Transcript Document

Forecasting Future Skill Needs in
NI
Presentation to Stakeholder Conference
Oxford Economics
Neil Gibson
27th November 2008
Outline
 Forecasting skills – the rationale
 The economic conditions – tougher times
 World
 UK
 NI





Skills data – the current picture
Skills forecasts – the forward picture - provisional
Planning and enabling a ‘better’ Northern Ireland - provisional
Summary and conclusions
Annex
Note: significant empirical project – still underway. Many information
omitted on regional comparisons, time series, NQF and priority sector
analysis (much of this can be included in reporting)
Forecasting skills – the
rationale
Forecasting skills - the rationale



To aid and inform strategic planning for future needs
To inform on potential skills shortages which could hamper potential economic
growth
To raise debate about skills funding priorities and choices
Technically difficult to do:





Formal skills not the only method of measurement
Data issues
Using past evidence of realized demand as indicative of desired demand
Economy hard to foretell (at the moment!)
Does not replace qualitative ‘bottom-up’ information
An accepted approach:


The Leitch Review and, to a lesser degree, the Sector Skill Council reports
include an element of quantitative measurement
The project Oxford Economics are charged with is carrying out an empirical
assessment of skills needs up to 2020
The economic conditions –
tougher times
UK heading into recession …
UK : GDP growth
% annual
5%
4%
3%
2%
1%
0%
1995 1997 1999 2001 2003 2005 2007 2009 2011
-1%
-2%
Source: Oxford Economics
… as world demand begins to slide …
World: GDP growth
% year
5.0
Forecast
4.5
4.0
3.5
3.0
2.5
2.0
1.5
1.0
0.5
0.0
1996
1998
2000
2002
Source: Oxford Economics
2004
2006
2008
2010
2012
… real incomes fall …
UK: Stockmarket
UK: House prices
3600
% year
40
3400
Forecast
Nominal
3200
30
3000
2800
20
2600
2400
10
2200
FTSE All share
2000
0
1800
1600
-10
Real
1400
-20
1200
1994
1996
1998
Source: Haver Analytics
2000
2002
2004
2006
2008
1984 1987 1990 1993 1996 1999 2002 2005 2008 2011
Source: Oxford Economics
… and all hope has gone!..
UK: Consumer confidence
GfK NOP Index
10
0
-10
-20
-30
-40
-50
1996
1998
2000
Source: Haver Analytics
2002
2004
2006
2008
…but





Interest rates still being cut
MPC and Government is acting aggressively
Fiscal stimulus
World problem – focus of all economies
Inflation coming down (though remember due to cooling
world economy – perhaps temporary)
 Company balance sheets in decent shape after recent
growth (did not return to borrowing)
How much will consumers retract key …
5%
saving
ratio
%
(Nov
base)
GDP grow th
CPI inflation
Bank rate
2009
2010
2009
2010
2009
2010
-1
0.9
2.3
1.2
2
2.1
7%
saving
ratio
9%
saving
ratio
-1.6
0.1
2
0.7
1.4
0.7
-2.5
-0.2
1.5
0.1
0.7
0.3
Very possible
… end of ‘golden era’ for NI …
Total employment: NI
000s
1,050
Forecast
1,000
950
EDF Sept 08
900
850
OE Nov 08
800
750
700
650
1996
1999
2002
2005
Source: DETI, LFS, Oxford Economics
2008
2011
2014
2017
2020
… a return to growth – but it looks very different …
Agriculture, forestry & fishing
Mining & quarrying
Manufacturing
Utilities
Construction
Retail & distribution
Hotels & restaurants
Transport & communications
Financial services
Business services
Public administration & defence
Education
Health & social w ork
Other personal services
Total em ployee jobs
Land forces
Self-em ploym ent
Total em ploym ent
1998-2008
(000s)
-4
0
-18
-1
14
27
8
6
5
36
0
8
22
6
109
-7
20
122
2008-2018
(000s)
0
0
-8
0
-2
5
4
2
3
20
-1
3
13
3
43
0
6
48
A key difference –
with skills
implications
Skills – the current picture
(Note data LFS unless stated)
NI workforce skills – up skilling evident
Qualifications of persons in em ploym ent
1997 % total (3year m oving
average)
2007 % total (3year m oving
average)
Change (pp point)
NVQ Level 0 (including other and do not know )
NVQ Level 1
NVQ Level 2
NVQ Level 3
NVQ Level 4
NVQ Level 5
Total
27%
8%
14%
27%
21%
3%
100%
22%
4%
18%
25%
25%
6%
100%
-4.9
-3.5
3.5
-2.0
4.0
2.8
-
More graduate
demand
Very few graduates out of work
NI: NVQ qualifications of non-employed
(Average 2005-2007)
Other and do not
know, 3%
NVQ Level 5, 2%
NVQ Level 4, 9%
NVQ Level 3, 19%
NVQ Level 0, 42%
NVQ Level 2, 20%
NVQ Level 1, 5%
Source: LFS
Returns to qualifications
Weekly w ages
Postgraduate
NVQ Level 4 + (not postgrad)
NVQ Level 3
NVQ Level 2
NVQ Below Level 2
None
UK
£777
£537
£385
£322
£306
£229
NI
£565
£455
£329
£275
£242
£204
NI ‘in the pack’ regionally for graduate
concentrations
London
Canada
Japan
Scotland
South East
Finland
UK
ROI
South West
North West
Eastern
North East
NI
East Midlands
Wales
West Midlands
Yorkshire & Humber
Graduate %
em ployed
persons (2007,
3-year m oving
average)
UK=100
46%
46%
40%
39%
36%
35%
35%
34%
33%
33%
32%
31%
31%
31%
31%
31%
29%
133
133
115
112
105
100
100
97
97
94
92
91
90
89
89
89
84
International figures refer to 25-64 w orking age qualifications
(2005)
Sectorally – lower graduate share in
‘traditional’ and secondary activities
Agriculture, forestry & fishing
Mining & quarrying
Manufacturing
Utilities
Construction
Retail & distribution
Hotels & restaurants
Transport & communications
Financial services
Business services
Public administration & defence
Education
Health & social w ork
Other personal services
Whole econom y
NI graduate %
em ployed
persons (2007, 3year m oving
average)
8%
0%
23%
53%
11%
14%
6%
19%
33%
50%
43%
64%
50%
30%
31%
UK graduate %
em ployed
persons (2007, 3year m oving
average)
18%
38%
28%
41%
16%
16%
14%
20%
39%
50%
44%
64%
48%
33%
35%
NI (UK=100)
45
0
82
130
71
86
44
98
84
101
97
99
104
90
90
Worthy of
note
18,000 less graduates than structure suggests
NI: Actual minus expected qualifications (2007)
Other and do not
know
No qualifications
Level 1
Actual < Expected
Actual > Expected
Level 2
Level 3
18,000 more graduates
in employment if NI had
same sectoral skill
structure as UK
Level 4
Level 5
-60
-40
-20
0
20
40
NI actual minus expected qualifications (000s, 2007)
Source: LFS, Oxford Economics
60
Would move NI to
just below the UK
graduate average
Where would the 18,000 be?
