Regional Skills Assessment Glasgow City Deal Insight Report

Transcription

1 Regional Skills Assessment Glasgow City Deal Insight Report

2 2 Contents 1 Introduction 3 The importance of skills planning in Scotland 4 Regional Skills Assessments and Skills Planning 5 National Skills Issues 6 Content 7 2 The Glasgow City Deal Region 8 Glasgow City Deal Economy and Place 9 Glasgow City Deal s People 22 3 Demand for Skills in Glasgow City Deal Region 31 Employment 32 Occupations 35 Sectors 42 Qualifications 48 4 Concluding Remarks 52 Appendix 1: Oxford Economics Definitions 54 Appendix 2: Key Sector Definitions 56

3 1 Introduction

4 Regional Insight Report 1 Introduction 4 The Importance of Skills Planning in Scotland Skills, alongside other wider and social and economic conditions, help to achieve the stated Scottish Government purpose of: creating a more successful country, with opportunities for all of Scotland to flourish, through increasing sustainable economic growth Significant public sector funding (some 2 billion) is invested annually to support skills development in Scotland. This, alongside employer and other partner investment, amounts to a substantial resource. To ensure it is invested wisely it is important to ensure that there is a robust evidence base to guide decisions. Current Scottish Government Strategy for skills includes Scotland s Economic Strategy, Scotland s Labour Market Strategy and Scotland s Youth Employment Strategy and also the recent UK Industrial Strategy. These, alongside the Scottish Skills Planning Model (Figure 1.1), influence skills investment. The skills planning model is evolving. Phase 2 of the Enterprise and Skills Review that reported earlier this year included a range of proposals to achieve the dual goals of (1) a dynamic, inclusive globally competitive economy and (2) a high performing, inclusive labour market. Work is ongoing on these proposals that include regional partnership models, learner journey models and, of most relevance to skills planning, proposals for skills alignment. Figure 1.1 Scottish Skills Planning Model The vision for skills alignment is for skills services to be fully aligned to deliver the learning and skills necessary for sustainable and inclusive economic growth. A project is in place to achieve this; the purpose of which is to align the relevant functions of the Scottish Funding Council (SFC) and Skills Development Scotland (SDS) to ensure that Scotland s people and businesses are equipped with the right skills to succeed in the economy, not just now but in the future. The proposals include the development of a five step planning model (Figure 1.2) and a Governance Structure (Figure 1.3) Figure 1.2 Five Step Model

5 5 At the time of writing, SFC and SDS are engaged with Scottish Government to develop a detailed implementation plan to carry through the reforms identified. Work that has been agreed to take place in the short term includes: The development of Terms of Reference for a strategic Skills Hub of the Strategic Board Skills Committee; Development of the five step model to confirm the deliverables of each stage; and The appointment of a Director of Skills Alignment reporting jointly to the Directors of SDS and SFC. Evidence developed through Regional Skills Assessments now and in their future evolution can help inform Step One of the five step model. This iteration, unlike in previous versions, focuses much more on demand side evidence to support Step One of the proposed planning process. Figure 1.3 Governance Regional Skills Assessments and Skills Planning Regional Skills Assessments (RSAs) were first launched in 2014 and have evolved over time as a result of feedback from an independent review (2015 by the Training and Employment Research Unit) and ongoing partner consultation, as part of a continuous improvement process. Their purpose is to: Support partners in strategic skills investment planning including: The two national skills agencies SDS and SFC (in conjunction with Regional Colleges, Strategic Bodies and College Boards); Enterprise Agencies and regional and local partnerships; and Identify gaps in evidence that require to be addressed. To ensure an inclusive approach to their development, dissemination and utilisation, RSAs are produced by SDS in partnership with Highlands and Islands Enterprise (HIE), Scottish Enterprise (SE), SFC and the Scottish Local Authorities Economic Development Group (SLAED). RSAs include the use of recently published datasets. Inevitably, when using published data there is a time lag but the data contained is

6 Regional Insight Report 1 Introduction 6 the most up to date available at the time of writing. Feedback from partners has indicated that an area of evidence they wished to see more was in relation to forecasting. Given this, RSAs also include forecast data that has been commissioned through Oxford Economics. These forecasts are based on three factors: National/regional outlooks all the forecasting models they operate are fully consistent with the broader global and national forecasts which are updated on a monthly basis; Historical trends in an area (which implicitly factor in supply side factors impinging on demand), augmented where appropriate by local knowledge and understanding of patterns of economic development; and Fundamental economic relationships which interlink the various elements of the outlook. As with all forecasts, certain caveats need to be applied. They are based on what we know now and include past and present trends projected into the future. They can therefore be affected by potential disruptors (e.g. Brexit) and unforeseen events and their value is in identifying likely directions of travel rather than predicting exact figures. The more disaggregated they become, especially at smaller geographical units, the less reliable they are likely to be. The historical data on which the forecasts are based is subject to revision and may be volatile, particularly at a sub-regional and sub-sectoral level. Therefore forecasts at a higher, less disaggregated level are more robust than the detailed breakdowns. They also cannot take into account recent developments that may be happening at local level or an individual firm s perspective, so inevitably they lack nuance. Finally, the occupational (SOC) and sectoral (SIC) classifications should be looked at to understand how an occupation or industry is defined. Links have been given to facilitate this in the relevant sections. Education, for example, is an industrial sector that takes in a wide variety of teaching and educative functions e.g. driving instructors. It is recommended therefore that users examine trends over time rather than focusing on changes in individual years, use caution at the more granular level and examine occupational and sectoral definitions where relevant. National Skills Issues Prior to the publication of RSAs, SDS has published a national skills assessment Jobs and Skills in Scotland. This report highlights key strengths of Scotland s skills alongside challenges to be addressed, as well as pointing to drivers that will have an impact on skills and skills planning and outlining potential forecasts for the future. Nationally, it is recognised that, following the recession: Employment in Scotland has recovered and is above pre-recession levels; Many key sectors have had good employment growth despite difficult trading conditions (see Appendix 2); Scotland has maintained a highly skilled workforce; and The economy offered a range of opportunities for young people after school. That said, on demand for skills, growth rates for the Scottish economy remains behind that of the UK and, although productivity has improved, Scotland s record remains poor. Also, although employment has recovered since the recession we have seen: A rise in non standard jobs - part time employment, self employment and nonpermanent employment have grown; An hour glass labour market structure which presents challenges for progression in the workplace, underemployment and under utilisation of skills; and Low pay and in-work poverty as of continuing

