Labour is one of the principle resources fuelling economic production.  Effective utilisation of the labour force is crucial for a region’s economic prosperity.  Income and fulfilment from employment are key parts of people’s standard of living and employment is important for the overall well-being of our region.

This review considers the condition and the structure of the South West labour market.  It analyses key economic, labour market and skills data to assess the long term position of the region as well as recent changes caused by the recession.  It aims not only to provide a key source of statistics but to also paint a picture of some of the underlying trends and challenges facing the region’s labour market.  The review is structured into four chapters – the economic context, characteristics of labour supply, characteristics of labour demand and skills and qualifications.

This review finds that the South West labour market continues to be characterised by relatively high economic activity rates, high levels of employment and low rates of unemployment.  Average wages in the region tend to be lower than the national average and employment is more concentrated in lower value occupations and industries.

Key facts include

·        Around 2.5 million, or 81.9% of the working age population, are classed as economically active in the South West, the second highest rate in the country after the South East (82.9%) in the year up to March 2009.  The region has consistently performed well on this measure in the last ten years.  

·        Sub-regionally, economic activity rates vary from 77.2% in the city of Bristol to 87.4% in South Gloucestershire in the year up to March 2009.

·        The region has an ageing population.  In 2008, 19% of the population was aged over 65 (England 16%) and by 2021 this is predicted to rise to 26% (England 22%).

·        Between Q2 2008 and Q3 2009, unemployment in the region increased from 3.8% of the economically active population to 6.6% (768,000 individuals).  The SW unemployment rate remains the lowest of all the English regions.

·        In the year up to March 2009, on the Labour Force Survey (LFS) measure, unemployment in SWE’s sub-regions ranged from 3.2% in South Gloucestershire to 7.1% in Torbay.

·        The number of individuals claiming unemployment related benefits has increased following the onset of the recession, rising from 1.3% in April 2008 to a peak of 3.1% in April 2009 – an additional 56,653 claimants.  At the end of 2009, the rate was 2.9%.  SWE has, however, seen the smallest percentage rise in claimants amongst the regions and, recently, the negative trend has halted.  It remains to be seen if this is a turning point.

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