1.4
Human health and social work activities
98,300
1.2
Construction
35,300
1.2
Public administration and defence
33,600
1.2
5,100
1.2
Utilities: Water
7%
Other Services
105,800
1.0
Education
57,800
1.0
Accommodation and food service activities
40,800
1.0
Info & Comms
Arts, entertainment and recreation
15,000
1.0
Other
Other service activities
11,100
0.9
2,200
0.9
Administrative and support service activities
39,500
0.8
Professional, scientific and technical activities
34,400
0.8
Transportation and storage
21,500
0.8
9,100
0.8
Information and communication
14,400
0.7
Financial and insurance activities
10,900
0.6
400
0.6
700
0.1
617,600
1.0
17%
13%
Transport & Storage
15%
Location
Quotient
Wholesale and retail trade
Utilities: Electricity
Sectoral Representation
4.11
When compared with the national economy, both the public sector and
manufacturing are highly represented, accounting for a higher share of employment
(31% compared to 28% and 15% compared to 10% respectively). In contrast,
financial, professional and business services account for a smaller share (15%
compared to 20%). The profile of the remaining sectors, is largely in line with the
national average. The adjacent table shows the Location Quotient for each of the
broad sectors in Lancashire. A location quotient indicates the relative concentration
of employment in one location compared to the national average – a location
quotient of more than one indicates a higher concentration of employment.
Real estate activities
Mining and quarrying
Agriculture, forestry and fishing
Column Total
Source: BRES
4.12
The high representation of the public sector is driven by health and social
work activities and public administration and defence, while employment levels in
education are in line with the national average.
4.13
In the case of financial, professional and business services, the
underrepresentation results from employment levels in all sub-sectors administration and support; professional, scientific and technical; real estate; and
financial and insurance services - being low compared to the national average.
4.14
In particular this applies to financial and insurance services and real estate
activities where employment levels reach just 60-70% of the national average. Both
of these sub-sectors have also experienced decline in recent years as set out in the
63
represented sub-sectors are manufacturing related. Civil engineering and
information and communication are also highly represented.
Sectoral Employment in the Sub-Geographies
4.16
The LEP-wide profile does however mask variations in the sectoral
composition of the sub-geography areas within Lancashire. The key differences to
note are:

Lancaster (total employment of 54,000): The public sector accounts for over
a third (37%) of total employment, reflecting the presence of Lancaster
University and Lancaster Hospital. There is also below average representation
of manufacturing employment in the district compared to the wider LEP area.

East Lancashire (total employment of 205,900): Whilst the majority of
sectors have a similar representation to that of the LEP area, manufacturing is
over–represented in East Lancashire, accounting for 20% of total employment
compared to 13% in Lancashire. This is still considerably lower than in
previous years, reflecting the level of labour market adjustment that has been
taking place in East Lancashire.

West Lancashire (total employment of 43,800): Whilst still the largest sector
in employment terms, the area has a below average representation of public
sector employment (25% compared to 31% in Lancashire). Transport and
storage and manufacturing are slightly over-represented.

Central Lancashire (total employment of 180,900): The inclusion of Preston
in this area is evident, with a low representation of manufacturing employment
and a high proportion of financial, professional and business services
employment (35% of total LEP employment in this sector compared to Central
Lancashire’s 29% share of total LEP employment).

Blackpool, Flyde and Wyre (total employment of 138,000): The area has a
high representation of accommodation and food services employment, largely
reflective of Blackpool as a popular visitor destination (one-third of the LEP
total, compared to one-fifth of all employment within the LEP).
Sub Sectors in Lancashire 2013
10 Largest Sub Sectors
Sector
No.
LQ
10 Highest Represented Sectors*
Sector
No.
LQ
Retail (exc. Motor)
60,700
0.9
Manufac. of leather
Education
57,800
1.0
Manufac. of other transport
1,300
5.7
12,900
4.0
Human health
54,500
1.1
Wholesale (exc. Motor)
33,600
1.2
Manufac. of textiles
3,700
2.7
Manufac. of furniture
5,200
Public admin & defence
33,600
1.2
Civil engineering
2.7
12,700
Food & beverage services
30,800
0.9
2.7
Information services
2,500
2.0
Social work (w/o accomm.)
26,700
Residential care
17,100
1.4
Manufac. of paper
2,300
1.8
1.0
Manufac. of beverages
1,100
Legal & accounting
1.7
15,500
1.3
Manufac. of chemicals
4,300
1.7
Specialised construction
15,200
0.9
Manufac. of rubber/ plastic
6,400
1.5
Source: BRES
*Based on the ten highest LQs in sub-sectors with a minimum of 500 employees.
4.15
The manufacturing employment specialism in Lancashire is further
reinforced by sub-sectoral data, which shows that eight of the ten highest
64
Advanced Manufacturing18
4.22
In line with national trends, employment in the manufacturing sector in
Lancashire is declining at a greater rate than the overall economy and this is
primarily within advanced manufacturing. Almost 10,000 jobs losses occurred in the
advanced manufacturing sector between 2009 and 2013 (accounting for 90% of
losses in the manufacturing sector), representing a decline of 15%. Further, the
sector is forecast to continue to decline over the next 15 years.
Contribution of the Sector
Profile of the Workforce
4.18
Manufacturing is a key sector within Lancashire, with significant
employment numbers and high levels of productivity. The sector employs over
80,000 people within the LEP area and contributes 20% of the LEP’s GVA
(compared to a sector average of 10% nationally).
4.23
The manufacturing workforce is predominantly male (76%) and the
majority of jobs are full time (97%). The sector is characterised by an older
workforce, with a lower than average proportion of workers aged 16 to 29 (18%
compared to 24%) and a higher proportion aged 45 to 64 (45% compared to 40%).
Key Sector Profiles
4.17
The following sections draw on the research undertaken as part of the
sector skills actions plans being developed for Lancashire’s key sectors.
4.19
Advanced manufacturing accounts for significant proportion of this, with
over 60,000 employees (9% of the LEP total) and a 13% contribution to Lancashire’s
total GVA.
Qualifications of Manufacturing Sector in
Lancashire
Qualifications of Overall Workforce in
Lancashire
No Qualifications
16%
Manufacturing Employment and
GVA Contribution
25%
Advanced Manufacturing
Employment and GVA
Contribution
15%
10%
5%
0%
% of Employment
Lancashire
% of GVA
England
Level 1
15%
Level 2
Level 3
Level 3
15%
18%
Level 4+
Lancashire
England
4.20
Manufacturing is a core element of Lancashire’s business base, with 3,400
businesses operating in the sector. Of these, 2,100 businesses are within the
advanced manufacturing sector, accounting for 5% of Lancashire’s business base.
Following the profile across the economy, businesses in the sector are
predominantly micro businesses, however the manufacturing sector accounts for
20% of the LEP’s large businesses (primarily in the manufacture of food and the
manufacture of rubber and plastic products).
4.21
Reinforcing Lancashire’s advanced manufacturing specialism, the sector
has a Location Quotient of 1.4 and particularly high representations of manufacture
of leather and related products and manufacture of other transport equipment,
predominantly aerospace.
Level 4+
17%
Apprenticeships and
other
Apprenticeships and
other
Source: Census 2011
% of GVA
Level 2
30%
15%
% of Employment
No Qualifications
11%
Level 1
16%
24%
14%
12%
10%
8%
6%
4%
2%
0%
20%
9%
15%
Source: Census 2011
4.24
Within
Lancashire’s
manufacturing
workforce,
apprenticeship
qualifications are highly represented, reflecting the strength of the manufacturing
industry and the traditional routes into this. The sector has an above average
proportion of the workforce with no qualifications (15% compared to 11% across
Lancashire) and the level of graduates (Level 4+ qualifications) is below that of the
whole economy.
4.25
Reflecting the nature of the job roles within the sector, skilled trades and
process, plant and machine operatives are highly represented within the sector.
4.26
Wages in the sector are above the average for the North West Economy,
with annual earnings of £27,800 and the highest wages in the manufacture of metals
and the manufacture of tobacco products.
Skills Issues
4.27
The sector has one of the highest rates of skills shortage vacancies in
Lancashire (23%) and despite falling employment in the sector 4,000 vacancies
18
Sector Skills Baseline Study and Action Plan for Advanced Manufacturing, Regeneris
Consulting 2015
65
were posted in the 12 months to June 2015. Whilst these vacancies were in a wide
range of roles, the most commonly posted were for engineering technicians, welding
trade roles and production managers. The main skills required by employers were
industry experience, knowledge of machinery, experience in sales, repair and CAD.
4.34
Particularly large sub-sectors in Lancashire are legal and accounting
activities (15,500 jobs), employment activities (13,200 jobs) and real estate (9,100
jobs). Legal and accounting is the only sub-sector to have an above average
representation in Lancashire when compared to the national average (LQ of 1.1).
4.28
The ageing effect occurring within the sector presents skills issues for
employers, with a large level of replacement demand anticipated. The North West
Aerospace Alliance has forecast that the sector will lose a large proportion of it’s
workforce over the next 20 years over a range of positions. In particular the sector
is forecast to lose a high proportion of its employees holding Level 2 qualifications
(36%).
4.35
The LEP area is home to several key companies in the sector, including
the Co-operative Bank Business Customer Services, Moore and Smalley LLP,
Guardian Financial Group and Marsden Building Society.
4.29
It is anticipated that technological change will continue to have a big
influence on the demand for skills within the manufacturing sector and that
employers will increasingly seek employees with experience of using industry
specific technologies, such as CNC machining, Additive manufacturing/3D printing
and Computer Aided Design.
4.30
The advanced manufacturing sector already has one of the highest levels
of skills shortage vacancies in Lancashire and is affected by an ageing workforce
and high levels of replacement demand for labour. Technological change, new
markets, the continued fragmentation of the production chain and increased
dependence on skilled workers are all creating an increased need for a flexible
workforce with strong specialist skills in niche areas.
4.31
The sector skills action plan has four strategic objectives: inspiring and
engaging young people; recruiting and retaining a competitive workforce;
developing a responsive learning infrastructure system; and securing employer
investment in training.
Financial and Professional Services19
Contribution of the Sector
4.36
There are 10,200 FPS businesses in the LEP area, accounting for 22% of
the business base. The size profile of these businesses broadly follows the national
profile, however notably, two thirds of the sectors turnover is accounted for by
medium sized businesses.
Profile of the Workforce
4.37
Nationally, 82% of employees in the FPS sector are employed full-time,
compared to 73% across the whole economy. An above average proportion of the
workforce is self employed and the sector is less likely to have temporary employees
than other sectors.
4.38
The age of the workforce varies by sub-sector, with real estate and facilities
management characterised by an older workforce, whilst finance, insurance and
professional services has a relatively young workforce.
4.39
36% of the financial and professional services workforce in Lancashire
hold a level 4 qualification or above (higher than the national economy average of
30%). The sector has a below average representation of workers holding
apprenticeships (6% of the workforce compared to 9% across Lancashire).
Skills profile of the FPS sector
Occupational profile of the FPS sector
Source: Census
Source: Census
FPS
FPS
4.32
The financial and professional services sector has been identified as a
priority growth sector for the UK. The sector generated £505bn GVA in 2014 and
employs 6.7m people nationally.
Lancashire
Economy
Lancashire
Economy
4.33
The sector plays an important role in Lancashire’s economy, employing
82,000 people (13% of total employment) and contributing £5.6bn GVA (22% of the
total economy). Whilst FPS employment is represented across the LEP area, the
largest concentration is in Central Lancashire, centred around the urban core of
Preston and the northern edge of South Ribble.
Managers, directors and senior
Associate professional & tech.
Skilled trades
Sales and customer service
Elementary
0%
20%
40%
60%
80%
Professional
Administrative and secretarial
Caring, leisure and other service
Process, plant and machine
100%
0%
20%
40%
60%
80%
100%
No qualifications
Level 1 qualifications
Level 2 qualifications
Level 3 qualifications
Level 4 qualifications and above
Apprenticeships and other qualifications
19
Proposed Skills Action Plan for Lancashire’s Financial and Professional Services Sector,
Final Report, and State of the Sector Report, SQW 2015
66
4.40
Associate professional and technical and administrative and secretarial
occupations are highly represented in the financial and professional services sector,
collectively accounting for almost 40% of the workforce. Skilled trades, caring and
leisure and process, plant and machine operatives have below average
representation in the sector, when compared with the Lancashire LEP average.
Skills Issues
4.41
In 2014 there were over 2,000 FPS vacancies posted in Lancashire; an
increase on the previous two years. Almost half of these were in computer
programming activities (48%), with 1,060 vacancies in 2014. Non-life insurance and
life insurance followed this, with 290 and 100 vacancies posted respectively. The
highest number of vacancies were in programme and software development
professional occupations and web design and development professional
occupations.
4.42
The sector is forecast to continue to grow nationally and in Lancashire,
increasing the demand for skills in the sector. Current changes and developments
in the sector, such as technological developments, the heightened importance of
big data and changes in lending and saving patterns, will affect the skills required
by the sector. Whilst skills issues within FPS vary by subsector, the following key
themes are identified:




20
Technical Skills are crucial for the development of the sector and, in
particular, skills in areas such as risk, legal, analytical, IT and leadership
and change management are areas which need improvement. Generic
skills such as communication, interpersonal and problem solving skills are
also highlighted by employers as key areas for improvement.
A shortage of specialists in the sector, in particular in the banking and
building societies subsector and wealth, investments and pensions
subsector, leads to employers developing their existing staff. This makes
retention of staff key to employers and means that the high levels of
replacement demand forecast for the sector will have significant
implications.
The work readiness of new recruits is highlighted by employers as an
issue in the FPS sector, with many lacking key skills, such as writing and
interpersonal skills, and lacking the ‘right attitude’ towards work.
Poor perception of the financial sector has led to a reduced supply of
skilled workers available to employers in some subsectors. In particular,
the insurance sector is often not viewed as a career choice by graduates.

The need for a multi-skilled workforce is increasing, with businesses
often requiring employees with a wide-ranging skills base.
4.43
Drivers for change within the financial and professional services sector
include increased regulation and governance, demographic and environmental
change, globalisation, technological change and customer demand. Whilst the
sector is expected to grow in absolute terms in Lancashire, replacement demand
will be more significant, accounting for around 75% of the total labour requirement.
Coping with an ageing workforce, and early succession planning, will be crucial to
the success of the sector in Lancashire.
4.44
The sector skills action plan identifies priorities within four thematic areas:
meeting the demand for skills, including addressing skills gaps and shortages and
meeting replacement demand requirements; developing the supply side, so that it
can address the changing needs of employers; increasing the attraction of the
sector and the location, to improve the retention of workers; and increasing
intelligence by tracking sector development, horizon scanning and articulating
employer needs to providers.
Health and Social Care20
Contribution of the Sector
4.45
Driven by an ageing population and an increasing demand for services, the
health and social care sector is growing nationally and is forecast to continue to
grow.
4.46
There are 98,000 people employed in the sector in Lancashire, making it
the largest employment sector and accounting for 16% of the LEP areas total
employment. With a Location Quotient of 1.2 the sector has above average
representation within the area, compared to the national average, with particularly
high concentrations of social work without accommodation (LQ of 1.9) and
residential nursing care activities (LQ of 1.4).
4.47
The largest employment subsectors within Lancashire are hospital
activities, employing 40,000 people and social work activities, employing 22,600
people.
4.48
There are 3,900 businesses within the sector, 7.1% of the Lancashire total,
and the number has increased since 2010. Human health activities account for the
highest number of businesses (hospitals, general and specialist medical practice
and dental practice activities), in total making up 44% of all businesses in the sector.
The vast majority are micro or small businesses.
Sector Skills Baseline Study and Action Plan: Health and Social Care, New Economy, 2015
67
Profile of the Workforce
4.49
Nationally, the health and social care workforce is predominantly female
(80% of employees) and approximately 1 in 5 employees are over 55 years old.
4.50
Across the North West, the health and social care sector has a higher
proportion of workers aged 50 years or older, compared to the average across all
sectors and a lower proportion of workers under the age of 30 than the average
across the economy.
4.51
Additional data for the social care sector shows that the age profile of
Lancashire’s workforce is broadly in line with the profile nationally, with almost half
of the workforce aged over 45. However, Lancashire has a higher proportion of
social care employees aged under 34 than the national average (33% compared to
30%).
4.52
The social care sector in particular is characterised by low wage levels,
with the average annual salary in Lancashire at around £16,500, compared to
Lancashire’s total economy average wage of £24,400.
Skills Issues
4.53
The health and social care sector is facing skills issues nationally, due to
the ageing population leading to increasing reliance on health and care services.
This increased demand, coupled with public sector spending constraints, heightens
the importance of addressing current skills challenges, including:

The sector’s reliance on an older workforce and the push factors affecting
these workers, such as reduced job satisfaction, dissatisfaction with career
opportunities and the sectors inflexible approach to retirement, is likely to
increase the level of new recruits required as a result of replacement
demand future years.

High turnover rates are an issue for the sector nationally and even more
so in Lancashire, where turnover levels exceed the sector average.
Further, vacancy rates for the sector are high (and are increasing at a
greater pace than nationally) and a lower proportion of employees have
been in their role for over 10 years than nationally.


21
4.54
The transformation of health and social care services in response to an
ageing population, developments in medical technology and tightening public
finances, has implications for the organisation and health and social care jobs and
the provision of education and training. Many of the decisions about health and
care provision are made outside Lancashire (e.g. by Health Education England), it
is important that Lancashire employers are able to influence the provision of training.
4.55
The sector skills action plan identifies four key objectives: strengthening
employer leadership of skills, by developing an infrastructure through which
employers can lead skills provision; prioritise and coordinate state investment in
skills provision; widen access to careers in health and social care by providing
alternative entry routes; and develop a strong, competitive provider base which can
meet the needs of employers, now and in the future.
Visitor Economy21
Contribution of the Sector
4.56
The visitor economy sector is an important sector nationally; employing
over 1.4m people and contributing £48bn to the economy. Growth nationally is being
driven by increased inbound tourism and domestic trips.
4.57
In Lancashire the visitor economy sector plays a key role in the LEP’s
economy and employs over 50,000 people, accounting for 8% of the LEP’s
employment. Whilst the sector is represented across the LEP area, Blackpool is a
key location for visitor economy employment.
4.58
At a sub-sectoral level, the largest employment sector is food and drink,
followed by accommodation and sports and recreation, which collectively account
for 92% of the sectors employment. There are several subsectors which are highly
represented in Lancashire including, amusements and theme parks (LQ of 2.4),
event catering activities (LQ of 1.8) and other amusement and recreation activities
(LQ of 1.6).
4.59
There are 3,800 businesses operating in the sector in Lancashire,
accounting for 8% of the total business base. Mirroring the trends found across the
economy, these are predominantly micro and small businesses employing fewer
than 50 people.
The high skills requirements in parts of the sector mean that there are
skills gaps within the existing workforce, with employers reporting gaps in
practical skills such as problem solving skills, oral communication,
customer handling, teamwork, management and leadership.
4.60
The sector contributed £3.5bn to Lancashire’s economy in 2013; a figure
which has increased since 2009.
A lack of applicants to the sector is also a key factor in current and future
skills challenges.
4.61
The visitor economy workforce in Lancashire, and nationally, is transient
and is characterised by seasonal and part-time work and zero-hours contracts.
Profile of the Workforce
Sector Skills Baseline Study and Action Plan for the Visitor Economy, ekosgen, 2015
68
There are a slightly higher proportion of females employed in the sector, compared
to the total economy, and the workforce is predominantly white (90% of workers).
4.62
Young people account for a significant proportion of the workforce, with
34% of workers under the age of 30, compared to 24% across the total Lancashire
economy. There is an underrepresentation of workers aged 40 – 59 in the visitor
economy sector.
Age profile of Visitor Economy in Lancashire
4.66
The seasonal nature of the visitor economy sector and the transient
workforce which it employs presents challenges in terms of recruitment and
retention of staff, the visitor experience provided and company performance. These
issues include:

A high turnover of staff reflecting the seasonality of the work available
and the high proportion of young people working in the sector. This can act
as a disincentive to invest in workforce training, resulting in skills gaps.

High vacancy numbers due to the high turnover of staff, with 17% of
hotels and restaurants reporting vacancies. However, fewer of these
vacancies were classified as hard to fill than in other sectors, with
employers reporting that they were looking for employees with the ‘right
attitude’, rather than specific skills.

Skills gaps are common in the sector, with hotels and restaurants
accounting for 12% of all employers in the LEP reporting skills gaps. In
particular employers were looking for staff with soft skills, such customer
service skills and effective communication with colleagues.