NI: Actual minus expected graduates (2007)
Other personal services
Health & social w ork
Education
Public administration & defence
Business services
Financial services
Actual < Expected
Actual > Expected
Transport & communications
Hotels & restaurants
Retail & distribution
Construction
Utilities
Manufacturing
Mining & quarrying
Agriculture, forestry & fishing
-6
-4
-2
0
2
NI actual minus expected graduates (000s, 2007)
Source: LFS, Oxford Economics
4
Less managers and science professionals
NI % em ployed UK % em ployed
persons (2007, persons (2007,
3-year m oving 3-year m oving
average)
average)
Corporate Managers
Science & Technology Professionals
Health Professionals
Teaching & Research Professionals
Business & Public Service Professionals
Science & Technology Associate Professionals
Health & Social Welfare Associate Professionals
Protective Service Occupations
Culture, Media & Sports Occupations
Business & Public Service Associate Professionals
Administrative Occupations
Skilled Metal & Electrical Trades
Skilled Construction & Building Trades
Sales Occupations
Customer Service Occupations
Process, Plant & Machine Operatives
Transport & Mobile Machine Drivers & Operatives
Total
8%
2%
1%
5%
4%
1%
5%
1%
1%
4%
10%
5%
6%
8%
1%
5%
4%
100%
12%
4%
1%
5%
3%
2%
4%
1%
2%
5%
9%
4%
4%
6%
1%
4%
4%
100%
NI (UK=100)
66
61
101
97
109
82
122
61
64
72
111
124
156
119
45
137
115
100
Lowest concentrations of managers and
professionals
UK regions: Managers and professionals (2007)
% in
employment (3year ma)
60%
50%
40%
30%
20%
10%
0%
GL
SO
EN
UK
SW
Source: LFS, Oxford Economics
NW
SC
EM
WM
YH
WW
NE
NI
30,000 less managers than structure suggests?
NI: Actual minus expected occupations (2007)
Elementary
Process, plant and machine operatives
Sales and customer service
Actual > Expected
Personal service
Actual < Expected
Skilled trades
30,000 more managers
and 18,000 more
professionals in
employment if NI had
same occupation skill
structure as UK
Adminstrative and secretarial
Other professionals
Business and public service professionals
Science and technology professionals
Managers and senior officials
-40
-20
0
20
NI actual minus expected occupations (000s, 2007)
Source: LFS, Oxford Economics
40
Focus on key sectors - manufacturing
A key
weakness
% em ployed persons (2007, 3-year m oving average)
Corporate Managers
Science & Technology Professionals
Science & Technology Associate Professionals
Business & Public Service Associate Professionals
Administrative Occupations
Skilled Metal & Electrical Trades
Skilled Construction & Building Trades
Textiles, Printing & Other Skilled Trades
Sales Occupations
Process, Plant & Machine Operatives
Transport & Mobile Machine Drivers & Operatives
Elementary Trades, Plant & Storage Related Occupations
Elementary Administration & Service Occupations
Total
NI
North East
Wales
UK
11%
5%
3%
4%
6%
14%
4%
6%
2%
28%
4%
5%
1%
100%
15%
7%
3%
4%
5%
16%
2%
4%
1%
24%
4%
9%
1%
100%
13%
5%
4%
3%
5%
16%
2%
4%
1%
29%
4%
9%
2%
100%
17%
7%
3%
5%
6%
13%
2%
5%
1%
19%
3%
7%
2%
100%
Focus on key sectors – business services
Again a key weakness –
sub-sector structure likely
to be a factor
% em ployed persons (2007, 3-year m oving average)
Corporate Managers
Managers & Proprietors in Agriculture & Services
Science & Technology Professionals
Business & Public Service Professionals
Business & Public Service Associate Professionals
Administrative Occupations
Secretarial & Related Occupations
Sales Occupations
Customer Service Occupations
Elementary Administration & Service Occupations
Total
NI
North East
Wales
UK
10%
2%
9%
18%
7%
10%
9%
2%
1%
14%
100%
12%
3%
7%
10%
9%
12%
4%
2%
2%
15%
100%
13%
3%
8%
12%
12%
14%
7%
2%
1%
12%
100%
16%
4%
10%
13%
10%
11%
6%
2%
1%
10%
100%
Towards degree subject analysis – lower in science and
arts
NI % em ployed UK % em ployed
persons (2007, persons (2007,
3-year m oving 3-year m oving
average)
average)
Medicine and Dentistry
Subjects Allied to Medicine
Biological Sciences
Physical Sciences
Mathematical and Computer Sciences
Engineering
Technologies
Architecture, Building and Planning
Social Studies
Law
Business and Administration
Mass Communication and Documentation
Linguistics, Classics and Related
Creative Arts and Design
Education
Combined degree
Total
5%
14%
4%
3%
4%
5%
1%
2%
6%
2%
15%
1%
1%
3%
7%
21%
100%
2%
11%
5%
5%
6%
6%
1%
2%
6%
4%
12%
2%
3%
5%
7%
18%
100%
NI (UK=100)
190
130
72
67
78
79
79
91
102
65
133
47
31
62
107
117
100
Exploring STEM – 6,000 less than structure suggests
NI: Actual minus expected graduate subjects (2007)
Combined degree
Education
Actual > Expected
Creative Arts and Design
Arts
Business and Administration
Actual < Expected
6,000 more STEM and
3,000 more creative
graduates in
employment if NI had
same sectoral
graduate subject
structure as UK
Law
STEM
Biological, Vetinary and Agricultural
Sciences
Medicine, Dentistry and Allied Subjects
-15
-10
-5
0
5
10
NI actual minus expected graduate subjects (000s, 2007)
Source: LFS, Oxford Economics
15
More business
graduates yet lower
than expected share
of managers
Subject analysis – manufacturing
Strengths in maths / computing, business – weakness in
engineering
NI % em ployed UK % em ployed
persons (2007, persons (2007,
3-year m oving 3-year m oving
average)
average)
Subjects Allied to Medicine
Biological Sciences
Physical Sciences
Mathematical and Computer Sciences
Engineering
Technologies
Social Studies
Law
Business and Administration
Creative Arts and Design
Combined degree
Total
4%
4%
6%
10%
16%
0%
4%
1%
25%
1%
23%
100%
3%
5%
9%
6%
20%
2%
4%
2%
15%
6%
19%
100%
NI (UK=100)
174
87
71
172
82
0
102
78
171
23
126
100
Subject analysis – business services
Strength in business – weakness in maths and science
NI % em ployed UK % em ployed
persons (2007, persons (2007,
3-year m oving 3-year m oving
average)
average)
Biological Sciences
Physical Sciences
Mathematical and Computer Sciences
Engineering
Architecture, Building and Planning
Social Studies
Law
Business and Administration
History and Philosophical Studies
Creative Arts and Design
Combined degree
Total
1%
2%
7%
8%
7%
4%
10%
23%
2%
4%
24%
100%
4%
6%
10%
8%
7%
6%
9%
15%
3%
5%
18%
100%
NI (UK=100)
35
34
70
91
109
68
102
149
67
81
132
100
STEM – lowest regional concentration
UK regions: STEM graduates (2007)
% grads in
employment (3year ma)
20%
18%
16%
14%
12%
10%
SO
EN
EM
WM
SW
Source: LFS, Oxford Economics
UK
SC
NW
WW
NE
YH
GL
NI
Business administration – star performer
UK regions: Business and Administration graduates
% grads in
(2007)
employment (3year ma)
16%
Demand or supplyled?