7 Regional Insight Report 1 Introduction 7 concern. The report points to key areas of uncertainty for the skills environment such as the impact of Brexit, productivity challenges, societal change and automation. It also provides some indicative forecasts for the future through modelling by Oxford Economics that highlight the potential: Political uncertainty is likely to restrict the pace of economic development in the short term, and this will curtail job creation. Growth is forecast to accelerate towards the end of this decade, but Scotland is projected to underperform the UK as a whole; Total employment in Scotland is forecast to rise by 84,800 by 2027, equivalent to an average annual growth rate of 0.3 per cent. The comparable figure for the UK is 0.5 per cent; The next decade (2017 to 2027 inclusive) will see a shift in the sectoral composition of employment in Scotland. Rising employment in business services, wholesale and retail trade, construction and health and social work will be accompanied by a reduction in manufacturing and public administration; These sectoral changes will affect the occupational profile of Scotland s workforce. There will be an increase in the number of elementary clerical and service occupations and business and public service professionals. But job losses in manufacturing will see fewer process, plant and machine operatives and skilled metal and electrical trades; and Scotland s largest urban centres will lead job creation. Together, Edinburgh and Glasgow are forecast to account for three in every four new jobs created. Employment is forecast to fall in around a third of Scottish council areas over (inclusive) Finally, the report outlines four significant challenges and opportunities in relation to jobs and skills: 1. Boosting productivity will be vital for our long term prosperity. 2. Our growth needs to be more inclusive. 3. Scotland s demographics represent some significant challenges - and Brexit may exacerbate these. 4. The world of work is changing - we need to support businesses and individuals to navigate and embrace that change. Content It is within this national context that this RSA has been developed. The RSA for Glasgow s City Deal region is in three parts (1) a summary A3 infographic (2) an insight report and (3) a slidepack of charts and tables for utilisation by partners. This report the insight report - is in three parts: The Glasgow City Deal region an introduction to the region s economy and its people; Demand for skills past, current and forecast demand for total employment, occupations and sectors; and Concluding remarks. Please note that more detailed conclusions and implications for skills planning in the Glasgow City Deal region can be found in the Regional Skills Assessments which have also been published - relevant regional RSAs for this region include Glasgow, Lanarkshire, and the West Region Further, more detailed analysis of each of the individual constituent local authorities in the City Deal region can be found in the accompanying 32 local authority reports.

8 2 The Glasgow City Deal Region

9 Regional Insight Report 2 The Glasgow City Deal Region 9 The Glasgow City Deal region 1 is made up of eight local authority areas; East Dunbartonshire, East Renfrewshire, Glasgow City, Inverclyde, North Lanarkshire, Renfrewshire, South Lanarkshire and West Dunbartonshire. This section outlines key characteristics of the region focusing on the region s economy and its people. Glasgow City Deal s Economy and Place GVA and Productivity In relation to the Scottish economy, the Glasgow City Deal region is mostly characterised by high output (although low in East Renfrewshire and East Dunbartonshire) but low productivity (although high in Glasgow City, North Lanarkshire and South Lanarkshire) (Figure 2.1). The region is a mostly urban economy and is home to Glasgow City, which has the highest output of all local authorities in Scotland. Based on 2015 data, the city deal region contributed 41,021 million in GVA 2 ; accounting for one third of all output for Scotland. At 11 per cent of the city deal region s output (2015 figures), the Wholesale and retail trade and Human health and social work activities sectors accounted for the highest sectoral outputs in the region. This was followed by Manufacturing (10 per cent) and Real estate activities (nine per cent). The city deal region s productivity (measured as GVA per job, 2015) was 45,189, below the Scottish average of 45,900. There was, however, variation across the city deal region: Glasgow City made the greatest contribution to output, accounting for 15 per cent of Scotland s GVA output, the highest in Scotland. Through the rest of the city deal region, this ranged from a high of five per cent in both North Lanarkshire and South Lanarkshire, to a low of one per cent in East Dunbartonshire and East Renfrewshire; and East Renfrewshire ( 50,270) had the highest productivity in the city deal region, and the fifth highest productivity in Scotland. Productivity was above the Scottish average elsewhere across the city deal region, ranging from 47,076 in West Dunbartonshire to 43,650 in South Lanarkshire. Looking to the future, GVA growth in the Glasgow City Deal region is forecast 3 to average 1.7 per cent per year between 2017 and This is in keeping with forecast growth for Scotland (1.7 per cent), however lower than that of the UK (two per cent). The pace of growth is expected to slow in the short term as the consumer sector loses momentum in the face of rising inflation, businesses investing cautiously due to Brexit-related uncertainty, and fiscal policy remaining tight. Private service industries account for 55 per cent of the city deal region s economy. These are expected to drive growth over the forecast period and ensure the Glasgow City Deal region grows in line with the Scottish average. The most dynamic industries are forecast to be Professional, scientific and technical services, Information and communications and Administrative and support services. Other notable contributions to growth are expected from Real estate activities and the relatively large Wholesale and retail trade sector. 1 Hereafter referred to in text as the City Region Deal. 2 GVA is the measure of the value of goods and services pro duced 3 Forecasts by Oxford Economics

