Empower counties to deal with future skills shortages, report argues

Empowering counties as strategic authorities to lead local labour strategies could ensure people have the skills to do the jobs of tomorrow, a new report says.

Localis’ latest report, In place of work, supported by CCN, highlights four major threats to the country’s future domestic economies fortunes: automation, a shrinking skills base, ageing demographics, and Brexit.

The analysis reveals that rural county areas account for nine out of 10 locations most at risk from these threats to local labour markets.

CCN argues the report makes a clear case for devolving powers to its members so they can devise local labour strategies.

To that end, Localis propose creating 47 strategic authorities across England to develop ‘place-based’ local industrial strategies, including local labour market strategies. In county areas, Localis propose that the strategic authority is led by the county authority, and built around existing county boundaries.

The report shows that counties are already pulling together private and public partners to address growth issues and skills shortages, but lack the powers to make a difference.

It calls for empowering these areas through devolving the Adult Skills Budget, working with business to shape the apprenticeship levy, and pooling together resource with the NHS to address projected workforce recruitment and retention issues.

More widely, the research reveals a gulf in the strength of England’s local labour markets, with the bulk of investment - both public and private, infrastructure, research and development and foreign investment - being channelled into London and the space which occupies Oxford and Cambridge.

However, the findings do not support the traditional view of ‘north-south’ divide in wealth and economic outcomes, but instead outlined there are greater differences within regions, with labour markets of the South East needing support just as much as certain parts of the North East.

Paul Carter, chairman of the County Councils Network, said: “Counties have intimate knowledge of their local economies, both public and private sectors, but have been hamstrung by a ‘one size fits’ all skills agenda. Government must hone and unleash this potential in rural areas by creating strategic authorities, led by the county authority.

“County authorities have the ambition, size, and expertise to engineer real change in their local skills market, but are shackled by a lack of powers. Let’s embrace the art of the possible – this new approach would be good for business and good for residents.

“This report by Localis sets out a deliverable framework to develop local labour market strategies. By devolving significant skills budgets and adult education powers, we can begin to create make a difference locally and a more prosperous country nationally.”

Liam Booth-Smith, co-author of the report and chief executive of Localis, said: “As the country slowly gets to grips with the broader implications, both positive and negative, of Brexit, it strikes us that the biggest threat to our future prosperity won’t come from Brussels, but from our own people.

“Simply put, our population is too low-skilled for the high-paying industries we are developing.”