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What does Levelling Up really require?

Author: ICAEW Insights

Published: 26 Apr 2022

The government’s Levelling Up White Paper is the most recent attempt to improve the fortunes of areas in the UK that struggle to provide jobs and opportunities.

Robbie Bryant, Head of Education and Development at Open Study College, knows the challenges and opportunities of Birmingham well. Open Study College is based in Birmingham Business Park, and has worked with Birmingham City Council to provide the £12m Supplier Skills programme for local SMEs. 

A study by the council and PwC found that more than 40% of Birmingham’s children live in relative poverty. It is the third most deprived core city behind Liverpool and Manchester; 90% of its wards are more deprived than the national average. 

It also requires levelling up between its own regions; there is a decade-wide gap in life expectancy between the poorest and richest areas of Birmingham.

“While the city and region has a fantastic heritage and reputation for manufacturing, engineering and technology, there’s no escaping the fact that there is a huge skills gap in these sectors,” says Bryant. “This is being addressed in part by the likes of the Kickstart programme, apprenticeship schemes and other learning opportunities … Birmingham also has a high BAME population who do not always have the same opportunities and access to learning.”

 The Levelling Up White Paper announced plans for the West Midlands to be a “trailblazer” combined authority which will be allowed to bid for more powers. Alongside Greater Manchester, the West Midlands took control of its adult education budget in 2019 but has called for more skills funding on several occasions. 

“When it comes to skills and education, we believe businesses should receive as much support as possible to invest in their workforce which can only have a positive impact on economic growth within the region,” says Bryant. “We know every business wants to invest in staff training, but cost is often the biggest barrier.

“We’ve been encouraging eligible Midlands businesses to apply for grants of up to £18,000, to join a scheme that covers a wide range of courses including project management, HR, finance, leadership and management as well as childcare, A Levels and GCSEs.”

The ICAEW working group on Levelling Up has held regional seminars and roundtables with members to determine what they and businesses see as the key issues for the agenda.

All members in all regions cite what they see as an enormous skills gap as the biggest concern. It seems that the government has not realised how badly this affects the regions. This is in part due to local stakeholders not being included in decision making regarding improvements, and a failure to ensure education systems are providing key skills.

Members from all over the country say the skills gap affects everyone: in one area there were 47,000 people looking for work, but 37,000 roles advertised, giving some sense of the scale of the mismatch between skills required and those of the job-seeking population.

This is particularly pronounced in the South West and North East.

Outside of skills, those groups have highlighted a number of other factors that need to be addressed for levelling up to work across the regions: wages, transport, digital connectivity, devolution, and sense of pride.

Will it work?

Members are sceptical that Levelling Up will work in its current format; there are deep and long-term problems that will take longer than the allocated eight years to fix.

Members from the Midlands say levelling up would likely fail there because of the lack of joined-up development.

Melanie Christie, ICAEW Director, Regions, says there is a real focus on what needs to happen regionally but there are more micro-differences in the regions that make things more complicated.

“There are Levelling Up issues in the regions, but there are different issues depending on where you are in that region,” she says. “Government can’t adopt a blanket approach for a regional area, but must make sure that differences are taken into account. Skills, transport and other issues are also all interlinked.”

Christie says regions that have good mayoral representation are more likely to make a better case for their areas to receive investment, and draws a comparison between Manchester and Liverpool – which have strong mayoral presences – and Lancashire, which does not and is being left behind as a result. 

“There’s no drive from the government to say that this mayoral representation is important for regions, and they’re being left behind and don’t have a voice. There will be a mixed picture for levelling up on who has the loudest voice and can attract the best investment,” she says.

Christie adds that the brain drain and poor access to education are also key regional issues, and that the current Levelling Up agenda is too patchy. 

“Enterprise Zones, created some years ago, were a similar idea, but also relied on there being some local infrastructure such as local investment committees or a civic authority. If that doesn’t exist, the policy is not going to work. Members think there needs to be a real will to make Levelling Up happen, otherwise it will be all talk.”

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