Transcript Document
Greater Manchester Forecasting Model 25th November 2014 Professor Neil Gibson Special Advisor: Oxford Economics Agenda The key facts Changes since last release The outlook Exploring the unemployment story Commuting flows – how have they changed? Risks and policy considerations Our details & what is available 2 The key facts 3 Greater Manchester - A vital component of the UK economy 2014 2.7 Million People Employment 1.4 Million Jobs Gross Value Added £54.7 billion GVA Source: Oxford Economics 4 Service sector dominates the labour market… Greater Manchester Population & employment breakdown - 2014 Looking after family home 3% Student 3% Unemployed 2% Sick 3% Construction 6% Other 2% Manufacturing 8% Wholesale & retail 15% Child population 20% Employed 51% Elderly population 16% Source: Annual Population Survey, Oxford Economics 5 Business services 26% Other 19% Public services 26% …generating over half the wealth Sectoral breakdown of GM’s 2014 GVA £55 Billion Construction Manufacturing 0 Wholesale & retail 10,000 Other 20,000 Public services 30,000 £m 2011 Source: Oxford Economics 6 Business services 40,000 50,000 Manchester accounts for over a quarter of jobs % of total GM Employment 2014 Wigan 8.4% Bolton 9.0% Bury 5.5% Rochdale 5.9 % Oldham Salford 6.5% 9.9 % Manchester Trafford 27.7% Tameside 5.7% 11.4% Stockport 10.1% Source: Oxford Economics 7 … and GVA % of total GM GVA 2014 Wigan 7.7% Bolton 8.4% Bury 4.9% Rochdale 5.5 % Oldham Salford 5.9% 10.6% Manchester Trafford 29.3% Tameside 5.56% 12.0% Stockport 10.1% Source: Oxford Economics 8 Changes since last release 9 Forecast changes modest – new starting points Population Greater Manchester 2,950 2,850 Current release 2,800 Last release 2,750 2,700 2,650 2,600 2,550 2,500 2000 2005 2010 2015 Employment Greater Manchester 2020 1,550 ■ Demographic outlook remains similar. ■ The total employment level in 2014 is some 48,000 jobs higher than that estimated in the last release. ■ The jobs forecast is very similar to last year, albeit from a higher base. 1,500 1,450 (000s) (000s) 2,900 Current release Last release 1,400 1,350 1,300 1,250 1,200 2000 10 Source: ONS, Oxford Economics 2005 2010 2015 2020 Changes since last release GVA Greater Manchester 6 ■ Our GVA growth outlook for the area is marginally weaker than the previous release. ■ GVA has been rebased to 2011 prices and based upon the 2010 European System of Accounts. 4 (%) 2 0 -2 Current release -4 Last release Unemployment Greater Manchester -6 2000 2005 2010 2015 2020 90 80 ■ ■ The unemployment outlook is more positive this year, with around 20,000 fewer claimants expected in 2024. The latest data shows 2014 to have been better than expected Welfare effect more muted than provisioned for, coupled with higher job numbers and modestly less population Source: ONS, Claimant Count, Oxford Economics 11 70 (000s) ■ Current release Last release 60 50 40 30 20 2000 2005 2010 2015 2020 Changes since last release Summary of differences in 2014 Population (000s) Employment (000s) GVA growth (pp change) Unemployment (000s) Bolton Bury Oldham Rochdale Stockport Tameside Trafford Wigan Manchester Salford Greater Manchester -0.6 -0.4 0.5 -0.5 0.8 -0.1 1.2 0.8 -3.4 -1.2 -2.8 8.5 -1.0 0.7 -4.6 -3.5 1.3 12.7 2.5 24.3 6.9 56.2 Source: ONS, Claimant Count, Oxford Economics 12 1.7 0.7 0.7 -0.3 -0.3 1.0 1.7 0.8 1.6 1.2 1.2 -2.3 -1.1 -1.9 -1.6 -1.3 -1.7 -1.3 -2.4 -4.5 -2.1 -20.2 Specialisms – Winners and losers Note: Winners & Losers Head offices Management consultancy Call centres Other social work Social security activities Wholesale of machinery Temp agency Amusement Public administration of state policies Cleaning services Other social work Wholesale of machinery Rochdale Bolton Wigan Trafford Hospital activities