WEST LOTHIAN LABOUR MARKET PROFILE Introduction This report provides a labour market profile for the West Lothian area. Similar profiles are available for the other councils in the Lothian region. They offer a consistent overview of local labour market conditions in West Lothian. Most of the content is based upon official information sources.

KEY STATISTICS • • • • •

• • • • • •

Economic output: GVA was estimated at £2,173 million in 2004. Forecasts indicate growth of 14.1% between 2004 and 2007, in contrast to growth of 10.7% for Edinburgh and Lothian and 7.2% for Scotland. Population: estimated at 162,845 in 2004, an increase of 2.6% since the 2001 Census. Projections for the period 2004 to 2014 indicate an increase of 9.1% (14,882) – the fastest growth of any council area in Scotland. Working age population: estimated at 104,502 in 2004. Projections suggest growth of 8.5% (8,871) between 2004 and 20014 to reach 113,373. Employment rate: the proportion of working-age residents in employment is high and estimated at 79% in 2003 - similar to the rate for Edinburgh and Lothian (77%) but above the Scottish rate (74%). Workforce employment: the number of filled jobs in West Lothian stands at around 71,650 - a decrease of 1.7% (-1,230) since 2001, in contrast to growth of 1.1% for Edinburgh and Lothian. However, forecasts predict that the number of jobs will increase by around 4.4% (3,120) over the next 3 years – well above the forecast for Scotland (0.4%). Top 5 sectors for employment: Manufacturing (16%), the Public Sector (14%), Business Services (11%), Retailing (11%) and Wholesaling (10%). Employment growth: forecasts suggest that he largest absolute increases in employment are predicted for the Wholesaling (+670) and Hotels and Catering (+650) sectors. Claimant count unemployment: was 2.3% at July 2004. The claimant count unemployment rate has improved steadily over recent years to the extent that it is now the lowest for over a decade. Economic inactivity: an estimated 17% or 17,000 of the working-age population are considered economically inactive – below the rate Scotland (21%) Average weekly wage (2003): at workplaces was £369 - on a par with the Scottish average (£366) and 94% of the average weekly wage in Edinburgh and Lothian (£391). Qualifications: the working-age population of West Lothian is becoming steadily more qualified. In 2002, 26% held NVQ4 (HND, Degree) level qualifications, an increase of 7% since 1999.

Lothian Labour Market Unit ECONOMIC OVERVIEW The indicator for economic activity at the local area level is GVA (Gross Value Added)1, which is an indicator of GDP (Gross Domestic Product). In 2004, West Lothian is estimated to have a GVA of £2,173 million, accounting for 18% of Edinburgh and Lothian’s GVA. The forecasts shown by Figure 1 suggest that GVA will expand by 2.8% in 2004 after contracting by -0.4% in 2003. Over the next 3 years, growth will peak at 5.2% before falling back to around 4%. The buoyant forecast highlights the adaptability of the West Lothian economy following the downturn in the global demand for electronic goods and components. Between 2004 and 2007, forecasts suggest GVA will increase by 14.1% (to reach £2,478 million) compared to growth of 7.2% for Scotland and 10.7% for Edinburgh and Lothian as a whole.

10.0

Figure 1: Annual change in GVA, 2000 - 2007

5.0

%

0.0 -5.0

-10.0

2000

2001

2002

2003

2004

2005

2006

2007

West Lothian

9.0

1.7

-5.6

-0.4

2.8

5.2

3.7

4.5

Edinburgh & Lothian

3.5

3.6

-0.1

1.2

3.1

3.6

3.1

3.3

Scotland

2.1

2.5

1.5

1.7

2.3

2.3

2.4

2.5

Source: Experian Business Strategies, 2003

The most important sectors for GVA are Manufacturing2 (30% - principally Electrical and Optical Equipment), Wholesaling (9%), the Public Sector (8%) and Transport and Communications (8%). The sectors contributing the most to growth over the next three years GVA is a measure of the value of all goods and services produced in an area. GVA is a major component of GDP (Gross Domestic Product) and is usually considered to be the best indicator of the amount of economic activity carried out by an industry in any one period. Care must be exercised when using GVA as a local indicator of wealth. GVA creation is concentrated where high value creating employment is prevalent. Thus cities and areas of high value manufacturing tend to have high GVA per head. 2 Manufacturing comprises the sectors of Engineering (including the sub-sector of Electrical and Optical Equipment) and Other Manufacturing. The Public Sector comprises Public Administration and Defence, Education and Health. 1