14%
12%
10%
8%
6%
NI
GL
WM
SC
NE
Source: LFS, Oxford Economics
SO
UK
WW
YH
EN
SW
EM
NW
Creative – lowest regional concentration
UK regions: Creative Arts & Design graduates (2007)
% grads in
employment (3year ma)
8%
6%
4%
2%
0%
GL
SW
YH
UK
NW
Source: LFS, Oxford Economics
WW
EN
SO
WM
NE
EM
SC
NI
Subject mix new graduate entrants to labour market - HESA
Medicine and Dentistry
Subjects Allied to Medicine
Biological Sciences
Vetinary Science, Agriculture and Related Subjects
Physical Sciences
Mathematical and Computer Sciences
Engineering
Technologies
Architecture, Building and Planning
Social Studies
Law
Business and Administration
Mass Communication and Documentation
Linguistics, Classics and Related
European Language, Literature and Related Subjects
East Asiatic, African, American and Australian Languages and Literature
History and Philosophical Studies
Creative Arts and Design
Education
Combined degree
Total
2002/03 %
total
2006/07 %
total
3.1%
14.2%
4.5%
0.1%
0.6%
2.1%
0.3%
9.2%
4.0%
3.4%
10.2%
1.8%
18.3%
1.5%
3.5%
3.1%
3.2%
15.0%
1.9%
0.0%
100.0%
3.8%
19.6%
5.7%
0.1%
0.4%
2.0%
0.6%
5.3%
4.3%
3.7%
9.6%
3.3%
13.9%
1.7%
2.8%
2.6%
3.8%
16.7%
0.2%
0.0%
100.0%
NI domiciled leavers gaining HE qualifications at UK HEIs and in employment in NI six months after graduation
Skills forecasts – the forward
picture
Approach
 Leitch / IER & CE - developed quantified views on long-run
trends in skills requirements
“One method would be to gather information from Sector Skills Councils
(SSCs) about their assessments of recent trends and possible futures.
This information would typically be qualitative, and often very specific,
but would provide well-grounded ‘bottom-up’ information. Such
assessments often suffer from excessive influence from very recent
trends, but the same could be said of other methods. We do not pursue
this approach. Rather, we focus on quantitative methods, intended to
complement a qualitative assessment, to give some idea of scale and a
means of aggregating to allow summary lessons to be drawn”
Gathering data
 To estimate demand flows:
- Expansion demand is taken from base forecasts – change in
employment stock (e.g. rising stock for professional services,
declining stock for manufacturing)
- Replacement demand is based on flows data drawn from the LFS
– leavers due to retirement, looking after home etc. i.e. replacement
demand creates a need for workers even in declining sectors
 Though replacement demand flow analysis should be done
separately by industry / occupation there are sample size
complications so UK aggregates are often used
 An issue over skills inflow not requiring training is important
(for example moving industry, returning from sickness) this raises a net / gross issue
Summary baseline forecasts - occupations
Net
requirem ent
Indicative
from
'education'
education and requirem ent
m igrants
Expansion
dem and
Gross
replacem ent
dem and
Total
returnees
Corporate Managers
Managers & Proprietors in Agriculture & Services
Science & Technology Professionals
Health Professionals
Teaching & Research Professionals
Business & Public Service Professionals
Science & Technology Associate Professionals
Health & Social Welfare Associate Professionals
Protective Service Occupations
Culture, Media & Sports Occupations
Business & Public Service Associate Professionals
Administrative Occupations
Secretarial & Related Occupations
Skilled Agricultural Trades
Skilled Metal & Electrical Trades
Skilled Construction & Building Trades
Textiles, Printing & Other Skilled Trades
Caring Personal Service Occupations
Leisure & Other Personal Service Occupations
Sales Occupations
Customer Service Occupations
Process, Plant & Machine Operatives
Transport & Mobile Machine Drivers & Operatives
Elementary Trades, Plant & Storage Related Occupations
Elementary Administration & Service Occupations
Whole econom y
27.0
1.6
8.4
1.6
1.4
9.2
0.2
3.6
-0.6
3.3
8.6
-6.6
-7.4
0.3
-8.0
0.2
-2.5
12.5
-0.6
5.5
1.4
-11.4
1.1
-5.4
5.0
48.3
42.7
15.2
10.8
2.7
23.7
14.9
2.8
13.8
4.0
1.9
22.1
63.4
10.8
8.9
29.2
40.6
11.9
48.9
27.1
64.7
4.2
59.3
22.3
34.8
100.2
681.0
16.5
6.1
12.3
1.1
13.5
12.3
8.2
21.0
0.0
6.1
16.0
43.2
11.9
4.1
21.9
29.2
15.0
38.0
14.7
74.2
2.6
27.7
19.8
24.2
63.5
503.0
53.2
10.8
6.9
3.1
11.7
11.9
-5.2
-3.7
3.4
-0.9
14.7
13.6
-8.6
5.1
-0.7
11.6
-5.6
23.4
11.8
-4.1
3.0
20.3
3.7
5.1
41.7
226.3
53.2
10.8
6.9
3.1
11.7
11.9
-5.2
-5.5
3.4
-0.9
12.9
13.6
-8.6
5.1
-6.7
10.2
-8.7
18.3
6.7
-4.1
2.7
8.1
2.1
-0.8
25.2
165.6
Whole economy (annual)
4.0
56.7
41.9
18.9
13.8
2008-2020
Assumes average
annual net
migration of 700 pa
2008-2020 (almost
10,000 pa 2006-07)
Summary baseline forecasts – walk through
 4,000 pa expansion in net jobs (people-based)
 57,000 leavers pa to retirement, death, unemployment, inactivity, other
occupations and out migration
 42,000 returnees to labour market pa from unemployment, inactivity
and other occupations
 Net requirement of 19,000 persons pa from education and in-migration,
of which 14,000 expected to be required from ‘education’ after
forecasting migration joiners (based on recent trends and economic
conditions)
 To put this into context annual young person age cohort is 25,000
[though roughly 5,000 FT first year enrolments at non-NI HEIs,
undergrad and postgrad]
Skill level entering employment - NVQ
2007 % total (3-year m oving average)
NI
NVQ Level 0 (including other and do not know )
NVQ Level 1
NVQ Level 2
NVQ Level 3
NVQ Level 4
NVQ Level 5
Total
Previously in
em ploym ent
From
education
Nonem ployed
22%
4%
17%
25%
26%
6%
100%
11%
2%
36%
30%
19%
3%
100%
72%
0%
1%
18%
0%
10%
100%
Note: broadly similar, higher level 5 into employment in UK. More L2
and L3 from education in NI
2007 % total (3-year m oving average)
UK
NVQ Level 0 (including other and do not know )
NVQ Level 1
NVQ Level 2
NVQ Level 3
NVQ Level 4
NVQ Level 5
Total
Previously in
em ploym ent
From
education
Nonem ployed
20%
5%
16%
24%
27%
8%
100%
12%
3%
33%
27%
20%
6%
100%
72%
0%
1%
12%
1%
15%
100%
Seems high –
verification with
DETI underway
Summary baseline forecasts - NVQ
NVQ Level 0
Other qualifications
NVQ Level 1
NVQ Level 2
NVQ Level 3
NVQ Level 4
NVQ Level 5
Whole econom y (annual)
Gross
replacem ent
dem and (000s,
2008-2020)
Indicative
'education'
requirem ent
(000s, 2008-2020)
208
27
44
131
131
107
30
56
30
5
6
26
36
47
14
14
Note: this takes account of sectoral and occupational shifts and educational ‘creep’
Summary baseline forecasts - graduates subjects
Medicine & dentistry
Subjects allied to medicine
Biological sciences
Veterinary science
Agriculture & related subjects
Physical sciences
Mathematical sciences
Computer science
Engineering & technology
Architecture, building & planning
Social studies
Law
Business & administrative studies
Mass communications and documentation
Languages
Historical and philosophical studies
Creative arts & design
Education
Combined
Total
Indicative
'education'
graduate
requirem ent
(000s, 2008-2020)
1.3
-1.1
2.7
0.0
0.6
0.9
0.3
1.2
1.9
2.0
5.0
2.0
29.7
0.5
1.0
0.8
0.7
11.6
0.2
61.1
% total
2%
-2%
4%
0%
1%
1%
1%
2%
3%
3%
8%
3%
49%
1%
2%
1%
1%
19%
0%
100%
Note: extreme care must be exercised – this uses recent trends as indication of demand into
given occupations (may not be desired)
Planning and enabling a
‘better’ Northern Ireland
Towards an ‘upper scenario’