Temp agency Tax consultancy Cleaning services Employment agencies Public admin of state policies Manufacture of wearing apparel Social work activities Warehousing & storage Other social work Head offices Residential care for elderly & disabled Stockport Event catering Retail sales in specialised stores Call centres Public admin of state policies Source: BRES, Oxford Economics Hospital activities 13 Auxiliary insurance & pension Tax consultancy Waste treatment Temp agency Cleaning services Wholesale of machinery Manufacture of gas 2013 BRES results revealed… Top 10 and bottom 10 employee changes, Greater Manchester, 2012-2013 14 Source: BRES Temporary employment agency activities Activities of call centres Accounting, bookkeeping and auditing activities Other postal and courier activities Retail sale of other goods in specialised stores Real estate activities on a fee or contract basis Renting and operating of own or leased real estate Event catering and other food service activities Management consultancy activities Wholesale of food, beverages and tobacco 2012-2013 4800 4800 4100 3700 3500 3400 3400 3200 3000 2400 Other social work activities without accommodation Wholesale of other machinery, equipment and supplies Cleaning activities Beverage serving activities Electrical, plumbing and other construction installation Restaurants and mobile food service activities Private security activities Freight transport by road and removal services Manufacture of furniture Retail sale in non-specialised stores 2012-2013 -6200 -5800 -3500 -3000 -2800 -2400 -2300 -2100 -2000 -1900 Biggest changes between 2012 and 2013…. Activities of head offices: +1322 jobs Wholesale of other machinery, equipment and supplies: -587 jobs Manufacture of gas; distribution of gaseous fuels through mains: +1142 jobs Wireless telecommunications activities: -667 jobs Administration of the State: +3090 jobs Rochdale Other social work activities: -1806 jobs Bolton Wigan Bury Tameside Trafford Stockport Hospital activities: +1944 jobs Administration of the State: -1147 jobs 15 Activities of head offices: -1533 jobs Renting and operating of own or leased real estate: +707 jobs Wholesale of other machinery, equipment and supplies: -540 jobs Salford Administration of the State : +1715 jobs Event catering and other food service activities: -1842 jobs Oldham Warehousing and storage: +341 jobs Activities of call centres: +3749 jobs Hospital activities: -2588 jobs Secondary education: +310 jobs Accounting, bookkeeping and auditing activities; tax consultancy: -587 jobs Accounting, bookkeeping and auditing activities; tax consultancy: +640 jobs Manufacture of gas; distribution of gaseous fuels through mains: -1243 jobs Making sense of the data? Labour market indicators, change, 2012-2013 Bolton Bury Manchester Oldham Rochdale Salford Stockport Tameside Trafford Wigan Greater Manchester North West 16 BRES, employee jobs Claimant count 3,900 -800 800 -800 16,300 -2,200 100 -1,800 -2,600 -1,400 4,200 -900 -2,200 -600 100 -1,400 7,000 -800 1,200 -1,700 28,800 -12,400 41,000 -30,700 APS employment -2,100 -300 12,000 2,000 1,400 -3,600 6,600 2,600 3,400 -4,500 17,500 37,900 APS unemployment 400 -2,900 -7,900 -2,100 -1,200 4,900 -400 1,200 -900 1,400 -7,500 -25,600 The outlook 17 What’s the story? – The Outlook 2014 – 2024 growth 128,000 More People Employment 109,000 Net New Jobs Gross Value Added £17bn More annual GVA Source: Oxford Economics 18 The regional picture - In line with the UK average Per Annum GVA Growth 2014 - 2024 Greater Manchester 2.78% Lower than Greater Manchester Higher than Greater Manchester Scotland 2.34% UK 2.78% Northern Ireland 2.23% East Midlands 2.53% North West 2.53% East 2.85% Wales 2.40% London 3.39% a South West 2.68% 19 South East 