Chapter 3: Skills strengths and needs
This chapter sets out the key skills strengths and needs in the West Midlands, as they relate to qualifications, occupations, and industrial sectors. The analysis shows a broad continuation of strengths and needs trends seen in recent years, alongside a notable improvement in the qualifications profile of the working population in the West Midlands.
Demographic profile
The West Midlands Metropolitan area is characterised by a particularly young and diverse population. The latest ONS population estimates show that the Metropolitan Area (21.4%) and West Midlands NUTS 1 region (19.6%) have higher proportion of under 16s compared to the UK average of 19%. In terms of ethnicity, we anticipate that the 2021 Census will show a broad continuation of the trends seen a decade ago, which has the Metropolitan Area as one of the most ethnically diverse regions outside of London, with 30% of the Metropolitan Area being from non-white backgrounds, compared to 20% nationally3.
These demographic factors are long standing and pertinent to the skills system, underpinning our strategic approach to skills and employment support; with its focus on young people – our future talent pipeline – and on inclusive growth, making sure all communities across the region participate in and benefit from our economic development.
Compared to the UK average, the West Midlands has a larger proportion of the working age population with no or low-level qualifications, and a smaller proportion qualified at level 4 and above. This difference can be almost entirely attributed to the Black Country, which as a centre of manufacturing, draws on skills not always recognised in formal qualifications. The other two LEP areas are much closer to the UK in general.
Nonetheless, between 2019-2020, the West Midlands has seen an above average increase
in the proportion of people with qualifications at all levels, alongside a 2.5 percentage point fall in the proportion with no or low qualifications.
| % of Working Age Population with NVQ Qualifications | West Mids (2019) | UK (2019) | West Mids (2020) | UK (2020) |
| % with NVQ4+ | 33.5% | 40.2% | 36.7% | 43.0% |
| % with NVQ3+ |
51.3% | 58.4% | 55.8% | 61.2% |
| % with NVQ2+ |
69.8%
|
75.6% | 74.0% | 78.0% |
| % with NVQ1+ | 80.4% | 85.5% | 84.4% | 87.6% |
| % with other qualifications (NVQ) | 8.3% | 6.6% | 6.8% | 5.8% |
| % with other qualifications (NVQ) | 11.3% | 7.9% | 8.8% | 6.6% |
Table 1: West Midlands working-age population at each qualification level, by NVQ equivalent.
Census data here is taken from the WMCA’s Covid-19 Equality Impact Assessment (internal documentation).
The current employment profile of the West Midlands reinforces the strengths outlined in the Strategic Economic Plan and is built on the unique assets across our three LEP areas; the Black Country is a globally significant hub of leading advanced manufacturing and engineering businesses with international supply chains, manufacturing essential components such as aerospace actuation and transmission systems. The CWLEP area also boasts a high-value advanced manufacturing sector, primarily associated with the automotive industry and the extensive supply chain that supports leading automotive brands. The logistics and gaming sectors are also prominent, as is the tourism industry. Coventry, a QS top 50 global student city with a walkable city centre, was the UK’s City of Culture 2021. Located between BCLEP and CWLEP, GBSLEP is primarily built around the UK’s second city, which hosts many of the economic drivers of the wider conurbation, and is an economy based around the professional services industry.
Occupational analysis in Annex A shows that health, education, business admin & support services, manufacturing, retail and professional roles account for almost two thirds of jobs in the region. The West Midlands has relatively more employment in manufacturing and in the public health and education sectors, but a significantly smaller IT sector. Although the need to replace retiring workers will continue to drive employment in manufacturing even as total employment declines, the relatively younger population in the West Midlands poses a challenge for future job creation. Expansion in professional services and other regional strengths such as biosciences will be integral to this.
Occupational growth forecasts for the West Midlands show broad contractions for manufacturing, primary sector and utilities, trade, accommodation and transport, and growth for business and other services. However, there is also projected growth roles in the construction, business and non-marketed service occupations (See Annex A).
| Industry | BCLEP | CWLEP | GBSLEP |
| Primary sector and utilities | -2.4% | -2.50% | -4.70% |
| Manufacturing | 13.20% | -11.20% | -11.50% |
| Construction | 1.30% | -0.50% | 0.30% |
| Trade, accommodation and transport | -0.80% | -0.60% | -0.30% |
| Business and other services | 2.90% | 4.10% | 2.40% |
| Non-marketed services | 3.90% | 1.20% | 1.50% |
Table 3: Forecast total change in employment by sector and LEPs, 2020-2027.
The continued growth of our transformational sectors is contingent on the availability of workers with skills aligned to the needs of current roles, and on investment in future skills needs. Skilled workers will also be needed to meet replacement demand, even in those sectors with contracting levels of employment. Across our economy, there is a need to equip residents with the skills to access work, and to support progression within employment. We are encouraged that apprenticeship achievement by sector broadly aligns with our sector strengths: 31% business, admin & law accounts, 22% health, and 21% engineering and manufacturing technologies. As a result of devolution, we have also been able to better align AEB provision to regional growth sectors (as shown in Annex A), create more flexible and responsive models of delivery, and improve employment outcomes of training.
The Advisory Board also has a strategic role to play in ensuring that the region has the workforce skills needed to support the growth of a greener economy and help achieve the aspirations set out in its WM2041 strategy. Our analysis shows that most jobs created, as part of the region’s net zero transition, will be in manufacturing low emission vehicles, battery packs and modules in giga factories situated near existing production sites. Wider mobility services and products may also play a role and affect demand for new vehicles and create opportunities for employment in the wider mobility sector. We have already developed a range of skills programmes, including retrofit provision, and in the coming year will be developing a broader green skills strategy.
Higher Education
The West Midlands benefits from a strong Higher Education base, alongside many Good and Outstanding schools, colleges and training providers. Universities in the region make a substantial contribution to the economy5: educating 180,720 students (fulltime equivalent, 2019/20); employing 25,030 staff (full-time equivalent, 2019/20), and
contributing an estimated £4.8 billion to GDP
over five years. Overall, our universities (59%) outperform the national average (56.2%) on employment metrics (see Annex A). This is positive for the West Midlands, given the volume of current and anticipated graduate roles in our transformational sectors. However, the region faces ongoing challenges in relation to graduate employment and retention within the region; 6.3% of graduates in the West Midlands are unemployed, compared with 5.4% nationally. A DfE typology analysis categorises
the West Midlands as demonstrating ‘mild brain drain’, due to its successful attraction of students to its university system but subsequent loss of many young graduates to other parts of the UK. This highlights the
need for the Skills Advisory Board to support further collaboration between universities, employment and skills services and industry to support retention in the region (see Annex A). 5 Data.
| Summary | |||
| Skills Strengths | Skills Needs | ||
|
Occupations
|
Qualifications
Universities
AEB
|
Employers
|
Qualifications
Employment
Universities
|
Table 4: Summary of skills strengths and needs for the West Midlands.
5 Data presented to the Skills Advisory Board by Professor Julian Bear, Birmingham City University