Economic bulletin

We are ambitious for the economy of Staffordshire, our businesses, and people. The impacts of global events continue to be felt on the local, national, and global economies and cannot be ignored. However, the county council, Government, and our partners, will continue to support Staffordshire’s residents and businesses through challenging times, ensuring we are well-placed to deliver a more resilient, more dynamic and more productive local economy.

Our ambitious Economic Strategy is our roadmap to delivering our ambitions for the Staffordshire economy, where our existing business are helped to grow, new businesses are established and thrive, our residents have the skills needed to access the jobs of the future and our towns across the county are supported to be places we can all be proud of.

An Employment and Skills Strategy 2023-2030 has been developed to support this and can be used to guide future employment and skills work programmes, to enable effective communication of Staffordshire’s shared employment and skills goals, and to inform the development of the Local Skills Improvement Plan (LSIP) for Stoke-on-Trent and Staffordshire.

A summary brochure of the Staffordshire Employment and Skills Strategy 2023-2030 has also been produced.

To effectively achieve our priorities and deliver our long-term vision for our economy we need robust ongoing analysis and evidence of the latest economic picture, ensuring that we are aware of any challenges that may arise. The monthly Economic Bulletin forms a key part of our live evidence base.

Latest edition

Issue 45 May 2024 (1.68 MB)

Welcome to the latest edition of the Staffordshire & Stoke-on-Trent Economic Bulletin produced by our Economy, Skills and Insight Teams, which provides the timeliest analysis of official Government data, national intelligence and local insights on the state of the local economy.

Alongside information on the Claimant Count and Job Vacancies that will be a part of every Bulletin, this month’s issue also provides more detailed youth claimant count analysis and updated ward level analysis of the claimant count to help identify areas which are being impacted the hardest by unemployment and a reliance on work-related benefits across Staffordshire & Stoke-on-Trent and where there may be a greater need for support. We also provide analysis of the latest business insolvency data to further understand how businesses are faring during the current economic climate.

We hope you find the Bulletin useful and welcome your comments and suggestions on further information you would like to see included in future editions. If you do have any feedback please send your comments to Darren Farmer, Economy & Skills Analyst at darren.farmer@staffordshire.gov.uk.

Stay Safe,
Darryl Eyers
Director for Economy, Infrastructure and Skills, Staffordshire County Council

Key messages from edition 45

Local Picture

In Staffordshire having seen improvement in the local economy and labour market following the COVID pandemic, as seen nationally, we have seen unemployment, youth unemployment and dependency on work-related benefits increase during the energy and cost-of-living crisis.
Positively, this month we have seen a decline in the Claimant Count which hopefully signals a change in direction and further declines to follow over the coming months.
Although job vacancies have declined it is also positive that they remain well above pre-pandemic levels meaning that there remain job opportunities across Staffordshire for those that unfortunately find themselves out of work.
We will continue to support our residents into work and ensure that Staffordshire has the strong workforce it needs to grow the economy.
We also continue to support local businesses that face ongoing challenging conditions due to a wide range of factors including high interest rates and energy prices, increased commodity costs, increasing wage levels and lower consumer demand.
Looking at the local data in more detail, following increases in the claimant count since before the start of the year, the number of work-related benefit claimants in Staffordshire decreased by 85 this month to a total of 15,805 claimants. In contrast, we have seen increases both regionally and nationally.
The claimant rate for Staffordshire has remained the same this month at 3.0% of the working age population. Staffordshire remains one of the lowest rates in the West Midlands, far lower than the average for the region of 5.0%, and lower than the average for England at 3.9% which also remained unchanged this month.
Turning to job vacancies, Staffordshire saw a 9% decrease in the number of available job vacancies between March and April to a total of 14,000. This is lower than the number of work-related benefit claimants. Stoke-on-Trent also saw a 9% decrease in job vacancies to a total of 5,700 which is significantly lower than the number of claimants. Across the region in the last month there was a 10% decrease, and nationally there was also a 10% decrease in job vacancies.
Although we are seeing a steady decline in total vacancies, positively for those residents out of work, demand for labour remains comparatively high with the number of vacancies still above pre-pandemic levels and there is currently estimated to be close to one job vacancy available for every claimant within the county.
Considering the top 20 job vacancy occupations in Stoke-on-Trent and Staffordshire, demand for roles in social care continue to remain high with ‘Care Workers and Home Carers’ being the most in demand occupations. The following occupations ‘Sales Related’, ‘Cleaners & Domestics’, and ‘Teaching Assistants’, also have strong demand.
There continue to be reports of labour and skills shortages with not enough skilled workers to fill the vacant jobs.This has the potential to slow down economic growth and limit business survival unless the labour shortage and skills gap is quickly and effectively addressed. Clearly employment support organisations, skills providers and the Government’s Plan for Jobs including the Restart schemes and new Skills Bootcamps have a vital role in upskilling and reskilling jobseekers into areas of demand and preventing them becoming long-term unemployed. Government and business sectors have a key role in ensuring that jobs in areas of demand are attracting workers with good pay and terms and conditions to help prevent labour shortages.
It is clear there continues to be a high number of jobs available in the local economy and the need now is to ensure that there is a strong local labour pool with skilled workers able to fill these roles to support business recovery/survival and improve prosperity through better pay. The national and local support which is in place to support those that have been unfortunate enough to lose their jobs is vital in both reskilling and upskilling as well as enabling potential applicants to access the opportunities available. Encouraging those that have become economically inactive due to COVID will further help to address labour shortages and skills gaps.
Staffordshire County Council’s new Job Brokerage Service is designed to do exactly this by matching local people, employers, and training providers to fill jobs and provide people with the jobs and careers they need.
There are clear emerging opportunities for job creation in digital (including online retail and e-commerce) and the green economy (including retrofitting homes to improve energy efficiency, electric cars e.g., Jaguar Land Rover, and hydrogen e.g., JCB).
We will also look to build on our existing strengths including engineering and advanced manufacturing through the adoption of AI, Automation and Machine Learning, construction to achieve Government house building targets and build major new infrastructure projects such as the West Midlands Freight Interchange which will create 8,500 new jobs. Also advanced logistics with ecommerce creating continued demand and the recent announcement by Pets At Home in Stafford creating over 750 new jobs.