10 Regional Insight Report 2 The Glasgow City Deal Region 10 Figure 2.1 Distribution of GVA ( million, constant 2013 prices) and Productivity (per job) by City Region Deal, 2015 Source: Oxford Economics Productivity Aberdeen City Region Deal Low GVA, High Productivity High GVA, High Productivity 1 Edinburgh and South East Scotland City Region Deal 0 Output (GVA) Glasgow City Deal Low GVA, Low Productivity High GVA, Low Productivity Stirling and Clackmannanshire City Region Deal Inverness and Highlands City Region Deal Note: the data is scaled - the units used are standard deviations from the mean.

11 Regional Insight Report 2 The Glasgow City Deal Region 11 Figure 2.2 Distribution of GVA ( million, constant 2013 prices) and Productivity (per job) by local authority, 2015 Source: Oxford Economics Productivity Low GVA, High Productivity Aberdeenshire Aberdeen City 2 High GVA, High Productivity Moray Edinburgh City East Renfrewshire 1 Inverclyde South Ayrshire West Dunbartonshire East Dunbartonshire Renfrewshire Perth and Kinross Low GVA, Low Productivity Angus Fife Clackmannanshire South Lanarkshire North Lanarkshire East Lothian North Ayrshire Highland Glasgow City Output (GVA) High GVA, Low Productivity Falkirk West Lothian Note: the data is scaled - the units used are standard deviations from the mean.

12 Regional Insight Report 2 The Glasgow City Deal Region 12 The Business Base There is a total of 46,655 businesses operating within the Glasgow City Deal region, almost two fifths of which (37 per cent) are based in Glasgow City, with a further 19 per cent in South Lanarkshire and 15 per cent in North Lanarkshire. The largest sector (in terms of the business base) within the region is Professional, scientific, and technical, accounting for 18 per cent of all businesses (Table 2.3). This is, however, not uniform across the region, ranging from 14 per cent in North Lanarkshire and West Dunbartonshire, up to 24 per cent in East Dunbartonshire. Construction is the second largest sector at the city deal region level (12 per cent of all businesses) and is typically among the largest sectors for each of the local authority areas (indeed it is the largest sector in North Lanarkshire and West Dunbartonshire). Whilst broadly in keeping with the national sectoral breakdown, there are some broad differences between the local authority areas and the national split. These include: A typically greater share of businesses operating within the Construction sector; A greater share of businesses within the Retail sector; and A greater share of businesses within the Arts, entertainment and other services sector. The city deal region also has a lower share of businesses within the Agriculture, forestry and fishing sector than the national average (two per cent compared to 10 per cent nationally); this is expected given the largely urban settings within the Glasgow City Deal region. South Lanarkshire has the greatest share of businesses operating within this sector seven per cent.

13 Regional Insight Report 2 The Glasgow City Deal Region 13 Table 2.1 Sectoral Breakdown of Business Base, (2016) Source: UK Business Counts. Glasgow City Deal East Dunbartonshire Glasgow City East Renfrewshire Inverclyde North Lanarkshire Renfrewshire South Lanarkshire West Dunbar tonshire Agriculture, forestry & fishing 2% 2% 2% 0.2% 2% 2% 3% 7% 3% 10% Production 6% 5% 4% 5% 7% 7% 7% 8% 9% 6% Construction 12% 13% 11% 9% 10% 16% 14% 13% 14% 11% Motor trades 3% 2% 2% 2% 3% 4% 3% 3% 3% 3% Wholesale 4% 4% 4% 4% 4% 4% 4% 5% 3% 3% Retail 9% 7% 8% 11% 11% 9% 9% 8% 9% 8% Transport & storage 4% 3% 2% 2% 3% 7% 4% 5% 4% 3% Accomm.& food services 8% 5% 5% 10% 9% 8% 7% 7% 10% 8% Information & communication 7% 8% 9% 9% 5% 5% 5% 6% 5% 6% Financial & insurance 2% 2% 2% 3% 1% 2% 2% 2% 1% 2% Property 4% 4% 5% 5% 4% 3% 3% 3% 3% 3% Professional, scientific & technical 18% 24% 23% 19% 21% 14% 18% 15% 14% 19% Business administration & support services 7% 7% 8% 7% 6% 7% 7% 7% 7% 7% Public administration & defence 4 <1% 0% 0% <1% 0% 0% 0% 0% 0% <1% Education 1% 1% 1% 1% 2% 1% 1% 1% 1% 1% Health 5% 5% 5% 6% 5% 4% 4% 4% 5% 4% Arts, entertainment, recreation & other services 8% 9% 9% 9% 8% 8% 9% 7% 10% 7% Total 46,660 2,975 2,605 17,300 1,665 7,170 4,460 8,705 1, ,905 4 Please note from ONS: All figures are rounded to avoid disclosure. Values may be rounded down to zero and so all zeros are not necessarily true zeros. Totals across tables may differ by minor amounts due to the disclosure methods used. Furthermore, figures may differ by small amounts from those published in ONS outputs due to the application of a different rounding methodology. Scotland

