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2011 Census Do they change our view of the Greater Manchester economy?

2011 Census Do they change our view of the Greater Manchester economy? . Miriam Ferrari Senior Economist mferrari@oxfordeconomics.com 02892528614. 16 th August 2012. Contents . Introduction Executive summary At a glance – 59,000 extra people Migration and jobs – a surprise?

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2011 Census Do they change our view of the Greater Manchester economy?

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  1. 2011 CensusDo they change our view of the Greater Manchester economy? Miriam Ferrari Senior Economist mferrari@oxfordeconomics.com 02892528614 16th August 2012

  2. Contents • Introduction • Executive summary • At a glance – 59,000 extra people • Migration and jobs – a surprise? • Forecast implications • Policy messages • GMFM – next steps

  3. Introduction

  4. Introduction • Oxford Economics • GMFM team - Neil, Alan, Kerry and Miriam • GMFM update • Focus here is on: • Migration and the economy • Forecast / GMFM implications

  5. Executive Summary

  6. Executive summary • Population higher than expected across the England and Wales (476,000 people) • Highest increases in metropolitan areas / core cities • Greater Manchester no exception with 59,000 more people than anticipated in the official statistics (the rolled-forward population estimates) • ‘Families’ also causing an uplift • Migration and labour market relationship puzzling • GMFM has suggested upward pressure on population for some time • But growth over recession period not predicted

  7. Executive summary cont. • Important that look at other ways to ‘track’ the population size • Greater role for scenario planning • GMFM model will be revised to reflect new population numbers in the 2011 Census

  8. At a glance – 59,000 extra people

  9. Population differences – largely due to migration • Population in England & Wales increased by 7.8% over the last ten years according to 2001 & 2011 Census data. • Analysis by ONS suggests that in terms of inaccuracies: • 45% is attributable to potential problems with the 2001 population base (the starting point for the current series of MYEs), which is considered to be too low due to the undercounting of certain age groups in the 2001 Census • 55% is due to potential inaccuracies in the measurement of net international migration over the decade. Difference between Census day and revised rolled-forward population estimates, England & Wales (millions) Source: Census, ONS

  10. GM population – an extra 59,000 people • Population 2.2% higher than the rolled-forward population estimate. • Largest differences between the GM Census result and MYE rolled-forward estimates: • Female population • Family age cohorts (0-14 years old and 35-44 years old) • Manchester (48% ), Trafford (14.8%), Wigan (11.9%) and Rochdale (10.5%) Difference between Census day and revised rolled-forward population estimates, Greater Manchester (000’s) Source: Census, ONS

  11. Migration and jobs – a surprise?

  12. Migration and jobs – historical pattern High net migration despite job losses

  13. Weak correlation – puzzling on the face of it........ Low R Squared – weak correlation

  14. .......But students are a major factor...................... Long-Term International Migration into the United Kingdom. YE Dec 01 to YE Sep 11: Immigration by main reason for migration No. of students increasing Immigration for work reasons – fallen during recession Source: ONS

  15. ....whilst is the UK really a bad place to be in a recession?.. Long-Term International Migration into and out of the United Kingdom. YE Dec 01 to YE Sep 11 – all citizenships Immigration remains strong despite the recession emigration peaked at the height of the boom and has fallen ever since Source: ONS

  16. ...Greater Manchester’s relative attractiveness............... Emigration also starting to fall Source: ONS

  17. But also the family uplift factor Manchester: Comparison of population by age band for rolled-forward estimates and 2011 Census Implies migrants are staying and having families

  18. Forecast Implications

  19. Will migration stay high? Back in 2006 - ‘no’ migration firmly fixed in policy

  20. What would a high migration scenario mean? Indicative scenario – accounting for higher migration, against baseline and ONS 2010 projections Will official statistics now form an ‘upper’ scenario? Forecast Source: ONS, Oxford Economics

  21. Does it mean more jobs? Indicative economic implications of population scenarios Significant economic impacts if assume employment rates remain the same Source: Oxford Economics

  22. However what about demand? • Population will drive demand for housing, domestic services, public services. • But not necessarily for export orientated sectors • Unwise to assume that more people means more jobs. • Other key factors: • Skills will matter • Real incomes / cost pressures – ‘new normal economy’ • Welfare reform • Dangerous to assume more people results in more jobs – scenario planning important

  23. Policy Messages

  24. Trust no one • Errors sadly increasing, BRES, migration, GVA. Could the Census even be wrong? • Triangulate different data sources to assess performance. Use data dashboards across economic/ labour market indicators. • Consider population ‘tracking’ – use housing data which should give good indication of population to correlate with official data. • Forecasts – only an indication of direction of travel, should be used alongside other information • Scenario planning – alternative futures (supply growth scenarios important from strategy perspective)

  25. Simplified data dashboard E.g.

  26. GMFM – next steps

  27. Reflections • Equations for migration better way to forecast – demand and population driven • But drivers of demand are weak – can population really keep growing this fast? • Other factors will influence future forecasts: • Lack of job opportunities (more emigration?) • Government policy • Tuition fees • Welfare reform • International context – if UK becomes less attractive • Slowing population still a strong possibility – as ‘no’ migration was ingrained in policy do not let ‘high’ migration become the same • Scenario planning, flexibility remain key – will new official projections form an ‘upper scenario’

  28. GMFM – Next steps • Currently prioritising employment series – SIC code changes (2003 to 2007) • Develop a new population series to sit alongside the official data • Official ONS historical data series incorporating Census 2011 will not be released in time. • Therefore looking to account for differences in backdated time series – starting this now. • Simplify the current demographic system – counterproductive to estimate 5 year age bands if population likely to be significantly revised. • Therefore proposing to simplify age bands and provide a number of alternative scenarios to examine housing implications.

  29. GMFM – key future dates • Model Management Group Meeting - 24th October • GMFM 2012 Seminar - 19th November

  30. Annex

  31. How did the GMFM 2011 forecast compare? Difference between Census day, revised rolled-forward population estimates and GMFM population estimates for 2011, Greater Manchester (000’s)

  32. SIC Codes – 2007

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