1. Regional Skills Assessments
Dumfries & Galloway
December 2016 OK
Glasgow

2. Introduction An Introduction to Regional Skills Assessments (RSAs)
Key Data for Dumfries & Galloway
Implications for Skills Investment Planning

3. An Introduction to RSAs

4. What are RSAs?
A single, agreed evidence base on which to base future investment in skills, built up from existing datasets
Partnership between Skills Development Scotland (SDS), Highlands and Islands Enterprise (HIE), Scottish Enterprise (SE), the Scottish Funding Council (SFC) and the Scottish Local Authorities Economic Development (SLAED) Group.
Purpose:
Support SFC, Regional Colleges, Strategic Bodies and College Boards in negotiating Regional Outcome Agreements (ROAs) for Academic Years
Provide a framework for aligning SDS investment in individuals and businesses
Assist partners in planning their strategic investment in skills
Highlight gaps in national and regional skills evidence

5. Why are they important for skills planning?
They provide a high quality and consistent source of evidence about economic and skills performance delivery at various spatial levels.
They can be used to identify regional strengths and any issues or mismatches arising, and so inform thinking about future planning and investment at a regional level.
They are accessible online to support all partners in their planning.
They provide a core evidence base to support the Scottish Skills Planning Model.

6. Scottish Skills Planning Model

7. What do RSAs cover?
Economic Performance, Profile of the Workforce, People and Skills, Education and Training (Schools, MAs, FE, HE), Other Economic Activity, Skills Mismatches and Forecasting
Underpinned by the 2016 data matrix of seven workbooks, containing data on over 100 social and economic indicators
With data at various spatial levels: Regions; City Region Deal; Local Authority
The matrix only draws upon official datasets (including APS, BRES, UKCES, UK Business Counts, Census, Scot Gov datasets) and partner data (SFC, SDS, SE, HIE).
The data matrix is found here:
This slide pack provides a summary of the data for this area

8. Dumfries and Galloway Overview
A rural economy which benefits from its location between Scotland and England, with important employers in the distribution and logistics sector
Traditional strengths in land industries, food and drink, tourism and manufacturing continue to underpin the economy but limited growth in private sector services impacts on employment opportunities
Population and workforce decline will make employment driven growth very challenging

9. Business Trends
Growth in business numbers below national growth
+345 businesses to 6,350, +5.7%, compared to +7.3% nationally in 2014/15
Growth concentrated in 3 sectors: administrative and support services (+70); other service activities (+65); accommodation and food (+50);
99% of businesses (6,280) are small or micro (<50 employees), only 15 employ 250+
17.2% are self-employed, compared to 10.8% nationally
424 business per 10,000 population, compared to 313 nationally, reflects the high self-employment rate
52% of Dumfries and Galloway businesses in Growth Sectors (46% nationally) in 2015
Little change in proportion of businesses in Growth Sectors compared to 2014 (+0.3%) despite a 3.7% increase nationally
Much greater proportion of Growth Sector businesses are in food and drink than nationally (61% v. 22%)
Low level of business investment in research (BERD) - £33 per head compared to £169 nationally and £309 UK wide (2014)

10. Sector Trends and Specialisms
Good number of sectors in high representation and high growth quadrant
Employment static in Health and Retail sectors which accounted for most employment
Very strong employment growth in business administration and support, also accommodation and food which is an important sector locally
Note: SIC Section A: Agriculture, Forestry and Fishing omitted as data for farm agriculture (SIC subclass 01000) is not available sub-nationally
Click here for explanation: Explanation of Sector Trends and Specialism diagram

11. Population and Projections
Population of 149,670
2.8% of Scotland total (2015)
Decreased slightly (-0.2% compared to +0.5% nationally) and much slower growth over the past ten years (+0.1% compared to +5.1% nationally)
Population change :
Growth in the 65+ (+21%) population and decline in both other age groups
Forecast Population Growth, :
Population expected to decline (-6% compared to +8% nationally)
Working age population will decrease by 23% (-20,700) compared to 4% decrease nationally – the greatest decline of any region

