Skills remain biggest challenge to Birmingham’s growth

Paul Faulkner, chief executive, Greater Birmingham Chambers of Commerce

Skills shortages are the biggest obstacle to economic growth in Greater Birmingham, according to a new report.

The report -– the Birmingham Economic Review 2017 – has been produced by the Greater Birmingham Chambers of Commerce and the University of Birmingham’s City-REDI, which is tasked with accelerating economic growth in the West Midlands city region.

The new survey spells out Birmingham’s strengths and weaknesses, and concludes that the city is more successful than most in terms of attracting inward investment and establishing new businesses.

Birmingham also has above average employment in a number of sectors, including finance and insurance, education, public administration and defence.

In addition, there are a number of major opportunities for the city to take advantage of, including the new HS2 high speed rail line – potentially the most significant transport infrastructure project in the UK since the 1960s.

The economic review states that HS2 will have a substantial impact on the economic and transport environment in Birmingham and its surrounding areas.

But all of the good could be undone by the skills shortage, an issue highlighted by the experts to have contributed to the report.
Dr Catherine Harris, City-REDI, University of Birmingham, said Birmingham was the youngest major city in Europe, with under-25s accounting for nearly 40% of its population. Tapping into the potential from this was another major opportunity for the city, she said.

“Such a large population of under 25s is incredibly exciting because these young people will become the workforce of tomorrow and represent a great amount of potential. However, a young population is only an asset if they are equipped with the skills and opportunities they need to succeed as they enter the local workforce,” she said.

“In practice, this means closing the gap between business and education to help develop a sound skills base, becoming more attractive to graduates so that we retain talent in the city, and working together to address unemployment and skills gaps across Birmingham.”

Her City-REDI colleague, Professor Anne Green added that Birmingham had its fair share of high level skills, due to being home to a number of world class universities, but the big problem was in the area of intermediate and low skills.

She said: “Local and regional statistics show that in Birmingham and the West Midlands this long tail of low skills is more pronounced than nationally, and also that employment rates are lower than average.”

Glenn Caton, president, Northern Europe, of Mondelez International, one of Birmingham’s major employers, said that much more needed to be done in his company’s sector.

He said: “We need schools to provide the basic skills in English and maths, as well as inspiring pupils into science, technology, engineering and maths (STEM) subjects, and careers advisors to connect with businesses to provide alternative pathways. We recognise the value apprentices bring to our business and are committed to investing in a sustainable apprenticeship programme.

“In our business, apprentices are a vital pipeline of talent to help us close this skills gap. We are proud to employ 55 apprentices in the UK. But we still struggle to recruit people with the right skills.”

Judith Armstrong, CEO of Millennium Point, said that the ‘widening’ skills gap was a direct threat to Birmingham’s ‘innovative future’, which required a ‘significant’ proportion of new roles requiring job specific higher-level skills and qualifications.

“In addition to improvements driven by changes in the curriculum, we must collaborate to bridge this gap by investing in initiatives that raise awareness of STEM and encourage pursuit of it in education,” she said.

Paul Faulkner, chief executive, GBCC, said: “Skills gaps clearly remain a major concern in Greater Birmingham, and we consistently see this reflected in our Quarterly Business Report.

“However, the Birmingham Economic Review 2017 provides a detailed, striking analysis of the areas most affected. It is the hope of the chamber that this review will help businesses and policy makers ensure, going forward, that local people have the skills they need to access and succeed in the new jobs being created across Greater Birmingham.”