 Extremely complex process
 Easier to say where we want to get to (more jobs, more productive,
richer) than how
 To date no ‘accepted’ vision of how ‘aspirational’ growth will be
delivered in terms of employment sectors (PfG target and activity
focused)
 Gathering a consensus is complex probably un-achievable
 Oxford have consulted with key representatives, reviewed the Sector
Skills Councils, MATRIX reports and priority sectors documentation
and used their economic understating to determine a plausible ‘upper
scenario’
 This is based upon the approach in the Leitch Review and achieving
the PfG productivity aim
 Sectoral balance based on Oxford’s views drawn from the examined
qualitative and quantitative views of elsewhere
 Note: Far from definitive
PfG key goals
 PfG key goals (examples)
-
-
Halve the private sector productivity gap with the UK average (excluding the
Greater South East) by 2015
Increase the employment rate from 70% to 75% by 2020
Secure inward investment commitments promising over 6,500 new jobs by 2011, of
which 5,500 will provide salaries above the Northern Ireland private sector median
70% of new FDI projects secured to locate within 10 miles of an area of economic
disadvantage
Increase the number of tourists visiting each year from 1.98m to 2.5m by 2011 and
increasing tourism revenue from £370m to £520m each year by the same date
Ensure by 2015 that 80% of the working age population is qualified to at least GCSE
level or equivalent
Increase by 25% the numbers of students, especially those from disadvantaged
communities, at graduate and postgraduate level studying Science, Technology,
Engineering and Mathematics (STEM subjects) by 2015
Closing the productivity gap – the challenge
Relative productivity: NI baseline (EDF Sept 08)
UK excl
GSE=100
100
98
Target half gap 2015 = 96.7
PfG target
96
94
92
90
1995
1999
Source: Oxford Economics
2003
2007
2011
2015
2019
Leitch – understanding the process
 Higher skills, better generic skills and improved managerial capacity →
drive innovation, be more creative, take advantage of technological
change and harness skills of employees → higher productivity →
implication for employment by sector, occupation and skill level. i.e.
supply-driven scenario
-
-
Assumed impact on labour productivity equal to increase in an index of the quality of
labour. i.e. better skills → better returns personally and to whole economy
Adjusted sectoral economic model to reproduce these assumed changes in labour
productivity at a sectoral and aggregate level
Formed views on the extent to which each sector’s increase in productivity came
about through higher output, or lower employment, or some combination
Employment by sector then used as inputs for subsequent model of profile of
occupations and qualifications to complete the picture and check that outcomes
broadly consistent with the initial improved skill base assumptions
Role of demand - although supply-side improvements are a prerequisite, the more
important factor is stimulating the demand among employers for more highly skilled
workers
Higher skills – can mean lower jobs
 Less jobs 1
- Skill improvements could be translated into productivity gains (i.e. ‘lean’
manufacturing) without much or any increase in output, resulting in a fall in
employment. E.g. where demand is fixed and little scope to improve
product quality
 Less jobs 2
- Where higher skills lead to rise in general level of wages in the economy,
firms in low value-added activities have to pay more and respond in part by
changing the character of jobs to raise productivity, but also by exiting from
activities that are no longer viable
 More jobs
- Where improved quality of labour results in improved quality of output as
well, likely to increase the volume demanded (including exports) and/or
increase the price customers are willing to pay and increase employment
Note also multiplier job impacts in secondary sectors
Leitch – two high skill scenarios
 Catch up scenario
- Future in which sectors that have performed less well in past decade are
regarded as offering the greatest scope for improvement → greater
investment in skills and a stronger relative improvement in those sectors
 Restructuring scenario
- Future in which sectors that have performed less well in the past decade
are regarded as being most vulnerable to the impact of globalisation and
technological change in the future → greater investment in skills in the
same sectors that saw the largest increase in the skills index in the last
decade
 Implication
- Although the two scenarios result in a somewhat different pattern of value
added and employment by sector, the implications for output are similar
- Whole-economy increase in the annual rate of growth of value added
per workplace job (productivity) is 0.1–0.2%
Leitch – UK restructuring scenario (note less jobs)
Agriculture
Mining & quarrying and utilities
Food, drink & tobacco
Textiles & clothing
Wood, paper, printing & publishing
Chemicals & NMMP
Metals & metal goods
Engineering
Transport equipment
Manufacturing other & recycling
Construction
Wholesale distribution
Other retail distribution
Hotels & restaurants
Transport
Communications
Banking & insurance
Professional services
Computing services
Other business services
Public administration & defence
Education
Health & social w ork
Miscellaneous services
Total
Difference from baseline 2020
Em ploym ent
GVA (£m )
(000s)
-10
-108
0
361
-14
-215
-6
-61
-7
503
-6
786
-13
-161
-7
447
-8
116
-2
123
12
1,420
-13
1,467
-16
1,535
19
1,326
13
1,286
3
2,457
-19
1,315
18
4,454
10
2,299
12
1,301
-54
201
19
2,312
27
4,076
-1
1,998
-40
30,985
Key
Leitch – UK catch up scenario (note slightly more jobs)
Difference from baseline 2020
Agriculture
Mining & quarrying and utilities
Food, drink & tobacco
Textiles & clothing
Wood, paper, printing & publishing
Chemicals & NMMP
Metals & metal goods
Engineering
Transport equipment
Manufacturing other & recycling
Construction
Wholesale distribution
Other retail distribution
Hotels & restaurants
Transport
Communications
Banking & insurance
Professional services
Computing services
Other business services
Public administration & defence
Education
Health & social work
Miscellaneous services
Total
Employment
(000s)
9
0
6
4
16
9
5
26
8
6
20
21
-34
3
22
-3
18
57
30
0
-6
22
46
2
283
GVA (£m)
526
527
1,196
224
1,500
2,216
1,072
2,763
1,403
606
1,946
3,490
1,549
1,470
2,294
2,639
3,032
6,150
3,039
1,779
1,924
1,774
2,913
21,115
50,546
Still a fall
Mimicking Leitch – what we did




Mirrored exactly the productivity and employment growth improvements set out
in Leitch scenarios
The sector profile – it could be argued – might be different if the Leitch – skills /
earnings (as proxy for productivity return) analysis was done separately
(outside scope)
This is not sufficient to achieve the PfG productivity target
Therefore additional jobs / productivity improvements have been added in core
export sectors to reach the PfG 2015 target

This sectoral mix and the balance between productivity gains / employment
growth is based on consultations, SSC, MATRIX, and the ‘ethos’ of the Leitch
scenarios

Recall Leitch is focused on productivity improvement NOT employment growth
(which remains – and may increasingly be - a problem for NI)
The challenge – Q. would Leitch be enough?