14 Regional Insight Report 2 The Glasgow City Deal Region 14 The business density of the Glasgow City Deal region (number of businesses per 10,000 population) is 257 the lowest of the five City Deal regions. Within the region there are differences between local authority areas, with business density ranging from 198 in West Dunbartonshire (with the lowest business density of any Scottish local authority area) to 281 in Glasgow (ranked 17th out of 32). The region has the three local authority areas with the lowest business densities in Scotland West Dunbartonshire, Inverclyde (209), and North Lanarkshire (211). In terms of business size (2016), the region has a similar picture to Scotland in that micro businesses (employing zero to nine people) make up the majority of businesses within the region (87 per cent, slightly lower than the national figure of 88 per cent). This trend is generally the same throughout the local authority areas within the region, albeit to varying degrees as set out in Table 2.1. Glasgow City has the lowest share of micro businesses (84 per cent), with a subsequently higher proportion of medium sized businesses (10 49 employees, 13 per cent). Table 2.2 Proportions of businesses by size band, 2016 Source: UK Business Counts % of businesses by size band Glasgow City Deal East Dunbarton shire Glasgow City East Renfrewshire Inverclyde North Lanarkshire Renfrewshire South Lanarkshire West Dunbarton shire % 91% 91% 84% 88% 87% 86% 88% 87% 88% % 8% 8% 13% 9% 10% 11% 10% 12% 10% % 1% 1% 2% 2% 2% 2% 2% 1% 2% 250+ <1% <1% <1% 1% 1% <1% 1% <1% <1% <1% Scotland

15 Regional Insight Report 2 The Glasgow City Deal Region 15 The number of business births within a region can indicate dynamism in that region s economy. By business births per 10,000 of the population, the City Deal region ranks 3rd out of the five city deal regions with 42 business births per 10,000 population. However, much like business density, there are wide local authority area differences, with Glasgow ranking 2nd of all 32 local authorities (with a birth rate of 52) compared to West Dunbartonshire, ranked 29th (with a birth rate of 31). It can be said, therefore, that Glasgow City drives business births within the region. Looking at births, deaths and survival rates together over time enables us to see the broader picture however. Prior to and in the early part of the recession, the business birth rate had increased in the region before decreasing to 2010; since then, however, there has been annual growth and this has been particularly strong in the last two years for which there is data. Overall, the business birth rate has increased from 26 in 2005 to 42 in The business death rate has also increased over the period, however, to a much lesser extent, from 28 in 2005 to 30 in Despite decreasing in the initial part of the decade, the business death rate increased during and immediately after the recession; however, this has fluctuated in the years since. Figure 2.3 Business births and deaths per 10,000 population ( ) and Business survival index ( ) Source: ONS Business Demography and Mid-Year Population Estimates 45 per 10,000 population Business Births per 10,000 population Business Survival Rates, Recession ( ) Business Deaths per 10,000 population Index, 2010= Note: for Business Survival Rates only available for in Evidence Base.

16 Regional Insight Report 2 The Glasgow City Deal Region 16 Business Expenditure on Research and Development (BERD) The value of BERD varied across the local authority areas - measured by BERD per head of the population expenditure Glasgow City had the highest level of investment in the region ( 146), largely due to the presence of universities and the high value services sector that is prominent in the local economy. West Dunbartonshire and Renfrewshire also had relatively high levels of BERD at 117 and 112 respectively, partly a result of the presence of the high value manufacturing sector that is prominent in these local economies. East Renfrewshire and East Dunbartonshire by comparison were low, at 30 and 17 respectively. This is reflective of the structural composition of these local economies; they consist of sectors with typically low levels of BERD. Earnings The average weekly resident earnings in each local authority area within the city deal region varied, with earnings in East Renfrewshire 104 above the national average and 9 below in Glasgow City. West Dunbartonshire and Inverclyde were also below the national level, by 14 and 32, respectively. The variation was, however, greater within the average weekly workplace earnings. Workplace earnings were 34 higher than the national average in Glasgow City and 15 higher in South Lanarkshire. In contrast; workplace earnings were 103 lower than the national average in East Dunbartonshire, 87 lower in East Renfrewshire, and 70 lower in Inverclyde. Further information is provided in Table 2.3. Table 2.3 Resident and workplace based earnings, 2016 (Median) Source: Annual Survey of Hours and Earnings, 2016 Provisional figures. Figures based on weekly pay of all workers. Area Resident Earnings Workplace Earnings East Dunbartonshire East Renfrewshire Glasgow City Inverclyde North Lanarkshire Renfrewshire South Lanarkshire West Dunbartonshire Scottish Average The difference between where a person lives (resident earnings) and where they work (workplace earnings) can tell us whether: individuals are more likely to travel to other local authorities to work and, therefore, Difference between resident and workplace earnings whether their skills are retained within that local authority or leak outside. Commuting flows can also help us understand this.

