Economic and social disparities are a historical feature of the geography of the UK. Recent ONS data shows the North-South divide remains prevalent, with London outperforming northern regions in terms of income and productivity. There is little indication of the gap closing. The desire to reduce inter-regional and urban imbalance long predates the current government’s Levelling Up agenda. Labour’s 1934 Special Areas Act and the Conservative's 2014 Northern Powerhouse Strategy are prime examples. Despite interventions, entrenched productivity and skills deficits persist.
In considering the implications for the future of levelling up, within a context of limited resources, government must prioritise a long-term approach which aligns with broader policy aims, including ambitions to ‘Build Back Better’, and transition to net-zero.
At CIOB, we believe the built environment plays a pivotal role in transforming regional economic performance and productivity. We welcome government investment for infrastructure and construction projects as part of the Levelling Up agenda. This will offer stability to a sector severely affected by Brexit and the Covid-19 pandemic. It can also accelerate the implementation of digital technologies and data-driven practices, ensuring supply chain collaboration, and efficiency in project delivery.
However, we are concerned about the availability of labour and skills in the regions to deliver and maintain the levelling up construction pipeline. The sector has historically suffered with a capacity and capability deficit. Reduced access to EU migrant labour since January 2021 has exacerbated the issue. We therefore recommend that the government undertakes an urgent assessment to determine how the sector can strategically continue with its limited resources, while planning for the future. Any assessment must include a robust analysis of the local context, considering the construction pipeline for the area, current labour market conditions and skills mismatches. This would enable the development of immediate and long-term strategies to recruit, retrain, and progress workers within the industry, at both a national and local scale.
Nationally, immediate strategies should include reforming the current ‘Apprenticeship Levy’ to a broader, more flexible ‘Skills Levy’, enabling employers to leverage funds for skills investment beyond apprenticeships. Lifelong learning, upskilling and reskilling will help to future-proof the industry and, in turn, boost productivity and growth. In the long-term, we need better representation of construction pathways within compulsory education. This would ensure progression to T-Levels and support recent reforms to post-16 education and training. In 2021, a ‘Built Environment GCSE’ was developed by WJEC, the largest awarding body in Wales, and made available for teaching. CIOB urges government to follow suit and introduce this in England.
Alongside a national education and skills framework, a tailored, place based approach is required as local leaders often have a better grasp of skills requirements in their areas. We therefore support further devolved powers, and fiscal flexibility, so local leaders can build stronger and more dynamic partnerships between employers, training providers, and other key stakeholders. This will help ensure education and training are more closely aligned to local employer and labour market needs.
Ultimately, we see skills as the crucial driver of regional economic and social disparities. To genuinely level up the country, the government must develop a long-term and stable approach to skills policy. Concerted efforts on these fronts will deliver growth and jobs in the industry, and more importantly, will transform levelling up from rhetoric to reality.
Key Points:
• CIOB recognise the Levelling Up agenda presents significant opportunities for the construction industry to develop strategies and capabilities that fuel regional innovation and growth.
• Investment in public-private infrastructure projects will aid sector recovery post-Brexit and Covid.
• Plans will fall short on delivery if we do not have the necessary skills to support them.
• To genuinely level up the country, government must increase skills investment, raise educational standards, and put local leaders and employers at the heart of education and skills policy.
This article originally appeared in The Leaders Council’s special report on ‘The Levelling Up agenda’, published on November 30, 2022. Read the full special report here.