Poor pay and conditions are expected to have an increasing impact on
recruitment in the sector as the economy recovers and competition for
workers increases.
Skills Profile of the Visitor Economy sector in Lancashire
Source: Census 2011
Source: Census 2011
Visitor Economy
Visitor Economy
Lancashire
Economy
Lancashire
Economy
0%
Age 16 - 19
Age 50 - 59
Skills Issues
20%
Age 20 - 29
Age 60 - 64
40%
60%
Age 30 - 39
Age 65 and over
80%
100%
Age 40 - 49
0%
No Qualifications
Level 2
Level 4+
20%
40%
60%
80%
100%
Level 1
Level 3
Apprenticeships and other
4.63
The qualification profile for the visitor economy in Lancashire is below that
of the LEP area as a whole. An above average proportion of employees in the
visitor economy sector have no formal qualifications (one and half times the
proportion for the LEP area), and nearly 60% hold qualifications at Level 2 or below.
In contrast, the proportion of employees in the visitor economy qualified to Level 4
and above is less than half the LEP-wide average.
4.64
Sales and customer service staff account for nearly a quarter (24%) of the
sector’s workforce in Lancashire, reflecting the customer facing nature of the visitor
economy.
4.65
Wages in the visitor economy have historically been lower than in many
other sectors and recent figures show that this remains the case (in 2014, the
average annual wage in the visitor economy in Lancashire was less than half the
all-sector average for the LEP area). Unsurprisingly given the north-south salary
divide, average wages in the visitor economy in Lancashire are lower than they are
nationally.
4.67
Employment growth is expected within the sector and levels of
replacement demand are significant. The sector skills action plan has three key
themes: preparing the future workforce, aiming to attract more appropriately skilled
young people into the sector; developing the existing workforce, addressing skills
gaps relating to management and leadership, increasing online sales capabilities
and ensuring the sector is prioritised within workforce development programmes;
and learning from good practice, supporting the roll-out of innovative and effective
practice.
Energy and Environmental Technologies22
Contribution of the Sector
4.68
The energy and environmental technologies (EET) sector is a key and high
performing sector across the UK. In 2013, the sector generated £25bn of GVA,
accounting for 6% of total GVA, and employed 680,000 people nationally.
4.69
The sector, broadly defined to include energy and sub-sectors relating to
environmental technologies, is a major employer across Lancashire, with over
A Skills Action Plan for Lancashire’s Energy and Environmental Technologies Sector,
Proposed Action Plan and State of the Sector Report, SQW 2015
22
69
40,000 employees and accounting for 7% of Lancashire’s workforce. The sector has
experienced employment growth since 2009, although this has levelled off since
2011. Whilst EET employment is represented across the LEP area, a third of
sectoral employment is located in the South Ribble district, reflecting the presence
of several large companies.
4.70
Key sub-sectors in Lancashire include nuclear, offshore gas, oil and wind,
onshore wind, waste recovery and environmental technology and manufacture. A
number of sectors are large employers and are also highly represented within the
LEP, including the construction of utility projects for electricity and communications
(6,900 employees / LQ 31.2), the production of electricity (1,300 employees / LQ
1.9) and the processing of nuclear fuel (1,300 employees / LQ 5).
4.71
Both the University of Central Lancashire and Lancaster University are
internationally renowned for their work in the sector and there are 5,200 businesses
in the EET sector in Lancashire, including several key employers, such as
Springfield Fuels, EDF and AMEC PLC.
4.77
Key skills issues for the EET sector include:

The ageing workforce means that 70% of the existing workforce will have
retired by 2025. This is a particular issue in relation to electrical engineers,
who will play a key role in the building of new power stations. Linked with
this, the limited number of young people entering the sector and the length
of time required to train new recruits will have an impact on the sectors
skills supply in the future.

A shortage of engineers and technicians, including experienced
electrical engineers, installation technicians with the necessary skills and
knowledge and renewable energy technicians.

Multi-utility of skills and competencies as job roles are widening, due
to restructuring and cost saving, roles now require a greater range of skills.
Employers also now desire qualifications which are multi-utility.

Increasing need for specific technical skills as technology becomes
more specialised.

Increasing need for project management skills as employers
increasingly require project managers who combine commercial ability and
experience of the sector.

Qualifications continue to be important to the sector, in particular level 3
qualifications, level 4 – 6 qualifications and STEM related qualifications.
Profile of the Workforce
4.72
Nationally, the majority of the energy sector jobs are full-time (92%
compared to 72% across all sectors). Only a small proportion of the workforce is
self employed (5% compared to 14% across the economy) and the sector is less
likely to have temporary employees than other sectors.
4.73
The sector has an ageing workforce, with an above average proportion of
employees aged 40 – 59 than the whole economy and a low proportion of
employees under 25 years old.
4.74
The EET workforce nationally is predominantly male (81%) and a below
average proportion of the workforce hold qualifications at level 4 and above.
Skills Issues
4.75
Over the last three years around 1,000 vacancies in the EET sector in
Lancashire were posted by businesses, the most common of which were in
plumbing, heat and air conditioning installation, the collection of hazardous waste
and other engineering activities. The largest number of vacancies by occupation
was in plumbing and heating and ventilating engineers, accounting for 28% of
vacancies in Lancashire.
4.76
The sector has several significant skills issues which are likely to become
increasingly important in future years, due to an ageing workforce and the
subsequent replacement demand and the low number of young people specialising
in engineering.
4.78
Forecasts for the sector vary, but replacement demand is likely to be more
significant than absolute growth due to the age of the existing workforce. The sector
skills action plan has four thematic areas: meeting demand for skills, including
technical skills, softer skills and business skills; increasing the attraction of the
sector in Lancashire through changing perceptions of both the industry and the
location; improving intelligence by tracking developments in the sector; and
developing the supply side by ensuring availability of appropriately skilled FE staff
and adjusting provision to meet employer needs.
Creative and Digital Industries23
Contribution of the Sector
4.79
Nationally, the creative and digital industries sector is growing due to
technological advances and digitisation. Employment has risen to 2.8m, an increase
of 14% since 2011. The sector, defined to include both the creative industries and
those in creative occupations in other sectors, is now thought to account for one in
eleven of all jobs in the UK.
23
Sector Skills Baseline Study and Action Plan for the Creative and Digital Sectors,
Executive Summary, The Work Foundation, 2015
70
4.80
The number of jobs in the sector in Lancashire is estimated to be around
36,000, of which 22,000 are in the creative industries and 14,000 in creative
occupations in other sectors. This equates to just under 6% of employment in
Lancashire, compared to 8.6% nationally. The sector is estimated to account for
£800m of GVA in Lancashire, rising to £1.3bn when creative occupations outside
the sector are considered.
the ability to engage with businesses, rapidly changing skills needs, a
model of learning by doing rather than through traditional education or
training, limited levels of engagement with apprenticeships within the
sector, and the lack of flexible funding available to support short, focussed
training provision within the sector, as opposed to the provision of full
qualifications, which are often not what businesses in the sector require.
4.81
Employment in Lancashire is concentrated in IT, software and computer
services, with below average concentrations in film, TV, video, radio and
photography. Geographically, 40% of employment is located in Preston, Chorley
and Blackburn with Darwen, and has fallen by 5% since 2009, in contrast to a 10%
increase nationally. There are estimated to be around 4,500 creative businesses in
Lancashire, of which 90% are microbusinesses employing fewer than ten people.
4.83
The sector skills action plan sets out three key objectives: strengthening
the digital skills pipeline from schools to HEIs; gearing skills provision to be more
appropriate to the needs of the dynamic microbusinesses within the creative
economy in Lancashire; and improving recruitment and retention through
addressing the challenges and opportunities of the position of the sector Lancashire.
Construction24 - update
Skills Issues
Contribution of the Sector
4.82
Skills issues experienced within the sector in Lancashire include:

Difficulties in recruiting people with the appropriate digital skills, with a
higher prevalence of skills gaps in the digital sub-sector than in the creative
part of the industry, and skills shortage vacancies in advanced IT and
software skills.

A mismatch between demand for and supply of skills, with provision
being focussed on creative arts, and the majority of ICT provision focussed
on users rather than technical ICT training.

High levels of demand for graduate labour within the creative sector,
which will require high levels of graduate retention from Lancashire’s
universities.

A less diverse workforce than in the economy as a whole (for example
women account for only around one-third of employment in creative
economy jobs, compared to nearly half of all jobs nationally. The digital
sub-sector is particularly lacking in diversity, and this will present
challenges as demand for labour increases.


Concerns about the ability of the higher education sector to supply an
appropriate number of suitably trained and qualified potential
employees, in particular their ability to keep pace with technological
change, and provide opportunities for work experience within the sector.
Challenges for skills providers in meeting the sector’s skills needs,
arising from the prevalence of small businesses in the sector, which limits
4.84
The construction sector employs over 1 million people nationally and is a
key employer in Lancashire. There are over 35,000 people employed in the
construction sector in Lancashire, accounting for 6% of Lancashire’s total
employment.
4.85
The largest employment sub-sectors in Lancashire include the
construction of utility projects for electricity and telecommunications (6,700 jobs),
electrical installation (4,700), construction of domestic buildings (4,600) and
construction of other civil engineering (4,600).
4.86
Lancashire accounts for 22% of the North West’s construction business
base. The construction business base consists of 5,360 businesses across the LEP
area (18% of which are in South Ribble and Preston) and, following the national
trend, these are predominantly micro businesses. Key companies within the sector
include, Eric Wright Group, Kiernan Construction, Conlon Construction and John
Turner Construction Group.
4.87
The construction sector has experienced significant growth in Lancashire
since 2010, with a 10% employment increase, whilst nationally sectoral employment
has declined by 4%.
Profile of the Workforce
4.88
The construction sector workforce is predominantly male (88% of
employees compared to 53% across the economy) and follows broadly the same
age profile as that of Lancashire’s total economy.
24
Skills and Employment Strategy and Implementation Plan for Preston, South Ribble and
Lancashire City Deal, ekosgen, 2015
71
4.89
There is a high representation of apprenticeship qualifications held by the
construction sector workforce, with 19% of employees holding an apprenticeship
compared to just 9% across Lancashire, reflecting the traditional routes into the
sector. There is an under-representation of workers who hold degree level
qualifications (L4+) in the sector.
4.94
Technological advances and the low carbon agenda have also affected the
skills needs of the sector, increasing demand for specific skills, such as skills in
using green materials and methods in construction. This has also heightened the
need for management skills, with the management of sites key to the reduction of
carbon footprints.
4.90
Reflecting the nature of the job roles in the sector, the most common
occupation within construction is in skilled trades, accounting for over half of the
sectors employment (55%). Professional, associate professional and technical,
administrative and secretarial and sales and customer service occupations have a
below average representation in comparison to Lancashire’s wider economy.
4.95
Increased international competition also requires workers in the sector to
have a greater range of skills to operate successfully in the overseas markets,
including language and managerial skills.
Highist Level of Qualification in Lancashire
Occupational profile of the construction sector
Source: Census 2011
Source: Census
Construction
Construction
Lancashire Economy
4.96
The City Deal Employment and Skills Strategy has two strategic objectives
that directly relate to the construction sector. The first is to support the construction
industry and supply chain, through actions to encourage more well young people
into the sector, increase the number of apprenticeships, internships and graduate
recruitment, provide bespoke business support for the sector, including
management development, and consider the economic benefits arising from
construction related manufacturing and supply chain product development. The
second is to work with the construction sector to increase training and employment
opportunities for young people and older workers and increase social value.
Lancashire
Economy
0%
20%
Managers, directors and senior
Associate professional & tech.
Skilled trades
Sales and customer service
Elementary
40%
60%
80%
100%
Professional
Administrative and secretarial
Caring, leisure and other service
Process, plant and machine
0%
20%
No qualifications
Level 2 qualifications
Level 4 qualifications and above
40%
60%
80%
100%
Level 1 qualifications
Level 3 qualifications
Apprenticeships and other
Skills Issues
4.91
It is recognised that there is a deficit in training in the construction sector
and it is anticipated that in 2015-18 training needs will be 45% higher than the
average across 2011-14. The top five professions in demand in 2015 have been
non-construction professional, technical, IT and other office-based staff, wood
trades and interior fit out, construction managers, plumbing heating, ventilation and
air conditioning trades and electrical trades and installation roles.
4.92
The cyclical nature of the sector poses a challenge for employers in terms
of planning their workforce and potential skills demands. The sector is forecast to
grow in future years and replacement demand, driven by the ageing workforce, will
heighten the need for skills within a range of construction roles.
4.93
Post recession, workers who have secured employment in other sectors
are reluctant to move back into construction, preferring more stable employment.
This is also the case for many young people and highly skilled workers (such as
managers) who prefer to seek employment in other sectors where their skills are
required.
72
Gross Value Added
4.97
Gross Value Added (GVA) is a measure of the value produced in a local
economy, made up of the wages earned by workers and the profit made by
businesses. In 2012, the Lancashire LEP area generated £24.7bn of GVA.
Lancashire County contributed 83% of this (£20.5bn) and the remainder consisted
of £2.3bn (10%) from Blackburn with Darwen and £1.9bn (8%) from Blackpool. GVA
levels have risen by 15% since 2004, although this is substantially lower than the
national increase of 25% over the same period. If Lancashire had kept pace with
the national increase, GVA levels would be £2.7bn (11%) higher.
Lancshire GVA growth over time, 2004-2012
Source: GVA by LEP, ONS
30,000
25,000
20,000
15,000
10,000
5,000
2004
2005
2006
Lancashire LEP
2007
2008
2009
2010
2011
2012
England minus London - trend
73
Productivity
Productivity by Sector
4.98
Productivity has been a long term challenge in Lancashire. In 2012, the
level of GVA generated per full time equivalent employee (FTE) was just under
£50,000, equivalent to 83% of the national average.
4.99
Productivity levels vary across the Lancashire LEP, although they are
consistently below the national average25. Lancashire County generates the highest
level of GVA per FTE, followed by Blackpool and then Blackburn with Darwen where
productivity levels are equivalent to just 74% of the national average.
Gross value added per full-time equivalent employee, £, 2012
Source: Regional Accounts and BRES
GVA per
FTE, £
% of England
minus London
Production
95,500
81%
Financial and insurance activities
87,670
93%
Information and communication
67,120
75%
Other services and household activities
60,890
96%
Construction
56,800
76%
Manufacturing
52,010
82%
Total
49,580
83%
70,000
Public administration; education; health
39,590
89%
60,000
Distribution; transport; accommodation & food
38,940
89%
Business service activities
35,990
83%
50,000
Source: Regional Accounts and BRES
40,000
Note: Agriculture and real estate are excluded from the table due to data limitations
30,000
20,000
The Lancashire Business Base
10,000
Business Density
Lancashire
England
Lancashire
LEP
minus London
County
Blackpool
Blackburn
with Darwen
Sectoral Productivity
4.100 Productivity levels also vary by sector ranging from £35,990 in business
service activities to £95,500 in production (mining and utilities). However, the level
of GVA per FTE is below the national average in all broad sectors. The gap with the
national average is smallest for other services and household activities and financial
and insurance services. In construction and information and communication GVA
levels are equivalent to just 75-76% of the national average.
4.101 In 2013, there were approximately 49,800 active businesses in the
Lancashire LEP area. This equates to a business density of 54 businesses per
1,000 working age population compared to 59 nationally (England minus London).
If Lancashire were to meet the national average there would be an additional 4,000
businesses across the LEP area.
4.102 The low business density appears to be linked to a low start up rate.
Business survival rates match or exceed the national and regional averages. Start
up rates were above the national average until 2009, but have been lower than
average since then (although they are recovering from the 2010 low).
Data is available for the NUTS 3 areas within Lancashire – Lancashire County, Blackpool
and Blackburn with Darwen
25
74
Active Businesses by Sub-Geography
Business Start Up Rate 2004 - 2013
Source: Business Demography
No.
Start up rate (%)
16.0%
15.0%
14.0%
%
East Lancashire
17,645
35%
Central Lancashire
12,945
26%
Blackpool, Flyde and Wyre
10,990
22%
Lancaster
4,185
8%
West Lancashire
4,060
8%
Lancashire LEP
49,825
100%
13.0%
12.0%
11.0%
10.0%
9.0%
8.0%
2004
2005
2006
Lancashire LEP
2007
2008
2009
2010
England minus London
2011
2012
2013
North West
Business survival rate (businesse s born 2008)
Source: Business Demography
100
Source: Business Demography
4.104 The business density varies by sub-geography, with three of the five areas
outperforming the LEP average of 54. Specifically:
•
Lancaster has the lowest business density, with just 46 businesses per
1,000 working age population.
•
East Lancashire also falls short of the LEP average with a business density
of 53.
•
West Lancashire has the highest business density, with 59 businesses per
1,000 working age residents, followed by Blackpool, Flyde and Wyre and
Central Lancashire (both with a business density of 56), all of which
outperform the LEP average.
90
Survival rate (%)
80
70
60
50
40
30
20
10
0
1 year
2 years
3 year
Lancashire LEP
North West
4 year
5 year
England minus London
4.103 In line with the share of employment across the sub-geographies, East
Lancashire accounts for a third of the LEP areas business base, with over 17,000
active businesses in 2013. Central Lancashire and Blackpool, Flyde and Wyre have
relatively large business bases, with 13,000 and 11,000 active businesses
respectively. As with employment, Lancaster and West Lancashire make the
smallest contribution to the LEP’s business base, with just over 8,000 active
businesses collectively.
75
Business density - businesses per 1,000 working age population, 2013
Source: Business Demography and MYPE
Businesses by Size 2013 (local units)
90%
70
80%
50
40
30
20
10
-
% of business base
60
70%
60%
50%
40%
30%
20%
10%
0%
Micro
Small
Lancashire LEP
North West
Medium
Large
England minus London
Source: Activity, Size, Location
Business base by size
Employer Demand for Skills
4.105 Data on local units, which counts the number of business sites locally and
may therefore include multiple branches of one business, shows that the business
base is dominated by micro businesses, employing fewer than 10 people. The size
profile largely mirrors that of the national economy, although Lancashire has a
slightly smaller proportion of micro businesses, and a slightly larger proportion of
small businesses (employing 10-49 people) than the national average.
Vacancies
4.106 From a skills perspective it is important to note that while there is just a
small number of large businesses (employing more than 250 people) they account
for a disproportionate and large share of employment. While data of this nature is
no longer collated, the last available data showed that large employers accounted
for 30% of employees in the Lancashire economy. By way of comparison, small
businesses accounted for 24%, medium businesses 25% and micro businesses
21%26.
4.107 The Labour Insight online labour market information system gathers data
on the job vacancies advertised online across the UK. Job postings are gathered
from over 20,000 sources and categorised by occupation, sector and qualification
requirement. The data can be analysed at Lancashire level to identify the job roles
which are most commonly sought by Lancashire’s employers.
4.108 Nearly 80,000 vacancies were recorded through Labour Insights in 2014.
Although half were not coded by industry sector, of those that were:

Health and care accounted for the highest proportion, as was also the case
in 2013, more than twice as many as any other sector. The health and
care sector’s share of vacancies was 50% higher in Lancashire than in the
UK as a whole.

The manufacturing sector accounted for the second highest number –
nearly 5,000. The number of vacancies within this sector has been on a
downward trajectory for the past three years.