17 Regional Insight Report 2 The Glasgow City Deal Region 17 Commuting Levels of out-commuting vary across the city deal region, and are particularly high within East Renfrewshire and East Dunbartonshire (81 per cent and 75 per cent, respectively), and lowest in Glasgow City 23 per cent. The most common destination is Glasgow City, with people coming to the city for employment, and overall, there is a high degree of people commuting across the city deal region as a whole. If we look at the 2011 Census, this is confirmed: Three quarters of those in East Dunbartonshire (75 per cent) commute out of the local authority area, with 53 per cent of all going to Glasgow City (more than double the level of those remaining within the local authority area itself, 25 per cent). Overall, the majority (69 per cent) commute elsewhere within the city deal region; Over four fifths (81 per cent) of those in East Renfrewshire commute out of their local authority area; again, the majority go to Glasgow (52 per cent), which is almost three times the figure remaining within East Renfrewshire itself (19 per cent). Overall, 76 per cent commute elsewhere within the city deal region; Just 23 per cent commute out of Glasgow City, with the most common destinations being the adjacent local authority areas of Renfrewshire (five per cent), South Lanarkshire (four per cent) and North Lanarkshire (four per cent). In total, 19 per cent commute elsewhere within the city deal region; One third of those from Inverclyde commute out of their local authority area, with Glasgow City and Renfrewshire the most common destinations (15 per cent and 13 per cent, respectively). In total, 28 per cent commute elsewhere within the city deal region; Some 46 per cent of those in North Lanarkshire commute out of the area, with 22 per cent going to Glasgow City and 11 per cent to South Lanarkshire. In total, 37 per cent commute elsewhere within the city deal region; Almost half of those from Renfrewshire commute out of the local authority area (47 per cent), with Glasgow (32 per cent) the most frequent destination. In total, 43 per cent remain within the city deal region; Almost half of those in South Lanarkshire (49 per cent) commute outside the local authority area, with 43 per cent going elsewhere within the city deal region, including 26 per cent to Glasgow City, 12 per cent to North Lanarkshire and one per cent to East Dunbartonshire; and Over half of those from West Dunbartonshire commute out of their local authority area (53 per cent). Again, Glasgow is the most common destination (31 per cent), followed by Argyll and Bute (eight per cent). Overall, 43 per cent commute elsewhere within the city deal region. Analysis of out-commuters by occupational grouping shows that, in each area, the largest grouping of outcommuters is in professional occupation (SOC 1-3) 5, ranging from 38 per cent in West Dunbartonshire to 57 per cent in both East Dunbartonshire and East Renfrewshire. 5 Managers, Directors and Senior Officials (SOC 1), Professional Occupations (SOC 2) and Associcate Professional and Technical Occupations (SOC 3)

18 Regional Insight Report 2 The Glasgow City Deal Region 18 This suggests that those with higher skill levels travel more to access suitable employment opportunities; in this case particularly to Glasgow City where much of the region s employment is based by 2027, Glasgow will have 49 per cent of total regional. Table 2.4 Glasgow City Deal local authorities out commuting proportions by occupational grouping (SOC 6 ) Source: Origin Destination statistics by Local Authority, open access (WB07BUK_la), UK Data Service. Note: denominator = total trips out of the local authority SOC 1-3 SOC 4-6 SOC 7-9 East Dunbartonshire 57% 26% 17% East Renfrewshire 57% 25% 18% Glasgow 49% 25% 26% Inverclyde 47% 29% 24% North Lanarkshire 42% 30% 27% Renfrewshire 50% 29% 21% South Lanarkshire 49% 28% 23% West Dunbartonshire 38% 35% 27% 6 A link to the Standard Occupational Classification is here: ard-occupational-classification/ons_soc_hierarchy_view. html

19 Regional Insight Report 2 The Glasgow City Deal Region 19 Deprivation The post-industrial legacy of the region is evident in the fact that the city deal region has the biggest share of deprivation in Scotland with a 63 per cent share of Scotland s most deprived deciles 7. This amounts to 443 datazones. The City Deal region with the next highest is Edinburgh and South East with 13 per cent of the most deprived deciles (90 datazones). Within the city deal region, most of this is concentrated in Glasgow City, with a 35 per cent share of the most deprived deciles across the region. Areas of deprivation are greatest in number in the north east and east end of the city, areas along the Clyde like Govan and the 1960s housing estates on the outskirts of the city. The least deprived datazones are found mainly in the west end and south side of the city. [There are also large variations within the city, with datazone S (Intermediate zone Carntyne West and Haghill) the second most deprived in Scotland, compared to datazone S (Partickhill and Hyndland), with a rank of 6936 and thus one of the least deprived in Scotland, 6,976 being the least deprived datazone rank. Equally, the suburban local authority areas of East Renfrewshire and East Dunbartonshire are amongst the least deprived in Scotland, particularly in the old pre-1996 districts of Eastwood (East Renfrewshire) and Bearsden and Milngavie (East Dunbartonshire). Both this and the fact that many of the currently most deprived areas in Glasgow City were also the most deprived in the 1960s and 1970s 8 shows that the region has a particular challenge in its spatial lock-in of both affluence and deprivation, despite successive waves of regeneration. Elsewhere, post-industrial parts of the city deal region like West Dunbartonshire and Inverclyde along the Clyde, as well as North Lanarkshire all have concentrations of deprivation. This postindustrial legacy and the long standing placebased deprivation poses particular challenges for policy within the city deal region, especially given the multiple dimensions of deprivation and the difficulty of tackling this through any single domain (e.g. housing, education). This has implications for skills policy and planning if the Scottish Government goal of inclusive growth is a realistic aim. That said, SIMD identifies deprived areas - not people. Guidance on the use of SIMD by Scottish Government highlights that: Not all deprived people live in deprived areas: Two out of three people who are income deprived do not live in deprived areas; and Not everyone in a deprived area is deprived: Just under one in three people living in a deprived area are income deprived 9. This is important when analysing deprivation, particularly in rural areas. 7 Most deprived here defined as Scotland s 10% Most Deprived Data Zones. 8 Pacione, M. (1995). The geography of multiple deprivation in Scotland. Applied Geography, 15(2),