(Table 1 on next page) are predicted to be Engineering, Wholesaling and Business Services – together accounting for 60% of growth, with Engineering alone accounting for 40%. Table 1: Projected change in GVA by sector GVA (£ millions) Agriculture, Forestry & Fishing Mining & Utilities

2004 26.7

2007

Change 200120042004 2007

28.0

3.0

% Change 200120042004 2007 4.7

6% 4%

14.1

16.1

-6.4

2.1

-31.2

14.6

130.8

5.4

9.7

4.7

8.0

Engineering

497.3

619.4

-210.5

122.1

-29.7

24.6

Other Manufacturing

157.6

166.9

-0.6

9.4

-0.4

5.9

Construction

167.0

187.3

15.2

20.2

10.0

12.1

Wholesaling

200.4

236.6

34.0

36.1

20.4

18.0

Retailing

113.7

128.7

11.2

15.0

10.9

13.2

83.1

95.0

13.0

11.9

18.5

14.3

173.7

191.4

7.0

17.7

4.2

10.2

52.2

58.1

5.9

5.8

12.8

11.2

Banking & Insurance Other Financial & Business Services

45.1

46.2

6.6

1.1

17.1

2.4

157.5

181.4

23.8

23.9

17.8

15.2

Public Admin. & Defence

50.8

49.7

2.6

-1.1

5.4

-2.2

Education

67.3

69.9

-0.9

2.6

-1.3

3.9

Health

66.5

76.4

5.4

9.9

8.9

14.9

Other (largely private)

98.6

114.0

9.5

15.4

10.7

15.6

Total GVA 2,172.7 Source: Experian Business Strategies, 2003

2,478.4

-76.2

305.7

-3.4

14.1

Business Services

POPULATION Levels and Change Population levels are important to the job market – they may affect both the supply of labour and the demand for local services. The General Register Office for Scotland (GROS) estimates that the population of West Lothian is 162,850 in 2004. No other Council area in Scotland is growing as rapidly in population terms as West Lothian. Figure 2 shows that between the 2001 Census and 2004 the population increased by 2.7% (4,130). Over the same period the population of Edinburgh and Lothian increased by 0.8% to reach to reach 784,840, while Scotland’s fell by -0.5% (-24,190). Over the next 10 years the population is projected to increase by 9.1% to reach 177,730 in 2014 – accounting for over two fifths of the growth Edinburgh and Lothian’s population. In

Figure 2: Population projections - total population

8%

12.8

121.1

Transport & Communications

10%

1.3

Metals, Minerals & Chemicals

Hotels & Catering

contrast, by 2014, the population of the region as a whole is projected to increase by 4.3% to reach 818,950, while Scotland’s population is projected to fall by -1.5% to reach 4,963,000.

2% 0%

9.1%

0.8%

4.3%

2.6%

-1.5%

-0.5%

-2% -4%

2001-2004 West Lothian

2004-2014 Edinburgh & Lothian

Scotland

Source: 2001 Census and 2002 Population Projections, General Register Office for Scotland, Crown Copyright

Population by Age Group The working-age population is estimated at 104,500 – equivalent to 64% of the total population and an increase of 2.7% (2,620) since the 2001 census, as shown in Figure 3. Over the next 10 years, the working-age population is projected to grow by 8.5% to reach 113,370 in 2014. For Edinburgh and Lothian as a whole, this population is projected to grow by 4.9% to reach 533,730 in 2014, while Scotland’s will decline by -3.1% (100,000) to reach 3,048,170. GROS projections indicate that the working age population will continue growing throughout the next decade.