2.94% Recovery for all, but city economies do still lead 2008-2014 pa % growth 2014-2024 pa % growth GVA growth per annum (%) Greater Manchester 20 Greater Manchester Service strength leading the employment forecasts UK more heavily concentrated Greater Manchester more heavily concentrated Information & comms Accommodation & food Agriculture Public admin & defence Arts & entertainment Construction Education Mining & Quarrying Other service activities Human health & social work Manufacturing Water supply & waste management Electricity, gas & steam Financial & insurance Real estate transportation & storage Wholesale & retail Professional, scientific & technical Admin & support -1.50 -1.00 Source: Oxford Economics 21 -0.50 0.00 0.50 1.00 pp. differnce (GM % - UK %) Change in jobs 2014-24 +6,400 +8,100 -300 -6,700 +6,800 +13,800 -3,700 -100 +4,400 -5,300 -14,300 -500 -1,100 +2,300 +7,200 +9,200 +11,400 +31,200 +29,700 1.50 2.00 But industry plays bigger role in GVA outlook GVA growth 2014-2024 – Greater Manchester (£m 2011) Professional, scientific & technical Wholesale & retail Admin & support Information & comms Financial & insurance Manufacturing Construction Human health & social work Transportation & storage Accommodation & food Other service activities Arts & entertainment Education Electricity, gas & steam Water supply & waste management Public admin & defence Agriculture Mining & Quarrying Non Domestic Domestic 0 500 1,000 1,500 2,000 2,500 £2011m Source: Oxford Economics 22 Note: Excludes real estate as this includes ownership of dwellings and imputed rents The Outlook – headline local forecasts Bolton Bury Oldham Rochdale Stockport Tameside Trafford Wigan Manchester Salford 2014 - 2024 per annum change Jobs (000s) GVA (% per annum) Population (000s) 1.1 2.8% 1.3 0.5 2.6% 0.9 0.4 2.4% 0.6 0.2 2.2% 0.4 1.0 2.7% 1.2 0.2 2.2% 0.6 1.3 2.8% 0.9 0.4 2.3% 0.9 4.3 3.1% 3.9 1.7 3.1% 2.0 Source: ONS, Claimant Count, Oxford Economics 23 Private services dominating job creation Employment change, 2014-2024 (000’s) 45 Public services 40 35 30 25 20 15 10 5 0 -5 Source: Oxford Economics 24 Private services Production Sectoral focus – key business services ICT, professional services, administration, accommodation & food and arts employment (000s) 600 Forecast 500 82,000 Jobs (000s) 400 Greater Manchester 300 44,000 Jobs 200 Manchester & Salford 100 0 2000 2004 2008 Source: Oxford Economics 25 2012 2016 2020 2024 ■ Crucial ‘backbone’ of jobs recovery ■ Growth has been strong consistently in cities ■ ICT has upside risk Key Drivers: ICT and professional services ■ Classification can be an issue – but strong growth in parts of the country ICT employment (000s) 50 Forecast ■ Expected to grow steadily 45 6,400 Jobs 40 Greater Manchester 30 25 3,200 Jobs Manchester & Salford 20 15 10 2000 2004 2008 2012 2016 2020 2024 Professional services employment (000s) 180 Forecast 160 31,200 Jobs Greater Manchester 140 ■The primary source of job growth ■‘Catch-all’ sector for wide range of services – suggest breaking down where you can in policy circles ■Remember outsourcing from other sectors – key to understand this sector Source: Oxford Economics 26 120 (000s) (000s) 35 ■ ‘Big Data’ and computerisation of more activities (law, consulting etc. could see reclassification into this sector) 100 80 17,400 Jobs Manchester & Salford 60 40 20 0 2000 2004 2008 2012 2016 2020 2024 Key Drivers: Admin and hotels sector 200 180 160 140 120 100 80 60 40 20 0 2000 ■ Fast growing sector and likely to rise even faster as greater use of recruitment workers and outsourcing of activities Forecast 29,700 Jobs ■ Needs ‘broken down’ to fully understand the local labour market – do you know what your agency workers do? Greater Manchester 16,300 Jobs Manchester & Salford Accommodation & food employment (000s) 2004 2008 2012 2016 2020 2024 120 Forecast 14,900 Jobs Greater Manchester 100 ■ Key sector for both tourism and consumer spending ■ Expected to recover in line with wider economy, but could do even better? 