Education had the next highest number of vacancies, and the number has
been increasing year on year.
This is based on employee size bands of micro (1 – 10 employees), small (11 – 49
employees), medium (50 – 199 employees) and large (200+ employees).
26
76

In two key sectors – professional, scientific and technical and finance and
insurance – the share of vacancies in Lancashire is lower than nationally,
and the number has fallen in each of the past three years.
Vacancies by Occupation 2012 - 2014
Source: Labour Insights
100%
90%
Lancashire Vacancies by Sector
80%
2013
No.
No.
No.
%
5,610
11,570
11,110
14%
9%
40%
6,340
5,740
4,860
6%
5%
30%
Education
3,270
4,230
4,640
6%
5%
Wholesale And Retail Trade
2,870
3,200
2,910
4%
3%
640
1,390
2,300
3%
3%
1,300
1,910
2,090
3%
3%
1,730
3,340
1,880
2%
1%
1,360
1,300
1,020
1%
2%
1,750
1,080
1,010
1%
3%
Other Service Activities
660
1,050
920
1%
1%
Transportation And Storage
Accommodation And Food Service
Activities
Construction
760
1,400
900
1%
1%
590
980
880
1%
1%
370
700
480
1%
1%
Arts, Entertainment And Recreation
250
440
440
1%
1%
Real Estate Activities
120
450
430
1%
1%
Utilities: Water Supply
4340
380
140
0%
0%
Mining And Quarrying
100
110
100
0%
0%
Utilities: Electricity
40
60
50
0%
0%
Agriculture, Forestry And Fishing
20
50
20
0%
0%
Activities Of Households As Employers
60
90
20
0%
0%
Unspecified
30,520
47,160
43,200
54%
60%
Total
58,800
86,620
79,400
100%
100%
Human Health And Social Work
Activities
Manufacturing
Public Admin And Defence
Information And Communication
Administrative And Support Service
Activities
Professional, Scientific And Technical
Activities
Financial And Insurance Activities
2014
UK
70%
2012
%
60%
50%
Source: Labour Insight
4.109 Looking at vacancies by occupation, Lancashire has a higher share of
vacancies in intermediate and lower level occupations than is the case nationally.
Over the past three years, the proportion in lower level and intermediate
occupations has ranged between 40-50%, compared to 30-40% nationally.
20%
10%
0%
Lancashire
UK
Lancashire
2012
Elementary
Sales and customer services
Skilled Trades
Associate professional and Tech
Managers, director and Senior Officials
UK
2013
Lancashire
UK
2014
Process, plant and machine operatives
Caring, Leisure and other services
Admin and Secretarial
Professional
4.110 Compared to the current structure of the labour market, a clear difference
can be seen between vacancies identified through Labour Insight and current
employment. Higher level occupations – managers, directors and senior officials;
professionals; and associate professionals – account for just under 40% of
employment in Lancashire, but nearly 60% of vacancies identified through Labour
Insight. It is likely that this reflects how and where jobs at different occupational
levels are advertised, rather than indicating a significant shift in the structure of the
Lancashire labour market.
4.111 Looking at more detailed occupational groups, the most commonly
advertised are business and public service associate professionals, accounting for
over 10,000 jobs or 13% of vacancies in Lancashire, compared to 14% nationally.
The second most common are science, research, engineering and technical
professionals, but this group accounts for only 10% of vacancies in Lancashire,
compared to 14% nationally. Health professionals account for 10% of vacancies in
Lancashire, but only 6% nationally.
Top Vacancies by 2 Digit Occupation in Lancashire
2012
2013
Business And Public Service Associate Prof.s
7,800
10,100
10,200
2014
13%
14%
UK
Science, Research, Engineering And Tech. Prof.
5,500
6,700
7,600
10%
14%
Health Professionals
2,900
6,700
7,600
10%
6%
77
Administrative Occupations
5,500
7,600
6,900
9%
8%
Business, Media And Public Service Professionals
2,700
4,200
5,300
7%
9%
Corporate Managers And Directors
3,300
4,300
4,400
6%
7%
Sales Occupations
4,300
6,500
3,900
5%
4%
Caring Personal Service Occupations
2,700
4,500
3,600
5%
4%
Teaching And Educational Professionals
3,100
3,500
3,500
4%
4%
Science, Engineering And Tech. Associate Prof.
2,500
3,000
3,100
4%
4%
Source: Labour Insight
4.112 At the level of individual occupations, the data shows demand for both
highly skilled and lower skilled workers. The most commonly advertised occupation
is that of nurse – 4,000 vacancies, plus a further 1,800 job adverts for medical
professionals. The number of adverts for programmers and software development
professionals, plus web design and development professionals indicates a demand
for high level ICT skills. Also prevalent are lower skilled occupations in which the
level of staff turnover is high – care workers, customer service occupations, retail
assistants and chefs.
their organisation, compared to 15% nationally. Gaps are most commonly reported
in elementary and sales and customer service occupations, with 5% and 4% of local
employers reporting skills gaps in these areas respectively.
4.115 The most common cause of skills gaps in Lancashire, as reported by
employers, is staff training being only partially completed (63% of employers with
skills gaps) and a high number of employers also reported that staff being new to
the role causes skills gaps. Other causes include staff lacking motivation,
performance not improving following training and staff not receiving the appropriate
training.
Causes of Skills Gaps in Lancashire
Source: UKCES
Training is currently only partially completed
They are new to the role
Staff lack motivation
Performance not improving sufficiently after…
Have not received the appropriate training
Top Vacancies by 4 Digit Occupation in Lancashire
The introduction of new w orking practices
2012
2013
No.
No.
2014
No.
UK
%
%
Nurses
1,800
4,600
4,000
5%
3%
Other administrative occupations n.e.c.
Programmers and software development
prof.
Business sales executives
2,300
3,300
3,000
4%
3%
1,300
1,700
2,200
3%
4%
2,100
2,300
1,900
3%
2%
Medical practitioners
400
900
1,800
2%
1%
Care workers and home carers
1,500
2,400
1,600
2%
1%
Customer service occupations n.e.c.
1,500
1,800
1,500
2%
2%
Sales and retail assistants
1,100
2,000
1,300
2%
1%
700
1,200
1,300
2%
2%
1,000
1,400
1,200
2%
1%
Web design and development professionals
Chefs
Source: Labour Insight
4.113 The UK Employer Skills Survey also provides information on the skills
needs of local employers. The data presented below presents Lancashire LEP area
in comparison to the England minus London averages, however due to limitations
of the dataset, analysis of the sub-geographies within Lancashire is not possible.
Skills Gaps within the Existing Workforce
4.114 Skills gaps within the existing workforce are more prominent in Lancashire
than nationally, with 17% of employers reporting that they have a skills gap within
Unable to recruit staff with the required skills
The development of new products and service
The introduction of new technology
Problems retaining staff
0%
20%
40%
60%
80%
Prevalence of Vacancies
4.116 Across Lancashire LEP, a lower proportion of employers reported having
at least one vacancy at the time of the survey (12%) than was the case nationally
(14%). The highest proportion of vacancies were in associate professional,
professional and caring, leisure and other services occupations, accounting for
almost 60% of all vacancies in Lancashire (+11% points on the national average).
Further, a significant proportion of employers also had a vacancy in an elementary
occupation (16%), in line with the high level of skills gaps identified in this area.
Vacancies in managerial occupations were uncommon in Lancashire, with just 3%
of employers reporting these vacancies (-3% on the national average).
78
Hard to Fill and Skills Shortage Vacancies
4.117 Of all establishments with vacancies, 31% had a vacancy which they
classified as ‘hard to fill’ (HTF), compared to 34% nationally. These vacancies were
predominantly in highly skilled occupations, with 66% of HTF vacancies in associate
professional, skilled trade and professional occupations. Nationally, whilst these
occupations were also the most highly represented amongst ‘hard to fill’ vacancies,
they accounted for a lower proportion of vacancies (52%).
4.119 The main cause of HTF vacancies reported by employers in Lancashire
was a low number of applicants with the required skills, which 45% of employers
with hard to fill vacancies reported as a cause for these. Other common causes
include a lack of work experience (31%), lack of applicants with the required attitude
and motivation (28%), a lack of qualifications and not enough interest in the type of
job (27% each).
4.118 Of all employers with vacancies, 25% have a skills shortage vacancy
(SSV); slightly below the national average of 27%. As presented below, the
occupational profile of these vacancies follows broadly the same pattern as that of
HTF vacancies, with SSV’s predominantly occurring within highly skilled
occupations.
Main causes of HTF Vacancies in Lancashire LEP
Source: UKCES
Low no. of applicants w ith the required skills
Lack of w ork experience the company…
Low no. of applicants w ith the required…
Lack of qualifications
Not enough interest in this type of job
Poor terms and conditions offered for post
Remote location/poor public transport
Low number of applicants generally
Too much competition from other employers
Other
Job entails shift w ork/unsociable hours
0%
20%
40%
60%
79
4.120 Across Lancashire, technical, practical and job specific skills were most
commonly reported as hard to obtain by employers. Further, planning and
organisation skills, oral communication skills and customer handling skills were
cited by a high proportion of employers as being difficult to obtain from applicants.
Skills found difficult to obtain from applicants in Lancashire
Source: UKCES
Technical, practical or job specific skills
Planning and Organisation skills
Oral communication skills
Customer handling skills
Problem solving skills
Team w orking skills
Written communication skills
Strategic Management skills
Literacy skills
Advanced IT or softw are skills
0%
20%
40%
60%
80%
80
5
Employment Forecast and Future Demand
for Labour
Key Messages
•
•
•
The forecasts for the Lancashire economy produced by Oxford Economics
show net employment growth of almost 30,000 jobs in the Lancashire
economy between 2015 and 2025. This is lower than the regional and
national forecasts (4% compared to +5-6%) and equates to two thirds of the
LEP’s target to create 50,000 jobs by 2025.
The private service sector is expected to drive employment growth. Although
the net employment increase in Lancashire between 2015 and 2025 is 29,900
jobs, an additional 47,900 jobs will be created in those sectors where growth
is forecast. In terms of actual growth in the number of jobs, the construction
sector is the most significant and could increase as the effects of City Deal
transport and other infrastructure investment becomes apparent.
There is also expected to be substantial job growth in administrative and
support and professional scientific and technical employment (the majority of
which will be at graduate level, with a significant proportion at post-graduate
level) plus the visitor and leisure economy, and retail and distribution of
goods.
•
The skills forecast suggests that there will be an up-skilling of the workforce
within most occupations and sectors, although there will be a reduction in
middle range skills, creating an hour glass effect in the workforce profile.
•
Replacement demand will be an important source of employment
opportunities and will generate significant skills requirements – in numbers
terms this will be more important that net employment growth.
Introduction
5.1
Economic forecasts can provide a guide to the likely future growth of the
Lancashire economy, although it should be recognised that they are subject to many
uncertainties and indicate a direction of travel rather than provide exact future
employment numbers.
5.2
Forecasts have been produced for the Lancashire economy by Oxford
Economics. This includes data on net employment growth and decline by sector
and the associated skills and occupational requirements. In terms of sectors, figures
are provided for broad sectors that align with standard datasets and for priority
sectors defined using the New Economy definitions.
5.3
From a skills perspective, it is also important to consider trends in
replacement demand, where appropriately skilled employees will be required to fill
posts resulting from employees retiring, leaving the workforce and/or moving to
other jobs.
•
The aggregate effect of sectors in decline will result in some 18,000 jobs
being lost. While the growth of almost 48,000 jobs cancels these losses out,
any reduction in the scale of job losses would make a significant contribution
to economic growth.
5.4
This section presents the analysis and implications of the economic
forecasts and data that is available on replacement demand through Working
Futures.
•
The majority of employment decline is forecast to be in manufacturing and
public administration. With 10,300 job losses forecast for manufacturing
(equivalent to a 12% decline), in both percentage and absolute terms the
forecast decline in the sector is significant, and is at odds with the ambitions
set out in the LEP’s Strategic Economic Plan.
5.5
Employment is forecast to grow by 4% in Lancashire between 2015 and
2025, adding nearly 30,000 jobs to the Lancashire economy. This equates to two
thirds of the LEP’s target.
•
•
While this scale of decline is not unusual for the manufacturing industry,
Lancashire has a number of very competitive manufacturing sub-sectors and
a significant base of advanced engineering companies. The LEP strategy
includes a strong commitment to strengthening manufacturing
competitiveness and attracting new investment to the County, notably
through the Enterprise Zone.
At the broad occupational group level, the forecasts suggest that there will be
relatively little change in the occupational profile of Lancashire’s employment
base between 2015 and 2025.
Employment Forecasts
5.6
The rate of employment growth in Lancashire is expected to be
considerably lower than that forecast for the UK as a whole (4% compared to 6%)
as well as below the average for the North West (5%).
5.7
Across the sub-geographies, employment growth is expected to vary
considerably. Lancaster and West Lancashire are forecast to experience
employment growth above the national average, whilst in East Lancashire,
employment is expected to increase by only 2% over ten years. The greatest
numbers of jobs, over 10,000, will be created in Central Lancashire.
81
5.10
Although the net employment increase in Lancashire between 2015 and
2025 is expected to be 29,900 jobs, an additional 47,900 jobs will be created in
those sectors where growth is forecast.
Employment growth forecasts, 2015-2025
Source: OE Forecasts
8%
7%
2,092,300
+195,000
6%
5% +29,900
4%
3%
2%
1%
0%
+4,500 +3,800
+10,700
Forecast Jobs Growth by Sector, 2015-2025
Source: Oxford Economics
5,500
Construction
Admin and support
Prof., sci. and tech.
Wholesale and retail
Accommodation and food
Transportation and storage
Arts, entertainment and rec.
Human health and social
Info. and comms.
Other services
Real estate
Financial and insurance
+5,300
Sectoral Change
5.8
The private service sector is expected to drive employment growth, while
the majority of employment decline will be in manufacturing and the public sector
(public administration and education).
5.9
With 10,300 job losses forecast for manufacturing (equivalent to a 12%
decline), in both percentage and absolute terms the forecast decline in the sector is
significant, and is at odds with the ambitions set out in the LEP’s Strategic Economic
Plan.
Source: OE Forecasts
Construction
Admin and support
Prof, sci & tech
Wholesale & retail
Accommodation & food
Transport & storage
Arts, ent. & recreation
Health & care
Information & communication
Other services
Real estate activities
Finance & insurance
Education
Public admin
Manufacturing
-10.0
-5.0
Growing Sub-sectors
200
-
4,000
8,000
12,000
Forecast growth (jobs)
5.11
In terms of actual growth in the numbers of jobs, the construction sector is
the most significant, with an additional 8,900 jobs over the period, a proportionate
increase of 16%. This figure could increase as the effects of City Deal transport and
other infrastructure investment become apparent.
5.13
The visitor and leisure economy and retail and distribution of goods will
also make a significant contribution to employment growth. When arts,
entertainment and recreation are combined with accommodation and food, an
additional 5,600 jobs will be created in parts of the visitor economy.
5.14
When the growth in retail and distribution (6,000) is combined with
transport and storage (2,900) the impact of logistics related industries is likely to be
considerable, more so given the continuing increase in e-commerce and home
delivery.
0.0
000s
3,000
2,900
2,600
2,500
2,200
1,900
1,700
5.12
When administrative and support and professional scientific and technical
employment are combined, 16,000 additional jobs will be generated in the
Lancashire economy by 2025. While these will require a range of qualification levels,
it is likely that the majority will be at graduate level, with a significant proportion at
post-graduate level.
Forecast employment change by sector, 2015-2025
-15.0
8,900
8,400
7,600
6,000
5.0
10.0
5.15
The employment growth will require a younger and well qualified
workforce, with relevant qualifications and good public facing skills.
5.16
In terms of skills needs the key growth sectors are:
82

Professional and business services – well qualified younger workers, as
well as senior mangers and technical professions

Visitor economy and leisure – well qualified younger workers, as well as
well qualified supervisors and managers

Distribution and logistics operatives, drivers, supervisors and managers

Construction sector – skilled trades workers will be required as well as
experienced technical personnel
5.17
In a typical year, some 4,500 new jobs will be created in the Lancashire
Economy between 2015-2025.
5.20
While this scale of decline is not unusual for the manufacturing industry,
Lancashire has a number of very competitive manufacturing sub-sectors and a
significant base of advanced engineering companies. The LEP strategy includes a
strong commitment to strengthening manufacturing competiveness and attracting
new investment to the County, notably through the Enterprise Zone.
5.21
The other significant jobs losses are likely to be in the public sector, notably
education and public administration. While Local Authority budgets are under
considerable pressure, this may not be the case over the full ten years of the
forecast period. In addition, some of the budget reductions are likely to lead to outsourcing, transferring employment from the public sector to the private or third
sector as well as the relocation of back office functions.
Priority Sector Analysis
Declining Sub-sectors
5.18
The aggregate effect of sectors in decline will result in some 18,000 jobs
being lost, equivalent to 2% of the 2015 employment base. While the growth of
almost 48,000 jobs cancels these losses out, any reduction in the scale of job losses
would make a significant contribution to economic growth (as highlighted by the
alternative growth scenarios set out later in this section).
Forecast Jobs Decline by Sector, 2015-2025
Manufacturing
(10,300)
Public admin and defence
(4,500)
Education
(1,500)
Agriculture
(900)
(400)
Utilities: Water supply
(300)
Utilities: Electricity
Mining and quarrying
(100)
(12,000)(10,000) (8,000) (6,000) (4,000) (2,000)
5.22
The following section presents the forecasts for priority sectors using the
definitions provided by New Economy. It should be noted, that the manufacturing
sector is narrower than the broad definition used in the previous section and
therefore the numbers presented differ.
Business, Financial and Professional Services
5.23
The Business, Financial and Professional Services forecast indicates that
employment will increase by 15,200 in Lancashire between 2015-2025. This is
equivalent to a 15% uplift and is marginally higher than the North West and UK. The
main drivers of the employment growth rate is employment activities and
businesses, which are expected to increase by 17% and 16% respectively
compared to 15% nationally.
5.24
In terms of actual growth, business services and professional services will
be the main sources of new jobs, with both sub-sectors expected to create
approximately 6,300 jobs each. This compares to 2,400 additional jobs in
employment activities and 200 additional jobs in financial services.
5.25
Overall, the business, finance and professional services are likely to
require a young and graduate educated workforce, although a number of the new
posts will not be very highly paid.
-
Forecast decline (jobs)
5.19
The forecasts indicate that over 50% of employment losses will be a result
of a further decline in manufacturing employment. Over 10,000 jobs are forecast to
be lost, 12% of all manufacturing jobs.
83
5.30
Given the importance of tourism to the Blackpool economy and to
Lancashire’s rural areas, increasing employment growth in the sector to match and
if possible exceed national growth is likely to be an important objective for local
partners
BFPS Forecast Employment change, 2015 - 2025
Source: Oxford Economics
20%
18%
16%
14%
12%
10%
8%
6%
4%
2%
0%
Total FPBS
Business
services
Lancashire LEP
Employment
activities
North West
Financial
services
Professional
services
UK
Manufacturing
5.26
Based on the New Economy manufacturing definition, the sector is
expected to lose over 9,000 jobs between 2015 and 2025, equivalent to a 10%
decrease. While this is higher than forecast decline in the North West and UK
manufacturing sector, it is much lower rate than the historic rate of employment
decline in the sector.
5.27
The job losses are expected to be concentrated in other manufacturing
(with an expected loss of 3,600 / -12%) and advanced manufacturing (with an
expected loss of 3,000 / -7%). This compares to forecasts of 900 jobs losses in food
and drink manufacturing and 1,500 in textile manufacturing.
5.28
There is scope for some of the new initiatives planned by the LEP to fully
arrest or possibly reverse employment decline in specialist sub-sectors such as the
decline in both advanced manufacturing and food and drink manufacturing
(approximately 7% over ten years). In contrast, the forecast figure of a 20% decline
in textile manufacturing employment suggests that the long term decline of this
subsector is likely to continue over the next ten years.
Visitor Economy
5.29
The Tourism and Culture forecast indicates that employment will increase
by 7% in Lancashire between 2015 and 2025. Although lower than the North West
and national growth forecast, the sector will make an important contribution to
employment growth through the creation of over 3,800 jobs.
84
Occupational Forecasts
Skills Profile 2015 - 2025
5.31
At the broad occupational group level, the forecasts suggest that there will
be relatively little change in the occupational profile of Lancashire’s employment
base between 2015 and 2025. However, this disguises significant upskilling
requirements within the occupational groups as set out in the following sections.
Occupational Change 2015 - 2025
Source: Oxford Economics
Lancashire 2015
34%
Lancashire 2025
22%
38%
North West 2015
20%
35%
21%
16%
13%
8% 8%
13%
14%
9% 6%
16%
13% 8% 8%
13%
14%
16%
13% 8% 7%
13%
14%
Source: Oxford Economics
North West 2025
2015
10.3%
15.4%
10.5% 11.3%
12.6%
10.8% 7.9% 8.6% 12.6%
38%
UK 2015
36%
UK 2025
2025
10.6%
15.5%
10.5% 11.0%
12.6%
11.0% 8.1% 8.2% 12.7%
0.0%
20.0%
40.0%
Managers
Associate professionals
Skilled trades occupations
Sales and customer services staff
Elementary staff
21%
40%
0%
Level 4+
20%
20%
20%
Level 3
40%
Level 2
60%
Level 1
8% 6%
8% 6%
80%
Other
100%
No quals
60.0%
80.0%
100.0%
Professionals
Administrative/clerical staff
Caring, leisure and other services staff
Machine operatives
Skills Forecasts
5.32
The skills forecast suggests that there will be an up-skilling of the
workforce, although there will be a reduction in middle range skills, creating an hour
glass effect in the workforce profile.
5.33
Occupations requiring level 4+ skills will account for 38% of employment
in Lancashire by 2025, up from 34% in 2015. This reflects both the type of
employment growth forecast, and the up-skilling or qualification inflation in other
sectors, taking advantage of a large pool of graduates nationally.
5.34
There will be a significant decline in level 2 and level 3 skills, equivalent to
five percentage points, from 38% of employment to 33%. This change in part
reflects the forecast decline in manufacturing employment, and the subsequent
decline in skilled trades.
5.35
By 2025, there will have been a reduction in employment requiring no
qualifications from 8% to 6% although level 1 jobs will account from 14% of
employment; a higher proportion than level 2 jobs. The majority of employment at
level 1 and below is likely to be low paid.
85
Skills Profile by Occupation
Percentage of Employees Requiring Skills at L2 or below, by Occupation
5.36
Focusing on the increasing requirement for Level 4+ qualifications, as
would be expected, the groups with the highest proportion of positions at Level 4+
will continue to be managerial, directors and senior occupations, professional
occupations and associate professional and technical occupations. In the latter
group, the proportion will increase to over 50%.
5.37
The proportions of the workforce with Level 4+ will also increase in
administrative and secretarial, skilled trades, care and leisure and customer
services as part of a general tend on an up skilling of the workforce.
Source: Oxford Economics
80%
70%
60%
50%
40%
30%
20%
10%
0%
2015
2025
Percentage of Employees Requiring L4+ Skills, by Occupation
Source: Oxford Economics
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
2015
2025
Skills Profile by Sector
5.39
The increase in the proportion of the workforce holding qualifications at
Level 4+ will be driven by demand from then public sector (education, health and
public administration), with an important contribution from professional and
business services (including professional, scientific and technical and
administration and support sectors). The importance of the workforce qualified at
Level 4+ will also increase in the industrial sector, accounting for some 30% of
employment.
5.38
While requirements for Level 2 and below will decline further as a
proportion of the workforce, the change is not dramatic. Level 2 and below
employment will further concentrate in process, plant and machine operators and
elementary occupations, with significantly fewer opportunities in administrative and
secretarial, care and leisure and sales and customer service occupations.
86
Percentage of Employees Requiring L4+ Skills, by Industry
Source: Oxford Economics
2015
2025
80%
70%
60%
50%
40%
30%
20%
10%
0%
5.41
Replacement demand typically runs at circa 4% per annum, as employees
retire, leave the workforce and/or move to other jobs. This can vary by sector, with
some sectors affected by staff turnover driven by low wages and/or terms of service.
5.42
The highest levels of replacement demand are in white collar jobs,
including high and medium level skills. This includes administrative and secretarial,
managers and directors and professional occupations.
5.43
The overall replacement demand rates for process, plant and machine
operatives, sales and customer services occupations, and skilled trade occupations
are lower at 3% per annum. However, the numbers are still significant.
Replacement Demand 2012 - 2022 (as % of current employment)
Source: Working Futures
Administrative and secretarial
Mangers, directors and senior officials
Professional occupations
Note: Chart presents industries w ith over 10,000 employees
5.40
Workers with qualifications at level 2 and below will continue to make up
an important part of the workforce in four sectors – wholesale and retail,
manufacturing, administration and construction.
Elementary occupations
Associate professional and technical
Process, plant and machine operatives
Percentage of Employees Requiring Skills at L2 or below, by Industry
Source: Oxford Economics
70%
60%
50%
2015
2025
Sales and customer service
Skilled trades occupations
0%
10%
20%
30%
40%
50%
40%
30%
20%
10%
5.44
Applying the proportion of replacement demand within each occupational
group to the 2015 occupational figures for Lancashire shows that replacement
demand is a significant source of employment opportunities, and in numbers terms,
much more important than net employment growth.
0%
Note: Chart presents industries w ith over 10,000 employees
Replacement Demand
87