10%

Figure 3: Population projetions - working-age population

8%

8.5%

6% 4% 2% 0%

4.9% 2.7%

1.6%

-0.1% -3.1%

-2% -4%

2001-2004 West Lothian

2004-2014 Edinburgh & Lothian Scotland

Source: 2001 Census and 2002 Population Projections, General Register Office for Scotland, Crown Copyright

The population projections, as shown in Table 2, indicate the aging of West Lothian’s population. Despite this, West Lothian has a relatively youthful demographic profile compared to Scotland as a whole. The population aged 0-44 is projected to fall slightly (1,070 or -1%), while the population aged 45 and over will be the main driver of population growth – increasing by 27% (15,950) between 2004 and 2014. The 2001 Census confirmed that net inward migration is the main driver of population growth, but there is also positive natural population change (excess births over deaths). According to the 2001 Census, which provides a snapshot of migration during the previous year, 9% of inward migration was from abroad, 19% from the UK outside Scotland and 72% from areas within Scotland. Table 2: Population projections by age group, 2004 - 2014 Age Group

2004

2014

change

% change

0-4

9,960

9,770

-190

-1.9%

5-15

24,500

22,980

-1,520

-6.2%

16-29

27,070

31,020

3,950

14.6%

30-44

41,030

37,720

-3,310

-8.1%

45-59

32,570

40,120

7,550

23.2%

60-74

19,870

25,370

5,500

27.7%

7,850

10,750

2,900

36.9%

75+

EMPLOYMENT The level of employment can be measured in two ways: • By counting the number of employed persons resident in an area, irrespective of the location of their workplace, also know as “resident employment”; or • By counting the number of filled jobs located in any given area, otherwise known as “workforce employment”. The resident based measure is an indicator of prosperity or deprivation, while the workplace measure is a better indicator of local economic activity and economic change. The Employment Rate • Resident (working-age) employment 3 in West Lothian was estimated at 84,000 in 2003, corresponding to an employment rate of 79% - above the employment rate for Scotland (74%) and similar to the rate for Edinburgh and Lothian (77%). There has been little change in the employment rate since 1999. • Workforce employment in West Lothian is estimated at 71,650 in 2004. This represents a decrease of 1.7% since 2001, in contrast to growth of 1.1% and 1.2% for Edinburgh and Lothian and Scotland respectively.

Total 162,850 177,730 14,880 9.1% Source: 2001 Census and 2002 Population Projections, General Register Office for Scotland, Crown Copyright

The aging of the population is a common demographic trend, as shown by Figure 4. In the case of Scotland, the declines in the population aged 44 and under (particularly those aged 30-44 and 5-15) are the main drivers of Scotland’s falling population.

Industrial Structure Table 3 (on the next page) provides a breakdown of the industrial structure of the workforce. Manufacturing is the largest employer in West Lothian, accounting for 16% of total employment. The Public Sector is also very important accounting for 14% of filled jobs, while Business Services and Retailing each account for 11%. In contrast, Manufacturing accounts for only 9% of filled jobs in Scotland, while the Public Sector is substantially more important with 26% of employment.

Figure 4: Population projections by age group, 2004-2007 40% 30% 20% 10% 0% -10% -20% West Lothian

0-4

5-15

16-29

30-44

45-59

60-74

75+

Total

-1.9%

-6.2%

14.6%

-8.1%

23.2%

27.7%

37.0%

9.1%

Edinburgh & Lothian

0.1%

-11.3%

6.1%

-5.1%

14.2%

16.6%

13.8%

4.3%

Scotland

-6.8%

-16.5%

1.1%

-19.4%

9.0%

14.6%

17.5%

-1.5%

Source: 2001 Census and 2002 Population Projections, General Register Office for Scotland, Crown Copyright

3

The number of residents in employment is estimated from the Labour Force Survey.