80 (000s) (000s) Admin & support employment (000s) 60 7,300 Jobs 40 Manchester & Salford 20 Source: Oxford Economics 27 0 2000 2004 2008 2012 2016 2020 2024 Key Drivers: Summary ICT, professional services, administration, accommodation & food and arts employment (000s) ICT Bolton Bury Oldham Rochdale Stockport Tameside Trafford Wigan Manchester Salford Greater Manchester 0.40 0.30 0.30 0.20 0.90 0.20 0.70 0.30 2.00 1.20 6.50 2014 - 2024 Employment Change (000s) Professional Administrative Arts & services services entertainment 3.50 2.40 0.70 1.30 0.80 0.30 0.90 1.00 0.20 0.80 0.80 0.30 2.40 2.70 0.70 0.90 0.50 0.30 3.40 3.20 0.90 0.80 2.10 0.70 14.20 10.90 2.00 3.20 5.40 0.60 31.40 29.80 6.70 Suggests the area has a specialism in this sector Source: Oxford Economics 28 Total 7.00 2.70 2.40 2.10 6.70 1.90 8.20 3.90 29.10 10.40 74.40 UK LQ <1.2 UK LQ >1.2 Key drivers: The contrast in industrial jobs and GVA Employment – Thousands 200 GVA - £m 2011 8,500 Forecast Forecast 8,000 175 7,500 (£m 2011) (000s) 150 125 100 7,000 6,500 6,000 75 5,500 50 2000 2004 2008 2012 2016 2020 2024 5,000 2000 2004 2008 2012 2016 2020 2024 14,000 Manufacturing job losses are forecast over the next decade, with per annum GVA growth of 1.7% expected. Source: Oxford Economics 29 A little more on manufacturing… What Greater Manchester makes… Top Manufacturing Sectors - Greater Manchester Employees GB LQ 5,700 3,300 2,900 2,900 2,800 2,600 2,500 2,300 2,200 2,100 2,000 1,700 1,700 1,600 1,600 1,500 1,500 1,400 1,400 1,300 1.89 0.90 1.45 3.08 2.63 0.69 1.49 0.93 5.13 1.61 1.28 0.83 2.36 2.46 1.55 1.08 1.38 2.19 0.88 1.36 Manufacture of bread, pastry goods and cakes Other printing Manufacture of plastic products Manufacture of made-up textile articles Manufacture of rusks and biscuits Machining Manufacture of builders ware of plastic Manufacture of instruments Manufacture of soap and detergents Manufacture of other food products Manufacture of other furniture Manufacture of metal structures Manufacture of motor vehicles and coachworks Manufacture of paints and varnishes Manufacture of general-purpose machinery Manufacture of medical and dental instruments Manufacture of prepared meals and dishes Manufacture of rubber products Manufacture of builders' carpentry and joinery Manufacture of plastic packing goods LQ > 1.2 Source: Business Register Employment Survey 30 Manufacture of bread tops the list of manufacturing sectors within Greater Manchester, with over 5% of total manufacturing employment coming from this sector. Manufacturing still a key component across GM Manufacturing: 11,800 Manufacturing: 7,000 ■ Baking: 2,300 ■ Plastics: 1,300 ■ Plastics: 1,200 ■ Soap & detergents: 700 ■ Furniture: 900 ■ Other textiles: 500 Manufacturing: 12,500 Manufacturing: 10,800 Bolton ■ Plastics: 700 Wigan Bury ■ Metal Treatment: 800 Oldham Tameside ■ Basic chemicals: 800 ■ Instruments: 500 ■ Plastics: 800 Stockport Manufacturing: 10,100 Manufacturing: 10,400 ■ Meat processing: 1,000 Trafford ■ General machines: 400 ■ General machines: 600 Manufacturing: 10,100 ■ Grains & starches: 1,000 31 ■ Furniture: 800 Salford Manufacturing: 7,600 ■ Printing: 700 Manufacturing: 9,900 ■ Baking: 900 ■ Baking: 1,100 ■ Dairy products: 800 ■ Other textiles: 1,100 ■ General machines: 800 Rochdale ■ Other food: 2,700 ■ Plastics: 1,200 Manufacturing: 13,400 ■ Baking: 1,300 ■ Metal fabrication: 1,600 ■ Printing: 1,200 ■ Knitted apparel: 1,100 ■ Instruments: 600 ■ Baking: 1,100 Business services – what does it really do? Business services: 