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Economic and Social Inclusion in the West Midlands: Baseline Evidence Update Helena Duignan and Andy Phillips 7th June 2013 marketingbirmingham.com The region’s employment prospects remain poor • Net loss of 120,000 jobs between 2008 and 2009 • 40,000 in Birmingham alone • 20,000 net new jobs have been created since then • Employment levels have yet to start recovering in parts of the Black Country marketingbirmingham.com Meagre prospects for entry level jobs • Only 54,000 net new jobs forecast by 2020 • A further 1.3 million due to labour market ‘churn’ • But most will be taken by people already in work with skills and experience • A dearth of entry level jobs – dwarfed by workless numbers 37,400 overall entry level jobs available 20122010 232, 300 unemployed people in the West Midlands in 2012 marketingbirmingham.com Unemployment has risen by more than 50% • Unemployment has risen by 82,000 to 232,000 over the 2007-2012 period • The gap between regional and national unemployment rates has widened slightly • The gap between best and worst performing local authority areas has widened • Sandwell and Wolverhampton have the highest rates - overtaking Birmingham marketingbirmingham.com Twice as many wards with out-of-work benefit rate 25%+ • 23 wards have 25% or more people on benefits – compared to 10 in 2007 • 21 extra wards are now over 20% and 40 extra are over 15% • There are 23 fewer wards in the lowest group, 0-5%. 2003 CAS ward marketingbirmingham.com February 2007 2003 CAS ward February 2012 00GLMY : Bentilee and Townsend 30.2 00CUFR : St. Matthew's 29.8 00CNGH : Sparkbrook 29.2 00GLMY : Bentilee and Townsend 29.7 00CNFB : Aston 28.8 00CSFU : Soho and Victoria 29.4 00CSFU : Soho and Victoria 27.8 00CWFA : Bilston East 29.2 00CWFK : Low Hill 26.9 00CWFK : Low Hill 28.8 00CUFE : Blakenall 26.6 00CNGH : Sparkbrook 28.2 00CNGP : Washwood Heath 26.3 00CTFC : Chelmsley Wood 28.0 00CUFR : St. Matthew's 25.9 00CUFE : Blakenall 28.0 00CNFR : Kingstanding 25.1 00CNFB : Aston 27.4 00CNGD : Shard End 25.0 00GFPH : Malinslee 27.2 00CWFF : Ettingshall 24.9 00CNGD : Shard End 27.2 00GFPU : Woodside 24.8 00GFPU : Woodside 27.1 00CWFA : Bilston East 24.8 00CWFJ : Heath Town 26.5 00CQFE : Foleshill 24.7 00CWFF : Ettingshall 26.4 00CTFC : Chelmsley Wood 24.7 00CNFR : Kingstanding 26.3 00GLNC : Burslem South 24.6 00CNGP : Washwood Heath 26.2 00GFPH : Malinslee 24.6 00CTFE : Fordbridge 26.2 00CNGG : Soho 24.3 00CSGA : West Bromwich Central 25.9 00CWFJ : Heath Town 24.2 00CSFQ : Princes End 25.8 00CSFQ : Princes End 23.9 00GLNC : Burslem South 25.6 00CSGA : West Bromwich Central 23.7 00CNGG : Soho 25.5 00CNFL : Handsworth 23.6 00CTFS : Smith's Wood 25.5 00CTFE : Fordbridge 23.6 00CUFJ : Darlaston South 25.3 Nearly 100,000 fewer people are in employment • Similarly the gap between regional and national employment rates has widened • And the gap between best and worst performing local authority areas has widened • Birmingham’s rate was just 57% in 2012 - 13 points below the England average marketingbirmingham.com Long term unemployment more than doubled to 88,000 • 50,000 more people are long term unemployed than in 2007 – a 130% increase • Accounting for 38% of the jobless total compared with 25% in 2007 • Almost half (43%) of the long term unemployed are from elementary occupations marketingbirmingham.com The impact has been uneven by demographic group Employment rates have fallen sharply for: • Those with low/no qualifications • Young people • Males But the employment rate has risen for those from a BME group and fallen only slightly for disabled people Qualification levels are improving • The skills profile of the region is improving but still lags behind national levels. • The proportion with no qualifications fell from 17% to 14% between 2007-11. • 69,000 people in Birmingham (10.3%) have ‘other qualifications’ marketingbirmingham.com Impact so far of welfare reforms • The profile of the caseload is changing considerably • People are being moved onto short term benefits and encouraged to move into work • JSA