Table 4: Estimated change in workforce employment by sector in West Lothian

Table 3: Percentage of total employment by sector, 2004 West Lothian

Edinburgh & Lothian

Scotland

Agriculture, Forestry & Fishing

1.0%

0.9%

2.1%

Mining & Utilities

0.2%

0.8%

1.7%

Metals, Minerals & Chemicals

4.1%

1.7%

2.2%

Engineering

9.8%

3.9%

Other Manufacturing

6.4%

4.2%

Construction

9.2%

5.4%

Wholesaling

10.3%

Retailing

10.9%

Hotels & Catering

2004

2007

Change 2001 2004 2004 2007

% Change 2001 2004 2004 2007

Wholesaling

7,410

8,080

790

670

11.9%

9.0%

Hotels & Catering

5,530

6,180

870

650

18.7%

11.8%

3.4%

Other (largely private)

4,770

5,370

210

600

4.6%

12.6%

5.4%

Business Services

7,790

8,220

-60

430

-0.8%

5.5%

6.7%

Health

3,810

4,230

250

420

7.0%

11.0%

4.6%

4.9%

Retailing

7,780

8,170

360

390

4.9%

5.0%

9.6%

10.4%

Construction

6,590

6,800

310

210

4.9%

3.2%

7.7%

7.1%

7.4%

Education

3,950

4,040

-10

90

-0.3%

2.3%

Transport & Communications

5.7%

5.2%

5.9%

Engineering

7,029

7,075

-3,341

46

-32.2%

0.7%

Banking & Insurance

1.4%

8.7%

4.1%

Metals, Minerals & Chemicals

2,940

2,950

60

10

2.1%

0.3%

Other Financial & Business Services

1.7%

2.8%

1.95%

Banking & Insurance

990

1,000

70

10

7.6%

1.0%

Business Services

10.9%

15.2%

11.3%

Mining & Utilities

120

120

-110

0

-47.8%

0.0%

Public Admin. & Defence

3.3%

5.7%

6.5%

Other Financial & Business Services

1,230

1,190

-10

-40

-0.8%

-3.3%

Education

5.5%

8.6%

7.9%

Public Admin. & Defence

2,370

2,320

160

-50

7.2%

-2.1%

Health

5.3%

9.3%

11.6%

Agriculture, Forestry & Fishing

700

640

-140

-60

-16.7%

-8.6%

Other (largely private)

6.7%

6.5%

6.3%

Other Manufacturing

4,580

4,500

-210

-80

-4.4%

-1.7%

71,650

457,770

2,525,850

Transport & Communications

4,080

3,910

-410

-170

-9.1%

-4.2%

71,650

74,770

-1,230

3,120

-1.7%

4.4%

Full-time employees

45,930

47,490

-970

1560

-2.0%

3.4%

Part-time employees

17,760

18,860

2,000

1,100

11.9%

6.2%

Total employment (inc. self-employed) Source: Experian Business Strategies, 2003

Forecasts suggest that workforce employment in West Lothian will grow by around 4.4% (3,120) over the next three years, as shown in Table 4. In terms of sectors, forecasts indicate that Wholesaling will have the largest absolute increase in jobs (+670), closely followed by Hotels and Catering (+650) and Other (largely private) Services (+600). In contrast, the forecasts suggest that Transport and Communications will have the largest absolute decline in employment (-170). West Lothian is much less dependent on part-time employment than Scotland as a whole - an estimated 28% of employees are part-time compared to 41% for Scotland.

Total (inc. self-employed)

Source: Experian Business Strategies, 2003. Numbers are rounded.

The forecasts shown by Table 5 (on the next page) indicate that most sectors of West Lothian’s service economy will do relatively well in creating jobs – outperforming most of Scotland’s service sector. However, the production sector (comprising manufacturing, construction, mining and agriculture) will continue to loose jobs. Overall, the forecasts suggest that total employment in West Lothian will increase by 4.4% - slightly above the forecasts for Edinburgh and Lothian (3.3%). Part-time employment will also become an increasingly common feature of West Lothian’s employment base.