Local Initiatives

Staffordshire and Stoke-on-Trent businesses that have been turned down by other lenders can now apply to the Staffordshire and Stoke-on-Trent Business Loan Fund, supporting businesses to grow through affordable, unsecured loans from £10,000 to £50,000.
Applications for Staffordshire Means Back to Business Scheme business loans and grants remain open to small businesses in Staffordshire, including the Get Started and Grow Scheme.
Alongside this there is support available through the Growth Hub and we have our start-up schemes and the Staffordshire Jobs and Careers Service.
The Staffordshire Business and Enterprise Network (SBEN) continues to support local businesses with the transition to Net Zero.
To ensure residents have access to the support needed to find employment there are several employment and skills programmes which they can access including the Restart Scheme and skills bootcamps.
Stoke-On-Trent & Staffordshire Growth Hub have partnered with the Federation of Small Businesses (FSB) to offer free 1-2-1 virtual business support sessions.
The Staffordshire County Council Workplace Health Service, working with public health and local health experts, offers businesses a comprehensive and funded package of online and in-person support.
Businesses across Staffordshire have the opportunity to build confidence and skill-up their staff for free with the government's Multiply scheme.
Businesses in Staffordshire can now apply for free energy assessments through the Green Solutions scheme.
A major expansion at one of the county council’s enterprise centres is now under way. The £1.6million project at Newcastle Enterprise Centre in Knutton will see six workshop units built and is planned to be completed by the end of October.

National Context

After a turbulent 4-year period, this month there is further positive news in that the UK economy has seen growth at its fastest pace for 2 years, following a shallow and short-lived economic downturn.

Cost of Living

UK inflation continues to ease, with the UK's inflation rate fell to 2.3 per cent in the year to April 2024, down from 3.2 per cent in March and the lowest level since July 2021 when inflation was recorded at 2% - the Bank of England's target level.
Real pay growth continues as inflation continues to fall, and the prospect of lower interest rates should help households recover from recent cost of living pressures.
Annual growth in employees' average regular earnings (excluding bonuses) in Great Britain was 6.0% in January to March 2024, and annual growth in total earnings (including bonuses) was 5.7%.
Annual growth in real terms (adjusted for inflation using the Consumer Prices Index including owner occupiers' housing costs (CPIH)) for regular pay was 2.0% in January to March 2024, and for total pay was 1.7%.

Economy

The UK has left the technical recession that it slipped into at the end of 2023 when the economy contracted by 0.4 per cent over the year, with the economy growing 0.6 per cent in the first three months of 2024. This figure marks a return to growth in the UK economy, which has seen weak growth in the last two years.
The UK economy grew again in March, with monthly real gross domestic product (GDP) estimated to have grown by 0.4 per cent in March 2024, following growth of 0.2 per cent in February 2024 and growth of 0.3 per cent in January 2024. GDP growth is expected to continue to pick up this year and next.

