Presentation

23/02/2016
NI Skills Barometer
KESS
Presentation
Mark Magill
February 2016
Agenda
 Background to the NI Skills Barometer
 Overview of approach
 Demand for skills
 Supply of skills
 Supply/ demand (im)balance
 Policy comments
 Annex 1: What else is the evidence telling us about the
existing labour market?
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Background to the
NI Skills Barometer
Background to the NI Skills Barometer
 DEL sponsored 3 year project
 Broad number of stakeholder groups/ users including:
− young people, parents and careers advisors
− employers
− education institutions
− DEL
 Skills forecasting ‘tool’
 Economy wide and across a broad range of skills/ qualifications
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Overview of Approach
Quantitative analysis
Identify demand and supply factors
Demand
side
indicators
• Demand for jobs (by industry and occupation)
• Expansion demand
• Replacement demand
Plan for
• Demand for skills
high growth
• Current and Projected skills mix
• HE and FE skills (by subject area and NQF level)
•Supply of people
• Demographics (by industry and occupation)
Supply
• Immigration
side
• Supply of HE and FE skills (by subject area and NQF
indicators
level)
• Attainment
Supply/
Demand
(im)balance
• Identify the annual average supply gap
• by HE (JACS) and FE (SSA)
• by NQF Level
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Sectoral insight also essential

Consulting with a wide range of sector/ industry organisations

Quantitative AND qualitative input is critical:

to review and enhance our quantitative analysis

provide sector insight
Demand for skills
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Employment projections by sector
Total employment change by 1 digit SIC (2015-25)
20,000
15,000
10,000
5,000
Baseline Scenario
0
High Growth Scenario
-5,000
-10,000
-15,000
Source: UUEPC
Overview of demand
Total employment
831,000
(2015)
Annual average
Gross demand
85,200
(2015-25)
Filled from within the
existing labour market
55,900
(2015-25)
918,400
(2025)
Replacement
demand
Focus of the
Skills Barometer
Net requirement from
education & migration
20,200
Expansion
demand
29,300
(2015-25)
9,100
Source: UUEPC
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Gross demand by level of qualification
Annual average gross demand for skills (2015-25)
NQF Level 6+
8,934
Filled from within existing
labour market
8,379
Net requirement
• This charts sets out the annual average gross
demand (i.e. 85,200) by skills level.
• The largest net requirement (i.e. from
education) is at the graduate level, followed by
NQF Level 4-5
5,045
3,036
NQF L2 and then NQF L3.
• Overall large demand for low level skills (below
NQF Level 3
11,861
NQF L2) but a very significant proportion of
6,063
that demand will be met from within the
NQF Level 2
9,595
existing labour market. Demand for people
with low/ no skills from education is small.
7,278
Below NQF 2
20,433
0
5,000
55,900 jobs filled from within the existing
labour market
4,582
10,000
15,000
20,000
25,000
30,000
Number of people
29,300 jobs required from education and
migration
Source: UUEPC
Net requirement by skills level
Annual average net requirement from education and migration (2015-25)
28% job opportunities
require NQF L6+
8,380
NQF Level 6+
3,030
NQF Level 4-5
Total = 29,300 p.a.
6,060
NQF Level 3
7,280
NQF Level 2
Current forecast: 16%
4,580
Below NQF 2
0
2,000
2009 forecast: 22%
4,000
6,000
Number of people
8,000
10,000
Source: UUEPC
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Demand by industry sector
Annual average net requirement (2015-25)
Wholesale & retail
Manufacturing
Restaurants and hotels
Admin' & support services
Construction
Professional scientific & technical
Health & social work
Information & communication
Education
Transport & storage
Expansion
Arts & entertainment
29,300 p.a.
Replacement
Finance & insurance
Other service activities
Agriculture
Real estate
Elect' & gas
Mining
Water supply & waste
People employed by households
Public admin & defence
-2,000
-1,000
0
1,000
2,000
3,000
4,000
5,000
Number of people demanded
Source: UUEPC
Public sector contains almost half of the higher
skilled population
Source: UUEPC
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Sectoral demand (net requirement) by skills level
Which sectors recruit high (L6+) and medium skilled (L4-5) people?
High level skills requirement (Level 6 and above)
Professional scientific & technical
-1%
5%
5%
Information & communication
2%
Health & social work
18%
5%
Manufacturing
Sub-degree level skills requirement (Level 4 and 5)
Admin' & support services
4%
Education
2%
Health & social work
3%
Restaurants and hotels
Finance & insurance
9%
Information & communication
18%
Education
6%
Other
8%
3%
Wholesale & retail
Arts & entertainment
10%
4%
4%
Construction
10%
8%
Admin' & support services
2%
Wholesale & retail
11%
6%
Manufacturing
Professional scientific & technical
Real estate
Restaurants and hotels
8%
Public admin & defence
25%
Other
Construction
9%
Other service activities
15%
Arts & entertainment
Source: UUEPC
Sectoral demand (net requirement) by
skills level
Which sectors recruit medium to lower skilled (L3 and below) people?
Mid to low level skills requirement (Level 3 and below)
2%
3%
3%
Wholesale & retail
3%
Restaurants and hotels
Manufacturing
22%
3%
3%
Construction
5%
Admin' & support services
Transport & storage
5%
Professional scientific & technical
14%
10%
Health & social work
Other
Agriculture
12%
13%
Information & communication
Other service activities
Arts & entertainment
Source: UUEPC
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Supply of skills
Based on current trends NI continues to supply a
pipeline of low skills
Highest qualification of school leavers
81,000 pupils projected to leave
school without achieving at least
5GCSE’s including English and
Maths over the coming decade
Source: DE, DEL, UUEPC
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But a smaller proportion of low achievers enter the labour market
immediately
Number of school leavers becoming economically active after qualifying
5000
4500
Number of school leavers entering the labour market
No qualifications
Level 1
Level 2
Level 3
4000
3500
3000
2500
2000
1500
1000
500
2024/25
2023/24
2022/23
2021/22
2020/21
2019/20
2018/19
2017/18
2016/17
2015/16
2014/15
2013/14
2012/13
2011/12
2010/11
2009/10
2008/09
2007/08
2006/07
2005/06
2004/05
2003/04
0
Source: DE, UUEPC
Low school achievement feeds FE supply
Number of individuals qualifying from FE by NQF levels
30,000
Number of individuals qualifying from FE
68% below level 3
25,000
20,000
15,000
10,000
5,000
0
Entry Level
1
2
3
4
5
6
7
Source: DE, UUEPC
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Economy wide supply of skills
Supply of skills
Source: DEL, DE, UUEPC
Supply/ Demand (im)balance
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Supply Gap – NQF Level
Annual average labour market supply gap (NQF L1 to L8)
Source: UUEPC
NQF level 6+ Supply Gap – Broad subject area
Annual Average Supply Gap NQF L6+ (JACS 1 digit)
600
500
400
300
Under-supply
Number of Graduates
200
100
0
-100
-200
Over-supply
-300
-400
-500
STEM
mainly Public Sector
Source: UUEPC
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NQF L6+ Undersupply – Detailed subject area
Top 15 Annual Average Undersupply (2 Digit JACS)
Computer science
Nursing
Civil engineering
Electronic & electrical engineering
Information systems
Mechanical engineering
Mathematics
Physics
Chemistry
Marketing
Physical geographical sciences
General engineering
Design studies
History by period
Others in technology
0
50
100
150
200
250
300
350
400
450
Annual supply
Source: UUEPC
NQF L6+ Oversupply – Detailed subject area
Top 15 Skills Annual Average Oversupply (2 Digit JACS)
