Employment

Baroness Eaton Excerpts

Thursday 20th March 2014 Lords Chamber

[Baroness Eaton (Con)]

My Lords, I add my thanks and congratulations to the Minister on initiating this debate but also on his very inspired work in his field.

I am certain that there is not a single Member of this House who does not recognise the value of employment to the well-being of individuals and their families. Times of unemployment are tragic for people and for the places where they live. Therefore, it is heartening to note that, as we have heard, the number of people in employment is at a record high; over the past year the total has risen and we now have 30.19 million people in work. I know that that has already been referred to but it is such a good figure that I need to say it again.

Even so, many of our major cities, especially those in the north of England, have on occasion suffered disproportionately as major industries have almost disappeared. Therefore, today’s news—again, already referred to—about Hitachi moving its operation to the north-east is very welcome. It is also an indication of the confidence that business has in the UK and its Government.

The closure of one factory can cause several hundred jobs to be lost, even overnight. One authority in the north of England, the metropolitan district of Bradford, where I am a councillor, was once one of the richest cities in Britain and the centre of the world’s wool trade. Over a number of years, the wool trade declined and so did much of the heavy engineering industry. This had a major impact on the employment opportunities for the people of the Bradford district.

In Bradford, for the 12-month period to September 2013, 217,500 residents aged 16 to 24 were in employment. Since September 2011, an additional 18,400 people have found employment. Employment growth in Bradford since 2011 has almost doubled the 4.7% increase seen in the Leeds city region as a whole and is more than four times the 2% increase across the UK.

Bradford’s working population is growing by 2,000 people per year. By 2021, there will be an additional 18,000 work-age people living in the district. Maintaining current levels of employment rates will require 10,000 new jobs. The Leeds city region econometric model forecasts employment growth at around 16,000 by 2020—an increase of 7.5%, which is higher than the increase of 6.5% forecast for the UK. The majority of new jobs will be higher-skilled, with around 6,000 requiring graduate level skills, while only 2,000 will be NVQ level 1 or below. The sectors likely to experience the biggest growth are health, transport, education, retail and professional and business services.

Bradford Council has implemented the rates rebate scheme as part of a package of measures funded by the Government’s successful regional growth fund. This scheme has been critical in persuading a number of prospective commercial tenants to commit to a large retail development project, which has in turn enabled the critical level of pre-letting required to trigger development obligations.

Bradford’s city centre growth zone, launched in 2012, is jointly funded by the regional growth fund and the council, the aim being to encourage private sector investment. Construction of the new retail centre, I am pleased to say, is now under way. The construction phase will create 1,500 jobs, with 2,500 permanent jobs in the completed contract, which is projected to attract 20 million shoppers per annum. The timeframe for the growth zone offer is crucial. The construction phase commenced later than anticipated when the programme was devised, and this creates a major issue. The delivery schedule and the regional growth fund funding period are no longer aligned, resulting in many priority activities falling outside the contracted delivery period.

The city centre growth zone is working in the case of Bradford. It is bringing real change to the face of the city centre—change that is lasting. The momentum for investment has been really positive. It is essential that such excellent government schemes always allow flexibility on timescales to enable local circumstances to be accommodated.

A project called Get Bradford Working has provided funding for unemployed people and has funded longer-term placements in business to provide people with skills and experience. Some 273 unemployed people have been helped into jobs created through the Employment Opportunities fund, and a further 245 unemployed people have been supported into work through the Routes into Work fund. In spite of changes in heavy industry, there are opportunities to train for manufacturing jobs in the district, which still has a larger than average percentage of manufacturing. There is a shortage of engineers—especially those with high-level skills—and there are examples of people working well past retirement age as there are not the people with the relevant skills to replace them.

Nationally, youth unemployment has been rising since the early 2000s, growing by more than a third during the 2008-09 recession, and it has remained too high ever since. It is, however, encouraging news that the latest figures show that youth unemployment has fallen by 29,000 this quarter and is 81,000 lower than a year ago. Some 8.7% of all young people who have left full-time education are unemployed. While this is unacceptably high, we should note that it compares with 12% in 1993 and 14% in 1984.

As we have heard, the Department for Work and Pensions works with young people on jobseeker’s allowance through jobcentres, and the number of young people on JSA has fallen for the 21st month running. The 18 to 24 claimant count peaked in December 2011 at over 480,000, but today it is 295,000.

Apprenticeships can be part of the solution to youth unemployment and aid the development of appropriate skills in manufacturing. There are many opportunities. The Chancellor is to be congratulated on yesterday’s Budget, recognising the value of apprenticeships and extending the apprentice grant for employers scheme, providing £85 million in both 2014-15 and 2015-16 for 100,000 grants to employers, as well as £20 million for postgraduate apprenticeships, as referred to by the noble Lord, Lord Shipley.

As I have said, apprenticeships create many opportunities for young people, but in too many cases young people have not been encouraged in school or by their parents to think of them as a credible alternative to higher education. We need to move young people away from the idea that anything other than a higher education degree is an inferior route to employment.

In many schools, as the noble Lord, Lord Shipley, ably pointed out, careers advice is woefully inadequate, with too little focus on the variety of routes into work and education. Many careers departments in schools do not have a good understanding of the employment trends or the skills required in their locality. Academy schools with business sponsorship do much to improve this situation. Too often, those leaving education are not seen as being ready to cope with the world of work. There can be issues around attitude, timekeeping and communication. Therefore, to some potential employers, school leavers can be much less attractive than those who have experience.

There is no magic bullet that resolves the issues of unemployment overnight. Her Majesty’s Government are to be commended on their economic strategies, which give confidence to investors, on their many schemes, such as enterprise zones and the regional growth fund, and on the support that they gave to businesses in many ways in yesterday’s Budget, which will have a major and positive impact on employment opportunities.