Labour market inactivity adding to pressure on business - Chamber

The high volume of West Midlands residents leaving the workforce is adding to the pressure facing businesses, business leaders said today.

Greater Birmingham Chambers of Commerce said a one per cent increase in the region 's inactivity rate over the year - as revealed in the latest labour market figures - presents firms with another barrier to growth.

The inactivity rate - which measures the number of working-age adults who are out of the jobs market - now stands at 21.9 per cent.

The Office for National Statistics (ONS) said unemployment in the West Midlands fell by 0.3 per cent, while employment was 0.4 per cent higher than the previous three-month period (July to September).

Nationally, regular pay (excluding bonuses) grew by 6.7 per cent in the October to December 2022 period - its strongest rate of growth since the pandemic.

However, when adjusted for inflation, growth in total and regular pay fell year-on-year (by 3.1 per cent and 2.5 per cent respectively).

Emily Stubbs (pictured), senior policy and projects manager at Greater Birmingham Chambers of Commerce, said: “While economic inactivity has declined slightly over the quarter, the significant proportion of West Midlands residents leaving the workforce over the past year exacerbates the growing pressures on local firms and presents yet another barrier to business growth.

“Employers and stakeholders must work together to encourage talented individuals to return to work and enable investment in training and upskilling to meet labour market demand.

“The Local Skills Improvement Plan for the West Midlands, currently being delivered by the three regional Chambers, will be key to facilitating direct and dynamic working arrangements between employers and providers to deliver the skills employers need, now and in the future.

“We 're currently seeking to deepen our understanding of skills challenges across the region through a short survey of local employers.

“By taking the time to complete the survey and support this work, you will be helping to shape how public funding is spent on training to support local businesses. ”

Complete the West Midlands Local Skills Improvement Plan survey and help inform local skills provision.