Business Conditions

We are aware that there are still many businesses struggling due to a wide range of factors including high interest rates and energy prices, increased commodity costs, wage pressures, supply-chain constraints, lower consumer confidence and labour market challenges.
Although business conditions remain challenging for many, there are signs that the business environment is improving with a number of key indicators heading in the right direction and it is important that we continue to support viable businesses through these challenging times to survive and then grow.
The latest business insolvencies data which shows that in April 2024 there were a total of 2,303 company insolvencies in England and Wales, 37% higher than the number registered in the previous year (1,685 in April 2023), and 149% higher than the number registered three years previously: 925 in April 2021). The main concern around company and individual insolvencies are associated issues such as mental health and homelessness.

Labour Market

In summary, after the tightest labour market since records began, most measures (aside from pay) are back around their long-term averages. There has been a further fall in the headline employment rate from the ONS Labour Force Survey and a further small drop in the total number of people on payrolls from HMRC data. The number of payrolled employees remains well above pre-pandemic levels, while the employment rate is still below its pre-pandemic level. Over the last quarter unemployment increased to its highest for almost a year and is just above its pre-pandemic level, while economic inactivity increased further and remains well above its pre-pandemic level. Job vacancies have seen a further decline which reflects the long-term trend but remain above pre-pandemic levels.
Payrolled employees in the UK fell by 5,000 (0.0%) between February and March 2024, but rose by 288,000 (1.0%) between March 2023 and March 2024.
The early estimate of payrolled employees for April 2024 decreased by 85,000 (0.3%) on the month but increased by 129,000 (0.4%) on the year, to 30.2 million and 1.2 million above pre-pandemic level.
The UK employment rate (for people aged 16 to 64 years) was estimated at 74.5% in January to March 2024, below estimates of a year ago, and decreased in the latest quarter and 1.7pp below pre-pandemic level.
The UK unemployment rate (for people aged 16 years and over) was estimated at 4.3% in January to March 2024, above estimates of a year ago, and increased in the latest quarter and 0.2pp above pre-pandemic level.
The UK economic inactivity rate for people aged 16 to 64 years was estimated at 22.1% in January to March 2024, above estimates of a year ago, and increased in the latest quarter and 1.6pp above pre-pandemic level.
The UK Claimant Count for April 2024 increased by 8,900 on the month and by 29,300 on the year, to 1.579 million.
In February to April 2024, the estimated number of vacancies in the UK decreased by 26,000 on the quarter to 898,000. Vacancies decreased on the quarter for the 22nd consecutive period but are still 102,000 above pre-pandemic level.

Conclusion

In conclusion, we have seen the economy emerge from the short recession with the fastest growth for 2 years, while inflation continues to ease and is now close to the Bank of England target. Wage levels continue to rise and there is hope of interest rate cuts in the near future, all of which further eases the cost of living.
Business conditions remain challenging for many, but confidence is improving with rising expectations for growth.
The labour market continues to cool, with those in work falling, while we see unemployment and economic inactivity continue to rise. We are also seeing a continued long-term decline in jobs available for those that find themselves out of work.
We need to continue to support those still struggling with the cost-of-living and support viable businesses to survive and grow.By reducing the impact on our business base, we can see faster recovery and a return to economic growth to the benefit of all.
In Staffordshire we have a confident, diverse, and robust economy, demonstrated by the improvement and recovery witnessed since the last lockdown due to Covid.As the ongoing global and national socio-economic challenges persist it remains vital that local partners work together to support local businesses and residents. We continue to deliver the Staffordshire Means Back to Business Programme which has helped hundreds of Staffordshire businesses transition to new business models including diversification, digitisation and greenification to improve their viability and sustainability.
We continue to support residents into work and help businesses address ongoing labour shortages and skills gaps to aid survival and growth. A key part of this being the recently established Staffordshire Jobs and Careers Brokerage Service which is designed to match local people, employers, and training providers to fill jobs and provide people with the jobs and careers they need.
Alongside this the Government’s ‘Plan for Jobs’ schemes such as Restart, and Skills Bootcamps have an important role to play in ensuring that local residents have the skills and training needed within the local economy to support increased growth, productivity, and prosperity. Reskilling and upskilling residents from declining sectors into priority growth areas of the economy such as digital, green, advanced manufacturing, advanced logistics, construction, and health and social care where they can access higher value better paid jobs will be key.