This piece was first published over on the LEP Network.
Back in July, the Department of Business, Innovation and Skills (BIS) took many in the Further Education sector by surprise by announcing that they would shortly be conducting a series of area reviews, essentially looking at how well each institution is contributing to economic productivity and responding to employer needs in their area. The details, which were set out in Reviewing Post-16 Education and Training Institutions, stated that each area would be overseen by a “steering group” made up of a variety of local stakeholders, including LEPs.
In fact, it looks like LEPs will play a central role at every stage of the process. Prior to the reviews, they will be involved in “defining the areas to be covered by each review and how the review will be carried”. During the reviews themselves they will be included in the steering groups. And in the aftermath of each review, the Government says that it “expects the funding agencies and LEPs to only fund institutions that have taken action to ensure they can provide a good quality offer to learners and employers.”
With this central role also comes a good deal of responsibility, especially as the review conclusions could well see colleges that are deemed to be failing to meet the needs of the local economy having to collaborate or merge with other colleges. Given that the stakes are high, one of the biggest responsibilities facing LEPs will be to ensure that they themselves are fully aware of what the needs of the local economy actually are.
This will of course require access to accurate Labour Market Information, but there are a couple of major issues that need to be thought through carefully. The first is regard to the granularity of the industry and occupation data used to assess how well colleges are meeting local needs. Many publicly available datasets, such as BRES and Labour Force Survey, whilst providing suitably granular data, only describe historic and not future trends. On the other hand, some datasets that do provide forecasts, such as Working Futures (from UKCES), do not provide the granularity at the sectoral or occupational level, or lower geographies than the LEP area, to truly unpick specific skills need amongst local labour markets. If the steering groups rely on these raw data sources, they will not only fail to understand what the really specific skills needs are in their area (i.e. because the data doesn’t provide accurate forecasts at the SIC and SOC 4 levels), but there is a real danger that colleges might be penalised not necessarily because they aren’t meeting the needs of the local economy, but because the data is flawed.
The other major issue to be aware of, which could potentially see colleges treated unfairly, is that the economic priorities of individual colleges might well be very different from the economic priorities of the LEP region as a whole.
Imagine a LEP region which covers two Local Authorities and which contains four colleges, A, B, C and D (see map on the right). Let’s say that within the region as a whole, there is a large aerospace industry, which employs over 2,000 people. However, the industry is located entirely in Local Authority 1 and, even more specifically, exclusively within the catchment area of college A.
Given this, we might find that employment in the industry looks something like this:
For the LEP Region as a whole, the industry is a big employer and so clearly a high priority. However, this is by no means the story across the region as a whole. Both current employment and expected growth are found almost entirely within the catchment area of College A, whilst the other three catchment areas not only employ very few people in the industry, but in the case of C and D are expected to see decline over the next few years.
In this scenario, it is clear that the LEP has a responsibility to ensure that the needs of the aerospace industry in the region as a whole are met. However, it is equally clear that the responsibility for meeting this demand lies almost exclusively with College A. Colleges B, C and D, by contrast, not only have little or no responsibility to meet the needs of the aerospace industry, it would be counterproductive if they attempted to do so.
If an area review were to be conducted in this imaginary geography, and if it relied on data that only took into account the broad needs of the LEP region as a whole, or even the two Local Authorities, it would inevitably lead to some inaccurate conclusions. For instance, if College’s C and D have no provision related to the aerospace industry, which given the actual facts of their catchment area is the correct position, they could well find themselves being penalised for not meeting local needs. On the flip side, if these colleges did have a sizeable aerospace-related provision, they may well be commended on the basis of the broad data, when in fact they may well simply be leading to an over-supply to the industry if College A is already adequately supplying its needs.
What all this shows is that for these reviews to be fair and successful, they must be based on data that can not only dig down to the most specific industry and occupation levels, but also to the most specific levels of geography. Failure at this point has the potential to lead to some highly skewed conclusions, with far reaching consequences both for colleges and for local economies as a whole.
For more information about our detailed and robust employment forecasts, contact Andy Durman at firstname.lastname@example.org