More ‘stretched’
scenario to close gap
PfG target
97.0
96.5
Catch-up
Restructure
UK excl. GSE = 100
96.0
Base
GB Leitch
95.5
95.0
94.5
Productivity impact
applied uniformly to
all regions outside
GSE (not NI)
94.0
93.5
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
A. Not if other regions implement Leitch also (though some modest improvement)
If not – then what else?

Who we interviewed (many more contacted)
Government
representatives
Trade bodies
Education bodies
Local economists
Sector bodies
Sector Skill Councils
Actual consultations took place
Education & Skills Committee
Stern Review
Invest NI sector treams (Life Sciences, Creative Industry, Softw are,
Construction and Tourism)
Institute of Directors
MATRIX
Association of NI Colleges
Pricew aterhouseCoopers
Manufacturing - Food and Drink Association
Tourism - NI Hotels Federation
Voluntary - NICVA
ICT - Momentum
Association of Sector Skill Councils
Workshop w ith 8 SSCs
Aim
• Guidance on how a more aspirational scenario for NI might be achieved
• Guidance on future skill, occupation and subject needs, particularly under an aspirational scenario
• No accepted vision / lack of consensus
• For many consulted, consensus was to direct us towards SSCs / Sector Skill Agreement reports
• SSCs completed qualitative and quantitative questionnaires (two-thirds of SSCs replied)
SSC forecasts – varying time periods and details
Selected SSC forecasts
Cogent
Construction Skills
E-Skills UK
Financial Services
Lifelong Learning UK
SEMTA
Em ploym ent
Em ploym ent
grow th
grow th
forecast forecast - total expansion
(000s)
dem and
(000s)
4.0
0.0
11.2
5.6
2.9
0.1
0.3
12.1
0.6
Em ploym ent
grow th
forecast replacem ent
dem and
(000s)
4.0
2.8
11.5
Tim e period
2004-2014
2008-2012
2006-2021
2007-2010
By 2014
2005-2014
Achieving aspirational scenario – some thoughts from
consultations
 Upskilling of existing persons employed across sectors (though why is
this not happening already?) → work smarter, think more creatively,
more commercially sensitive BUT may be difficult in a downturn (training
often cut back)
 Development of indigenous businesses and new indigenous start-ups
(more likely to stay and in sectors NI not necessary renowned for its
international competitiveness
 Attract export-orientated ‘here to stay’ high value added FDI in sectors
NI can be competitive in (e.g. ICT) – competing on cost less of an option
 Tourism should be part of the aspiration (if not necessarily high value
added)
 Mixed employment strategy – high and low productivity - to reflect what
NI has (concentration of low skills)
 “No single solution – needs a bit of everything”
Achieving aspirational scenario – some thoughts from
consultations
 Skills
-
Upskilling
Financial, literacy and numeracy
Generic: Readiness for work, creativity, adaptability, problem-solving
Caveat: Formal qualifications not always best proxy for skills – need for
work experience – shortfall in quantitative work
 Occupations
- Need for more managerial expertise
 Subjects
- Sectors differ in relative importance of subjects
- Matter a lot – Cogent, SEMTA, Summit Skills
- Matter less – Financial Services
- Generic skills matter for all sectors
Extending Leitch scenarios to reach PfG target –
“Convergence”
PfG target achieved
101
Restructure convergence
100
Catch-up convergence
Base
UK excl. GSE = 100
99
GB Leitch
98
97
96
95
94
93
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
Jobs and GVA additions
 For catch up:
■ Employment growth improved by 0.5% pa compared to Leitch
restructuring in all exporting sectors (agriculture, manufacturing,
transport & comms, hotels, finance, business and other services)
■ Productivity growth improved by 0.5% pa compared to Leitch
restructuring in all service export sectors, manufacturing
unchanged
 For restructuring:
■ Employment growth improved by 0.25% pa compared to Leitch
restructuring in hi-tech manufacturing, communications, finance &
business services and tourism (priority, export potential sectors)
■ Productivity growth improved by 0.75% pa compared to Leitch
restructuring in exporting services and 0.25% pa in specialist
manufacturing
Jobs and GVA added
Leitch restructure convergence
Agriculture
Extraction
Manufacturing
Utilities
Construction
Distribution & retail
Transport & comms
Financial & business
Public admin & defence
Education & health
Other services
Total
Total annual average
Employment
change 2015
(000s)
-0.4
0.0
-0.2
0.0
0.5
1.2
0.4
1.9
-0.8
0.4
0.4
3.4
0.5
GVA change
2015 (£m)
-4.3
0.6
101.2
0.0
28.7
96.5
109.5
410.1
0.9
71.1
57.2
853.9
-
Leitch catch-up convergence
Employment
change 2015
(000s)
0.7
0.0
2.0
0.0
1.1
2.4
0.4
4.3
0.0
1.6
0.9
13.3
1.9
GVA change
2015 (£m)
28.5
0.7
260.4
0.1
45.7
152.9
76.2
405.6
34.8
62.2
63.0
1089.2
-
More productivity focussed More employment focussed
500 jobs pa
1,900 jobs pa
Productivity implications
Base 2015
Agriculture
Extraction
Manufacturing
Utilities
Construction
Distribution & retail
Transport & comms
Financial & business
Public admin & defence
Education & health
Other services
Total
Note: Productivity relative to UK
81.2
126.1
97.7
120.1
86.1
92.2
84.5
80.3
121.9
90.9
92.4
86.8
Leitch
restructure 2015 Leitch catch-up
(converge)
2015 (converge)
81.7
127.1
99.8
120.2
86.8
93.3
88.6
84.3
123.6
92.1
96.3
88.8
83.1
127.2
100.4
120.2
86.8
93.7
87.1
82.7
123.5
91.4
95.8
88.5
Sectors, skills and productivity
 For catch up:
■ Net additional jobs = 13,000, directly alters overall occupation
structure (although only modestly)
■ Upskilling existing jobs (based on historical replacement demand
analysis) / shift towards higher grade occupations
■ Skills ‘uplift’ of new entrants
■ Academic literature on links between qualifications and wages /
productivity and HESA
 For restructuring:
■ Net additional jobs = 3,000 (very modest)
■ Significant upskilling and skills creep / shift towards managerial and
professional occupations
■ Again academic literature / HESA on qualification-productivity
relationship
Qualifications and wages / productivity
Harmon and Walker (2000) for NI and HESA
(LFS possible alternative source)
Harm on and Walker (2000)
GCSE
A-Level
Degree
Wage return
relative to no
qualications
(m ale)
33%
49%
66%
HESA 2004/05
Median annual
salary (study and
em ployed in NI)
Undergraduate
Postgraduate
Masters
Doctorate
£16,000
£19,000
£19,500
£21,000
Assum ed return
relative to
average
qualification
0%
16%
33%
Assum ed return
relative to
average
qualification
0%
19%
22%
31%
Doctorate
Masters
PGCE
Other postgrad incl unknow ns
Rest of NVQ5
NVQ 4
NVQ 3
Trade apprenticeships
NVQ 2
NVQ 1
Other qualifications
No qualifications
Productivity
factor relative to
NVQ 2
64%
55%
52%
52%
52%
33%
16%
0%
0%
-16%
-16%
-33%
Scenario summary (preliminary)
Baseline
Restructuring
Catch up
Total employment 2015 (job-based)
Total employment 2015 (people-based)
o/w NQV Level 0 %
o/w NQV Level 4/5 % (graduate)
868
767
17%
35%
871
770
13%
37%
881
779
14%
36%
Expansion demand 2008-2015 (annual, 000s)
o/w managerial and professional
o/w process and elementary
4.0
4.4
-0.9
4.7
5.4
-1.4
6.2
5.2
-0.5
Gross replacement demand 2008-2015 (annual, 000s)
56.7
56.6
57.6
Indicative 'education' requirement 2008-2015 (annual, 000s)
o/w NQV Level 0
o/w NQV Level 4/5 (graduate)
o/w STEM subjects
o/w Business & Administraive subjects
13.8
2.5
5.1
0.4
2.5
14.5
1.9
5.9
0.5
2.9
17.3
3.1
5.9
0.5
2.8
Additional GVA above baseline 2015 (£m 2003 prices)
Employment rate 2015
67%
854
67%
1,089
67%
Growing demand for graduates
NI: Employed graduates
NVQ 4/5 % total
(3-year ma)
45%
Forecast
40%
35%
30%
25%
Restructuring
Catch up
Baseline
20%
1995
2000
Source: LFS, Oxford Economics
2005
2010
2015
2020
Falling need for low skills (provisional)
NI: Employed persons with no and other qualifications
NVQ 0 and
other % total (3year ma)
30%
Forecast
Possible data
issue
25%
20%
15%
Baseline
10%
Catch up
Restructuring
5%
1995
2000
Source: LFS, Oxford Economics
2005
2010
2015
2020
Leitch – some issues to consider
 Not predominantly an employment strategy (PSA1 not PSA
3)
 What do those losing jobs under restructuring do?