Lancashire Occupational Demand 2015 - 2025
Employment Growth / Decline
Estimated
Total
Annual
Requirement
Requirement
(000’s)
(000’s)
Replacement Demand
Estimated
Total
Annual
Requirement
Requirement
(000’s)
(000’s)
Professional
4,000
400
43,670
occupations
Caring, leisure and
3,000
300
35,270
other services
Administrative and
-5,000
-500
34,020
secretarial
Elementary
3,000
300
32,690
occupations
Mangers, directors
4,000
400
30,270
and senior officials
Skilled trades
2,500
250
29,950
occupations
Associate
professional and
2,500
250
27,060
technical
Process, plant and
-1,000
-100
22,190
machine operatives
Sales and customer
2,500
250
19,660
service
Source: Oxford Economics; ekosgen estimates based on Working Futures
4,370
3,530
3,400
3,270
3,030
3,000
Distribution and logistics operatives, drivers, supervisors and managers
5.48
The aggregate effect of sectors in decline will result in some 18,000 jobs
being lost. Any reduction in the scale of job losses would make a significant
contribution to economic growth.
5.49
With 10,300 job losses forecast for manufacturing (equivalent to a 12%
decline), in both percentage and absolute terms the forecast decline in the sector is
significant, and is at odds with the ambitions set out in the LEP’s Strategic Economic
Plan.
5.50
In order meet the LEP employment target the forecast decline in
manufacturing will have to be reduced substantially, while growth is accelerated in
the priority sectors.
5.51
The labour needed to meet the replacement demand requirements in many
sectors will create competition for employers seeking to recruit additional staff in the
employment growth sectors.
2,710
2,220
1,970
Meeting the LEP Employment Ambition
5.45
The Oxford Economics forecasts show net employment growth of almost
30,000 jobs in the Lancashire economy between 2015 and 2025, some two thirds
of the LEP’s target to create 50,000 jobs by 2025.
5.46
Although the net employment increase in Lancashire between 2015 and
2025 is 29,900 jobs, an additional 47,900 jobs will be created in those sectors where
growth is forecast.
5.47
Employment growth will be driven by three broad areas, all of which will
require a young, well educated workforce. These are:

Construction – skilled trades workers as well as experienced technical
personnel

Professional and business services – well qualified younger workers, as
well as senior managers and technical professions

Visitor economy and leisure – well qualified younger workers, as well as
well qualified supervisors and managers
88
6
Performance of the Education, Skills and
Employment System
Key Messages
•
Educational performance in Lancashire falls away after KS2 (age 11), with
fewer than half of pupils achieving 5 A*-C GCSEs including English and
maths
•
Although GCSE attainment has risen over the past ten years, there is
considerable variation across Lancashire’s local authorities, and over 1,000
young people did not achieve 5 GCSE passes at grades A*-G in 2013/14.
•
A significant number of schools face challenges to raise performance levels
so that all children obtain the skills they need to succeed in employment and
/ or further learning
•
•
Participation in education and training amongst 16/17 year olds in
Lancashire has risen in recent years and is now at or above the England
average across all three local education authority areas. Around 80%
continue in full-time education beyond the age of 16.
The percentage of young people achieving Level 2 qualifications by the age
of 19 has risen significantly, and Blackpool and Blackburn with Darwen have
closed the attainment gap with other areas. However, there is still an issue
in raising level 2 attainment including English and maths, and one-third of
the cohort (over 5,000 people) had not achieved this by the age of 19 in
Lancashire in 2014. There has also been a improvement in the percentage
of 19 years old attaining Level 3 qualifications, although Blackpool is still
below the national average.
•
Just under 90% of 16 year olds progress into sustained education
destinations, with between 4% and 6% going into apprenticeships. Around
8% failed to settle in a sustained destination in 2012.
•
Amongst those who had been entered for Level 3 qualifications (including
A-levels), around 70% go into education or employment, with an above
average proportion going into higher education. However a smaller share of
Lancashire residents go to the top third of UK Higher Education Institutions
(HEIs), and higher proportion attend HE courses in FE Colleges than is the
case nationally.
•
There were over 284,000 starts on learning aims by Lancashire residents in
2013/14, a fall of 14% since 2012/13. Nearly half of starts were by learners
aged 25+, 37% were on courses below Level 2, and only 2% were at Level
4 or above. Preparation for Life and Work accounted for 38% of all starts.
•
Amongst 16-18 year olds, the number of starts on FE provision fell by 31%
between 2012/13 and 2013/14. Preparation for Life and Work accounted
for 36% of all starts, but the proportion of starts on more advanced learning
aims was much higher, with 42% of starts at Level 3.
•
Amongst those aged 19 and over, the number of starts has fallen but only
by 1%. The vast majority of starts are at lower levels, with 41% below Level
2, and Preparation for Life and Work accounting for 39% of all starts.
•
Nearly 29,000 learners are currently undertaking apprenticeships in
Lancashire, with 14,000 starts in 2013/14. The number of new starts has
fallen over the past year, largely due to the introduction of Advanced
Learning Loans for those aged 24+, a measure which has subsequently
been withdrawn.
•
Success rates in FE and apprenticeships compare favourably to national
performance, and FE provision in Lancashire is highly regarded by Ofsted
and employers.
•
Impact of Advanced Learning Loans at Lancashire level is not yet clear
•
The number of HE students has fallen, due to a reduction in UK domiciled
entrants. Lancashire’s higher education institutions take a higher proportion
of students from disadvantaged backgrounds than the average, and a very
high proportion of graduates are retained within the region after graduation.
•
48,000 people have been supported through the Work Programme since its
commencement but only one in five have secured long-term employment.
89
Introduction
6.1
This section of the evidence base looks at the education, skills and
employment system, which has a critical role to play in ensuring Lancashire’s
residents have the skills they need to meet the needs of employers in the 21 st
century economy and contribute to the achievement of the LEP’s economic and
employment targets. The section covers:
% of pupils in Year 1 meeting the required standard of phonic decoding
Source: DfE
80
70
60
50

Educational performance from Key Stage 1 to Key Stage 4 (GCSE)

Participation, attainment and destinations of young people aged 16-19

Participation in Further Education by Lancashire residents, and provision
by Lancashire providers

Apprenticeships

Travel to learn

Advanced Learning Loans

Higher Education

Employers’ views of the work readiness of their recruits

The Work Programme
40
30
20
10
0
2012
Lancashire
2013
Blackburn with Darwen
Blackpool
2014
North West
England
6.4
There has also been improvement in the proportion of children achieving
the expected level at Key Stage 2 (age 11), although in the most recent data there
is a lower level of attainment evident within Blackburn with Darwen.
6.5
There is a fall-off in educational performance in Lancashire between Key
Stage 2 (age 11) and Key Stage 4 (age 16). The number of pupils making the
expected progress between KS2 and KS4 in Lancashire is not keeping pace with
the improvement in England as a whole, largely due to weaker performance in
Blackpool.
Educational Performance
6.2
Attainment of young people within the education system is crucial to their
future success within the labour market, and provides a pool of future workers with
the appropriate basic skills to progress within the labour market. The performance
of the education system is therefore a key factor in supporting successful
economies.
6.3
During the early part of their school careers, children in Lancashire perform
well. The percentage of Lancashire children reaching the required standard of
phonic decoding in Year 1 has increased year on year and is close to or above the
national average in all three Local Education Authorities (LEAs). Around one
quarter of children do not reach the required standard, in line with the national
average.
90
6.6
Although relatively few young people move into work immediately after
taking their GCSEs, the qualifications mark an important milestone on the road to
labour market entry. Research by the Centre for Cities has highlighted the
importance of GCSE attainment for job prospects and the relationship between
those areas where a high proportion of young people do not attain an A*-C grade in
maths and English at GCSE, and areas with high levels of youth unemployment27.
Percentage of pupils achieving Level 4 at key stage 2
Source: DfE
90
80
70
60
50
6.7
Despite improvements in GCSE attainment both nationally and in
Lancashire in recent years, over 30% of pupils do not achieve five GCSEs at grade
A*-C, and over 40% fail to achieve five good GCSEs including English and maths.
Whilst Lancashire county matches the national average with regard to 5+ A*-C
GCSE attainment, the proportion achieving five good grades is lower in Blackburn
with Darwen, and Blackpool continues to lag behind, with only 53% achieving five
A*-C grades and 44% achieving five A*-C grades including English and maths.
40
30
20
10
0
2012
Lancashire
Blackpool
2013
Blackburn with Darwen
2014
North West
England
Percentage of pupils making expected progress in English and Maths
between KS2 and KS4
Source: DfE
GCSE Attainment, 2013/14
Source: DfE
5+ A*-C including English & maths
5+A*-C grades
England
North West
80
70
Blackpool
60
Blackburn with Darwen
50
40
Lancashire
30
20
0%
20%
40%
60%
80%
10
0
2012
Lancashire
2013
Blackburn with Darwen
Blackpool
2014
North West
England
6.8
At local authority level there is considerable variation in performance, with
the proportion achieving five A*-C grades including English and maths ranging from
just over 40% in Burnley to over 70% in Ribble Valley.
GCSE Attainment
27
http://www.centreforcities.org/blog/gcse-results-their-importance-for-a-citys-economy/
91
5+ A* - C Grades inc English and Maths, 2013/14
GCSE performance, by local authority area, 2013/14
Source: DfE
Source: DfE
Ribble Valley
Chorley
Wyre
Lancaster
Fylde
Rossendale
South Ribble
Preston
West Lancashire
Blackburn with Darwen
Hyndburn
Blackpool
Pendle
Burnley
England average
0
20
40
% of pupils
60
Ribble Valley
Chorley
Wyre
Lancaster
Fylde
Rossendale
South Ribble
Preston
West Lancashire
Blackburn w. Darwen
Hyndburn
Blackpool
Pendle
Burnley
80
6.9
The chart below shows the proportion of the GCSE cohort in each local
authority area who only achieve five GCSEs at grades A*-G, or do not achieve five
GCSEs at all. In Burnley, one in ten fail to achieve five GCSEs at grades A*-G, and
in total over 1,000 young people in Lancashire finished Key Stage 4 without
achieving five GCSEs at grades A*-G in 2013/14.
6.10
This low level of attainment leaves young people poorly prepared for
employment or further learning or training, and there are major challenges to
improve achievement in Burnley, Pendle, Blackpool and Hyndburn.
0%
20%
5+ A*-C inc. English & maths
40%
60%
5+ A*-G
80%
100%
<5 A*-G
Pupils achieving fewer than 5 A*-G GCSE passes, 2013/14
Source: DfE
140
120
100
80
60
40
20
0
6.11
The challenge for the education system in Lancashire is illustrated by the
fact that thirteen of the LEP area’s 96 schools serving 11-16 year olds do not meet
the Department for Education’s (DfE) floor target. A school is below the floor
standard if less than 40% of pupils achieve 5+A*-C grade GCSEs, including English
92
and mathematics, and the expected progress between key stage 2 and key stage 4
is less than the median of 74% in English and less than the median of 67% in
mathematics. One in three schools in Blackburn with Darwen falls into this category.
Percentage of secondary schools below the floor target, 2013/14
Source: SFR
16.0
14.0
12.0
10.0
8.0
6.0
4.0
2.0
Participation at 16-17
0.0
England
Lancashire LEP
North West
6.12
The government has introduced reforms to the GCSE system, including
reforming the content of the courses to make them more challenging so that young
people are better prepared for further academic or vocational study, or for work. In
recent years there has also been a greater emphasis on core academic subjects,
and sustained efforts to increase take-up of STEM subjects (Science, Technology,
Engineering and Maths) . There is some national-level evidence that this is having
an impact, with take-up of STEM-related subjects increasing as a share of all GCSE
entries. Take-up of design and technology has been falling over the same period,
perhaps as a consequence of the move away from vocational subjects.
6.13
The Department for Education gathers information on the participation in
education and work-based learning of 16-17 year olds. This is measured as a
percentage of the relevant cohort and is available for local education authority
areas.
Participation in education and work-based learning, 16-17 year olds
Source: DfE
100
95
90
85
80
75
70
65
60
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Lancs
BwD
B'pool
NW
Eng
6.14
In 2012, 90% of 16-17 year olds in Lancashire and Blackburn with Darwen
were participating in education or work-based learning, and 88% of 16-17 year olds
in Blackpool, all at or above the England average of 88%. This represents a
93
significant increase over the past ten years, with the percentages increasing from
82% in Blackburn with Darwen in 2002, 77% in Lancashire, and 69% in Blackpool.
6.15
The chart below provides a more detailed understanding of the type of
education or work-based learning in which 16-17 year olds in the Lancashire LEP
area were participating. The vast majority were involved in full-time education, with
part-time education and work-based learning each accounting for around 5% of the
cohort. Around 10% of the cohort of 16-17 year olds who had completed Key Stage
4 in 2011/12, nearly 3,000 young people, were not participating in any form of
education or work-based learning in 2012/13.
6.17
The percentage of young people attaining qualifications at Level 2 has
risen significantly in all three Lancashire local education authorities since 2005, with
a slight dip in performance in Blackpool in the most recent year and in Blackburn
with Darwen in 2013.
Percentage of young people who attain L2 by age 19, 2005-2014
Source: DfE
90
85
80
Partipcation of 16 & 17 year olds in education and WBL, 2012
Source: SFR
100%
90%
75
70
65
10%
11%
10%
11%
12%
60
80%
55
70%
50
2005
60%
50%
40%
81%
80%
79%
78%
79%
2006
Lancashire
North West
2007
2008
2009
2010
2011
Blackburn w. Darwen
All LAs
2012
2013
2014
Blackpool
30%
20%
10%
0%
BwD
Full-time education
Blackpool Lancashire North West
WBL
Part-time education
England
Not participating
6.18
A different picture emerges when the percentage of 19 year olds attaining
Level 2 including English and Maths is considered. Overall, the attainment level is
much lower. Although all areas have seen an improvement, the gap between the
best performing area (Lancashire) and the worst performing (Blackpool) has not
narrowed significantly. 45% of young people in Blackpool, 36% in Blackburn with
Darwen and 30% in Lancashire county do not achieve Level 2 including English and
Maths by the age of 19, leaving them ill-equipped to succeed in the labour market.
Level 2 and Level 3 Attainment at age 19
6.16
Achievement of qualifications at Level 2 can be considered the minimum
necessary for progression within the 21st century labour market, and provides a
platform on which further study can be undertaken. A significant improvement in
Blackpool since 2008 means that all three Lancashire local education authorities
now perform close to the national and regional average of 86%, with Blackpool
slightly below (83%) and Lancashire and Blackburn with Darwen both slightly above
the average (88% and 87% respectively)
94
Percentage of young people attaining L2 including English and Maths
by age 19, 2005-2014
Percentage of young people who attain L3 by age 19
Source: DfE
60
75
70
65
60
55
50
45
40
35
30
Source: DfE
55
50
45
40
35
30
25
2005
2006
2007
2008
2009
2010
2011
Lancashire
Blackburn w. Darwen
North West
All LAs
2012
2013
2014
Blackpool
Attainment at age 19, 2014
Achieved
L2
Had not
achieved
L2
Total
Cohort
Lancashire
9,080
2,280
1,575
12,935
Blackburn w. Darwen
1,170
425
235
1,830
Blackpool
Lancashire LEP area
2006
Lancashire
North West
6.19
From a total cohort of more than 16,000 across the Lancashire LEP area,
over 5,000 (32%) had not achieved Level 2 including English and maths by the age
of 19, and over 2,000 (13%) had not achieved Level 2 at all.
Achieved
L2 inc.
English &
Maths
2005
865
430
265
1,560
11,115
3,135
2,075
16,325
2007
2008
2009
2010
2011
Blackburn w. Darwen
All LAs
2012
2013
2014
Blackpool
6.21
The relationship between skills and deprivation is clear from the data,
which differentiates between those who had been eligible for free school meals (at
the age of 16), and other young people. Young people who had been eligible for
free school meals have considerably lower attainment levels than those who hadn’t,
although the gap between the two groups is smaller in Blackburn with Darwen than
in the other local education authority areas. In Blackpool, only just over one third of
pupils eligible for free school meals attain Level 2 qualifications including English
and maths by the age of 19, leaving them further disadvantaged in the labour
market.
Source: DfE Level 2 and 3 Attainment by Young People in England
6.20
The percentage of young people who attain Level 3 by the age of 19 is
above the regional and national average in Lancashire county and Blackburn with
Darwen (60% and 58% respectively, compared to 57%), but below average in
Blackpool (54%). All areas have seen a significant increase since 2005, and the
gap between the best performing and worst performing areas has narrowed
considerably.
95
6.25
A higher proportion of the Lancashire LEP cohort goes into higher
education than is the case nationally (ranging from 52% in Blackburn with Darwen,
to 56% in Blackpool, compared to 49% nationally) – a total of nearly 5,800 young
people in 2012/13. Between 4-5% move into an apprenticeship, with 10-17% going
into Further Education. Almost 1,500 went into an education or employment
destination but did not sustain it (over two terms October-March) including nearly
250 who became NEET, and a further 1,500 were not captured in the data (because
they had moved out of the country, were attending an institution that was not
captured in the data (e.g. in Wales or Scotland, some independent schools), or
were in custody).
Attainment at 19 by free school meal eligibilty, % of total
Source: DfE
80
70
60
50
40
30
20
10
0
Not eligible for
FSM
Eligible for FSM
Not eligible for
FSM
L2 inc Eng & Maths
Lancashire
Destinations at Key Stage 5 (aged 17/18): 2011/12 Cohort who entered A-level
or other Level 3 qualifications, Destination in 2012/13
Eligible for FSM
L3
Blackburn w. Darwen
No. of
students
Blackpool
Destinations at Key Stage 4 and Key Stage 5
6.22
The vast majority of young people completing Key Stage 4 in 2011/12 (age
16) continued in education, ranging from 87% in Blackpool to 89% in Lancashire,
which is also the England average. The type of education that Key Stage 4 leavers
went into varied considerably, reflecting the differences in provision across the LEP
area.
Lancs
7,900
BwD
1,480
B’pool
1,470
NW
52,160
Eng
382,140
Source: DfE
Over
all
educ
ation
or
empl
oyme
nt
73%
73%
71%
74%
71%
Any
educati
on
destinat
ion
FE
Colle
ge
Other
FE
App.
68%
70%
66%
67%
67%
10%
14%
8%
9%
9%
2%
3%
2%
3%
3%
5%
4%
4%
5%
4%
UK
HEI
53%
52%
56%
52%
49%
Sust
ained
emp
and /
or trg
Not
sustain
ed
Not
captur
ed
5%
3%
4%
5%
6%
13%
16%
13%
12%
11%
14%
12%
16%
14%
18%
Destinations at Key Stage 4 (16): 2011/12 Cohort, Destination in 2012/13
No. of
students
Lancs
13,120
BwD
2,000
B’pool
1,550
NW
81,210
Eng
594,810
Source: DfE
FE
colle
ge
48%
60%
41%
37%
32%
School
6th
form
19%
18%
6%
25%
36%
6th
form
coll.
16%
2%
31%
19%
12%
Ind.
Sch.
Other
FE
App.
Emp.
w/ trg
1%
4%
3%
3%
5%
4%
4%
6%
4%
3%
6%
4%
5%
6%
4%
1%
0%
1%
1%
1%
Not
sustain
ed
8%
8%
9%
8%
7%
Not
captur
ed
1%
3%
1%
2%
2%
6.23
Around 8% did not sustain an education destination (for the first two terms
of the 2012/13 academic year), and it is estimated that between 1-3% became
NEET.
6.24
At Key Stage 5, the proportion of those who have been entered for at least
one A-level or other Level 3 qualification who subsequently enter any education or
employment destination ranges from 71-73% across Lancashire, matching the
England average of 71%.
96
Further Education – Total Learner Volumes
Lancashire
6.26
Further education for young people and adults makes an important
contribution to the overall level of skills within Lancashire’s resident population.
Detailed information is available on the various elements of Further Education –
education and training, community learning, workplace learning and
Apprenticeships, and this is presented in subsequent sections. However, it is useful
to begin by considering the total number of learners participating in Further
Education in Lancashire, drawing from the learner data made available in the
Further Education Data Library28.
2013/14
%
North West
England
%
%
Level 2
20,320
19%
21%
22%
Level 3
18,320
17%
17%
16%
English and Maths
28,620
27%
26%
27%
Other
40,580
38%
35%
36%
Total
107,840
100%
100%
100%
Source: SFA
6.27
The tables below include learners who are participating in
Apprenticeships, Workplace Learning, Community Learning and Education and
Training Provision which includes General Further Education Colleges including
Tertiary, Sixth Form Colleges, Special College - Agricultural and Horticultural
Colleges and Art and Design Colleges, Specialist Colleges and External Institutions.
6.28
In 2013/14, a total of 107,840 learners participated in Further Education in
Lancashire. The number of learners has fallen by 4% since 2011/12, a faster
decline than seen either regionally or in England as a whole.
6.30
Looking at change over time, Lancashire has seen a faster fall in the
proportion of learners studying at level 2 (-13% over the past two years) than is the
case regionally or nationally, and a smaller increase in the number learning at level
3. There has also been a much smaller decline in the number studying English and
Maths.
FE learners by Level – Change over time
North
West
England
% change
% change
% change
-13%
-11%
Lancashire
Total FE learners
2011/12
2011/12
2012/13
2013/14
% change
2011/12 to
2013/14
2013/14
Level 2
23,430
20,320
-11%
Level 3
18,150
18,320
1%
6%
7%
Lancashire
112,010
114,400
107,840
-4%
English and Maths
29,350
28,620
-2%
-12%
-11%
North West
482,220
512,670
466,870
-3%
Other
41,080
40,580
-1%
6%
11%
3,045,600
3,218,900
3,005,000
-1%
Total
112,010
107,840
-4%
-3%
-1%
England
Source: SFA
6.29
Looking at learners by the level at which they are learning, the data shows
that only 36% of learners were learning at levels 2 (19%) and 3 (17%) in 2013/14.
Just over one quarter were studying English and Maths (27%) and 38% were
learning at other levels. In comparison to the region and England as a whole, a
smaller proportion of learners were studying at levels 2 and 3, and a higher
proportion were involved in ‘other’ learning.
Source: SFA
6.31
Considering learners by age, the data shows that 27% of learners in FE in
Lancashire were aged under 19, similar to the North West proportion, but slightly
higher than the share nationally. 73% were aged 19+.
6.32
All areas have seen a 9% decline in the number of learners aged under
19. Whilst Lancashire has seen a 2% fall in the number of learners aged 19 and
over, in England the number has ridden by 2% over the same period.
FE learners by Level – % of all learners
FE learners by Age - % of total
28
https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/378265/feands
kills-achievement-by-geography-learner-demographics.xls
97
Lancashire
2013/14
North West
England
%
%
%
Breakdown of FE Learners in Lancashire, 2013/14
Source: SFA
5%
Under 19
28,810
27%
27%
26%
19+
79,020
73%
73%
74%
Total
107,830
100%
100%
100%
11%
U19 Level 2
35%
8%
Source: SFA
U19 E and M
FE learners by Age – Change over time
3%
North
West
England
% change
% change
% change
Lancashire
2011/12
2013/14
U19 Level 3
Under 19
31,690
28,810
-9%
-9%
-9%
19+
80,320
79,020
-2%
-1%
2%
Total
112,010
107,830
-4%
-3%
-1%
U19 Other
19+ Level 2
14%
19+ Level 3
19+ E and M
18%
6%
19+ Other
Source: SFA
6.33
There are significant differences in the pattern of learning amongst the
different age groups. Whilst roughly 1 in 5 of both learners aged under 19 and those
aged 19+ are learning at level 2, there is a marked difference in the proportions
studying at level 3. Level 3 learning accounts for 41% of all learners aged under
19, compared to only 8% of those aged 19+. Nearly half of those aged 19 and over
are involved in ‘other learning’, much of which is likely to be a level 1.
Lancashire FE learners by Age and Level 2013/14
Under 19
Level 2
18%
Level 3
English and Maths
19+
Total
19%
19%
41%
8%
17%
31%
25%
27%
Other
11%
47%
38%
Total
100%
100%
100%
Source: SFA
6.34
The chart below shows the breakdown of learners in Lancashire in
2013/14, with those aged 19+ learning at ‘other’ levels accounting for over 1 in 3 of
all FE learners.
98
Further Education Participation by Lancashire Residents