Table 5: Estimated percentage change in workforce employment West Lothian

2001-2004 Edinburgh & Lothian

Scotland

West Lothian

2004-2007 Edinburgh & Lothian

Scotland

Agriculture, Forestry & Fishing

-16.7%

-14.0%

-6.2%

-8.6%

-10.0%

-2.5%

Mining & Utilities

-47.8%

-2.5%

-2.5%

0.0%

-8.9%

-8.9%

Metals, Minerals & Chemicals

2.1%

1.4%

-4.6%

0.3%

-4.0%

-5.9%

-32.2%

-35.0%

-18.3%

0.7%

-0.3%

-1.1%

Other Manufacturing

-4.4%

-10.8%

-5.2%

-1.7%

-11.1%

-8.8%

Construction

4.9%

1.7%

5.1%

3.2%

1.6%

1.4%

Wholesaling

11.9%

2.2%

-2.9%

9.0%

6.4%

-1.0%

Engineering

Retailing

4.9%

-1.3%

0.2%

5.0%

3.2%

0.4%

Hotels & Catering

18.7%

16.0%

1.0%

11.8%

10.1%

3.5%

Transport & Communications

-9.1%

-3.7%

4.7%

-4.2%

-3.4%

-2.6%

Banking & Insurance

7.6%

7.9%

5.4%

1.0%

2.8%

-2.8%

Other Financial & Business Services

-0.8%

1.4%

7.1%

-3.3%

1.0%

-0.5%

Business Services

-0.8%

0.8%

1.1%

5.5%

4.4%

2.7%

Public Admin. & Defence

7.2%

7.4%

7.0%

-2.1%

-1.9%

-3.7%

Education

-0.3%

2.5%

5.2%

2.3%

1.1%

-0.5%

Health

7.0%

6.8%

4.5%

11.0%

9.8%

2.8%

Other (largely private)

4.6%

-0.9%

3.1%

12.6%

11.4%

13.0%

Total (inc. self-employed)

-1.7%

1.1%

1.2%

4.4%

3.3%

0.4%

-2.0%

1.4%

1.0%

3.4%

2.2%

0.4%

Part-time employees 11.9% Source: Experian Business Strategies, 2003.

10.4%

-1.6%

6.2%

5.2%

-0.6%

Full-time employees

Self Employment An estimated 11% (7,960) of the workforce in West Lothian are self-employed - similar to the self-employment rate for Scotland of 10%. The most important sector for self-employment is Construction with an estimated 37% (2,450) of the workforce in self-employed. Other sectors with a significant proportion in self-employment include Agriculture, Forestry and Fishing (32%), Transport and Communications (19%) and Business Services (17%). Forecasts suggest that self-employment will grow by 5.8% (460) by 2007 to around 8,420. Jobs Density Jobs density is an indicator of labour demand but should be used in conjunction with other labour market indicators. It is defined as the number of filled jobs in an area (workforce employment) divided by the resident working-age population in that area. While areas with relatively high jobs densities clearly offer potential job opportunities for residents of the area, it may be the case that there is a mismatch between the type of jobs in an area and the skills of the people living there.

The jobs density for West Lothian is 0.7 – that is, just over half a job for every working-age resident. The figures for Edinburgh and Lothian and Scotland are 0.9 and 0.8 respectively. Comparing West Lothian’s jobs density with the employment rate and low claimant count indicates that there is more labour supply than demand within the area, which results in a relatively high level of outward commuting.