16,200 Business services: 7,300 ■ Legal: 2,200 ■ Head offices: 900 ■ Management consulting: 2,000 ■ Tax consulting: 800 ■ Temp agency: 1,900 ■ Architecture: 700 Business services: 8,900 ■ Temp agency : 3,400 ■ Advertising: 800 ■ Management consulting: 600 Business services: 14,200 ■ Temp agency : 1,600 ■ Business support: Bolton 1,500 Bury ■ Management consulting: 1,000 Oldham ■ Private security: 1,300 ■ Recruiters: 900 Wigan Salford Tameside Business services: 24,400 ■ Cleaning: 5,300 ■ Temp agency: 3,100 Business services: 6,500 ■ Tax consulting: 1,400 Trafford ■ Management ■ Architecture: 800 Stockport consulting: 2,300 32 Business services: 7,600 Rochdale ■ Temp agency: 3,100 ■ Temp agency : 700 Business services: 36,400 Business services: 73,500 Business services: 21,100 ■ Temp agency : 7,800 ■ Temp agency : 13,300 ■ Support: 3,500 ■ Tax consulting: 6,800 ■ Legal: 10,000 ■ Architecture: 2,400 ■ Private security: 5,100 ■ Management consulting: 7,700 ■ Tax consulting: 2,200 Research questions Understanding the local data – examining the results, checking the validity and inputting on the baseline position. The temporary employment agencies – a key component of the labour market, what sectors are the people actually working in? What does the professional services sector do? Who does it serve, what are the risks / opportunities? 33 Exploring the unemployment story 34 All areas experienced falls in unemployment numbers Unemployment, claimant count Bolton Bury Manchester Oldham Rochdale Salford Stockport Tameside Trafford Wigan October 2012 October 2014 0 4,000 Source: Claimant Count 35 Note: excludes Universal Credit 8,000 12,000 16,000 20,000 Good news for the young, not the long term unemployed Unemployment by age Younger unemployed workers have benefited most. 25,000 October 2012 20,000 October 2014 15,000 10,000 5,000 0 Unemployment duration Under 25-29 30-34 35-39 40-44 45-49 50-54 55-59 60+ 24 2+ years Unemployment halves from 84,000 in October 2012 to 42,000 in October 2014, but long-term unemployment persists. October 2012 October 2014 1 - 2 years 6 - 12 months 3 - 6 months 3 months Source: Claimant Count 36 Note: excludes Universal Credit 0 10,000 20,000 30,000 Elementary workers finding jobs (or falling out of the system?) Unemployment by occupation Management and senior staff haven’t benefited from the fall in un employment. Elementary Plant & Machine operators Customer Service Personal service Skilled Trade October 2012 Admin & secretaries October 2014 Technical Professionals Managers Unknown Unemployment by age 0 10,000 20,000 30,000 40,000 14,000 12,000 Males Oct '12 Males Oct '14 10,000 Females Oct '12 Females Oct '14 8,000 6,000 4,000 2,000 0 Source: Claimant Count 37 Note: excludes Universal Credit Is Greater Manchester close to full employment? Unemployment, Oct 2014 Bolton Bury Manchester Oldham Rochdale Salford Stockport Tameside Trafford Wigan Greater Manchester Source: Claimant Count 38 Note: excludes Universal Credit Total claimants, Oct 14 4,760 2,370 11,430 2,910 3,220 4,070 3,710 2,860 2,150 4,320 41,810 % 2.7 2.0 3.1 2.1 2.4 2.6 2.1 2.0 1.5 2.1 2.4 % excluding long term claimants 1.8 1.4 2.2 1.3 1.8 1.9 1.6 1.4 1.1 1.4 1.7 77 wards across Greater Manchester currently have an unemployment rate less than 1.7% Policy observations Are skills shortages about to re-emerge, evidence would suggest yes Impact on migration? Are the falling numbers of people unemployed reflecting more people in work, or people leaving the system The long term unemployment problem remains a key challenge How well do we understand inactivity / hidden unemployment? 39 Commuting flows – how have they changed? 