6.35
In addition to the learner volumes information available from the SFA, data
is also available on overall learning activity, looking at the total number of learning
aims undertaken. This section considers Further Education in Lancashire,
excluding apprenticeships which are addressed in the following section. The data
is drawn from two sources: the Statistical First Releases published by the Skills
Funding Agency (SFA) and the Department for Business, innovation and Skills
(BIS), and the SFA’s Data Cube29.
6.36
Further education can be considered from two perspectives – learner
participation, i.e. all FE learning undertaken by residents of a particular area, no
matter where that learning takes place, and learning provision, i.e. learning
delivered by providers within a particular area, no matter what the place of residence
of those to whom the learning is delivered. This section considers learner
participation (i.e. all FE learning undertaken by Lancashire residents). The next
section highlights where the pattern of learning delivery (i.e. all FE delivered by
providers based within Lancashire) differs from the learning taken up by Lancashire
residents.
6.37
The data included on the Data Cube counts the number of learning aims,
rather than the number of learners, reflecting the fact that learners can be following
numerous programmes of study at the same time, which may be at different
qualification levels and cover different subject areas. There were nearly 300,000
learning aim starts in Lancashire between 2012/13-2013/14, and over 245,000
learning aim achievements.
6.38
Further education is classed as one of three types:

Education and training, which covers further education learning delivered
mainly in a classroom, workshop, or through distance or e-learning,
including ESF provision;

Community learning funds a wide range of non-formal courses, ranging
from personal development through to older people’s learning, IT courses,
employability skills, family learning and activities to promote civic
engagement and community development. Courses may be offered by
local authorities, colleges, and voluntary and community groups, and
include activity specifically targeted at deprived areas and disadvantaged
groups; and
The data contained on the Data Cube was analysed under the terms of ekosgen’s data
sharing agreement with Lancashire Enterprise Partnership and the Skills Funding Agency.
The agreement states that the Data Cube data must not be externally published, although
following analysis of the data, it is permitted to make narrative statements about what it
29
Workplace learning which covers a broad range of training including basic
skills, Level 2, Level 3 and higher-level skills. Training is mainly delivered
through the workplace (but excludes Apprenticeships). Between 2008/09
and 2010/11 this included Train to Gain programme, Employability Skills
Pilot and other programmes such as Programmes for the Unemployed.
From 2011/12 it includes all training mainly delivered through the
workplace. Note that this definition excludes Apprenticeships and ESFfunded provision, and therefore does not capture a large amount of training
which is delivered in the ‘workplace’.
6.39
The number of Lancashire residents within each of these categories in
2013/14 is shown in the table below:
Learner Participation in Further Education in Lancashire 2013/14
No. of
Learners
%
Education and Training
76,750
71.9%
Community Learning
26,360
24.7%
Workplace Learning
3,660
3.4%
106,770
100.0%
Total
Source: SFA
6.40
In total nearly 107,000 Lancashire residents participated in one of the three
types of further education in 2013/14. The vast majority, nearly three quarters, were
involved in Education and Training, a further quarter participated in Community
Learning, and just 3% undertook Workplace Training.
6.41
Nearly two-thirds of learners who participated in Education and Training
were involved in Preparation for Life and Work, a practical course which provides
students with the skills and knowledge they need to apply for and secure
employment, with content including careers, health, personal finance and basic
employability skills. A further 20% were participating in provision related to health,
public services and care.
shows, such as trends over time, percentage change in the take up of particular provision etc.
Data which is included in reports for publication must be drawn from publicly available data,
such as that contained in the Statistical First Release publications.
99
Learner Participation in Education and Training 2013/14
% of learners
6.42
Considering participation in Community Learning, learners are less likely
to be participating in learning in more than one sector subject area, with the ratio of
sector subject participation to the total number of learners 2:1, compared to 3:1 in
Education and Training. Preparation for Life and Work accounts for a much smaller
proportion of overall learning, at just under 40%.
Preparation for Life and Work
66.1%
Health, Public Services and Care
20.1%
Science and Mathematics
15.5%
Information and Communication Technology
12.8%
Business, Administration and Law
11.9%
Languages, Literature and Culture
11.1%
Preparation for Life and Work
39.6%
10.2%
Arts, Media and Publishing
16.8%
9.7%
Information and Communication Technology
15.2%
6.9%
Health, Public Services and Care
14.0%
Engineering and Manufacturing Technologies
5.9%
Languages, Literature and Culture
8.1%
Construction, Planning and the Built Environment
5.2%
Retail and Commercial Enterprise
6.3%
4.6%
Leisure, Travel and Tourism
5.1%
History, Philosophy and Theology
3.7%
Not Applicable
4.3%
Education and Training
3.5%
History, Philosophy and Theology
3.1%
3.5%
Agriculture, Horticulture and Animal Care
0.9%
Unknown
0.0%
Business, Administration and Law
0.9%
N/A
3.3%
Construction, Planning and the Built Environment
0.8%
Education and Training
0.4%
Science and Mathematics
0.2%
Engineering and Manufacturing Technologies
0.0%
Arts, Media and Publishing
Retail and Commercial Enterprise
Leisure, Travel and Tourism
Social Sciences
Agriculture, Horticulture and Animal Care
Total
100.0%
Source: Data Cube
Note – students can be learning in more than one sector subject area, so the sector subject
area percentages do not sum to 100%.
Learner Participation in Community Learning 2013/14
% of learners
Total
100.0%
Source: Data Cube
Note – students can be learning in more than one sector subject area, so the sector subject
area percentages do not sum to 100%.
6.43
Although the number of learners participating in Workplace Learning is
considerably lower than other forms of FE, there is a different pattern of
participation, with engineering and manufacturing technologies accounting for the
highest proportion of all participation (just under 20%, compared to 6% of Education
and Training participation).
100
Learner Participation in Workplace Learning 2013/14
Learner Aim Starts by Age and Level (%)
Source: Datacube
% of learners
Under 16
Engineering and Manufacturing Technologies
19.7%
Preparation for Life and Work
18.6%
Health, Public Services and Care
17.5%
Construction, Planning and the Built Environment
14.8%
Retail and Commercial Enterprise
9.8%
Business, Administration and Law
8.2%
Leisure, Travel and Tourism
6.6%
Education and Training
3.0%
Information and Communication Technology
1.4%
N/A
1.1%
Science and Mathematics
0.8%
Agriculture, Horticulture and Animal Care
0.8%
Arts, Media and Publishing
Total
0.3%
100.0%
Source: Data Cube
Note – students can be learning in more than one sector subject area, so the sector subject
area percentages do not sum to 100%.
Learning Aim Starts
6.44
Learners can be enrolled on more than one learning aim, and the analysis
of starts by learning aim therefore shows a higher level of participation than the total
number of learners.
6.45
There were nearly 285,000 learning aim starts by Lancashire residents in
2013/14, a 15% reduction on the 2012/13 figure. The reduction was a result of a
large decline in the number of learning aim starts by young people aged 16-18,
falling by 31% from 44% of the total to 35%.
6.46
Further Education providers play an important role in addressing basic
skills and employability needs amongst Lancashire residents. The vast majority of
learning aim starts are at lower skills levels – with 58% of starts on learning aims at
Level 2 or below. Whilst the overall number of starts has fallen, there has been an
increase in starts on Level 4 learning aims, although these only account for 2% of
provision.
6.47
The pattern of starts by level varies considerably by learner age. Level 3
starts account for over 40% of all starts made by 16-18 year olds, compared to less
than 20% of starts across all age groups. Amongst 19-24 year olds, one third of
starts are on Level 1 provision, compared to one quarter amongst all age groups.
Entry level
16-18
Level 1
Level 2
19-24
Level 3
25+
Level 4 (original)
Not applicable
Total
0%
20%
40%
60%
80%
100%
6.48
Since 2012/13, the number of starts on Level 1 provision has fallen
amongst younger age groups (18 and under), by around 40%. At the same time,
the number of Level 1 starts amongst those aged 25+ has increased by 23%.
6.49
Looking at learning aim starts by sector subject area, the largest number
of starts is within the Preparation for Life and Work subject area, accounting for
nearly 40% of the total. The next most common sector subject areas – health and
care and ICT – align closely with the LEP’s priority sectors, and there have also
been a significant number of starts in arts, media and publishing, retail and
commercial enterprise, science and mathematics, business administration and law
and languages, literature and culture.
6.50
Whilst the total number of learning aim starts by Lancashire residents fell
by 14% between 2012/13 and 2013/14, some sectors saw a bigger decline in starts,
including some which are priority sectors for the LEP:

Starts in leisure, travel and tourism fell by 21%

Starts in business administration and law fell by 14%

Starts in health, public services and care fell by 9%
6.51
The number of starts in engineering and manufacturing technologies
remained steady, and the number of starts on Preparation for Life and Work courses
increased by 6%.
Learning Participation by 16-18 Year Olds
6.52
Almost all 16-18 year old Lancashire residents who were recorded as
starting a learning aim in 2013/14 were enrolled in education and training provision.
101
6.53
The total number of learning aim starts by 16-18 year olds fell by 31%, a
greater than average proportionate decline (-14%). This is believed to be linked to
a number of factors, including the raising of the participation age, and changes to
funding mechanisms which means that funding for FE is attached to the learners
rather than the qualifications that they undertake, and there is therefore no incentive
to enrol learners on additional qualifications which add little value.
6.54
The most significant change when looking at provision by level has been
the significant reduction in the number of starts for which the learning aim level was
recorded as ‘not applicable’. This accounted for nearly 27% of starts in 2012/13 but
only 10% in 2013/14.
6.55
Looking at learning aim starts by sector, around one-third of learning aims
started by 16-18 year olds in Lancashire were in the Preparation for Life and Work
subject area. Compared to the total number of starts, a higher proportion of 16-18
year old learners started learning aims relating to science and maths (13%
compared to 6% overall), and a lower proportion started learning aims within the
health and care, construction and ICT sector areas. This may reflect restrictions on
the employment of young people within some of these occupational areas.
Learning Participation by Lancashire Residents aged 19+
6.56
Looking at the pattern of learning aim starts amongst adults (those aged
19+), nearly 80% of starts in 2013/14 were on Education and Training, with the
share of starts accounted for by community learning and workplace learning both
declining. Overall the total number of starts amongst those aged 19+ remained
fairly stable, with a small decline of 1%.
6.57
Looking at learning aim starts by level, only around 8% of starts were at
Level 3 or above, with 63% at level 2 or below. Nearly 30% of starts did not have a
learning aim level.
6.58
Looking at starts by sector subject area, nearly 40% of starts amongst
those aged 19+ were in the Preparation for Life and Work area. There is evidence
of alignment of provision with the LEP’s priority sectors, including health and ICT
which account for the second and third largest number of starts. However, the
number of starts has fallen in the areas of health and care, arts, media and
publishing and leisure, travel and tourism. The number of starts in engineering and
manufacturing technologies has increased, but accounts for a small proportion of
the overall total (4%).
Further Education – Delivery by Lancashire Providers
6.59
As well as looking at participation by Lancashire residents, it is also useful
to look at FE provision by providers based in Lancashire, in order to judge how well
it aligns with economic need and learner demand. Overall, there is a large degree
of overlap between participation and provision, with the vast majority of Lancashire
residents participating in FE provided by Lancashire providers, and the vast majority
of Lancashire providers’ provision being delivered to Lancashire residents.
6.60
Delivery by Lancashire providers is very slightly higher than learning by
Lancashire residents (approximately 1.3% more starts were delivered than were
taken up by Lancashire residents). The pattern of provision by age is very similar
to participation, although the fall in the number of starts amongst 16-18 year olds is
less pronounced than amongst residents (31% compared to 40%). Overall the
number of learning aim starts provided by Lancashire providers fell by 15% between
2012/13 and 2013/14, compared to a 14% fall in starts by Lancashire residents.
6.61
Looking at learning aims by level, provision by Lancashire providers is very
similar to participation by Lancashire residents. Level 3 learning aims account for
a higher proportion of provision (21%) than participation by Lancashire residents
(18%). Provision at level 3 has increased, compared to a fall in starts by Lancashire
residents. Level 3 starts account for a higher proportion of delivery to 19-24 year
olds than their share of participation by Lancashire residents.
6.62
Considering learning aims by sector subject area, Preparation for Life and
Work accounts for 37% of all starts with Lancashire providers, a slightly lower
proportion than its share of learning aim starts amongst Lancashire residents. The
other sectors account for roughly the same proportions as amongst residents, with
some alignment to the LEP’s priority sectors evident.
6.63
Whilst overall the number of learning aim starts delivered by Lancashire
providers fell by 15% between 2012/13 and 2013/14, the number of learning aim
starts in the leisure, travel and tourism sector fell by 22%. Other sector subject
areas which are aligned to the LEP’s priority sectors – including business,
administration and law and information and communications technology – also saw
a declining number of starts.
6.64
In contrast, starts in languages, literature and culture, education and
training, Preparation for Life and Work and engineering and manufacturing
technologies all increased.
Preparation for Life and Work
6.65
Lancashire providers delivered over 100,000 starts in relation to
Preparation for Life and Work in 2013/14, a 5% increase on the number in 2012/13.
This is slightly lower than the number of learning aim starts in this sector subject
area recorded for Lancashire residents, suggesting that some residents are learning
with providers based outside Lancashire. Nearly half of those starting learning
programmes relating to Preparation for Life and Work are aged over 25, and it is
this age group which has seen the biggest increase (+11%).
Education and Training Success Rates
102
6.66
Nearly 90% (88.5%) of learners who were learning in Lancashire
successfully achieved their learning aim in 2013/14, compared to 84.7% nationally.
There is some variation in performance across the different types of providers, with
lower success rates in other public funded and private sector, public funded
institutions. Success rates in Lancashire are above the national average in general
FE and tertiary provision, sixth form college provision and other public funded
provision.
Education and Training success rate by institution
Source: SFA
90
Lancashire
England
Success rate (%)
88
86
Education and Training sucess rates by LA
Source: SFA
Fylde
Blackpool
Ribble Valley
Pendle
Burnley
Lancashire LEP
Rossendale
West Lancashire
South Ribble
Wyre
Chorley
Hyndburn
Blackburn with Darwen
Preston
Lancaster
84
75
80
82
85
Success rate (%)
90
95
Education & Training Success Rates by Age, 2013/14
80
Source: SFA
78
92.0
76
90.0
General FE
and Tertiary
College
Sixth Form
College
Specialist
College
All Institution
Type
Other Public Private Sector
Funded
Public Funded
88.0
86.0
84.0
6.67
There is also some variation in success rates across the local authority
areas, with the percentage of learners achieving their learning aims ranging from
just over 80% in Lancaster to over 90% in Fylde and Blackpool. Some of the local
authorities which have relatively weak performance on other education indicators,
such as GCSE attainment, perform much better on FE success rates, e.g.
Blackpool. Lancashire outperforms the national success rate for both 16-18 year
olds and 19+; however the gap is widest in relation to those aged 16-18.
82.0
80.0
78.0
76.0
All Age
16-18
Lancashire
19+
England
Apprenticeships
6.68
Apprenticeships are a key part of the Government’s aim to upskill the
workforce and provide the higher level technical and vocational skills that are
needed within the workforce. They also provide a mechanism to develop the skills
of those already in work, facilitating progression within the labour market and access
to higher paid employment. As with the analysis of further education, this section
looks at participation in apprenticeships by Lancashire residents, and then
highlights areas where the provision of apprenticeships by Lancashire-based FE
and training providers differs from that taken up by Lancashire residents.
103
6.69
Just under 29,000 Lancashire residents were enrolled on apprenticeship
provision during the 2013/14 year. Three in ten were undertaking an apprenticeship
relating to business, administration and law, and a further quarter in health, public
services and care.
Learner Participation in Apprenticeships 2013/14
% of total apprentices
Business, Administration and Law
30.9%
Health, Public Services and Care
25.1%
Engineering and Manufacturing Technologies
16.2%
Retail and Commercial Enterprise
15.3%
Construction, Planning and the Built Environment
3.8%
Leisure, Travel and Tourism
2.6%
Agriculture, Horticulture and Animal Care
2.4%
Education and Training
2.1%
Information and Communication Technology
1.6%
Arts, Media and Publishing
0.1%
Science and Mathematics
0.1%
Total
100.0%
Source: Data Cube
Apprenticeship Starts: Change 2005/6 to 2013/14
Source: SFR
20,000
18,000
16,000
14,000
12,000
10,000
8,000
6,000
4,000
2,000
0
2005/6 2006/7 2007/8 2008/9 2009/102010/112011/122012/132013/14
Lancashire LEP
England trend line
6.71
The fall in apprenticeship starts between 2012/13 and 2013/14 was a result
of a 42% reduction in starts on advanced level apprenticeships. The number of
starts on intermediate level apprenticeships remained relatively stable, and there
was a decline in starts on higher apprenticeships, which only account for a very
small proportion of the total number of apprenticeship starts by Lancashire
residents.
6.72
The reduction in advanced level apprenticeships was accompanied by a
reduction of older (25+) apprentices between 2012/13 and 2013/14, with numbers
falling by 40%. This decline is associated with the introduction (and subsequent
withdrawal) of Advanced Learning Loans for learners aged 24+ for advanced
apprenticeships. It remains to be seen whether the take up of advanced
apprenticeships will return to previous levels in 2014/15.
6.73
In terms of apprenticeship starts by sector, Lancashire has a similar profile
to the national profile, with the exception of business, administration and law, which
accounts for a higher proportion of apprenticeship starts in Lancashire than
nationally. Overall business, administration and law; health, public services and
care; and retail and commercial dominate apprenticeship starts in Lancashire,
accounting for almost 75% of starts.
Apprenticeship Starts – Lancashire Residents
6.70
There has been a marked increase in apprenticeship starts in Lancashire
since 2010, in line with national policy. Numbers peaked in 2012/13.
6.74
Manufacturing apprenticeships remain very important to Lancashire,
accounting for 15% of total starts, while the construction numbers are quite small
given the importance of the sector.
6.75
Over the past ten years, the greatest increase in the provision of
apprenticeships has been in business, administration and law, reflecting the
increased take up of apprenticeships by employers in these sectors.
104
6.77
Other sectors have been more resilient to the funding changes, with the
number of starts in engineering and manufacturing technologies increasing by 13%.
Apprenticeship starts by sector subject area, 2013/14
Source: SFR
Business, Admin.& Law
Apprenticeship Delivery
Health, Pub. Services &…
6.78
Apprenticeship delivery is the delivery of apprenticeship programmes by
Lancashire’s FE and training providers, to learners no matter where they live (i.e.
including some non-Lancashire residents).
Retail & Commerce
Engineering & Manufac.…
Construction & Planning
6.79
The total number of starts on apprenticeships delivered by Lancashire
providers is slightly lower than the number of Lancashire residents recorded as
starting on apprenticeships, suggesting that some residents are being supported by
providers outside Lancashire. The total number of starts delivered by Lancashirebased providers fell by 18%, very slightly less than the number of starts by
Lancashire residents.
Leisure, Travel & Tourism
Education & Training
Info & Comms. Tech
Agriculture & Animal Care
0%
Lancashire LEP
10%
20%
North West
30%
40%
England
Change in Apprenticeship Starts by Subject 2005/6 - 2013/14
6.81
When considering starts by age, again the pattern of delivery by
Lancashire providers is very closely aligned with take up by Lancashire residents.
In 2013/14, just over one third of all apprenticeship starts with Lancashire providers
were by those aged 25+ and a further third by those aged 19-24. Whilst the number
of starts by 16-18 year olds has increased, this has been more than offset by a small
decline in the number of 19-24 year old starts, and a 40% reduction in the number
aged 25+ starting an apprenticeship delivered by Lancashire-based FE providers.
Source: SFR
Business, Admin and Law
Health, Public Services and Care
Retail and Commercial Enterprise
Engineering and Manufacturing
Education and Training
Information and Communication
6.82
The pattern of apprenticeship starts by sector delivered by Lancashirebased providers is also very similar to the pattern of starts by Lancashire residents.
However, over the past year, Lancashire-based providers have experienced a
bigger decline in the number of starts in health and social care, and a bigger
increase in the number of starts on engineering and manufacturing technology
apprenticeships than has been the case amongst Lancashire residents.
Leisure, Travel and Tourism
Agriculture/ Animal Care
Arts, Media and Publishing
Science and Mathematics
Construction/ Planning
-2000
6.80
Considering apprenticeship starts by level, the profile of provision is very
closely aligned to apprenticeship starts by level by Lancashire residents. Nearly
two-thirds of provision is at intermediate level (Level 2, equivalent to GCSE level).
Again, the number of starts on advanced level apprenticeships has fallen markedly
over the past year.
0
2000
4000
6.76
As noted above, over the past year the number of Lancashire residents
starting an apprenticeship programme has fallen by nearly 20%. Some sectors,
including a number which are important to the LEP’s future growth plans, have seen
a greater proportionate decline, including construction, business, administration and
law, health and care and ICT.
Apprenticeship Success Rates
6.83
The overall success rates for apprenticeships delivered in Lancashire are
significantly higher than the equivalent national figure. In 2013/14 the difference was
some four percentage points, and the Lancashire success rate has been above 70%
in the last three years for which data is available.
6.84
Other public funded providers and specialist colleges have the highest
success rates, although the difference with success rates in general FE colleges
and private providers is not great. General FE colleges are unusual in having lower
105
success rates for higher level apprenticeships, although again, the numbers are
small.
GCSE performance, and Chorley and Wyre having relatively low apprenticeship
success rates compared to strong GCSE performance.
Apprenticeship sucess rates by Local Authority
Source: SFA
Ribble Valley
Pendle
Rossendale
Burnley
South Ribble
West Lancashire
Lancashire LEP
Lancaster
Preston
Chorley
Fylde
Blackburn with Darwen
Wyre
Hyndburn
Blackpool
0
20
40
60
80
Success rate (%)
6.86
Considering apprenticeship success rates by age, Lancashire outperforms the national success rates amongst all age groups.
Apprenticeship success rates by institution
Source: SFA
100
90
80
70
60
50
40
30
20
10
0
Success rate (%)
Apprenticeship Success Rates by Age 2013/14
Source: SFA
80.0
Lancashire
England
70.0
General FE and
Tertiary College
Other Public Funded
Private Sector Public
Funded
Specialist
College
Success rate, %
All Levels
Advanced
Intermediate
All Levels
Higher
Advanced
Intermediate
All Levels
Higher
Advanced
Intermediate
All Levels
Higher
Advanced
Intermediate
60.0
50.0
40.0
30.0
20.0
10.0
0.0
6.85
Apprenticeship success rates vary considerably across Lancashire, from
nearly 80% in Ribble Valley to below 70% in Blackpool. When compared with the
pattern of GCSE attainment, there are some clear differences, with Pendle and
Burnley amongst the best performers on apprenticeships despite relatively poor
16-18
19-23
24+
All Age
Travel to Learn: Further Education
106
6.87
The vast majority of Lancashire residents participating in FE are learning
within the LEP area. Those undertaking learning programmes at entry level or Level
1 are most likely to be learning within Lancashire, although nearly 20% of Level 2
learners appear to travel outside the LEP to access their learning.
Lancashire FE Learners by place of learning
Source: Datacube
Total Lancs Learners
Lancaster
% Travelling outside LEP to learn by level
Source: Datacube
Central Lancs
20%
B'pool, Fylde, Wyre
18%
16%
W Lancs
14%
E Lancs
12%
0%
10%
8%
Home LA
20%
40%
Rest of LEP
60%
80%
100%
Outside LEP
6%
4%
Travel to Learn: Apprenticeships
2%
0%
LEP
Entry
Level
Level 1
Level 2
Level 3
Level 4
Higher
Level
6.88
As might be expected, older learners aged 25+ are more likely (and
presumably more able) to travel to access learning outside the LEP area, with 11%
travelling outside the LEP area, compared to only 7% of those aged 16-18.
6.89
There are also some variations between subject area. Five sector subject
areas, including three associated with the LEP’s priority sectors, have a higher than
average proportion of learners travelling outside Lancashire to learn – construction,
planning and the built environment (a subject which will be in demand in the next
five to ten years as the City Deal is implemented); agriculture, horticulture and
animal care; engineering and manufacturing technologies; health, public services
and care; and business, administration and law.
6.91
Turning to those who are on an apprenticeship programme, a slightly lower
proportion are learning within the Lancashire LEP area than is the case amongst
those on other further education provision (87% compared to 90%). Although the
numbers are small, those on higher apprenticeships are much less likely to be
studying within the LEP area (78%). This may reflect the current roll-out of higher
level apprenticeship programmes. There is no difference in the likelihood of
travelling outside the LEP area to access apprenticeship provision by age group.
6.92
Three subject areas which have a significant number of apprentices have
a higher than average proportion travelling outside the LEP area to learn –
agriculture, horticulture and animal care; leisure, travel and tourism; and Information
and Communication Technology.
6.93
Apprentices in Lancaster are the most likely to be learning within their
home local authority, with those in West Lancashire the least likely. West
Lancashire apprentices are the most likely to be learning outside the LEP area.
6.90
There is significant variation in the proportion of learners who learn within
their home local authority area across Lancashire. Overall, 61% are learning within
their home LA, but this varies from 82% in the Lancaster sub-geography, to 56%
within East Lancashire. West Lancashire has the highest proportion – 30% travelling outside the LEP to learn, compared to the average of 10%.
107
Profile of Advanced Learning Loan Applications, 2014/15
Lancashire Apprentices by place of learning
Source: Datacube
Total
Nationality
Non-UK
UK national
Lancaster
B'pool, Fylde, Wyre
Gender
M
F
Central Lancs
E Lancs
Age
W Lancs
0%
20%
Home LA
40%
Rest of LEP
60%
80%
100%
Outside LEP
Advanced Learning Loans
6.94
Advanced learning loans have been introduced by the government to fund
learning at Level 3 and above for those aged 24+. Little information on the take-up
of Advanced Learning Loans at sub-national level is yet available. However,
national data is available on the profile of those applying for loans. Nearly threequarters (73%) of applicants are female, and 40% are aged between 24 and 30
years old.
24-30
0%
20%
31-40
40%
60%
41-50
80%
50+
100%
6.96
At the time that loans were introduced, BIS estimated that they would result
in a 20% reduction in learner numbers. Whilst it is not possible to definitively link
changes in learner numbers in Lancashire to the introduction of loans, the number
of apprenticeship starts by those aged 25+ has fallen by 40%, whilst the number of
FE starts has increased very slightly by 1%.
6.97
Research undertaken in Greater Manchester30 suggests that the impact on
learner numbers has been less than expected by BIS, but there was some evidence
of reduced interest in less well-paid areas or those where employers were typically
smaller, e.g. hair and beauty, construction.
6.95
Nearly one third of applicants are planning to undertake an Access to HE
course (the loan does not have to be paid back if the applicant subsequently enters
Higher Education). 43% undertake a Level 3 Diploma.
30
Advanced Learning Loans Assessing the Impact on Greater Manchester Providers, New
Economy, Dec 2013
108
24+ Advanced Learning Loan Applications 2014/15 by Provision Type
Source: Advanced Learning Loans Application Information, BIS
2%
1% 0%
national trend, since 2006/07. There is considerable variation between the three
Lancashire local education authorities, with the proportion entering HE ranging from
41% of those studying in Lancashire schools, to 29% of those who go to school in
Blackpool, well below the national and regional averages of 36% and 37%
respectively.
6%
Percentage of 15 year old pupils in maintained schools who enter HE
by the age of 19
Diploma L3
16%
43%
QAA Access to HE
Cert L3
Diploma L4+
A Level
Cert L4+
32%
Unknown
Satisfaction with FE
6.98
Lancashire’s FE providers are recognised for their work with employers
and the quality of their provision. This is reflected in the satisfaction ratings given
by both employers and learners.
Satisfaction with Lancashire FE providers
Em ployers
Source: SFA via FE Choices
12
Learners
10
Source: BIS
45%
40%
35%
30%
25%
20%
15%
10%
5%
0%
2006-07
Lancs
2007-08
BwD
2008-09
2009-10
Blackpool
2010-11
NW
2011-12
England
6.100 Data at the local authority level is one year older, but illustrates the
variation in progression to HE across Lancashire. In Fylde and Ribble Valley, more
than four in ten 15 year olds enter higher education by the age of 19, compared to
fewer than 28% in Blackpool, Hyndburn and Burnley.
8
6
4
2
0
Rated 9+/10
Rated 8 to 9 /10
Rated 7 to 8 /10
Rated 6 to 7 /10
Higher Education
Lancashire Residents participating in Higher Education (HE)
6.99
The proportion of young people progressing from maintained schools in
Lancashire to higher education by the age of 19 has increased, mirroring the
109
Percentage of A-level or Level 3 students in 2011/12 entering HE in
2012/13, by type of HE provider
UK HEI
Top
third of
HEIs
Oxford /
Cambridge
BwD
52%
10%
<0.5%
Russell
Group
HEI (inc
Oxbridge)
8%
32%
Other HE
providers
inc FE
Colleges
10%
B’pool
56%
14%
<0.5%
9%
33%
9%
Lancs
53%
18%
1%
13%
32%
3%
NW
52%
17%
1%
13%
33%
3%
England
49%
19%
1%
13%
28%
2%
All
Other
HEIs
Source: DfE
6.103 Whilst information is available on the age of entrants to higher education
institutions in Lancashire (see Characteristics of HE Students, below), it is not
possible to say what proportion of Lancashire’s adult population enter HE as mature
students each year.
Students Registered with HE providers within the Lancashire LEP area
6.104 There are four HEIs located within the Lancashire LEP area: the University
of Lancaster, the University of Central Lancashire (UCLan), Edge Hill University and
the University of Cumbria, which has its largest campus in Lancaster.
6.101 Looking at the type of higher education which Lancashire’s young people
go into, there are some variations to the national and regional pattern. The data
covers only those who are entered for at least one A-level or other Level 3
qualification, and shows the proportion who sustained entry to higher education for
at least two terms.
6.102 Whilst the overall proportion who entered HE was higher, the proportion
going into the top third of higher education institutions (HEIs) (defined by BIS on the
basis of the mean UCAS tariff score required for entry) was well below the national
average in Blackburn with Darwen and Blackpool. These two local education
authority areas had a much higher proportion of young people going into higher
education provided through FE colleges.
6.105 Over 66,000 students are registered with HEIs located within the
Lancashire LEP area, over 20% of whom are post-graduate students. The number
of students within Lancashire’s HEIs has fluctuated, with a 24% fall in UK domiciled
students since 2010/11.
6.106 Three-quarters of students are studying for a first undergraduate degree,
but there is a larger proportion in Lancashire following other undergraduate courses
(9% compared to 6% nationally), which includes qualification aims equivalent to and
below first degree level, such as the Professional Graduate Certificate in Education
(PGCE), foundation degrees, diplomas in higher education, Higher National
Diploma (HND) and Higher National Certificate (HNC), and a wide range of
professional qualifications at undergraduate level.
6.107 UK domiciled students account for 88% of those studying at HEIs within
the Lancashire LEP area, slightly down from the 92% recorded in 2008/09. The
proportion of students from other EU countries has remained stable at 3-4% over a
number of years, whilst the proportion from outside the EU has risen slightly, and
now equates to nearly 5,500 students. This group makes up nearly one-third of fulltime post-graduate students in Lancashire.
110
HE Students at Lancashire-LEP based HEIs, 2007-2014
Undergraduate
Source: HESA
Postgraduate
120,000
100,000
Domicile of students at Lancashire LEP HEIs
UK
Source: HESA
90,000
Other EU
80,000
Non-EU
70,000
60,000
80,000
50,000
60,000
40,000
30,000
40,000
20,000
20,000
10,000
0
0
2007/08
2008/09 2009/10 20010/11 2011/12
2012/13 2013/14
2007/08
2008/09
2009/10 20010/11 2011/12
2012/13
2013/14
Domicile of students by mode of study 2013/14
HE FTE Students by type of study 2013/14
Source: HESA
Source: HESA
100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
Lancashire
England
Full Time
0%
First degree
20%
40%
Other undergraduate
60%
80%
Postgraduate
100%
Part Time
Full Time
Undergraduate
Non-EU
Part Time
Postgraduate
Other EU
UK
6.108 In addition to those studying within Lancashire’s Higher Education
Institutions, there are also significant number of students studying for an HE
qualification within Lancashire’s Further Education Colleges, as the data on
111
0
10,000
20,000
30,000
40,000
50,000
HE students in HEIs
Biological Sciences
Education
Social studies
Creative Arts & Design
Engineering & Technology
Business & Admin studies
FEC registered FEC taught
Creative Arts & Design
HEI registered FEC taught
Social studies
Subjects allied to Medicine
HEI registered HEI taught
16.0%
14.0%
12.0%
10.0%
8.0%
6.0%
4.0%
2.0%
0.0%
Biological Sciences
Source: Higher Education and Local Growth, HEFCE
Source: Higher Education and Local Growth, HEFCE
Initial Teacher Training
Students studying for a Higher Education Qualification in Lancashire,
2012-13
Subjects studied by HE students in Lancashire (FTEs), 2012-13
Business & Admin studies
destinations of young people at Key Stage 5 would suggest. In 2012/13, this
amounted to nearly 6,500 full-time equivalent (FTE) students
HE students in FECs
Characteristics of HE Students in Lancashire
Subjects Studied by HE Students in Lancashire
6.109 Amongst students studying in Higher Education Institutions, the most
commonly studied subjects are subjects allied to medicine and business and
administrative studies, each of which account for around 14% of the total number of
FTE students in HEIs.
6.111 The vast majority of HE students in Lancashire are white – 80% of those
studying in Higher Education Institutions and 83% of those studying HE courses in
FE colleges. However, the proportion of students from an ethnic minority
background – between 17% and 20% - is significantly higher than the ethnic minority
share of the population as a whole.
6.110 The pattern of subjects studied is different for Higher Education courses
followed by students in FE Colleges. Here, engineering and technology account for
14% of full-time equivalent students.
6.112 The gender split of HE students varies considerably between the two
settings. In HEIs, women account for nearly two-thirds of students, whereas there
is a 50/50 split of students following HE courses in FE Colleges.
6.113 The pattern of entrants by age also varies between higher education
institutions and FE Colleges. Amongst students studying in HEIs, two-thirds are
aged 21 or under compared to 45% of those studying higher education courses in
FE Colleges. Mature entrants, aged over 24, make up 23% of entrants to HE
courses in HEIs, but 37% of those starting HE in FE Colleges.
112
Age profile of HE Students in Lancashire, 2012/13 (FTEs)
Lancashire HE students by ethnicity and institution type
Source: Higher Education and Local Growth, HEFCE
Source: Higher Education and Local Growth, HEFCE
Under 21
FEC
21-24
Over 24
FEC
HEI
HEI
-
10,000
20,000
30,000
Asian or Asian British
Black or Black British
Unknown
White
40,000
50,000
Other (including mixed)
-
20,000
30,000
40,000
50,000
6.114 Lancashire HEIs take a higher proportion of students from low participation
neighbourhoods and poorer backgrounds than HEIs in England as a whole.
Gender of HE students in Lancashire, 2012-13, FTEs
Source: Higher Education and Local Growth, HEFCE
Female
30,000
10,000
Male
Particpation of under-represented groups in HE:
Percentage of 2013/14 first degree entrants:
25,000
Source: HESA
20,000
England
Lancashire LEP HEIs
From low participation neighbourhoods
15,000
10,000
From poorer backgrounds
5,000
HEI
FEC
From state schools
0
20
40
60
80
100
6.115 HEFCE provides data on the home region of young first degree students
studying at HEIs in the Lancashire LEP area (aged under 21 years on entry) 31.
31
This data does not cover students on HE courses at FE Colleges.
113
Nearly 60% are from the North West region, with 7% from Yorkshire and Humber,
and a further 7% from outside the EU.
Home region of young first degree students in Lancashire HEIs, 2012-13
Source: HIgher Education and Local Growth, HEFCE
12%
3%
3%
4%
5%
59%
7%
7%
Destinations of first degree graduates, 2012-13
Lancs LEP
NW
Source: HEFCE Local Growth Data
80.0
70.0
North West
60.0
Yorkshire and The
Humber
Rest of the World
50.0
West Midlands
20.0
EU
10.0
40.0
30.0
0.0
South East
Work
Further study
Work and
study
East Midlands
Rest of the UK
Destinations of HE Students Studying within Lancashire
6.116 Lancashire HEIs have a slightly higher drop-out rate (8% not progressing
after the first year, compared to 7% nationally). Despite this, the percentage
achieving a degree is close to the national average (and considerably higher at
Lancaster University).
6.117 Over 70% of first degree graduates who studied within Lancashire went
into employment after graduating in 2012-13. This is a slightly higher proportion
than amongst graduates from the wider North West region.
Unemployed
Other
6.118 The HEFCE data, taken from the Higher Education Statistics Agency’s
Destinations of Leavers from Higher Education survey (DLHE 2012/13) also shows
the regions in which graduates from Lancashire’s higher education institutions are
employed. Nearly three-quarters remain in the North West.
Employment of Lancashire graduates, by region %
Source: HEFCE
1.4
2.1
1.5
0.9
0.6
0.5
Y&H
2.3
3.0
North West
London
West Midlands
4.2
South East
4.4
East Midlands
East of England
6.1
73.0
South West
North East
Wales
Scotland
Northern Ireland
6.119 The Higher Education Careers Service Unit (HECSU) have produced a
report using the DLHE data32 which categorises students as:
32
Loyals, Stayers, returners and Incomers: Graduate migration patterns, HECSU, 2015
114