12. Employment and Travel to Work
76% of working age residents are in employment, slightly above Scotland’s employment rate of 73% (2015)
Place of Work of Residents, by Local Authority:
Very self-contained labour market with low levels of out-commuting, reflecting isolation from major employment centres
9% of employed residents work outside Dumfries and Galloway
Key destinations for out-commuting are England (5.9%) and East Ayrshire (0.4%)
Please note, location of employment figures exclude those working outside the UK, on offshore installations or
with no fixed place of work

13. Workforce Trends
Total employment in Dumfries and Galloway in 2014= 58,700
2.8% increase from 2013 (slightly greater increase than across Great Britain, 2.7%)
Slower than 3.2% increase in Scotland as a whole, but remaining in line with national trends overall
32% work in higher level occupations
Significantly below Scotland average (42%) and decreased slightly over last year
73% work in private sector, compared to 77% nationally
29% of those in employment work part-time, with the percentage fluctuating between 27% and 35% over the past ten years
4.7% are in non-permanent employment, slightly lower than in Scotland (5.4%)
Nationally, 2.2% are employed on zero hours contracts
Note: Data on total employment relates to 2014, having been prepared in advance of 2015 BRES release.

14. Unemployment and Participation
Unemployment rate has fallen to below the national average (5.1% compared to 5.9% nationally and 5.4% UK wide)
Participation levels very marginally higher than the Scotland average, with nearly 91% of young people participating
Proportion of non-participants slightly lower than Scotland level (3.7% v. 4.0%)
Unemployment has decreased by -0.3ppts over the past year (2014/15) – a slightly slower rate of decrease than nationally (-0.4ppts)
Unemployment rate: Unemployed as a percentage of the economically active population

15. Qualifications and Skills
A slight increase in workforce qualification levels since 2005:
An overall increase ( ) in the proportion holding levels 7-12, though the increase has not kept pace with the national improvement, widening the gap in skills levels
Proportion with no qualifications remains slightly above the national average and has fallen more slowly over the past ten years
And still much less well-qualified than nationally
Fewer working age adults hold SCQF qualifications at levels 7-12 than nationally (43%) and UK wide (37%)

16. Skills Mismatches
43% of Dumfries and Galloway businesses have recruited staff over the past year (2015), compared to 53% nationally
Skills shortages are below national averages
Hard-to-fill vacancies equivalent to 0.8% of the workforce, compared to 1.1% nationally
Skills shortage vacancies 0.7% compared with 0.8% nationally
4% of the workforce have skills gaps
Businesses are as likely to report skills gaps and less likely to report under-utilisation of skills compared to businesses nationally
Skills gaps prevalent in sales and admin / clerical roles
73% of employers with a skills gap say there is an impact on the business (70% nationally)

17. Modern Apprenticeships
Schools
Modern Apprenticeships
Education and Training
The secondary school roll in 2015 was 8,015, 2.8% of Scotland total
93% school leavers had a positive
destination in 2015, compared to 92% nationally
Modern Apprenticeship uptake increased by 1% from 2014/15
3% of national total in 2015/16
Transport & logistics most popular MA framework group
18% of uptake
Heavily gender segregated - 93% male
79% MA achievement rate in 2015/16

18. Further and Higher Education
In 2015/16, at Dumfries and Galloway College there were 6,165 enrolments
2% of Scotland’s total
88% FE and 12% HE
Top three subjects:
Full-time: Care, Engineering, Hairdressing, beauty & comp therapies
Part-time: Care, Computing & ICT, Hospitality & tourism
61% successful completion of FE courses
There were over 1,000 students at the three HEIs in the region in 2014/15
Top three subjects:
Subjects allied to Medicine, Combined subjects and Veterinary Sciences, Agriculture and related subjects
Note: HE/FE data is available at regional level only. Data relates to enrolments at FE and HE Institutions in the region, not residents unless otherwise stated. Data provided by SFC and HESA