40 Significant in-flows into all labour markets Commuting in all areas rises over the decade except for Manchester Bury: 45.0% Change 2001-2011 (percentage point difference) Rochdale: 38.5% Bolton: 35.3% Oldham: 38.9% Wigan: 28.8% Tameside: 36.4% Salford: 60.1% Stockport: 46.5% Greater than 2001 Less than 2001 Source: Census 41 Trafford: 62.8% Manchester: 62.3% Who takes Manchester’s jobs? Usual place of residence of Manchester’s workforce, top 20 Manchester Stockport Trafford Tameside Salford Bury Oldham Cheshire East Rochdale Bolton Wigan Warrington High Peak Cheshire West and Chester Rossendale St. Helens Liverpool Chorley Kirklees Sefton Source: Census 42 2001 95,200 27,200 22,600 17,800 14,900 13,600 11,700 10,000 9,600 6,600 5,300 3,900 3,700 3,000 1,400 1,300 1,200 1,100 1,000 800 Manchester Stockport Trafford Salford Tameside Bury Oldham Cheshire East Rochdale Bolton Wigan Warrington High Peak Cheshire West and Chester Liverpool Rossendale St. Helens Kirklees Chorley Calderdale 2011 108,700 25,500 24,800 18,900 17,500 12,100 11,700 9,400 9,300 7,000 5,400 4,200 3,300 2,900 1,700 1,500 1,400 1,100 1,100 900 Residents leaving to work…. % of working residents who work in own area, 2011 60% 52% 44% Rochdale 53% Bolton Wigan Bury 56% Oldham Salford Tameside 47% Trafford 43% Stockport 48% 45% Greater than 2001 Less than 2001 Source: Census 43 60% A growing population will impact flows Demographic changes 2014-2024 2014 - 2024 change (000s) Population (ONS) Population (OE) Bolton Bury Oldham Rochdale Stockport Tameside Trafford Wigan Manchester Salford Greater Manchester Source: Oxford Economics, ONS 44 16.4 10.1 9.2 5.3 13.9 13.4 16.3 17.6 34.0 23.4 159.6 12.8 8.5 6.3 4.0 11.7 6.3 9.3 9.2 39.3 20.2 127.6 More jobs would be required under ONS population outlook 2014 -2024 Job forecast (000s) Bolton Bury Oldham Rochdale Stockport Tameside Trafford Wigan Manchester Salford Greater Manchester Source: Oxford Economics, ONS 45 10.9 5.0 3.7 1.8 9.8 1.8 12.7 4.3 42.6 16.6 109.2 Additional jobs required to support ONS population 2.4 1.1 1.3 0.6 1.2 4.3 3.0 4.7 -2.1 2.4 18.8 Risks and policy considerations 46 Assessing the risks Upside: wage pressures, skills shortages Upside: sectoral tapestry – spreading the wealth? Downside: Debt and interest rate rises Downside: Austerity, cutting not pruning? Upside / downside: The competition Upside / downside: External conditions 47 Policy considerations Jobs growth – do we believe it, could there be upside pressures? Are we on top of the business issues, esp. skills? Demographics – scenario planning, merging your knowledge with the data Broader church of growth – challenging picking winners? The supply side impacts of broader growth – skills, land, housing, transport Vulnerability of jobs – temporary agencies and the elementary workers How is the public sector today? Are we austerity ready (and will it happen)? 48 Our details and what is available 49 GMFM 2014 – What is available Economy : ■ Employment; ■ Employees (note: excludes selfemployment); ■ GVA; Demographics: Employment by 25 minor occupation groups; Qualification levels by occupation; Replacement demand by occupation; Household numbers; ■ Total population; Household income; ■ Broad age groups (young, working age population and elderly); Carbon emissions, and ■ Migration – domestic & international; Demand for commercial floorspace Residence based employment/employment rate; Unemployment level / rate; Note: economy results broken down by broad sector, 50 SIC2007 sectors as well as sectors defined by the New Economy Contact details: Oxford Economics Lagan House Sackville Street Lisburn County Down BT27 4AB UK Tel: 028 9263 5403 Fax: 028 9263 5425 Kerry Houston Head of Regional Forecasting Oxford Economics Email: [email protected] Tel: 02892 635402 Anthony Light Associate Director Oxford Economics Email: [email protected] Tel: 0207 803 1419