£14 billion productivity and skills gap in the region



This blog post has been produced for the Greater Birmingham Chambers of Commerce to provide industry insight on the findings of the Birmingham Economic Review.

The Birmingham Economic Review 2017 is produced by the University of Birmingham’s City-REDI and the Greater Birmingham Chambers of Commerce, with contributions from the West Midlands Growth Company. It is an in-depth exploration of the economy of England’s second city and is a high quality resource for organisations seeking to understand Birmingham to inform research, policy or investment decisions.

This post is featured in Chapter 7: Skills & Labour Market of the Birmingham Economic Review, which can be found here. You can read the full report and report summary here.

Productivity and Skills for West Midlands Combined Authority (WMCA) region are one of the biggest challenges for the regional economy .  GVA per head in the WMCA is currently at £19,423, nearly £3,500 less for each of the 4 million WMCA residents leading to a £14bn output gap compared to the national average.

WMCA report that the components of the output gap highlight issues across all the productivity drivers with insufficient skills, too few in employment and the quality of the indigenous WMCA business base. 

  • Skills: % of number individuals with qualifications at NVQ4+: in the West Midlands Region is 27.6% against a national picture of 34.9%
  • Employment: employment rate in the West Midlands Region is 67.2% against a national picture of 71.5%

Education and Business in partnership

It is essential that Education and Business work together, not just through the Corporate Responsibility Agenda and supporting students develop the essential work ready skills but also to: 

  • Shape academic programmes and content to reflect the needs of regional sectors
  • Identify the key growth areas across the region to ensure that training and development reflects the local economy
  • Horizon scan and knowledge share together to look at job market forecasts to ensure that training and development programmes are developed by education and training specialists that are fit for the needs of business today and tomorrow.
  • Grow our own regional talent: by working closer together through models like the Greater Birmingham Professional Services Academy and Creative and Digital Academy at BMet we can grow our own regional talent ensuring that our local young people and more mature talent from our diverse population are introduced to new careers and equipped with skills to enter new careers and sectors.

Suzie Branch