 By no means the only combination of jobs / productivity to
deliver faster growth?
 Is productivity the only question?
 What impact does rising productivity have on wealth
differentials and ‘lower skilled’ occupations?
 Is it challenging enough?
UK convergence before and after
NI: Relative productivity
UK=100
100
Forecast
Restructuring
97
Catch up
Baseline
94
91
88
85
1995
2000
Source: Oxford Economics
2005
2010
2015
2020
UK convergence before and after
NI: Relative employment rate
UK=100
100
Forecast
97
94
91
88
Catch up
Restructuring
Baseline
85
1995
2000
Source: Oxford Economics
2005
2010
2015
2020
Issues with aspirations
 World is a changing place (especially today)
 A vision for faster growth is difficult to settle on (and consensus is
unlikely)
 Productivity improvement means less jobs (where does this labour
go?)
 Training for sectors is risky – cannot fund all. Pick winners or pick
those in need of support?
 Winners appears more obvious – but remember it is not a ‘blank page’
– we have the skills that we have
 Forecasts can only provide a sense of scale and direction of travel
 Subject analysis limited in lessons learnt (more work required)
 Is observed demand desired demand?
 Formal qualifications are not the only metric
What else are we doing / questions
 Qualifications elsewhere (analysis by region)
 Sectoral analysis, including by priority sector
 Qualifications by NQF
Questions:
 Economy getting worse, importance of employment rate
coming back to the fore?
 Retraining / upskilling in a downturn – opportunity or
cutbacks?
Summary and your inputs
Summary and conclusions




The economy is heading into tough times
This could be a short term problem but may be a long term shift
Growth will definitely not look like the last decade
Skills needs will shift accordingly
 NI’s improving skills structure evident
 But less graduates and managers than would be expected
 STEM, arts under represented – business studies over represented
 Improved skills widely seen as a route to productivity improvement
 Leitch provides a potential framework – but is not an employment strategy
 Model suggest PfG target could be achieved by in the order of an extra 1,000
graduates per annum over base needs (approx 5K)
 The balance of jobs / sectors / subjects is complex – a myriad of options
 Ultimately however it remains a question of demand
 Current education outturns will be roughly in balance with labour market needs
(if you assume current student outflows and no in migration)
 An ongoing science – revisit – refine – question and debate
What we need you to do!
 Feedback and discuss!
 Think about the Leitch concept (is catch-up or restructuring
the best policy – only choices?)
 Think about the implications of Leitch – make sense?
 Think about the extra convergence challenge – correct
sectoral split?
 Challenge too hard or too straightforward?
 Please fill in the sheets on sectoral focus if at all possible
Contact:
Neil Gibson
Director Regional Services, Oxford Economics
Tel: 028 9266 0669
Email: [email protected]
Graeme Harrison
Head All-Island Consultancy, Oxford Economics
Tel: 028 9266 0669
Email: [email protected]
Karen Barklie
Economist, Oxford Economics
Tel: 028 9266 0669
Email: [email protected]
Annex: Additional information
Outputs of this project
 Analysis of current skills picture:
■ By skills level (NVQ and NQF) within SIC03 sectors and SOC00 occupations (all UK
regions)
■ By graduate degree subject of study (JACS coding) within sectors and occupations
(all UK regions)
 Forecasts of future skills needs by:
■
■
■
■
Net total requirement flow (expansion demand + net replacement demand)
NVQ and NQF
By 14 sectors (including DETI / Invest NI priority sectors) and by 25 occupations
New entrant graduate subject demand forecast
 Forecasts of future skills needs under an aspirational scenario
■ Development of an aspirational scenario carried out by Oxford under guidance from
selected consultations and review of existing material (Govt policy / PSA and PfG
targets, SSC reports)
Note – sample sizes an issue (LFS based – three-year averages used)
Note – quality of data an issue (LFS and sectoral employment)
Note – SSC reports reviewed and comparable data summarised where possible
(employment growth projections, skill and occupation trends)
Is NI more exposed or not ?..
More exposed
Less exposed
House price contraction more
severe
Public sector buffer
Construction and retailing key
sectors in recent performance
Limited world finance jobs
Confidence fall acute
Executive?
