Transcript Competitiveness and the knowledge economy

Competitiveness and the
knowledge economy - where do
we stand?
Prof David Charles
University of Newcastle upon Tyne
Knowledge and the Economy
• Knowledge (as human capital) is increasing in
importance as a factor of production
• Output and employment growth globally is fastest in
knowledge intensive sectors
• Investment in knowledge creation and formal learning
are increasing (over 17% of GDP in some cases)
• Skilled and knowledge workers are in increasing demand
• Core regions are massively specialised in knowledge
intensive activities
External Drivers for Change
• Combination of three main processes
– Globalisation will continue to weaken demand for low skilled
workers in all OECD countries
– Technological change will reduce demand for traditional and low
skilled jobs
– Shift to new flexible firm organisation requires a more
autonomous, creative, cosmopolitan and ultimately more selfreliant workforce
• Demand for unskilled workers will continue to fall, growth
in demand for personal services will only increase in the
context of wealth creation
• What is needed for a city or region to be
creative, economically successful and
have a good quality of life in a post
industrial and highly globalised world?
Competitiveness and city-region
challenges
Key interlinked urban development processes and
policy arenas underpinning competitiveness
• Knowledge and economic competitiveness
• Cosmopolitanism and image
• Reducing social polarisation
• Environmental sustainability
• Effective governance
Knowledge and city
competitiveness
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A central role for cities in the knowledge economy
Virtuous cycles of knowledge creation and application
Innovation and creativity
Knowledge as a strategic resource
Place specific tacit knowledge and localisation
Knowledge clusters and cluster knowledge
Emergence of new geographies of services
Building strengths in R&D and HE to underpin
clusters
Cosmopolitanism culture and
image
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The city as crossroad and place of interchange of ideas
Fashion, diversity, hybridisation, innovation, creativity
Combination of social classes and ethnic groups
Elite culture and innovation in popular culture
Stimulus to innovation in new forms of work and services
Cultural strategies
– Realisation of role as a production base –
– Re-branding the city - diversity and tensions
– Ripples and spillovers - diffusion of ideas
Creativity – talent, technology and
tolerance
• Cluster success requires and encourages flow of
talented individuals
• Especially important in new economy,
multimedia, creative industries etc
• Work in the US on the geography of talent
focuses on role of urban amenities
• Association between creative employment and
open, vibrant communities
• Interactions among the three Ts – technology
talent and tolerance
Criticisms of the Florida thesis
• Directions of causality
• Assumptions about ease of migration
• Innovation associated with both shared beliefs
and with difference
• But there are important points to consider
– Argument concerning US advantage in talent attraction in the
past - Other places now catching up
– International student market and retention of PhDs
– Global mobility of engineers – Finland and Bangalore
Growth of services
Region
1991
2000
% change
North East
48800
67200
37.7%
North West
170300
246900
45.0%
Yorks
93000
166000
79.1%
East Midlands
80000
150500
88.1%
West Midlands
121600
198700
63.4%
East
135100
258000
91.0%
South East
260000
544100
109.3%
London
436500
845200
93.6%
South West
110700
177800
60.6%
Wales
41400
64300
55.3%
Scotland
127400
187500
47.2%
GB
1624900
2906900
78.9%
Knowledge Intensive Business Services Relative Employment change 1991 – 2000
(Source: NOMIS)
Proportion of Workforce with Degrees by Sector
100%
80%
60%
40%
20%
l
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er
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vi
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M
an
uf
ac
t
Pr
im
ar
y
0%
0
<5.0
5.1-10.0
10.1-20.0
20.1-49.9
>50
Percentages
Higher
GCE GCSE grades
Degree or
education
A level or
A*-C
Other
No
3
4
equivalent qualifications equivalent or equivalent qualifications qualifications
16.3
8.5
24.1
21.7
13.7
15.0
North East
North West
Yorkshire and the Humber
11.3
13.3
13.4
9.1
8.3
7.7
25.1
24.6
25.6
22.7
24.1
22.1
12.6
11.4
14.4
18.8
17.5
16.2
East Midlands
West Midlands
13.0
12.7
7.6
8.3
25.1
23.6
22.6
22.7
13.4
14.1
17.1
17.6
East
London
South East
South West
16.2
24.7
19.9
16.2
7.7
6.0
8.6
9.8
22.7
18.5
24.2
24.9
25.0
16.7
22.4
24.1
14.0
20.2
13.7
13.4
14.0
13.4
10.6
10.7
England
Wales
Scotland
Northern Ireland
16.6
14.6
15.4
13.1
8.0
8.8
13.3
7.7
23.5
23.2
29.9
26.9
22.2
23.4
16.4
21.0
14.5
11.6
9.7
6.7
14.6
17.1
14.7
23.7
United Kingdom
1 Males aged 16 to 64 and females aged 16 to 59.
2 For information on equivalent level qualifications, see Notes and Definitions.
3 Below degree level.
4 Includes recognised trade apprenticeship.
Implications for the regions
• Regional competitiveness is being defined by
success in high GVA knowledge based services
• This is dependent on growing levels of graduate
skills
• UK productivity as a whole depends on raising
the performance of the regions
• How can regional skills partnerships support a
knowledge based regional economic strategy?
The graduate labour market
process
Students
from
elsewhere
New
migrants
Non-local
graduates
Students
domiciled in
the region
Regional
HEIs
Local
graduates
Regional
employers
Local and
non-local
graduates
Students studying in
other regions
Employers
in other
regions
Key questions
• How should regional partners intervene in
graduate labour markets?
• What kinds of skills policies can help to
develop new high value added industries?
• How does the regional skills strategy link
together lower level and high level skills
development?
An aside on learning regions (and
cities)
• Innovation systems or training strategies?
• Both are very partial readings of learning
and the extent to which it is characteristic
of place
• Individualised and social forms of learning
• We need to be promoting learning within
policy arenas as well as for individuals and
amongst organisations of all kinds