UNEMPLOYMENT Claimant Unemployment Recent changes in unemployment are represented in Table 6. In July 2004, the claimant count (the number of people claiming Jobseekers Allowance - JSA) in West Lothian was 2,389 consisting of 1,745 males and 644 females. The claimant count rate was 3.4% for males, 1.3% for females and 2.3% in total. From the peak in unemployment during 2002, there has been a steady improvement relative to other Council areas in the Edinburgh and Lothian region to the extent that the unemployment rate is now on a par with Edinburgh and the UK (2.3%). In fact, unemployment fell by 21% between July 2001 and July 2004. Over the same period, the picture of unemployment across Scotland has also been one of steady improvement – falling by 13%. Table 6: Claimant Unemployment, Jul 2001 – Jul 2004 Total Jul-01 Jul-02 Jul-03 Jul-04 Male Jul-01 Jul-02 Jul-03 Jul-04

West Lothian Number Rate 3,015 3.0% 3,290 3.2% 2,878 2.8% 2,389 2.3%

2,270 2,424 2,116 1,745

4.4% 4.7% 4.1% 3.4%

Female Jul-01 745 1.5% Jul-02 866 1.7% Jul-03 762 1.5% Jul-04 644 1.3% Source: Claimant Count, Jobcentre Plus/Nomis.

Edinburgh & Lothian Number Rate 11,756 2.4% 11,757 2.3% 12,326 2.5% 11,078 2.2%

Scotland Number Rate 108,212 3.4% 106,846 3.4% 105,014 3.3% 94,080 3.0%

9,059 8,914 9,276 8,282

3.6% 3.5% 3.7% 3.3%

82,387 80,933 79,114 70,532

5.1% 5.0% 4.9% 4.4%

2,697 2,843 3,050 2,796

1.1% 1.2% 1.2% 1.2%

25,825 25,913 25,900 23,548

1.7% 1.7% 1.7% 1.5%

Claimants by Age and Duration The change in the level of claimant unemployment varies between different groups. Table 7 shows that between July 2001 and July 2004 the level of unemployment fell in every group apart from the number of claimants aged 50 and over, including long-term unemployment (claiming over 12 months) which dropped by 20%. The fall in the claimant count has been most significant during the first half of 2004 and contrasts to the mixed picture for Edinburgh

and Lothian as a whole as shown by Figure 5. The region has seen a fall in the number of claimants aged 18 to 49 and long-term unemployment but an increase in the number of claimants aged 17 and under, 50 and over and the group eligible for the New Deal for Young People programme. In contrast, the figures for Scotland show a drop in unemployment across all categories. Table 7: Unemployment by age and duration, July 2004 West Lothian

Change: July 2003-04

Change: July 2001-04

Number

Jul-04 % of total

Number

Number

17 and under

130

5%

-40

-24%

-15

-10%

18-24

710

30%

-150

-17%

-255

-26%

25-49

1,210

51%

-260

-18%

-335

-22%

335

14%

-30

-8%

0

0%

Age

50+ Aged 18 - 24, claiming for over 6 months (eligible for the New Deal for Young People programme)

%

The traditional measures of unemployment – the claimant count and ILO unemployment4 – represent an incomplete picture of unemployment. Both measures exclude economically inactive groups who want to work and those on government training schemes such as New Deal. To illustrate the potential impact on unemployment figures of taking these factors into account, a study of hidden unemployment (undertaken by Sheffield Hallam University) estimated the “real level” of unemployment for Council areas for Jan 2002 (shown in Table 8). It would appear that unemployment – at its worst – is around four times higher than represented by the claimant count.

%

Table 8: Estimate of real unemployment, Jan 2002

95

4%

-15

-14%

-55

37%

Claiming for over 12 months

245

10%

-10

-4%

-60

-20%

Claiming for over 6 months

625

26%

-75

-11%

-150

-19%

Source: Claimant Count, Jobcentre Plus/Nomis. Due to disclosure control the numbers are rounded to the nearest five.