Regional loyals, who live, study and remain in a region

Regional returners, who move out of their home region to study, and then
return home afterwards to work
Work readiness of 16 year old school leavers

Regional stayers, who move out of their home region to study and then
remain in the region where they studied to work

Regional incomers, who work in a region different to both their home region
and that where they studied.
6.120 The data shows that the North West retains more of its domiciled graduates
and more students who studied locally than any English region other than London.
6.121 In terms of sector, Lancashire’s graduates are more likely than the regional
average to be employed in the health and social work sector, the professional,
scientific and technical sector and in mining and manufacturing.
Source: UKCESS
60%
50%
40%
30%
20%
10%
0%
Very well
prepared
Well
prepared
Poorly
prepared
England
Very poorly Don't know Varies too
prepared
much to say
Lancashire LEP
Employment, by sector, of first degree graduates, 2012-13
25.0
20.0
Lancs LEP
NW
15.0
Work readiness of 17-18 year old school leavers
Source: UKCESS
60%
10.0
50%
5.0
40%
0.0
30%
20%
10%
0%
Very well
prepared
Well
prepared
England
Poorly
prepared
Very poorly Don't know Varies too
prepared
much to say
Lancashire LEP
Employer Views of Young Recruits in Lancashire
6.122 Employers who recruit young people are asked for their views about work
readiness in the UK Employer Skills Survey. The data shows that employers are
more satisfied with the work readiness of HE and FE College leavers than with
school leavers, and generally less satisfied in Lancashire than in England as a
whole.
115
Work readiness of 17-18 year old FE college leavers
Source: UKCESS
70%
60%
50%
40%
30%
20%
10%
0%
Very well
prepared
Well
prepared
Poorly
prepared
England
Very poorly Don't know Varies too
prepared
much to say
Lancashire LEP
Work readiness of University or HE Leavers
Source: UKCESS
70%
60%
50%
40%
30%
20%
10%
0%
Very well
prepared
Well
prepared
England
Poorly
prepared
Very poorly Don't know Varies too
prepared
much to say
Lancashire LEP
116
Work Programme Performance
Job outcomes (as a % of attachments)
6.123 The Work Programme is the government’s flagship programme for tackling
long-term unemployment. Over 48,000 Lancashire residents have been attached
to the Work Programme since it began.
35%
6.124 The Work Programme is a single programme that provides support to a
range of groups who need additional support in the labour market. However, the
attachment data shows that the number supported closely aligns with the share of
JSA unemployment in each sub-geography.
20%
6.125 Alignment between the Work Programme and ILO unemployment is less
exact. East Lancashire residents account for half of those unemployed on the ILO
measure, but only 39% of those who have been referred to the Work Programme.
In contrast, Blackpool, Fylde and Wyre residents make up only 13% of Lancashire’s
ILO claimants, but have accounted for 26% of Work Programme attachments.
Work Programme Attachments by Local Authority, to Dec 2014
Source: Work Programme: Local Authority cumulative figures
30%
25%
15%
10%
5%
0%
Source: Work Programme: Local Authority cumulative figures Referrals
E Lancs
6%
B'pool, Fylde, Wyre
9%
Central Lancs
Lancaster
39%
W Lancs
20%
26%
Lancashire LEP = 48,440
6.126 One in five Work Programme participants in Lancashire have gone into
work since the programme began. This is slightly lower than the England average
(22% compared to 24% of all attachments), in part reflecting the difficult labour
market in Lancashire, where jobs growth has been slower than that seen nationally
since the recession. If the Work Programme in Lancashire matched the England
average job outcome level, an additional 4,400 people would have moved into
sustained employment.
6.127 The job entry rate varies considerably across Lancashire, with over 30%
of participants in Ribble Valley entering work, compared to less than 20% in
Blackburn with Darwen.
117
7
opportunities at areas of high replacement demand and genuine
employment growth, and ensure that adults have the opportunity to retrain to meet the needs of the economy and progress in the labour
market.
Conclusions and Key Messages
Key Messages

The overall competitiveness and sustainability of the Lancashire
economy is linked to a wider move to a higher skilled and more
productive workforce in both manufacturing and the service sector. This
will require, at every level, a better educated and qualified workforce,
with both life and vocational skills.

The provision of education, skills and training within Lancashire needs
to take account of both the challenges in supporting employment growth
and ensuring the benefits of growth are maximised, and the need to
strengthen and grow the business base through a better skilled
workforce.

Action is required across all parts of the education, skills and
employment system.

FE Estate Renewal and New Facilities: continue to upgrade the FE
Estate and provide new facilities and equipment which reflect the new
economy priority sectors.

Employer Engagement: increase employer engagement in skills, and
encourage greater commitment to workforce development, as well as
encouraging employers to work with education providers to influence
vocational provision. Providers need to make better collective and
individual use of the soft intelligence on skills needs that they gather
through their employer engagement activities.
The emerging priorities with regard to employers and workforce development are:

IAG and Careers Advice: support the careers work of local schools as
part of the process of making young people more aware of opportunities
and progression routes in key sectors.

Apprenticeships and vocational training: invest in the workforce and
address future skills shortages by increasing the number and quality of
apprenticeships.

Graduate Recruitment: work with local stakeholders to develop new
and innovative mechanisms to increase internships and graduate
placements across the Lancashire business base.

Workforce progression and up-skilling: support progress within the
workforce, through up-skilling and career changes, and access to higher
education, in order to anticipate future recruitment challenges and
alleviate potential skills shortages.

Influence vocational training provision: develop mechanisms
through which employers can work with Further Education Colleges,
other providers of education and training, to influence vocational training
provision and ensure public funds are directed towards areas of high
replacement demand and genuine employment growth.

Advanced Manufacturing: given the ageing workforce and high levels
of replacement demand, the priorities are to attract more young people
into the sector by inspiring and engaging them at a young age, to recruit
and retain a competitive workforce by ensuring the sector and the
location are attractive to people, to develop a responsive learning
infrastructure system which can adapt to changes within the industry and
The emerging priorities with regard to young people and the education and
training system are:

Schools: improving the attainment rate of those schools where students
are seriously lagging behind.

IAG and Careers Advice: providing more advice at a younger age to
school students, highlighting the new opportunities and requirements in
a changing economy and highlighting the strengths of various routes to
industry qualification, training and employment, particularly vocational
routes.

16-19 year olds: ensuring all young people have the opportunities and
support they need to achieve a minimum of Level 2 qualifications by the
age of 19, including English and maths, and raising the proportion who
achieve Level 3.

Apprenticeships and vocational training: increasing the number and
quality of apprenticeships, and encouraging greater levels of provision
at higher levels, reaching more employers and introducing strengthened
mechanisms to help employers deliver apprenticeships.

Increase the number of young people going on to higher education:
Lancashire needs to increase the number of young people from all of its
communities going on to higher education. There is an opportunity to
work closely with and support the access work of the four Universities.

FE Provision: work with Further Education Colleges, other providers of
education and training, and employers to target vocational training
118
responds to employer demand, and to secure employer investment in
training by ensuring employers are able to influence provision.






Financial and Professional Services: address skills gaps and
shortages and meet the expected high levels of replacement demand,
develop a more responsive supply of training provision, improve sector
intelligence, and increase the attractiveness of Lancashire as a place to
work in the financial and professional services sector.
Health and Social Care: as society ages, demands on the health and
social care sector increase. In order to meet these needs, challenges
within the health and social care workforce will have to be tackled,
through strengthening employer influence over skills and training
provision, co-ordinate the use of public investment in skills, widen
access through alternative entry routes, and develop a stronger provider
base able to meet employer needs.
Visitor Economy: to ensure the sector can play its full role in meeting
Lancashire’s growth ambitions, there is a need to attract more
appropriately skilled young people into the sector; address skills gaps
within the existing workforce, including management and leadership;
and learn from good practice, supporting the roll-out of innovative and
effective practice.
Energy and Environmental Technologies: meet demand for
technical, softer and business skills; increase the attraction of the sector
in Lancashire through changing perceptions of both the industry and the
location; improve intelligence by tracking developments in the sector;
and develop the supply side by ensuring availability of appropriately
skilled FE staff and adjusting provision to meet employer needs.
Creative and Digital Industries: increase the pipeline of digital skills,
working from schools to HEIs, in order to tackle skills gaps and
shortages relating to digital skills; ensure the skills enhancement system
is more appropriate to the needs of dynamic microbusinesses in
Lancashire; and improve recruitment and retention through addressing
the challenges and opportunities of the positioning of Lancashire.
Construction: given the need to complete major infrastructure works
and increase residential development, develop a super initiative, based
on arrangements already in place and working with industry bodies, to
address requirements and skills changes in construction, encourage the
industry to recruit older workers and increase the number of
apprenticeships in skilled trades.
The emerging priorities with regard to helping people into employment are:

Young People and Employability: there is a need to increase efforts
to link young people / those seeking employment with the opportunities
available through replacement demand, to tackle employability issues
before they become entrenched by reducing the number of young
people becoming NEET; and to work with those at risk of redundancy to
re-train or transfer their skills to other sectors / employers.

Work Programme: Lancashire needs a more effective Work
Programme capable of generating higher than average outcomes for
residents. This Programme remains the largest Government funded
initiative of its type and it needs to be improved as a matter of urgency.