19. Workforce Growth
The size of the working age population is expected to fall by 23% in Dumfries and Galloway over the next 20 years, the largest proportionate decline in Scotland
Nearly 23,700 fewer people of working age. This presents a considerable challenge to those working to support economic growth
The challenge is to ensure that everyone is supported to participate in the labour market, and that they have the skills employers need for business growth
Dumfries and Galloway is forecast to have the greatest proportionate decline of people in employment in Scotland from 2016 to 2024 (-1.9% v. 1.0% growth nationally). This will mean 1,300 fewer people are in employment.
This represents a slower decline compared to the past ten years ( ) (-4.3%)
It suggests that the number of people in work will decline more slowly than the working age population, suggesting an increase in economic activity / labour market participation rates
Note: analysis uses total employment (people) rather than total employment (jobs).
The former figure will be higher as a person can have more than one job.
With fewer people in the labour market, supporting continued workforce development and retaining skilled people within the workforce will be important in raising productivity and avoiding recruitment / replacement difficulties

20. Jobs and Skills Changes (1)
Total employment (jobs) in Dumfries and Galloway is forecast to fall by 0.2% per year over the period, average annual growth of 0.2% is expected for Scotland as a whole. This is equivalent to a loss of 1,300 jobs by The biggest job losses are expected in the manufacturing sector, with employment falling by over 600 jobs to Employment within public services and agriculture are also expected to fall with the loss of 400 & 300 jobs respectively. However, the construction, administrative & support activities, professional, scientific & technical activities and health sectors will have some modest job gains.
Forecast Demand for Jobs ( )
Total Employment Growth
Dumfries & Galloway Employment
% annual average change
Change in total jobs (‘000s),
Note: chart uses total employment (jobs) rather than total employment (people).
The former figure will be higher as a person can have more than one job.
Source: ONS / Oxford Economics
Glasgow

21. Jobs and Skills Changes (2)
With total employment in Dumfries and Galloway forecast to fall across the period , there are no occupational sectors expected to grow. The number of jobs in caring, leisure and other service occupations is expected to be static. Employment in all the other occupations is expected to fall, with skilled trades and process, plant and machine operatives expected to see the largest declines (300 jobs each), followed by administrative and secretarial occupations (200 jobs).
Forecast Changes in Occupational Demand
Dumfries & Galloway Employment
Change in number of workers (‘000s),
Note: chart uses total employment (people).
Source: Oxford Economics
Glasgow

22. Jobs and Skills Changes (3)
The majority of openings in Dumfries and Galloway over the forecast will require individuals with higher and middle level qualifications, in part a reflection of the sectoral and occupational trends expected over this period. Individuals qualified to SCQF level 7 or above will account for over half of the 20,700 openings expected to be created between 2016 and The remaining opportunities will mainly be for individuals qualified to SCQF levels 5-6, equivalent to 40% of openings over the forecast period. There will be limited demand for those with qualifications below this level.
Forecast employment change by Qualification ( )
Notes:
table uses total requirement (people)
totals may vary from previous slide due to rounding within the body of the table
Source: Oxford Economics
Glasgow

23. Jobs and Skills Changes (4)
Replacement demand will result in over 22,200 openings within the Dumfries and Galloway region over the forecast. These openings will occur across all types of occupations including those that are expected to decline in net terms. Expansion demand is expected to be negative with a fall of 1,500 between 2016 and However replacement demand will create a number of job openings. This will result in 20,700 openings over this period. Of these opportunities, demand will be highest within elementary, professional and skilled trades occupations although most other occupations are also expected to experience some degree of demand also.
Forecast Demand for Jobs ( )
Notes:
table uses total requirement (people)
totals may vary from previous slide due to rounding within the body of the table
Source: Oxford Economics
Glasgow