Social work
Training teachers
Psychology
Academic studies in education
Politics
Anatomy, physiology & pathology
Sociology
Nutrition
Others in subjects allied to medicine
Sport & exercise science
Law
Pharmacology, toxicology & pharmacy
Media studies
Architecture
Others in social studies
0
50
100
150
200
250
Annual supply gap
Source: UUEPC
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NQF L4-5 Supply Gap – Broad subject area
Annual Average Supply Gap NQF L4-5 (SSAs 1 digit)
300
Number of Graduates
200
Under-supply
100
0
Over-supply
-100
Source: UUEPC
NQF L4-5 Undersupply – Detailed subject area
Top 10 Skills Annual Average Undersupply (2 digit SSAs)
Science
Nursing & related
Engineering
ICT Practitioners
Creative Arts
Manufacturing Technologies
Law & Legal
Sociology & Social Policy
Building & Construction
Hospitality & Catering
0
50
100
150
200
250
Annual supply gap
Source: UUEPC
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Policy comments
Policy Comments
The following policy comments have been made from the analysis:
 High levels of job creation is required
 Lower economic growth could create over-supply.
 Large numbers of skilled people will leave NI if employment
opportunities are not available for them.
 This is preferred to an under-supply of skills
 Skills implications of austerity
 lower levels of government spending and recruitment levels will
reduce demand for skills.
 BUT Government spending and demand will increase in the medium
to long term, therefore care must be taken with the policy response
so as not to lose the capability to deliver this training in the interim.
 In the short term, more skilled people for the private sector.
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Policy Comments
 There is a need to over-supply
 Employers indicate that not all qualifiers have the skills required to work at
level equivalent to the qualification achieved.
 How do we deal with this issue?
 Potentially linked to the need for employability skills
 Strong need for employability skills such as: team working; good
communication; people management; problem solving and critical/ objective
thinking, initiative, commercial acumen.
 Education institutions must integrate the development of these skills into
course delivery.
 Students must get appropriate exposure to meaningful work experience,
typically through placement and/ or internship.
 Balancing the responsibility of the education institution and the
responsibility of the employer.
Policy Comments
 Policy response to areas of oversupply – avoid an initial (knee-jerk)
response to simply reduce provision (and this may be necessary), but
alternatives exist:
 Selling NI as a FDI location to industries requiring those skills
 Education institutions could sell over-supplied courses to international
students
 Conversion courses
 The image of FE
 The image of FE must be considered the equal of HE, if all young people
are to match their career choices with their abilities.
 Setting appropriate funding incentives
 If Government want to encourage improved outcomes (e.g. higher
employment outcomes), then the funding regime should incentivise and
reward those outcomes.
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Policy Comments
 Sector attractiveness
 Some sectors need to work harder to make their industry
attractive to potential recruits.
 Companies should broaden their search criteria
 Employers should consider the skills developed across a broad
range of qualifications. Do not focus solely on traditional
sector qualifications
Annex 1: What else is the
evidence telling us about the
existing labour market?
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Work readiness is a problem
Number of school leavers becoming economically active after qualifying
Source: DE, EPC
Employability skills crucial
Source: DE, UUEPC
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Work readiness is a problem
Number of school leavers becoming economically active after qualifying
Source: LFS
How skilled are we?
Employed - >35
NQF Level 8,
1%
NQF Level 7,
9%
Employed - <35
NQF Level 8,
No
NQF Level 7, 1%
qualifications,
6%
6%
No
qualifications,
13%
Below NQF
2, 8%
Other
qualifications,
4%
NQF Level 6,
13%
NQF Level 6,
21%
Below NQF 2,
11%
NQF Level 45, 16%
NQF Level 2,
15%
NQF Level 3,
11%
Other
qualifications,
4%
Trade
apprenticeshi
ps, 6%
NQF Level 2,
18%
NQF Level 45, 11%
NQF level 2: 5+ GCSE’s
NQF level 3: 2+ A-Levels
NQF level 4-5: Sub-degree
NQF level 6: Undergraduate degree
NQF level 7: Masters degree
NQF level 8: PHD
NQF Level 3,
22%
Trade
apprenticeshi
ps, 4%
Source: Labour Force Survey
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How skilled are we?
Employed
NQF Level 8,
1%
NQF Level 7,
8%
NQF Level 6,
16%
Unemployed
NQF Level 6, NQF Level 7,
2%
7%
Below NQF 2,
10%
NQF Level 45, 14%
NQF Level 2,
16%
NQF Level 3,
15%
NQF Level 8,
1%
No
qualifications,
Other
10%
NQF Level 4qualifications,
5, 2%
4%
No
qualifications,
Other
18%
qualifications,
4%
NQF Level 3,
17%
Below NQF 2,
16%
Trade
apprenticeshi
ps, 9%
NQF Level 2,
24%
Trade
apprenticeshi
ps, 6%
Source: Labour Force Survey
NQF level 2: 5+ GCSE’s
NQF level 3: 2+ A-Levels
NQF level 4-5: Sub-degree
NQF level 6: Undergraduate degree
NQF level 7: Masters degree
NQF level 8: PHD
How skilled are we?
Employed
NQF Level 8,
1%
NQF Level 7,
8%
NQF Level 6,
16%
NQF Level 45, 14%
Inactive excluding students
NQF Level 6,
5%
No
qualifications,
Other
10%
qualifications,
4%
NQF Level 3,
15%
NQF
Level 45, 8%
No
qualifications,
40%
NQF Level 3,
9%
Below NQF 2,
10%
NQF Level 2,
16%
NQF Level 7, NQF Level 8,
3%
0%
Trade
apprenticeshi
ps, 5%
NQF Level 2,
14%
Below NQF 2,
12%
Trade
apprenticeshi
ps, 6%
Other
qualifications,
5%
Source: Labour Force Survey
NQF level 2: 5+ GCSE’s
NQF level 3: 2+ A-Levels
NQF level 4-5: Sub-degree
NQF level 6: Undergraduate degree
NQF level 7: Masters degree
NQF level 8: PHD
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Thank you
Mark Magill
Senior Economist
T: 02890 366245
E: md.magill@ulster.ac.uk W: www.ulster.ac.uk
Twitter: https://twitter.com/MarkMagill1982
LinkedIn: http://uk.linkedin.com/pub/mark-magill/14/62a/296/
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