Understanding worklessness: there are 50,000 people looking for
employment, while only 16,000 are in receipt of Job Seekers Allowance.
More work is needed to understand this hidden unemployment group
and determine the types of support which could help some more people
back into employment.
These priorities need to sit alongside efforts to increase indigenous business
growth and new inward investment to provide additional employment. This will
include the development of strategic sites, employment land and commercial
floorspace, and provision of more housing to increase the Lancashire population,
with a focus on more and preferably younger working households. At the same
time, there are a number of challenges which relate to place and these need to
be taken into account in developing skills and learning priorities.
In the light of the importance of skills and training, the significant amounts of
monies invested each year by national agencies and the move to devolution,
Lancashire needs to consider how more local control and influence over key
areas of activity and funding could advance the economic and skills agenda.
Conclusions
7.1
The data and analysis set out in this evidence base provide a detailed
picture of the employment and skills environment in Lancashire, and give partners
a foundation from which interventions to tackle skills issues and employment needs
can be developed and implemented. This section of the report sets out the
conclusions from the analysis, and provides some key messages to guide partners
in setting skills and employment priorities for Lancashire and investing the resources
available to support economic growth and tackle disadvantage through education,
skills and training.
New Economy, New Lancashire
7.2
Having spent many years dealing with the after effects of major industrial
decline and dramatic employment losses, Lancashire has ambitious plans to move
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to a modern, competitive economy, based on new products, services and trends in
living and leisure, innovation and creativity, in a world of both international
opportunities and competition.
7.3
Lancashire LEP has embarked on a 20-30 year journey to transform the
Lancashire economy, building on its many assets, to focus the new economy on
sectors and services where market demand is growing and long term prospects are
positive. Lancashire’s new economy is based on a world class and competitive
manufacturing sector, new opportunities for higher value added service sectors, and
the natural and heritage assets which underpin a strong leisure and visitor economy.
It will be built on many of the companies already here, and new inward investors
keen to locate in an economy where a great quality of life comes at an affordable
cost.
7.4
The 21st Century Lancashire economy will be characterised by a business
base focussed on taking advantage of markets and innovation, looking to the future,
not the past, a business community building new glories, rather than reminiscing on
bygone days.
7.5
The major sectors will include advanced engineering, energy and
environment, professional, financial and business services, creative, digital, media
and ICT, logistics, construction and high quality tourism and leisure.
7.6
These sectors will be the principle source of wealth generation in the new
Lancashire economy, whilst other sectors, such as retail, health, education and
transport will provide the services which support strong local economies and
communities.
7.7
As the new economy of the 21st century increases the emphasis on a well
qualified and skilled workforce, Lancashire’s higher and further education centres
are attracting more students, both locally and from elsewhere in the UK and abroad.
New investment in facilities reflects the need for state of the art training for the new
economy.
7.8
Lancashire’s new economy will be characterised by businesses which
invest in human capital, with close working relationships between businesses,
schools, training providers, Colleges and Universities.
7.9
The new economy in Lancashire will benefit every town and village, as new
and better employment feeds in to more choices for young people and higher
household incomes. The new Lancashire will be reflected in the major economic
centres including Preston, Blackburn, Burnley, Blackpool and Lancaster.
7.10
The Lancashire economy, as for many other parts of the UK, needs to
attract new skilled labour to support its economic and employment growth plans.
New housing will be a key element in delivering economic growth in Lancashire over
the next twenty years. The importance of housing to productivity is now recognised
in Fixing the Foundations: Creating a More Prosperous Nation, published in July
2015, which sets out the Chancellor’s plans for improving UK productivity.
7.11
Lancashire will provide more housing in popular neighbourhoods and
towns, while at the same time, delivering major new housing developments in
locations close to the road and rail network to ensure the scale of new housing
needed to support economic growth is delivered.
7.12
New transport investment in the rail network will lead to better services to
the Manchester conurbation, with a marked improvement in services from
Blackburn and Burnley, as well as an increase in services from Preston and
Blackpool. These and other investments will strengthen Lancashire’s links to both
the Greater Manchester and Merseyside economies.
7.13
New investment on the road network in and around Preston will improve
access to the city, strengthening Lancashire’s role as the central location between
Greater Manchester and Merseyside to the south and Scotland to the north.
7.14
Lancashire LEP has set out its plans for the first stage of the transformation
of the Lancashire economy. Some 50,000 jobs over the next ten years in a more
competitive manufacturing sector, higher value added service sectors, and the
visitor and leisure economy will be based on the strength of the company base, the
skills of the workforce and a great quality of life at an affordable cost.
7.15
This initial phase will be linked to an outward facing economy making a
significant and recognised contribution to a resurgent north of England economy,
with civic and business leaders making the case for new investment to further
increase Lancashire’s economic contribution to the national economy.
Fundamental Challenges
7.16
Many in Lancashire enjoy a good quality of life, secure employment and a
relatively high standard of living. However, in the aftermath of major industrial
decline and dramatic employment losses that affected the economy in the 1980s
and 90s, for too many residents, the Lancashire economy is failing to deliver
economic security. Lancashire faces some fundamental challenges if it is to provide
high quality employment opportunities to its young people and maintain and
enhance its economic standing relative to other areas, regionally and nationally,
over the next ten years.
7.17
The Lancashire workforce is ageing, as it is elsewhere in England, and
combined with modest population growth, this presents the biggest challenge to the
LEP meeting its economic targets. Whilst the population as a whole is expected to
grow by 2% over the next ten years, much of this will be accounted for by the over
65s, and the number of people of working age (16-64) is expected to fall over the
same period, reducing the pool of labour available to Lancashire’s employers. This
is not an uncommon position for an economy in the north of England, but it is
important that partners are aware that the age profile of the workforce in Lancashire,
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and particularly the net loss of young people aged 20-34 to the rest of the UK has
the potential to constrain efforts to grow the LEP’s economy.
7.18
The current population, demographic and skills profile will make it more
difficult for Lancashire to attract the inward investment needed to support the
employment targets set out by the LEP, although new development plans, including
residential development and the presence of hotspots / clusters in particular
industries will attract new investment.
7.19
The targets set by the LEP suggest a step change in economic growth
compared to the baseline forecasts for Lancashire. Meeting the targets will require
more than a ‘business as usual’ approach to employment and economic
development, and is unlikely to be achievable solely through growing the indigenous
business base. Significant levels of inward investment will be required to shift the
Lancashire economy from its current trajectory.
7.20
Lancashire has a lower proportion of employment in higher level
occupations than nationally, and this will make it more challenging for employers to
recruit skilled workers, particularly for a number of the priority sectors. Currently,
only 39% of Lancashire’s residents are employed in higher level occupations,
compared to 43% nationally, meaning the pool of suitably skilled and experienced
candidates to fill new higher level positions (if they can be created) is limited.
7.21
Although a significant number of young people from Lancashire go on to
higher education, the proportion remains below that in England as a whole, with a
particularly low level of HE entry from young people attending school in Blackpool.
Whilst a relatively high proportion of graduates from Lancashire’s higher education
institutions remain in the North West to work, it is not clear how many of these are
employed in Lancashire, nor what proportion are employed in graduate-level jobs.
A relatively low proportion (20%) of new graduates employed in the North West are
young people who have left the region to study and then returned, and the 20-34
age group accounts for a smaller proportion of the total population in Lancashire
than nationally. The loss of young people, particularly well-qualified young people,
from the Lancashire workforce is a weakness in the workforce profile.
of skilled workers from other sectors. The high level of replacement demand across
sectors, as workers retire or move on in the labour market, also creates an on-going
challenge of providing a sufficient number of trained workers with the required skills.
7.24
Parts of the Lancashire sub-geography face particular challenges. There
are major challenges in creating new employment opportunities in East Lancashire,
and without more jobs and a better housing offer, further population decline is likely.
There are also considerable challenges in raising skills levels and creating high
quality employment opportunities with regard to Blackpool, Fylde and Wyre.
Slowing the decline in manufacturing employment is a challenge across Lancashire.
7.25
There is a strong link between successful local economies and growing
populations, as increased employment attracts working households. Whilst
Lancashire has the combination of employment and housing plans to support its
economic aspirations it is important that the contribution of housing growth to the
availability of a skilled workforce is recognised by all stakeholders.
Employability
7.26
The Lancashire economy has too few jobs to provide the employment
opportunities that would allow employment rates to increase to a level which would
significantly raise low household incomes in many communities. The number of
residents in employment has fallen by 6% since the onset of recession, and the
number of jobs at workplaces within Lancashire remains below the 2009 level, in
contrast to the position in the North West and nationally.
7.27
A considerable number of people are without employment in Lancashire,
and this number has been affected by the very slow employment recovery
compared to other parts of England. Economic inactivity has risen significantly
since 2012, with 27,100 fewer people active within the labour market (working or
seeking work), suggesting that many potential workers are becoming discouraged
and withdrawing their labour, with significant implications for household income
levels and the long-term potential of the economy.
7.22
For the foreseeable future, Lancashire will need to attract in workers in the
key occupations needed to support employment growth in the LEP priority sectors
and this will require a good employment and housing offer, as well as effective
marketing of the county as an attractive place to live and work. Ensuring the right
types of housing are available in the right locations to attract the well-qualified and
younger workers that Lancashire requires, will need to be a key part of the overall
economic strategy for Lancashire.
7.28
A lower employment rate, particularly amongst certain age groups
(including older people) and the doubling of unemployment since the onset of
recession, with 50,000 currently unemployed, presents a challenge in an economy
where employment growth has been limited and the number of opportunities to
move into work has therefore been constrained. The success in lowering the JSA
unemployment rate has masked the challenge of worklessness, whilst those facing
the greatest challenges within the labour market find it even more difficult to secure
an initial entry-level opportunity in a climate of increased labour market competition.
7.23
Many employers are already finding it difficult to recruit higher skilled and
experienced personnel and this includes a broad range of important sectors,
including health. Increasing demand for construction personnel is likely to lead to
more severe skills shortages in skilled trades, with the potential for the displacement
7.29
The workforce is becoming older as a result of demographic factors. In the
future this ageing will be increased by the fact that many people will need to remain
in employment longer due to changes in pension arrangements. Lancashire
currently has a very low level of employment amongst those aged 50-64 (8% points
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below the national average) and those aged 65+ (2% below the national average).
Supporting these groups to remain in employment will help to address their need to
continue earning, and will provide an additional source of (skilled and experienced)
labour for Lancashire’s employers. It will however indirectly lead to fewer
employment opportunities for Lancashire’s young people, unless new jobs are
created in the economy.
7.30
There is a strong link between qualifications and employment, and too
many people, including those affected by Welfare Reform, have qualifications below
Level 2. These people are vulnerable to becoming trapped in low-paid and insecure
employment, leaving some communities experiencing low incomes and multiple
deprivation. The forecasts suggest a move towards an ‘hour glass’ skills profile
within the labour market, with increasing demand for higher level skills, a relatively
large proportion with low level skills, and a squeeze on qualifications at levels 2 and
3.
7.31
The proportion of occupations in Lancashire requiring skills at levels 2 and
3 is expected to fall from 38% of the total in 2015 to 33% in 2025, in part reflecting
the decline in skilled trades occupations as the manufacturing sector continues its
gradual contraction. The reduction in ‘mid-level’ employment opportunities further
emphasises the need to improve the educational performance of school students in
many parts of Lancashire. With current attainment levels (40% failing to achieve five
good GCSEs including English and maths, and over 5,000 19 year olds, 32% of the
cohort, not achieving a Level 2 qualification including English and maths by the age
of 19), too many of Lancashire’s young people will be unable to take up higher level
employment and training opportunities in the sectors which will create new jobs.
7.32
80,000 of Lancashire’s residents currently commute out of the county to
work, and increasing this number through better public transport is likely to be part
of a solution to increase the employment rate and make more opportunities
available to residents. The wages earned by out-commuters are likely to be spent
in the Lancashire economy, creating turnover for local businesses and employment
for other local people.
7.33
East Lancashire in particular faces very severe problems in relation to
employability, exacerbated by a falling population and challenging employment
situation. The employment rate in East Lancashire is very low, particularly amongst
females, unemployment is high, and economic inactivity rates, particularly amongst
younger (20-34) and older (50-64) age groups are well above the national average.
Skills and Employment Provision
7.34
Lancashire has a number of highly regarded Further Education Colleges
and other FE providers providing substantial training each year to young people and
adults. While provision attempts to match market demand, there are some areas
where increased provision could be considered, including digital skills (including
online sales and marketing, social media and higher level technical skills),
leadership and management competencies, higher level STEM skills and specialist
engineering and technical skills, including short courses for people seeking to apply
their existing skills in new sectors.
7.35
Provision of adult skills and further education, as well as for 14-16 year
olds and 16-19s, is heavily influenced by funding and policy changes, with the
impact of Raising the Participation Age and the funding changes affecting provision
for those aged 24+ clearly evident in the data on take up of further education by
Lancashire’s residents. Ensuring that more of what is provided is higher level
provision and linked to skills needs in the LEP’s priority sectors should be an
important priority for partners.
7.36
At the same time, FE providers have an important role to play in raising
levels of employability and providing Lancashire’s residents with the skills they need
to enter and progress in work. Considerable numbers each year are provided with
life and work skills, although workplace learning opportunities are limited. Ensuring
a higher proportion of Lancashire’s young people reach the age of 19 with the basic
skills they need to secure and progress in employment is important both to help the
economy achieve its potential and to address issues of social justice and
disadvantage. The FE sector also provides the re-training opportunities that adults
need to access employment in key, growing sectors and replacement opportunities.
Ensuring a sufficient supply of skilled individuals in these areas is important to the
Lancashire economy, to enable residents to progress in work.
7.37
Apprenticeships continue to provide work based training opportunities,
although again numbers are limited, and without further incentives it is not clear if
employer participation can be increased substantially, or if a significant number of
young people with the required capabilities and attitudes can be attracted into
apprenticeships as a vocational alternative to higher education. There is an
opportunity to use higher level and degree-level apprenticeships to help meet the
demand for higher level skills although, again, there may be a need for incentives
to increase employer participation until this route becomes established and valued
by employers.
7.38
There are 50,000 unemployed people within Lancashire, although only a
proportion of these are eligible for and claiming Jobseekers Allowance (or the
unemployment-related element of Universal Credit). The Work Programme is one
of the largest back to work programmes in Lancashire and is intended to support
people from a range of client groups to access employment. Fewer than one in four
of the substantial number of participants successfully attain a job outcome.
Increasing the number of people who are supported to enter and remain in work
through the Work Programme and other similar interventions will help to address
disadvantage and support those facing barriers within the labour market to
overcome them.
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Lancashire’s Growth, Emerging and Key Employment Sectors
7.39
Demand for labour and skills within Lancashire will arise from a variety of
employment sectors. The growth trajectory and role played in the economy of each
sector varies, with some expected to experience significant employment growth,
others seeing growth in the form of GVA but creating relatively few jobs, and others
accounting for a large share of employment, and therefore providing income and
opportunities for many Lancashire residents, without necessarily experiencing
significant growth potential.
Level 4 or above. The sector is expected to grow, leading to increased demand for
a range of skills, many of which are being driven by technological changes and
changes in society.
7.46
The sector will need to recruit at all levels, including into graduate roles
and those requiring intermediate level qualifications.
Apprenticeships are
increasingly being used by employers in the sector and it will be important that
employers in Lancashire are able to access both highly motivated young people and
appropriate advanced and higher level apprenticeship provision to meet their
intermediate skills needs.
Advanced Manufacturing
7.40
The success of Lancashire’s economy remains firmly linked to the success
of its manufacturing base. Despite long-term employment decline, which the
forecasts suggest will continue, Lancashire’s manufacturing base accounts for a
higher share of total employment than is the case nationally and generates 20% of
the county’s GVA, as well as contributing to the UK’s export earnings. The
advanced manufacturing sub-sector employs over 60,000 people and contributes
13% of GVA, and Lancashire is home to a number of world class companies and
their supply chains.
7.41
The manufacturing workforce is predominantly male and 45% of workers
are aged over 45. Despite the long-term decline in employment in the sector, it
already has a high rate of skill shortage vacancies, with employers reporting that
they are unable to recruit the skilled workers they need.
7.42
The sector faces challenges to replace the skilled and experienced
workers who will be retiring over the next twenty years, and needs to utilise both
apprenticeships, attracting in the most talented school and college leavers, and
graduate recruitment from higher education institutions both in Lancashire and
elsewhere to access the skills it needs.
7.43
Those already working in the sector will need to have access to on-going
opportunities to re-train and increase their skills in response to on-going
technological change, particularly the increased demand for additive manufacturing,
3D printing and computer aided design.
Financial and Professional Services
7.44
The financial and professional services sector accounts for 13% of total
employment in Lancashire (82,000 people) and generates 22% of total GVA. The
sector is a key growth sector nationally and is expected to contribute both significant
employment gains and export earnings. The only sub-sector which has a higher
employment representation in Lancashire than nationally is the legal and accounting
sub-sector, which employs 15,500 people.
7.45
The financial and professional services workforce is generally quite highly
skilled, with one-third of those employed in Lancashire holding qualifications at
7.47
Workforce turnover presents a challenge for employers within the sector,
and replacement demand has the potential to result in a significant requirement for
skilled workers. Meeting employers’ needs for recruits with both the technical and
‘work ready’ skills they require will be fundamental to achieving the employment
growth expected within the financial and professional services sector in Lancashire.
Health and Social Care
7.48
The health and social care sector is the largest in Lancashire in
employment terms (98,000 jobs), and is growing as a result of the ageing population
and increasing demand for health and care services. The level of employment in
Lancashire is above the national average, reflecting the fact that parts of the county
have an older population profile.
7.49
The age profile of the workforce in the health and care sector in Lancashire
is older than the average, with more aged over 50 and fewer aged under 30 than is
the case in the economy as a whole. The workforce is diverse – ranging from highly
qualified medical professionals, to care workers and support workers who may have
low levels of qualifications.
7.50
As demand for the services provided through the health and social care
sector increases, but the public funds available to pay for them remain highly
constrained, addressing skills issues in the sector is an important priority. The older
workforce, plus high levels of labour turnover, means there is likely to be a
significant number of replacement demand opportunities within the sector, which
will provide entry-level employment opportunities suitable for many Lancashire
residents. At the higher skills end of the workforce, there is a need to ensure
sufficient applications are received for the many medical professional vacancies
which arise in Lancashire each year, with quality of life and the availability of suitable
housing key to attracting highly skilled personnel.
Visitor Economy
7.51
The visitor economy sector employs over 50,000 people in Lancashire, and
is particularly important in Blackpool. Nationally the sector is growing and
contributes nearly £50bn to the UK economy.
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7.52
The workforce both in Lancashire and nationally is characterised by
seasonal, part-time work and the sector is one of the biggest users of zero hours
contracts. The workforce is predominantly young, with one third of workers aged
under 34, and a smaller proportion of older workers, and less skilled than the
Lancashire average.
7.53
The sector faces several workforce-related issues. High levels of turnover
act as a disincentive for employers to invest in staff training, and skills gaps are
commonly reported in the sector. Turnover also results in high levels of vacancies,
with employers having to commit significant resources to recruit and induct new
staff. The sector faces increased competition for workers as the economy improves
and more employers begin to recruit additional workers. The sector does however
provide entry-level employment opportunities, which provide staff with flexibility to
fit work around other commitments, and therefore could provide a route back into
employment for those who have been out of the labour market for some time, if
appropriate pre-employment training and in-work support was put in place.
Energy and Environmental Technologies
7.54
The energy and environmental technologies sector accounts for 7% of
Lancashire’s workforce, and is recognised as a high performing sector, contributing
6% of total GVA at national level. Lancashire has a number of key companies and
both the University of Lancaster and UCLan have specialisms in the sector.
7.55
The energy and environmental technologies sector workforce is
predominantly male, and older on average than the workforce as a whole. The
sector is likely to be affected by the retirement of key staff, and there is a need to
address the skills gaps that this will leave.
7.56
The sector in Lancashire needs to attract a sufficient number of skilled
engineers and technicians, and the higher education base provides a key source of
potential recruits. Increased demand for multi-skilled workers who can work across
a range of technologies and utilities, as well as project managers with experience
of the sector, means that employers will need to work with education providers to
ensure they can access the skilled workers they need.
mismatch between demand for and supply of skills, which is likely to result in
recruitment difficulties in future years.
7.59
The sector skills action plan sets out three key objectives: strengthening
the digital skills pipeline from schools to HEIs; gearing skills provision to be more
appropriate to the needs of the dynamic microbusinesses within the creative
economy in Lancashire; and improving recruitment and retention through
addressing the challenges and opportunities of the position of the sector in
Lancashire.
Construction
7.60
Although not identified as one of the LEP’s priority sectors, the construction
sector is key to much of the proposed development that will underpin the expansion
of the other growth sectors. Over 35,000 people already work in the construction
sector in Lancashire, and this number will need to rise if the scale of development
proposed through the Growth Deal and the City Deal is to be achieved, and the
LEP’s ambitions for employment are to be met.
7.61
Apprenticeships are an important entry route into the sector, with 19% of
employees holding apprenticeship qualifications. Relatively few workers hold
degree-level qualifications, and most are employed in skilled trades occupations.
7.62
Skills needs in the construction sector are affected by the cyclical nature
of demand affecting the sector. Many skills were lost as construction workers left
the sector in the aftermath of the economic downturn, and it cannot be assumed
that these people will be re-attracted back into the sector. The awareness of peaks
and troughs in the sector also has an impact on the willingness of some young
people to enter the sector, with some reluctant to enter what is seen as potentially
unstable employment.
Creative and Digital Industries
7.63
Conversely, the growing demand for construction workers is leading to
increased wage levels, which have the potential to attract suitably skilled workers
who currently work in other sectors, e.g. electricians employed in the manufacturing
sector. The issue of displacement of skilled workers from one sector to another as
sectors experience different growth rates is one which the Lancashire partners
should consider as they plan appropriate levels of provision.
7.57
The sector is estimated to account for around 36,000 jobs in Lancashire,
including 22,000 within the creative industries and a further 14,000 in creative
occupations outwith the sector. Employment has been in decline in Lancashire, in
contrast to the position nationally.
The sector is largely made up of
microbusinesses, with skills gaps and shortages relating to high level digital skills.
7.64
Skills needs in the construction sector are also being driven by changes in
technology and ways of working, with the drive for low carbon construction and
increasingly high tech construction techniques creating a demand for non-traditional
skills. There is a need for existing workers within the sector to be able to re-train
and update their skills so that they continue to meet employers’ needs.
7.58
The sector faces a number of challenges, including skills shortages and
gaps relating to digital skills, difficulties faced by the skills and education system to
meet the needs of the dynamic and rapidly evolving sector, and a potential
7.65
The City Deal Employment and Skills Strategy has two strategic objectives
that directly relate to the construction sector. The first is to support the construction
industry and supply chain, through actions to encourage more well young people
into the sector, increase the number of apprenticeships, internships and graduate
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recruitment, provide bespoke business support for the sector, including
management development, and consider the economic benefits arising from
construction related manufacturing and supply chain product development. The
second is to work with the construction sector to increase training and employment
opportunities for young people and older workers and increase social value.
7.68
The economic forecasts suggest that manufacturing employment will
decline by some 10,000 jobs over the next ten years. Initiatives are underway to
ensure this does not happen and that manufacturing sub-sectors with the potential
to grow are fully supported. This will require:

New inward investment linked to Lancashire’s manufacturing specialisms
and supply chain.

The continual upskilling of the workforce.

A long term programme to bring new apprentices and graduates into the
industry.
Employment Growth and the Lancashire Workforce
7.66
Growth sectors in the Lancashire economy are forecasts to create nearly
48,000 jobs over the next ten years, offset by a decline of c. 18,000 in sectors which
are expected to contract (net growth of 29,900). If the LEP’s employment ambitions
are met, net employment growth will be 50,000. In terms of recruitment and skills
to support this employment growth:



As noted previously, a marked increase in construction employment is likely
to be inhibited by skills and recruitment challenges if a significant increase
in provision is not in place, supported by mechanisms to increase the
number of young people entering apprenticeships and the number of
employers able to offer them.
A large proportion of the recruitment for the forecast increase in logistics
and distribution, the visitor economy and leisure can be met by local
residents, including those unemployed or inactive in the labour market,
provided they have access to relevant occupational training and the
support they need to re-enter the labour market.
The expected growth in business and professional services and ICT related
employment is likely to be constrained by a limited pool of well qualified
younger people within Lancashire, and this may have an impact on inward
investment. Action will be required to support more of the county’s
graduates (both from Lancashire’s HEIs and those who have studied
elsewhere) to enter the sector, as well as providing more entry routes at
intermediate level, with young people having the opportunity to progress
once in work.
7.67
Many of the challenges facing companies recruiting for new jobs will be
exacerbated by the need to replace existing workers as they retire, change jobs or
leave the labour market. Replacement demand will create much greater
requirements for skills and training provision than absolute employment growth, and
much of it will be in higher level occupations. Creating linkages between groups of
potential workers (whether they be unemployed people, school and college leavers,
new graduates or older people inactive in the labour market) and sectors /
occupations in which significant levels of replacement demand are likely to arise,
will help to ensure the supply of labour in Lancashire more closely aligns with the
demand.
Key Messages and Emerging Priorities
7.69
The overall competitiveness and sustainability of the Lancashire economy
is linked to a wider move to a higher skilled and more productive workforce in both
manufacturing and the service sector. This will require, at every level, a better
educated and qualified workforce, with both life and vocational skills.
7.70
The provision of training needs to take account of both the challenges in
supporting employment growth and the need to strengthen the existing business
base through a better skilled workforce.
7.71
The emerging priorities with regard to young people and the education and
training system are:

Schools: improving the attainment rate of those schools where students
are seriously lagging behind.

IAG and Careers Advice: providing more advice at a younger age to
school students, highlighting the new opportunities and requirements in a
changing economy and highlighting the strengths of various routes to
industry qualification, training and employment, particularly vocational
routes.

16-19 year olds: ensuring all young people have the opportunities and
support they need to achieve a minimum of Level 2 qualifications by the
age of 19, including English and maths, and raising the proportion who
achieve Level 3.

Apprenticeships and vocational training: increasing the number and
quality of apprenticeships, and encouraging greater levels of provision at
higher level, reaching more employers and introducing strengthened
mechanisms to help employers deliver apprenticeships.

Increase the number of young people going on to higher education:
Lancashire needs to increase the number of young people from all of its
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communities going on to higher education. There is an opportunity to work
closely with and support the access work of the four Universities.

FE Provision: work with Further Education Colleges, other providers of
education and training, and employers to target vocational training
opportunities at areas of high replacement demand and genuine
employment growth, and ensure that adults have the opportunity to re-train
to meet the needs of the economy and progress in the labour market.

FE Estate Renewal and New Facilities: continue to upgrade the FE
Estate and provide new facilities and equipment which reflect the new
economy priority sectors.

Employer Engagement: increase employer engagement in skills, and
encourage greater commitment to workforce development, as well as
encouraging employers to work with education providers to influence
vocational provision. Providers need to make better collective and
individual use of the soft intelligence on skills needs that they gather
through their employer engagement activities.
7.72
The emerging priorities with regard to employers and workforce
development are:

IAG and Careers Advice: support the careers work of local schools as part
of the process of making young people more aware of opportunities and
progression routes in key sectors.

Apprenticeships and vocational training: invest in the workforce and
address future skills shortages by increasing the number and quality of
apprenticeships.

Graduate Recruitment: work with local stakeholders to develop new and
innovative mechanisms to increase internships and graduate placements
across the Lancashire business base.

Workforce progression and up-skilling: support progress within the
workforce, through up-skilling and career changes, and access to higher
education, in order to anticipate future recruitment challenges and alleviate
potential skills shortages.

Influence vocational training provision: develop mechanisms through
which employers can work with Further Education Colleges, other
providers of education and training, to influence vocational training
provision and ensure public funds are directed towards areas of high
replacement demand and genuine employment growth.

Advanced Manufacturing: given the ageing workforce and high levels of
replacement demand, the priorities are to attract more young people into
the sector by inspiring and engaging them at a young age, to recruit and
retain a competitive workforce by ensuring the sector and the location are
attractive to people, to develop a responsive learning infrastructure system
which can adapt to changes within the industry and responds to employer
demand, and to secure employer investment in training by ensuring
employers are able to influence provision.

Financial and Professional Services: address skills gaps and shortages
and meet the expected high levels of replacement demand, develop a more
responsive supply of training provision, improve sector intelligence, and
increase the attractiveness of Lancashire as a place to work in the financial
and professional services sector.

Health and Social Care: as society ages, demands on the health and
social care sector increase. In order to meet these needs, challenges
within the health and social care workforce will have to be tackled, through
strengthening employer influence over skills and training provision, coordinate the use of public investment in skills, widen access through
alternative entry routes, and develop a stronger provider base able to meet
employer needs.

Visitor Economy: to ensure the sector can play its full role in meeting
Lancashire’s growth ambitions, there is a need to attract more appropriately
skilled young people into the sector; address skills gaps within the existing
workforce, including management and leadership; and learn from good
practice, supporting the roll-out of innovative and effective practice.

Energy and Environmental Technologies: meet demand for technical,
softer and business skills; increase the attraction of the sector in Lancashire
through changing perceptions of both the industry and the location; improve
intelligence by tracking developments in the sector; and develop the supply
side by ensuring availability of appropriately skilled FE staff and adjusting
provision to meet employer needs.

Creative and Digital Industries: increase the pipeline of digital skills,
working from schools to HEIs, in order to tackle skills gaps and shortages
relating to digital skills; ensure the skills enhancement system is more
appropriate to the needs of dynamic microbusinesses in Lancashire; and
improve recruitment and retention through addressing the challenges and
opportunities of the positioning of Lancashire.

Construction: given the need to complete major infrastructure works and
increase residential development, develop a super initiative, based on
arrangements already in place and working with industry bodies, to address
requirements and skills changes in construction, encourage the industry to
recruit older workers and increase the number of apprenticeships in skilled
trades.
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7.73
The emerging priorities with regard to helping people into employment are:

Young People and Employability: there is a need to increase efforts to
link young people and those seeking employment with the regular
opportunities made available through replacement demand, to tackle
employability issues before they become entrenched by reducing the
number of young people becoming NEET; and to work with those at risk of
redundancy to re-train or transfer their skills to other sectors / employers.

Work Programme: Lancashire needs a more effective Work Programme
capable of generating higher than average outcomes for local residents.
This Programme remains the largest Government funded initiative of its
type and it needs to be improved as a matter of urgency.

Understanding worklessness: there are 50,000 people looking for
employment, while only 16,000 are in receipt of Job Seekers Allowance.
More work is needed to understand this hidden unemployment group and
determine the types of support which could help some more people back
into employment.
7.74
These priorities need to sit alongside efforts to increase indigenous
business growth and new inward investment to provide additional employment. This
will include the development of strategic sites, employment land and commercial
floorspace, and provision of more housing to increase the Lancashire population,
with a focus on more and preferably younger working households. At the same
time, there are a number of challenges which relate to place and these need to be
taken into account in developing skills and learning priorities.
7.75
In the light of the importance of skills and training, the significant amounts
of monies invested each year by national agencies and the move to devolution,
Lancashire needs to consider how more local control and influence over key areas
of activity and funding could advance the economic and skills agenda.
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Statistical Annexes
See separate documents
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