only group to have increased - 35% of out of work claimants are now on JSA compared with 25% in 2007 • But there are shortages of entry level jobs and the total caseload has risen by 56,000 marketingbirmingham.com Impact so far of welfare reforms • The introduction of ESA has so far seen the overall caseload decline only slightly, but with a greater proportion of completed assessment placing people in the ‘work group’ than the ‘support group’ • Further impact will see the ESA/IB caseload decline and the ESA work group expand. • Continuation of current approval levels could see an extra 143,500 jobseekers in WM. marketingbirmingham.com People are struggling to move into sustainable jobs • JSA stock was over 170,000 in 2012 • But over a 12 month period 350,000 claims moved on and off the register • Insecure, low paid jobs mean that people are struggling to stay in employment • There is a ‘revolving door’ between work and benefit marketingbirmingham.com Underemployment is becoming widespread • Increases in part time work and ‘under employment’ are keeping people out of unemployment but struggling to get enough work • Part time employment has increased by 5,000 while full time employment has decreased by 101,000 • The growth in part time working has, perhaps surprisingly, been an entirely male phenomenon • While female part time employment has fallen there are 20,000 more male part time workers Underemployment is becoming widespread • Involuntary part time employment has more than doubled in the West Midlands by 67,485 from 55,920 to 123,405 • There are now 162,594 people in WM who are economically inactive but want to work, up from 159,377 in 2007. • Using the JRF definition of underemployment (unemployed plus involuntary part time plus inactive want work) the West Midlands has seen a 41% increase on the 2007 level, from 366,397 to 518,299, an increase of 151,902. • Using the ONS definition of underemployment (employed but want more hours) under employment in the West Midlands has increased by 37%, or 62,000 to 229,000. 9.6% of workers are now classed as underemployed in WM (up from 6.8%). • Numbers of temp workers have remained relatively constant but there has been a 77% (UK 57%) increase in the number of temp workers who can't find permanent work, an increase of 21,978 to 50,516. In-work poverty is rising • While a decade ago the majority of people in poverty were in workless families it is now those in work who make up the majority • At 25% the West Midlands has second the highest proportion of working age adults in poverty in the country • The West Midlands has 460,000 workers (22%) earning below the living wage – well above the UK average • The number of housing benefit claims in the region from those in work has doubled since 2008 The impact of social and economic exclusion • Numbers of people reporting a mental health problem has increased by a third (APS), and number reporting any health problem has increased by 18%. • The unemployment rate for people with mental health problems has risen by five percentage points over the last 5 years and this group has an employment rate of just 31% • There has been a 20% increase in numbers of statutory homeless in the West Midlands between 2009 and 2011 • The West Midlands overtook London as the area with the highest rate of homelessness in 2009 In Summary • Falls in employment have hit those with low level qualifications and in elementary occupations hardest. There are very limited opportunities available for these workers. • Rising unemployment has pushed the region further behind the national average. • Key demographic groups with low employment rates have not been any worse affected than the population in general, with the exception of young people. • The impact of welfare reforms is yet to be fully reflected in the benefit caseloads. • Unemployment levels have not risen as high as many expected, but this is due to increases in under employment and temporary working. • In-work poverty, low wages , health problems and homelessness have all increased. Thank you. Any questions? marketingbirmingham.com