Labour force flexibility and skills mobility – right person, right skills, right place, right time

1. Labour force flexibilityand skills mobility –right person, right skills,right place, right time Anne GreenIER, University of Warwick A.E.Green@warwick.ac.uk

2. Scope of presentation • Context • What is a healthy labour market? • Regional and sub-regional variations in:- quantity and quality of employment- demand and supply • Skill shortages and gaps • Skill utilisation • Mobility- migration- commuting • Implications

3. Context • Shift in concerns from ‘quantity’ to ‘quality’ • Greater emphasis ondemand • Concern with stocks and flows • Labour market change: • Decrease in unemployment • Concerns about inactivity – and concentration in particular sub-groups and areas • Rise in employment → ‘tightening’ labour markets • Matching supply and demand – issues of mobility and accessibility • Skills as a key driver of regional competitiveness (within context of overall regional development)

4. ‘Healthy labour market’ concept • Goal: a labour market which produces desirable results, both socially and economically, and which is sustainable over time • 3 dimensions: • strong DEMAND side – in terms of quantity and balance /quality of jobs that the labour market generate • strong SUPPLY side – relates to the numbers and characteristics of people able to take those jobs • efficient and equitableFUNCTIONING to bring together demand and supply sides of the labour market • appropriate supporting conditions – education, training, workforce development, benefits and welfare, housing and transport infrastructure

5. Mobility and flexibility Healthy labour market emphasises movement up the skills and value chain Implies existence of progression routes Need for flexibility to adjust to change – but how much? Fine dividing line between ‘healthy’ and ‘unhealthy’ mobility and flexibility Balance Job opportunities at all levels Success in one part of the labour market not achieved at the expense of another part – geographical dimension Imbalance can be ‘healthy’ as well as ‘unhealthy’: it may be a driver of desirable change Mobility, flexibility and balance:scope for tension

6. % of employment in K1-K4 categories(source: LFS, 2004 [via emda])

7. Employment rates, 25-49 yearsHighly qualifiedNo qualifications

8. Issues of interpretation Typology of regions on skills deficiencies YH and WM:> average skills deficiencies &> average non-employment EM, E, SE and SW:> average vacancies &< average non-employment L, NE and NW: < average vacancies &> average non-employment under-education over-education ‘signalling’ function of qualifications do industries / employers have capacity to absorb and utilise high level skills? are high level skills used effectively? ‘move on up’ – to create openings for others Skill deficiencies Skills utilisation(NESS, 2003)

9. Role of mobility • right person, right skills, right place, right time implies occupational, industrial andgeographicalflexibility and mobility • ‘jobs to people’ and/or ‘people to jobs’? • MIGRATION andCOMMUTING- brain drain (training for export?)- brain strain- skills circulation • competing for skills – context of tighter labour market, ageing population, lower fertility, international migration • What is the capacity for mobility in the labour market? • What are theconstraints on mobility?

10. Understanding migration in the UK • The Greater South East is the motor of the UK economy and the driver of the UK migration system • An “escalator region”: it offers the largest quantity and greatest range of employment opportunities (particularly higher level occupations) in the UK • London attracts young people at the start of their careers from the rest of the UK and loses population to all other regions except in the 20-29 age group • It attracts full-time workers • It attracts international migrants – from all parts of the world (‘global reach’)

11. Migration of 20-29 year olds, 2000-2001(source: 2001 Census)

12. Role of migration in addressing labour market deficiencies migrants over-represented at both ends of the skills hierarchy:- highly skilled - less skilled refugees and asylum seekers skills utilisation – evidence for occupational downgrading labour market integration Factors associated with employment rates of migrants: gender & family status ethnicity qualifications area of residence year of arrival /nationality language discrimination International migration:towards a ‘managed migration’ policy

13. Countering population loss through: retaining home-grown talent encouraging Scots who have moved away to return attracting new people to Scotland Policies: closer working with Work Permits UK visa extensions for students staying after graduation support to universities in recruitment improving visitor impressions establishment of relocation advice service Competing for people and skills:the example of Fresh Talent (Scotland)

14. Fresh Talent (Scotland):questions and issues • Welcoming all comers? • Do migrants go where you want them to go?:- the success and attractiveness of Edinburgh- is it desirable/possible to create other magnets? • Importance of non-economic (environment, leisure, schools, etc) as well as economic factors • Limits to the role of interventions at Scotland level:- UK level policy (e.g. Home Office on immigration)- Scotland tied into UK migration system

15. Commuting • trend to longer flows, but most commutes are short distance • local areas play different roles - characterised by:- high in-commuting- high out-commuting- ‘transit camps’: high in- and out-commuting • complexity of commuting flows in some areas • sub-group differences

16. Spatial barriers to employment physical: accessibility especially in 24/7 economy social – information flows, social divisions, perceptions ‘bounded rationality’ –unwillingness to venture into terra incognita (mental maps) labour market opportunities my be restricted because jobs in accessible yet unfamiliar locations are not considered Permeability of spatial labour markets job growth does not necessarily ‘trickle down’ to local residents – even if local residents have the required skills higher-skilled workers can bump down’ in the labour market and compete for lower-skilled jobs: processes of mobility and job competition leave behind the weakest Constrained mobility

17. Example of workforce mobilityin construction(from IFF with University of Warwick)

18. Workers in London – where from originally 30% from outside UK 4% 5% 5% 1% 3% 2% 7% 3% 14% 1% 26% Base: 993 workers on sites in London 30% from outside the UK

19. Workers in London: where permanently resident 2% 4% 4% 2% 2% 2% 10% 2% 14% 2% 57% Base: 993 workers on sites in London

20. Workers in NE – where from originally 0% from outside UK 1% 91% 1% 1% 2% 1% 1% 1% 1% 1% Base: 378 workers on sites in NE

21. % of workers on sites in region with permanent residence in same region

22. 8% of construction workers live in temporary accommodation – but ranges from: 19% in London – of whom 67% have permanent address elsewhere in England, 10% in Scotland, 7% in Wales, 16% outside UK (4% Irish Republic) 9%-10% in NW, SW and N Ireland < 4% in NE and YH Reasons given: No / little work in home area (27% nationwide,more often cited by workers on sites in London) Sent by company (27% nationwide) Better pay (21% nationwide,more often cited by workers on sites in London) Better job opportunities (11% nationwide,more often cited by workers in London) Construction workers living in temporary accommodation

23. Creating a ‘healthy labour market’ vision of the desired result processes that might bring about that result how processes may be influenced by intervention –scope and limitations of regional-level intervention importance of advancement in work capacity for mobility Possible policy interventions public procurement cluster policy role of public sector Inter- and intra-regional disparities use of ratio measures and floor targets - for geographical / sub-group differences and setting minimum standards Implications