20 Regional Insight Report 2 The Glasgow City Deal Region 20 Figure 2.4 Deprivation in Glasgow City Deal by SIMD (2016)10 Deciles 1-10 Source: Scottish Government and Ordnance Survey, 2016 West Dunbartonshire East Dunbartonshire Glasgow City Inverclyde North Lanarkshire Renfrewshire East Renfrewshire Glasgow City Deal (SIMD 2016) Deciles 1-2 (Most Deprived) Deciles 3-4 Deciles 5-6 Deciles 7-8 Deciles 9-10 Data contains Scottish Government data Crown copyright Base: Ordnance Survey Crown copyright 2016 & database right See SIMD interactive map here: simd2016/btttftt/11/ / /. South Lanarkshire

21 Regional Insight Report 2 The Glasgow City Deal Region 21 Glasgow City Deal Region s People In introducing the city deal region s people we outline information on demography, labour market participation, qualifications and attainment. Demography The total population of the city deal region in 2016 was 1.8 million people. This equates to over one third (34 per cent) of the total national population (5.4m). The city of Glasgow is the most populous local authority area within the city deal region, accounting for 34 per cent (c.615,000 people). The next largest local authority areas by population are North Lanarkshire (19 per cent) and South Lanarkshire (17 per cent). Two thirds of the city deal region population are of a working age (aged 16 64), with a further 17 per cent each aged 0 15 or 65 or older. This broad pattern of a majority of people being of working age is true for each of the local authority areas within the region, ranging from 61 per cent in East Dunbartonshire and East Renfrewshire to 70 per cent in Glasgow City. Glasgow City has the lowest share of over 65 s (14 per cent), with the highest being 22 per cent in East Dunbartonshire. Based on 2014 population projection data, it is estimated that the Glasgow City Deal region population by 2039 will be 1,849,458; an increase of 52,716 (or three per cent) on 2014 figures. This is half the rate of growth forecast at the national level. This is not uniform across the local authority areas, however, with some expected to decrease over the period. By local authority area, population projections by 2039 are: East Dunbartonshire - a population of 112,967, an increase of six per cent on 2014; East Renfrewshire - a population of 104,727, an increase of 11 per cent; Glasgow City a population of 639,847, an increase of six per cent; Inverclyde a population of 70,271, a decrease of 11 per cent; North Lanarkshire - a population of 336,608, a decrease of 0.2 per cent; Renfrewshire a population of 174,709, an increase of 0.4 per cent; South Lanarkshire a population of 326,639, an increase of four per cent; and West Dunbartonshire a population of 83,690, a decrease of six per cent. Across all comparator areas, the overall finding of population change by age band is significant growth of those aged 65 and over, coupled with a decrease in the working age population (Table 2.5). The over 65 population is forecast to increase by 53 per cent at the City Deal region level. By local authority area, this ranges from 38 per cent in Inverclyde to 61 per cent in South Lanarkshire This decrease in the working age population is forecast to be particularly pronounced in Inverclyde and West Dunbartonshire with respective decreases of 17 per cent and 13 per cent forecast by The under 16 population is forecast to decrease at the regional level (by two per cent), and is forecast to increase in only three local authorities East Renfrewshire (14 per cent), East Dunbartonshire (four per cent) and Glasgow City ( four per cent).

22 Regional Insight Report 2 The Glasgow City Deal Region 22 Table 2.5 Population projections, % change by age band, Source: National Records of Scotland Glasgow City Deal -2% -12% -6% -8% 32% 77% East Dunbartonshire 4% -10% -3% -17% 14% 95% East Renfrewshire 14% 9% 4% -10% 21% 89% Glasgow City 4% -12% 4% 6% 42% 54% Inverclyde -16% -26% -24% -30% 13% 68% North Lanarkshire -9% -12% -15% -9% 37% 87% Renfrewshire -3% -12% -10% -17% 26% 79% South Lanarkshire -3% -9% -11% -12% 33% 95% West Dunbartonshire -12% -19% -20% -21% 27% 75% Scotland 1% -8% -2% -6% 27% 85%

23 Regional Insight Report 2 The Glasgow City Deal Region 23 Labour Market Participation The overall employment rate in the Glasgow City Deal region (72 per cent) was slightly below the national average in 2016 (73 per cent); indeed this employment rate was the lowest of all City Deal regions. Across the Glasgow City Deal region the employment rate was varied, being highest and above the national average in East Renfrewshire (77 per cent) and East Dunbartonshire (76 per cent), and lowest and below the national average in Glasgow City (68 per cent). The employment rate in Glasgow City was one of the lowest of all local authority areas in Scotland. As shown in Figure 2.5, each local authority area in the city deal region had a different pattern of labour market participation; East Renfrewshire and East Dunbartonshire had low unemployment and low inactivity; Glasgow City, Inverclyde and West Dunbartonshire had high unemployment and high inactivity; and South Lanarkshire was one of only two local authority areas to have high unemployment and low inactivity. As of 2016, 42,300 working age people were unemployed in the city deal region, accounting for one third of the national total (128,400) 11. Where 42 per cent of those unemployed across the city deal region were from Glasgow City and 18 per cent from South Lanarkshire, only four per cent and three per cent were from East Dunbartonshire and East Renfrewshire, respectively. The ILO unemployment rate in the region was five per cent, which was in line with the national average. The economic inactivity rate for the city deal region was 24 per cent in 2016, slightly higher than the national rate (23 per cent) 12. People can be economically inactive for a number of reasons, for instance they might be a student, looking after their family and home, long term or temporary sick, discouraged or retired (before aged 65). In the city deal region, the economic inactivity rate was highest (28 per cent) in Glasgow City which, due to the presence of a number of universities and college campuses might be expected, and a number of those inactive will be students. It is likely that many will also be inactive for other reasons as the rate is higher than other local authority areas with large student populations including the City of Edinburgh. The economic inactivity rates in East Dunbartonshire (22 per cent) and East Renfrewshire (20 per cent) were below the national average. 11 Source: ILO Unemployment rate. 12 Source: Annual Population Survey, Economic Inactivity Rate