Ill-prepared
Competitive location for wages
More globally integrated than
previously
Retailing boosted by cross border
NI workforce skills – up skilling evident
NI: Graduates (NVQ 4 and 5)
% employed
persons
35%
32%
29%
3-year moving
average
26%
23%
20%
1995
Source: LFS
1997
1999
2001
2003
2005
2007
NI workforce skills – NQF
Qualifications of persons in em ploym ent
Do not know
No qualifications
Other qualifications
NQF 1
NQF 2
NQF 3
> NQF 3 not including NQF 4
NQF 4
NQF 5
o/w Masters
o/w PhD
Total
1997 % total (3year m oving
average)
2007 % total (3year m oving
average)
Change (pp point)
1%
28%
4%
6%
5%
30%
1%
23%
4%
2%
0%
100%
1%
20%
4%
5%
8%
28%
0%
28%
7%
3%
1%
100%
0.7
-8.0
-0.5
-0.9
2.8
-1.6
-0.6
4.9
3.2
1.5
0.3
-
Qualifications of young and old
NI: NVQ qualifications of working age 50-59/64
(Average 2005-2007)
NI: NVQ qualifications of working age 25-29
(Average 2005-2007)
Other and do not
know, 17%
NVQ Level 5, 7%
NVQ Level 5, 9%
NVQ Level 4,
15%
Other and do not
know, 45%
NVQ Level 0, 7%
NVQ Level 4,
30%
NVQ Level 1, 4%
NVQ Level 3,
21%
NVQ Level 2,
19%
Source: LFS
NVQ Level 2, 8%
NVQ Level 3,
26%
NVQ Level 1, 4%
Source: LFS
NVQ Level 0,
27%
Graduate concentration lower – but not due to sector
NI actual graduate share in employment
UK actual graduate share in employment
Expected NI graduate share if sector graduate
shares equal to UK shares
Graduate gap due to low er sector graduate
shares
Graduate gap due to structure of economy
Actual graduates
(2007 graduate
share, 3-year
m oving average)
UK=100
31%
35%
89.9
100.0
34%
97.7
3%
7.7
1%
2.3
Managerial concentration lower – but not due to sector
NI actual managerial share in employment
UK actual managerial share in employment
Expected NI managerial share if sector
managerial shares equal to UK shares
Managerial gap due to low er sector managerial
shares
Managerial gap due to structure of economy
Managerial share
(2007, 3-year
m oving average)
UK=100
10.5%
15.0%
70.0
100.0
14.7%
98.3
4.2%
28.2
0.3%
1.7
STEM gap – not structure
STEM graduate
share (2007, 3year m oving
average)
UK=100
NI actual STEM graduate share in employment
12.9%
76.9
UK actual STEM graduate share in employment
16.8%
100.0
16.2%
96.4
3.3%
19.6
0.6%
3.6
Expected NI STEM grduate share if sector
STEM graduate shares equal to UK shares
STEM graduate gap due to low er sector STEM
graduate shares
STEM graduate gap due to structure of
economy
Forecasting skills – methodological re-cap
Expansion demand
Change in employment year 1
– year 0
By occupation and sector
Employment in sector
(12 months previous)
By occupation
- Census base grown at LFS occupation
shares within occupation -
- Model based
% leaving to
retire
% leaving to
inactivity /
other
% leaving to
migrate
% dying
% leaving to
other
occupations
(can be within
same sector)
% leaving to
other sectors
(same
occupation)
% split across
Optional
•Inactivity
•Unemployed
•Sickness (long term
/ short term)
•Looking after the
home
•Training
•Other
% joining from
other occupations
(can be within
same sector)
% joining from
other sectors
(same occupation)
Total need
By occupation and
section
Skill requirements by
occupation and sector
(trends over time)
i.e. increasing need for higher skills
- From time series analysis of LFS
new entrants series
Skill requirements
by occupation and
sector
- from LFS crosstabs of new entrants
(whole economy) -
% joining from new
migrants
% joining from
inactivity /
unemployment
Leavers
(rep
demand
outflows)
Taken from LFS
cross tabs of
activity last year
vs. activity this
year (whole
economy)
Joiners
(rep
demand
inflows)
Some definitions - leavers




To death
To retirement (early and retirement age)
To unemployment / training schemes
To inactivity
-
Long-term sick
Looking after family / home
Student
Other
 To other occupations, same sector (occupational mobility)
 To other sectors, same occupation (sectoral mobility)
 To migration (leave NI)
Some definitions - joiners
 From unemployment / training schemes
 From inactivity
-
Long-term sick
Looking after family / home
Early retirement
Other
 From other occupations, same sector (occupational
mobility)
 From other sectors, same occupation (sectoral mobility)
 From migration (arrive in NI)
 From education system
LFS flows data – leaving rates
Leaving rate % total em ployed persons w hole econom y
previous year (2007, 3-year m oving average)
Death *
Unemployment / training schemes
Inactivity excluding retirement
Retirement
Other occupations
Other sectors
Out migration *
Total leaving rate
* Not estimated from LFS
** Replacement demand analysed by occupation → sector
mobility leaving rate
NI
UK
0.3%
1.2%
1.9%
2.3%
2.6%
**
1.0%
9.2%
0.3%
1.9%
2.4%
3.4%
4.4%
**
1.2%
13.5%
2.7%
-
Leaving rates – occupations, generally lower leaving
rates (less churn or turnover)
Leaving rate % total em ployed persons previous
year (2007, 3-year m oving average)
Corporate Managers
Managers & Proprietors in Agriculture & Services
Science & Technology Professionals
Health Professionals
Teaching & Research Professionals
Business & Public Service Professionals
Science & Technology Associate Professionals
Health & Social Welfare Associate Professionals
Protective Service Occupations
Culture, Media & Sports Occupations
Business & Public Service Associate Professionals
Administrative Occupations
Secretarial & Related Occupations
Skilled Agricultural Trades
Skilled Metal & Electrical Trades
Skilled Construction & Building Trades
Textiles, Printing & Other Skilled Trades
Caring Personal Service Occupations
Leisure & Other Personal Service Occupations
Sales Occupations
Customer Service Occupations
Process, Plant & Machine Operatives
Transport & Mobile Machine Drivers & Operatives
Elementary Trades, Plant & Storage Related Occupations
Elementary Administration & Service Occupations
Whole econom y
NI
UK
Diff (pp point)
5.5%
7.1%
3.3%
2.7%
3.0%
5.6%
1.4%
3.0%
3.3%
4.9%
5.1%
5.6%
7.7%
2.0%
9.8%
5.0%
9.7%
6.2%
13.1%
11.3%
10.4%
15.1%
5.9%
15.2%
12.6%
9.2%
9.6%
11.2%
10.5%
6.3%
7.4%
8.5%
9.5%
7.5%
6.9%
9.7%
11.5%
12.1%
12.6%
12.0%
9.3%
9.6%
15.3%
12.9%
17.4%
20.9%
21.5%
18.2%
12.8%
22.0%
21.7%
13.5%
-4.1
-4.1
-7.1
-3.5
-4.4
-2.9
-8.0
-4.5
-3.6
-4.7
-6.3
-6.5
-4.8
-10.0
0.5
-4.7
-5.6
-6.7
-4.3
-9.6
-11.1
-3.2
-7.0
-6.8
-9.1
-4.3
Includes all
leavers:
•Death
•Retirement
•Unemployment
•Inactivity
•Other
occupations
•Out migration
PSA selected targets
 PSA 1 – productivity growth
- Increase by 3% the level of export sales as a percentage of total sales by
Invest NI client companies, excluding the top 25 exporting companies
- Increase the BERD expenditure in Invest NI client companies with greater
than 249 employees by a 5% CAGR (compound annual growth rate)
 PSA 2 – skills for prosperity
- Increase by 5% the numbers studying STEM subjects in post 16 cohort by
