The West Midlands needs to address its dismal employment rates

Birmingham looking festive. Image: Getty.

With the Midlands Engine policy, Joseph Chamberlain’s legacy being back in vogue and – perhaps most notably – CityMetric’s recent tour around the area, the West Midlands is finally getting the attention it deserves. Over the next few months, the run-up to the election of a metro mayor in the West Midlands Combined Authority (WMCA) should mean even more thought is given to what’s needed to help the region thrive.

And top of that list should be turning around its dismal employment performance.

The West Midlands’ rusty jobs machine isn’t a new problem, as a report published this week by the Resolution Foundation highlights. In the years leading up to the financial crisis, the conurbation’s employment rate remained stubbornly low compared to other city regions.

And while the recovery has seen the proportion of people in work nationally rising to record levels, the West Midlands still hasn’t got back to where it was, with an employment rate of just 64.5 per cent compared to 71.6 per cent across all the city regions.

The WMCA is made up of Birmingham, Coventry, Dudley, Sandwell, Solihull, Walsall and Wolverhampton – diverse areas with different histories and populations. But bar Solihull, each of those local authorities has an employment rate below the average across the UK’s other city regions. A cross-city plan is needed.

The big challenge for the new mayor, along with other local leaders and central government, is helping people from groups that have traditionally been disadvantaged in the labour market to find work. That doesn’t mean that we should expect, say, people with disabilities to have identical employment rates to the rest of the country. But the gap between the kinds of workers who tend to be in employment whatever the economic weather – in their thirties or forties, highly-educated – and these disadvantaged groups is significantly larger in the WMCA than in other city regions. Targeted support designed to help some of those groups that fare worst in the the region – younger workers, those with low qualifications and people from BAME backgrounds – could make a meaningful contribution.

Of course, it’s not enough to just think about potential employees: the kinds of jobs and sectors setting up in the city region are crucial too. The WMCA can be rightly proud of its industrial heritage, still evident today with companies like Jaguar Land Rover. And while a higher share of the WMCA’s workforce are employed in manufacturing, it’s still only 13 per cent. The city region should also look to expand into more “jobs-rich” areas such as the high value services sector. When it comes to industrial strategy, it should be proud of, but not constrained by, its past.


And hand in hand with attracting those sorts of jobs is having workers with the right skills. Qualification levels in the WMCA are below average. Despite having one of the highest proportions of students among city regions, it has trouble retaining them once they graduate, with fewer staying on than in Bristol or Manchester. More high-skilled jobs would help – but it’s worth thinking too about what those other “stickier” cities offer and how the WMCA can mark itself out and tap into the asset of its large student population.

While the mayor will have powers that can make a real difference, a shared focus with central government and other leaders in the West Midlands will be needed to boost employment. But with a targeted, ambitious plan that puts jobs growth at its heart, there’s every reason to hope that the West Midlands will be talked about for all the right reasons for years to come.

Conor D'arcy is a policy analyst at the Resolution Foundation.

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Worried Guildford will be destroyed by Chinese trains? Then you might not be very nice

A South West Train at Waterloo. Image: Getty.

Despite the collapse of everything else that more-or-less worked in 2008 Britain, before the Hunger Games years began, some things remain constant. One of the things that’s near-mathematical in its constancy is that, when a new train contract is let, people on both sides of the political spectrum will say extremely stupid things for perceived partisan advantage.

This week saw the award of the contract to run trains to the south west of London, and unsurprisingly, the saying stupid things lobby was out in force. Oddly – perhaps a Corbyn-Brexit trend – the saying of egregiously stupid racist lies, rather than moderately stupid things, was most pronounced on the left.

As we’ve done to death here: rail in Great Britain is publicly run. The rail infrastructure is 100 per cent publicly owned, and train operators operate on government contracts, apart from a few weird anomalies. Some physical trains are owned by private investors, but to claim rail isn’t publicly run would be like claiming the NHS was the same as American healthcare because some hospital buildings are maintained by construction firms.

Every seven years or so, companies bid for the right to pay the UK government to operate trains in a particular area. This is the standard procedure: for railways that are lossmaking but community-important, or where they are within a major city and have no important external connections, or where there’s a major infrastructure project going on that’ll ruin everything, special measures take place.

The South Western England franchise is not one of these. It’s a profitable set of train routes which doesn’t quite live up to its name. Although it inherited a few Devon and Dorset routes from the old days, its day job involves transporting hundreds of thousands of Reginald Perrins and Mark Corrigans from London’s outer suburbs and Surrey, Hampshire and Berkshire’s satellite towns to the grinding misery of desk jobs that pay a great deal of money.

(If your office is in the actual City of London, a fair trek from the railway’s Waterloo terminus, then you get the extra fun of an extra daily trip on the silliest and smelliest Tube line, and you get even more money still.)

Anyway. The South Western concession went up for auction, and Scottish bus and train operator First Group won out over Scottish bus and train operator Stagecoach, the latter of which had run the franchise for the preceding 20 years. (Yes, I know 20 isn’t a multiple of 7. Don’t ask me to explain, because I can and you wouldn’t enjoy it.)

First will manage the introduction of a bunch of new trains, which will be paid for by other people, and will pay the government £2.2bn in premiums for being allowed to run the service.

One might expect the reaction to this to be quite muted, because it’s quite a boring story. “The government does quite a good deal under which there’ll be more trains, it’ll be paid lots of money, and this will ultimately be paid back by well-paid people paying more train fares.” But these are not normal times.


First Group has decided for the purposes of this franchise to team up with MTR, which operates Hong Kong’s extremely good metro railway. MTR has a 30 per cent share in the combined business, and will presumably help advise First Group about how to run good metro railways, in exchange for taking a cut of the profits (which, for UK train franchises, tend to be about 3 per cent of total revenue).

The RMT, famous for being the least sensible or survival-oriented union in the UK since the National Union of Mineworkers, has taken exception to a Hong Kong company being involved in the railways, since in their Brexity, curly sandwich-eating eyes, only decent honest British Rail has ever delivered good railways anywhere in the world.

“A foreign state operator, in this case the Chinese state, is set to make a killing at the British taxpayers’ expense,” the RMT’s General Secretary Mick Cash said in a press release.

This is not true. Partly that's because a 30 per cent share of those 3 per cent profits is less than 1 per cent of total revenues, so hardly making a killing. Mostly, though, it’s because it’s misleading to call MTR “state-owned”. While it’s majority owned by the Hong Kong government (not the same body as the central Chinese state), it’s also partly listed on the Hong Kong Stock Exchange. More to the point, this a really odd way of describing a transport authority controlled by a devolved body. I wouldn’t call the Glasgow subway “UK-state owned” either.

So this fuss is intensely, ridiculously stupid.

There’s an argument – it’s a bad argument, but it exists – that the entire UK rail system should be properly privatised without government subsidy.

There’s an argument – it’s a slightly less stupid argument, but it exists – that the entire UK rail system should be returned to the public sector so we can enjoy the glory days of British Rail again.

The glory days of British Rail, illustrated in passenger numbers. Image: AbsolutelyPureMilk/Wikipedia.

But to claim that the problem is neither of these things, but rather that the companies who are operating trains on the publicly run network are partially foreign owned, makes you sound like a blithering xenophobe.

In fact, if you think it’s reasonable for a Scottish company to run trains but not for a Hong Kong company to run them, then that's me being pretty bloody polite all things considered.

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