24. Implications for Skills Investment Planning

25. Dumfries & Galloway: Key Implications (1).
Recommended Areas of Focus
Continuing to increase the number of jobs. Whilst there has been jobs growth in the region in recent years, this has been modest. The total number of jobs is expected to fall, with a sharp fall in the working age population expected. Job creation is essential to attract and retain workers, and for a balanced economy.
Increasing the quality of jobs. As well as more jobs, there is a requirement for more better quality jobs. Recent private sector jobs growth in accommodation and food services, for example, will be relatively low pay and low value added. There remains more that needs to be done to move to a greater knowledge-based economy in the region.
Creating a culture of employer investment. Employers continue to need to be encouraged to invest and innovate, which includes investment in skills. The supply of skills must also be available to satisfy increased and stimulated demand.
Engender more enterprise. A key route to for more private sector jobs is to increase the start-up rate and business density. Although birth rates have increased, they still lag the Scotland average.
Glasgow

26. Dumfries & Galloway: Key Implications (2).
Recommended Areas of Focus
Sectorally, there is a need to meet the needs of employers (1). This includes the important health and social care sector. The ageing population will have care needs that will need to be met over time.
Sectorally, there is a need to meet the needs of employers (2). There are other key sectors and occupations in the regional economy where replacement demand is strong, including sales and customer services. These require work-based learning routes into, and upwards, within sectors which includes tourism.
There will still be a need to meet the needs of employers in the traditional manufacturing and agricultural sectors. Although forecast to decline, replacement demand is still required, notably in elementary jobs and skills trades. Whilst there is certainly some engineering & related skills activity in the region, this does not feature amongst those subjects and frameworks most represented.
Glasgow

27. Dumfries & Galloway: Key Implications (3)
Recommended Areas of Focus
A need for progression routes and pathways. Demand for skills in the region is strongest at the upper and lower skills levels – professional and elementary occupations – and so progression to upper skills levels needs to be engendered and facilitated.
Nurturing new business activity. Self-employment rates are high, largely a result of the agriculture sector, but also trades and professional services. Sole traders and the self-employed can be nurtured and supported to grow, with the right skills development support.
A need for flexible provision. Non-permanent employment is increasingly a feature of the Scotland economy and more of the future jobs are expected to be part-time. Non traditional employment also means less conventional career paths, and movement between sectors. Skills provision must be equally flexible, with Foundation Apprenticeships and work placement programmes such as the Certificate of Work Readiness a feature of this.
The need for co-ordinated support. Skills and enterprise support are closely linked. There is an opportunity for the region to cement this relationship though best practice. .
Glasgow

28. Explanation of Sector Trends and Specialism diagram
The Sector Growth diagram allows three pieces of sector information to be displayed, providing a useful overview of the local economy. The diagram includes: Sector size (in terms of employment) – shown through the relative size of the dot representing the sector. Sector concentration relative to the Scottish average – The level of concentration is illustrated on the vertical axis through the Location Quotient. The Location Quotient is a measure of the concentration of industry in an area compared to the national average. It produces an index whereby a score of 1 indicates the industry employment concentration is the same both in the local area and nationally, more than 1 represents a higher concentration and less than 1 a lower concentration. Sector average annual growth rate – The horizontal axis shows the average annual employment growth rate of each sector over the past five year period. The diagram includes four quadrants: Top right quadrant - sectors that have shown employment growth and are more highly concentrated in the local area than the national average Bottom right quadrant – sectors that have shown employment growth but are less highly concentrated in the local area than the national average Top left quadrant – sectors that sectors that have shown employment decline and are more highly concentrated in the local area than the national average Bottom left quadrant - sectors that sectors that have shown employment decline and are less highly concentrated in the local area than the national average
Click here to go back to the main presentation: Sector Trends and Specialisms