24 Regional Insight Report 2 The Glasgow City Deal Region 24 Figure 2.4 Unemployment (ILO) and Economic Inactivity by City Region Deal, January to December 2016 Source: Annual Population Survey (resident based) Economic Inactivity Rate by City Region Stirling and Clackmannanshire City Region Deal 1.0 Low Unemployment, High Inactivity Edinburgh and South East Scotland City Region Deal Glasgow City Deal High Unemployment, High Inactivity Unemployment (ILO) Rate by City Region Low Unemployment, Low Inactivity 1.0 Aberdeen City Region Deal High Unemployment, Low- Inactivity Inverness and Highlands City Region Deal Note: the data is scaled - the units used are standard deviations from the mean.

25 Regional Insight Report 2 The Glasgow City Deal Region 25 Figure 2.5 Unemployment (ILO) and Economic Inactivity by Local Authority, Jan-Dec 2016 Source: Annual Population Survey (resident based) Economic inactivity rate, working age population Glasgow City Dundee City East Ayrshire North Ayrshire Low Unemployment, High Inactivity 1 Edinburgh City South Ayrshire Inverclyde West Dunbartonshire Fife Stirling East Lothian Aberdeen City Clackmannanshire High Unemployment, High Inactivity North Lanarkshire East Dunbartonshire West Lothian Dumfries and Galloway Midlothian Renfrewshire South Lanarkshire East Renfrewshire Moray Perth and Kinross Falkirk Argyll and Bute Angus Highland Scottish Borders Working Age Population (ILO) Eilean Siar 1 Aberdeenshire 2 Low Unemployment, Low Inactivity High Unemployment, Low- Inactivity Shetland Islands Note: the data is scaled - the units used are standard deviations from the mean. ILO Unemployment estimate for Orkney Islands is not available since the group sample size is zero or disclosive (0-2) and thus omitted.

26 Regional Insight Report 2 The Glasgow City Deal Region 26 Working Age Qualifications (16-64) The Glasgow City Deal region had lower levels of advanced qualifications (SCQF 7 12) compared to the national average (43 per cent compared to 44 per cent in 2016). The level of intermediate qualifications (SCQF Levels 5 and 6) in the region was also below national average 25 per cent compared to 28 per cent. There were, by contrast, a greater proportion of people within the Glasgow City Deal region with no qualifications than at the national average 13 per cent compared to 10 per cent, the highest of all the city deal regions. The remaining local authority areas ranged from 23 per cent in Glasgow City and Inverclyde to nine per cent in East Dunbartonshire for no or low qualifications. Within the city deal region the qualification profile of the local authority areas varied. East Dunbartonshire (59 per cent), East Renfrewshire (57 per cent) and Glasgow City (45 per cent) were the only local authority areas in the region that had the same or a higher proportion of residents with higher level qualifications (SCQF 7-12) than the national average. The proportion of the population with intermediate qualifications (SCQF 5-6) ranged from a high of 30 per cent in West Dunbartonshire and 29 per cent in both Inverclyde and Renfrewshire to a low of 22 per cent in Glasgow City. North Lanarkshire had the greatest proportion of people with no or low (SCQF 1-4) qualifications, 27 per cent compared to 19 per cent nationally.

27 Regional Insight Report 2 The Glasgow City Deal Region 27 School Leavers Destinations In 2015/16, 39 per cent of school leavers in the city deal region went into higher education; this was above the Scottish average (37 per cent). Within the city deal region, those going into higher education ranged from 61 per cent in East Renfrewshire (the highest in Scotland) to 31 per cent in Glasgow City (one of the lowest). The proportion of school leavers going into higher education has increased in all of the local authority areas in the city deal region since 2009/10. The proportion of school leavers going into further education has decreased since 2009/10, with two percentage point fewer leavers in the city deal region taking this option and with decline occurring in each of the local authority areas in the region. Overall just over one fifth (21 per cent) of school leavers in the city deal region went into further education as their initial leaver destination. This was slightly lower than the national average (22 per cent). By local authority area the proportion varied, with almost one quarter (24 per cent) of school leavers going into further education in Glasgow City and Inverclyde. The proportion was lowest in East Renfrewshire, at 13 per cent - the lowest in Scotland. Employment as an initial leaver destination has increased in the city deal region and in Scotland as a whole since 2009/10. In the city deal region over a quarter (28 per cent) of school leavers entered employment after school. Within the city deal region the proportion was highest in Inverclyde, North Lanarkshire and South Lanarkshire (30 per cent). East Renfrewshire had the lowest proportion of school leavers entering employment (19 per cent). Those becoming unemployed after school in 2015/16 were in line with the national average (eight per cent). East Dunbartonshire had the lowest rate (four per cent) of school leavers becoming unemployed after school. The highest rate in the city deal region was 11 per cent in Glasgow City which was above the national average and the joint highest in Scotland. All local authority areas in the city deal region saw a decrease in the proportion of school leavers entering unemployment from 2009/10, the largest fall coming in Glasgow City, by seven percentage points. Overall, over the period 2009/10 and 2015/16, there has been an increase in the proportion of school leavers entering higher education or employment. Decreases have occurred in the proportion of young people entering further education or unemployment. However as mentioned this does vary by local authority area. The economic downturn will have affected the destinations of school leavers in 2009/10, with young people becoming unemployed due to labour market contraction at that time or entering further or higher education due to a lack of opportunities in the labour market. Economic recovery will account for the increase in the proportion of young people entering employment after school, and reductions in other post school destinations. In terms of the 2017 Annual Participation Rate (16-19 year olds) 13, within the city deal region East Renfrewshire had the highest rate (96.2 per cent) and was in excess of the Scotland average (91.1 per cent). East Dunbartonshire (96.0 per cent), Inverclyde (91.9 per cent), Renfrewshire (91.4 per cent) and South Lanarkshire (91.2 per cent) also had rates in excess of the national average. North Lanarkshire (90.2 per cent), West Dunbartonshire (88.3 per cent) and Glasgow City (88.2 per cent) all had participation rates below the national average Annual Participation Measure, % of year olds participation 1st April 2016 to 31st March As agreed by Scottish Ministers, from August 2017, the Annual Partic ipation Measure will be adopted within the Scottish Gov ernment s National Performance Framework. It is replacing the school leaver destination follow up as the source of the indicator, increase the proportion of young people in learn ing, training or work, published through Scotland Performs. See below for details: dia/43580/2017_annual-participation-measure-re port-29th-august-2017.pdf