2011
- Increase the proportion of Further Education enrolments at Level 3 from
57% in 2005/06 to 60% in 2010/11
 PSA 3 – increasing employment
- Increase employment levels and reduce inactivity
- Assist 70,000 working age benefit clients to move into employment by
March 2011, subject to economic conditions
NI baseline forecasts
2008-2015 (unless
stated)
Em ploym ent (000s)
Agriculture, forestry & fishing
Mining & quarrying
Manufacturing
Utilities
Construction
Retail & distribution
Hotels & restaurants
Transport & communications
Financial services
Business services
Public administration & defence
Education
Health & social w ork
Other personal services
Total
1
0
-5
0
-6
2
3
1
3
15
-1
2
11
2
28
GVA - average annual real grow th
2.6%
Relativities 2015 (UK=100)
GVA per head
GVA per employed person
Employment rate
Working age population share
80
87
91
101
PfG achievement - replacement demand implications
Restructuring “convergence” scenario
Net
requirem ent
Indicative
from
'education'
education and requirem ent
m igrants
Expansion
dem and
Gross
replacem ent
dem and
Total
returnees
Corporate Managers
Managers & Proprietors in Agriculture & Services
Science & Technology Professionals
Health Professionals
Teaching & Research Professionals
Business & Public Service Professionals
Science & Technology Associate Professionals
Health & Social Welfare Associate Professionals
Protective Service Occupations
Culture, Media & Sports Occupations
Business & Public Service Associate Professionals
Administrative Occupations
Secretarial & Related Occupations
Skilled Agricultural Trades
Skilled Metal & Electrical Trades
Skilled Construction & Building Trades
Textiles, Printing & Other Skilled Trades
Caring Personal Service Occupations
Leisure & Other Personal Service Occupations
Sales Occupations
Customer Service Occupations
Process, Plant & Machine Operatives
Transport & Mobile Machine Drivers & Operatives
Elementary Trades, Plant & Storage Related Occupations
Elementary Administration & Service Occupations
Whole econom y
34.8
1.7
10.9
1.5
1.7
8.9
2.1
3.5
-0.7
3.0
7.5
-6.4
-5.9
0.2
-6.4
2.8
-1.9
13.0
-0.4
1.3
1.3
-8.8
3.4
-5.3
-5.8
56.1
44.9
15.2
11.4
2.6
23.5
14.8
3.0
13.5
3.9
1.9
21.7
63.2
11.3
8.7
29.9
43.3
12.1
48.2
27.0
62.7
4.2
62.1
22.9
35.1
91.8
679.2
17.0
6.0
12.8
1.1
13.4
12.2
8.6
20.7
0.0
6.0
15.8
42.9
12.4
4.1
22.1
29.7
15.1
37.6
14.6
72.8
2.6
28.2
19.9
24.1
61.6
501.4
62.7
10.9
9.6
3.0
11.9
11.6
-3.5
-3.7
3.3
-1.1
13.5
13.8
-7.0
4.9
1.4
16.4
-4.9
23.5
12.0
-8.8
2.9
25.2
6.5
5.7
24.4
233.9
62.7
10.9
9.6
3.0
11.9
11.6
-3.5
-5.4
3.3
-1.1
11.7
13.8
-7.0
4.9
-4.7
14.9
-8.0
18.6
7.0
-8.8
2.6
12.5
4.8
-0.3
9.0
173.6
Whole economy (annual average)
4.7
56.6
41.8
19.5
14.5
2008-2020
PfG achievement - replacement demand implications
Catch up “convergence” scenario
Net
requirem ent
Indicative
from
'education'
education and requirem ent
m igrants
Expansion
dem and
Gross
replacem ent
dem and
Total
returnees
Corporate Managers
Managers & Proprietors in Agriculture & Services
Science & Technology Professionals
Health Professionals
Teaching & Research Professionals
Business & Public Service Professionals
Science & Technology Associate Professionals
Health & Social Welfare Associate Professionals
Protective Service Occupations
Culture, Media & Sports Occupations
Business & Public Service Associate Professionals
Administrative Occupations
Secretarial & Related Occupations
Skilled Agricultural Trades
Skilled Metal & Electrical Trades
Skilled Construction & Building Trades
Textiles, Printing & Other Skilled Trades
Caring Personal Service Occupations
Leisure & Other Personal Service Occupations
Sales Occupations
Customer Service Occupations
Process, Plant & Machine Operatives
Transport & Mobile Machine Drivers & Operatives
Elementary Trades, Plant & Storage Related Occupations
Elementary Administration & Service Occupations
Whole econom y
32.0
2.3
9.5
1.7
2.3
9.8
0.5
4.1
-0.5
3.4
8.7
-4.7
-5.6
1.1
-5.7
3.7
-1.6
14.0
-0.1
4.1
1.5
-8.1
1.3
-4.5
5.7
75.0
44.0
15.4
11.0
2.6
23.7
15.0
2.8
13.6
4.0
1.9
22.0
63.8
11.4
8.8
30.2
43.6
12.2
48.5
27.2
63.9
4.2
62.7
22.3
35.9
100.3
691.2
16.6
5.9
12.4
1.1
13.2
12.3
8.2
20.7
0.0
5.9
15.8
42.3
12.5
4.1
21.9
29.2
15.0
37.0
14.5
72.7
2.6
27.9
19.3
23.8
62.1
497.0
59.4
11.7
8.1
3.3
12.8
12.5
-4.8
-3.0
3.4
-0.5
14.9
16.8
-6.7
5.9
2.6
18.2
-4.4
25.4
12.6
-4.7
3.1
26.8
4.2
7.6
43.9
269.1
59.4
11.7
8.1
3.3
12.8
12.5
-4.8
-4.8
3.4
-0.5
13.1
16.8
-6.7
5.9
-3.5
16.6
-7.5
20.5
7.5
-4.7
2.8
14.0
2.6
1.5
27.4
207.4
Whole economy (annual average)
6.2
57.6
41.4
22.4
17.3
2008-2020
PfG achievement - skills implications
Restructuring “convergence” scenario
NVQ Level 0
Other qualifications
NVQ Level 1
NVQ Level 2
NVQ Level 3
NVQ Level 4
NVQ Level 5
Whole econom y (annual average)
Gross
replacem ent
dem and (000s,
2008-2020)
Indicative
'education'
requirem ent
(000s, 2008-2020)
205
28
43
130
132
108
30
56
23
5
5
26
42
54
16
14
PfG achievement - skills implications
Catch up “convergence” scenario
NVQ Level 0
Other qualifications
NVQ Level 1
NVQ Level 2
NVQ Level 3
NVQ Level 4
NVQ Level 5
Whole econom y (annual average)
Gross
replacem ent
dem and (000s,
2008-2020)
Indicative
'education'
requirem ent
(000s, 2008-2020)
211
28
45
133
134
108
30
57
37
7
8
33
50
55
16
17
PfG achievement - indicative graduate subject
implications
Restructuring “convergence” scenario
Medicine & dentistry
Subjects allied to medicine
Biological sciences
Veterinary science
Agriculture & related subjects
Physical sciences
Mathematical sciences
Computer science
Engineering & technology
Architecture, building & planning
Social studies
Law
Business & administrative studies
Mass communications and documentation
Languages
Historical and philosophical studies
Creative arts & design
Education
Combined
Total
Whole econom y (annual average)
Indicative
'education'
graduate
requirem ent
(000s, 2008-2020)
% total
1.4
-1.0
2.8
0.0
0.6
1.0
0.3
2.1
2.8
2.3
4.9
2.0
35.1
0.4
0.9
0.7
1.0
12.8
0.2
70.3
5.9
2%
-1%
4%
0%
1%
1%
0%
3%
4%
3%
7%
3%
50%
1%
1%
1%
1%
18%
0%
100%
-
PfG achievement - indicative graduate subject
implications
Catch up “convergence” scenario
Medicine & dentistry
Subjects allied to medicine
Biological sciences
Veterinary science
Agriculture & related subjects
Physical sciences
Mathematical sciences
Computer science
Engineering & technology
Architecture, building & planning
Social studies
Law
Business & administrative studies
Mass communications and documentation
Languages
Historical and philosophical studies
Creative arts & design
Education
Combined
Total
Whole econom y (annual average)
Indicative
'education'
graduate
requirem ent
(000s, 2008-2020)
% total
1.4
-0.4
3.2
0.0
0.7
1.1
0.3
1.9
2.4
2.2
5.5
2.2
33.2
0.5
1.1
1.0
1.4
12.8
0.2
70.9
5.9
2%
-1%
5%
0%
1%
2%
0%
3%
3%
3%
8%
3%
47%
1%
2%
1%
2%
18%
0%
100%
-