28 Regional Insight Report 2 The Glasgow City Deal Region 28 Table 2.6 School Leaver Destinations, 2009/ /16 Source: Scottish Government School Leavers Destination Dataset Destination Higher education (%) Glasgow City Deal East Dunbarton shire East Renfrew shire Glasgow City Inverclyde North Lanark shire Renfrewshire South Lanarkshire 2009/10 36% 52% 58% 27% 33% 32% 38% 38% 34% 2015/16 39% 57% 61% 31% 36% 36% 39% 39% 36% Change 3% 6% 3% 4% 3% 4% 1% 2% 3% Further education (%) 2009/10 23% 17% 14% 25% 30% 23% 25% 20% 24% 2015/16 21% 14% 13% 24% 24% 21% 21% 20% 22% Change -2% -3% -2% -1% -6% -2% -4% -1% -2% Employment (%) 2009/10 21% 21% 19% 21% 17% 24% 20% 23% 19% 2015/16 28% 23% 19% 27% 30% 30% 28% 30% 28% Change 6% 2% 1% 6% 13% 6% 8% 7% 9% Unemployment (%) * 2009/10 14% 8% 7% 19% 14% 15% 13% 13% 17% 2015/16 8% 4% 5% 11% 9% 9% 9% 7% 9% Change -6% -4% -2% -7% -5% -6% -5% -6% -7% * Unemployment Seeking and Unemployment Not Seeking West Dunbarton shire

29 3 Deal Demand for Skills in Glasgow City Region

30 Regional Insight Report 3 Demand for Skills in Glasgow City Deal Region 30 Demand for Skills 14 in Glasgow City Deal region This section outlines past, current and forecast trends for total employment and sectors, occupations and qualifications. These forecasts have been developed by Oxford Economics 15 and, like any forecasts, they are based on what we know now; past and present trends projected into the future. They can therefore be affected by potential disruptors (e.g. Brexit) and unforeseen events and their value is in identifying likely directions of travel rather than predicting exact figures. Finally, the more disaggregated they become, especially at smaller geographical units, the less reliable they are likely to be. employment declining by nine per cent from a high of 956,600 in 2008 to 873,800 two years later, the lowest figure since That said, employment has generally been on an upward trend since, although it has not returned to pre-recession levels. This trend is forecast to continue over the forecast period to 2027, with employment projected to increase by four per cent between 2017 and 2027, slightly above the Scotland average of three per cent. Total Employment As shown in Figure 3.1, total employment (jobs) within Glasgow City Deal region currently (2017) 16 sits at 913,900, representing regional employment growth of eight per cent since 2000 (compared to ten per cent nationally). The impact of the recession is clear, with 14 Note: the analysis here is workplace based. Note the forecast period for skills demand is defined as follows: Total employment: 2017 and 2027; Total requirement: 2017 and 2027 (inclusive). For more information on Oxford Economics definitions please see Appendix For more information of the methodology used in the Oxford Economic forecasts, please see the Regional Skills Assessments section of the Skills Development Scotland website: partnerships/regional-skills-assessments/ 16 Note 2017 is itself a forecast

31 Regional Insight Report 3 Demand for Skills in Glasgow City Deal Region 31 Figure 3.1 Total Employment Projections (jobs), Source: Oxford Economics. '000s Total employment (jobs) There is a mixed picture when it comes to employment across the eight local authority areas within the Glasgow City Deal region. While employment in Inverclyde and East Dunbartonshire declined during the 2000s, other areas experienced growth, followed by a decline during the recession years. All areas have had a partial recovery since then, although in 2017 only the number of jobs in East Dunbartonshire and East Renfrewshire has increased above their pre-recession employment level. Employment is forecast to increase in six of the local authorities by 2027, with similar growth from the 2017 baseline in South Lanarkshire (1.5 per cent), North Lanarkshire (1.6 per cent) and Renfrewshire (1.7 per cent). The projected growth in East Dunbartonshire (3.3 per cent) and East Renfrewshire (3.4 per cent) is higher. However, Glasgow City is expected to see growth of 7.1 per cent and, as it contains 47 per cent of all employment in the region (in 2017), it is the main driver of employment change in the area. Two local authority areas are expected to see a decline in employment over the forecast period: Inverclyde (0.5 per cent) and West Dunbartonshire (2.9 per cent).