Figure 5: Change in JSA claimants by age and duration, July 2001 - July 2004 20% 10% 0%

Claimant count rate – Jan 2002 Male

Female

Total

Estimate of real unemployment – Jan 2002 Male

Female

Total

West Lothian

4.2%

1.3%

2.7%

12.7%

10.4%

11.7%

Edinburgh & Lothian

3.8%

1.1%

2.5%

10.6%

8.1%

9.5%

Scotland 5.1% 1.5% 3.4% 15.1% 11.5% Source: Centre for Regional and Social Research, Sheffield Hallam University, 2002

13.5%

ECONOMIC INACTIVITY Economically inactive5 people are those persons who are not actively engaged in the economy – they are not employed nor seeking work. In strict terms, the economically inactive includes those not in employment, not classified as unemployed (by the ILO measure), or not either actively seeking work or available for work. The Labour Force Survey estimates the rate of economic inactivity of the working-age population and recent annual estimates are shown by Figure 66. In 2002, an estimated 17,000 or 17% of the working-age population in West Lothian were economically inactive. There appears to have been little change in the rate of economic inactivity in West Lothian and rates have remained below the Scottish average.

% -10% -20% -30% -40%

4

17 & under

18-24

25-49

50+

18-24, >6 months

-10.3%

-26.4%

-21.7%

0.0%

-36.7%

-19.7%

-19.4%

-20.8%

Edinburgh & Lothian

8.2%

-4.1%

-9.1%

6.3%

12.0%

-13.6%

-4.7%

-5.8%

Scotland

-6.2%

-8.7%

-17.5%

-5.5%

-1.9%

-29.1%

-18.7%

-13.1%

West Lothian

Source: Claimant Count, Jobcentre Plus/Nomis.

>12 Total >6 months months claimants

The ILO (International Labour Organisation) definition of unemployment is the internationally agreed definition and is used by the UK. ILO unemployment is estimated from the Labour Force Survey but data is unavailable at smaller geographies due to the size of the sample. Under ILO guidelines, all people aged 16 and over can be classified into one of three states: in employment; ILO unemployment; or economically inactive. ILO unemployed people are: without a job, want a job, have actively sought work in the last 4 weeks and are • available to start work in the next 2 weeks; or • out of work, have found a job and are waiting to start it in the next 2 weeks. 5 Those who are out of work but do not meet the criteria of ILO unemployment are economically inactive. The economically inactive is a broad definition of what is a very disparate group of people, which include: non-working adults looking after family, students, the retired, the disabled, prisoners and other groups with multiple difficulties. 6 The estimates from the Labour Force Survey are subject to margins of error which increase with smaller populations.

25

23.2

20 15

%

The number of people claiming at least one key working-age benefit in West Lothian has changed little in recent years (1% increase since 1999). At November 2003, there were an estimated 16,420 persons of working-age in West Lothian claiming at least one of the key (working-age) benefits – equivalent to 16% of the working-age population. The proportion of the working-age population in West Lothian dependent on key benefits is lower than the Scottish average but higher than the proportion Edinburgh and Lothian as a whole.

Figure 6: Economic inactivity rates, 1999-2003

17.7 17.4

20.1 19.4 16.6 17.2

18.6 18.7

22.0 21.7 21.3

10

Table 10 shows the composition of the population claiming one of the four key benefits. By far the largest group dependent on benefits are those unable to work or require Income Support due to sickness or disability – accounting for around two thirds (67%) of claimants in West Lothian.

5 0

West Lothian

Edinburgh & Lothian

Table 10: Working age claimants of key (working-age) benefits by statistical group, Nov 2003

Scotland

Source: Annual Labour Force Survey, Office for National Statistics

West Lothian

Many of the economically inactive say they want to work and this is important in the context of the tight labour market experienced in Edinburgh and Lothian where they form a relatively substantial pool of potential workers. According to the Labour Force Survey, roughly one fifth of the economically inactive population want a job. This represents a pool of workers around 40% greater than the number of claimant unemployed. Within this group there will be varying degrees of labour market attachment and for some, it may only take a relatively small change in circumstances to look for work.

Edinburgh & Lothian

Scotland

Numbers

%

Numbers

%

%

2,460

15%

11,140

16%

17%

10,960

67%

45,620

66%

66%

2,240

14%

9,180

13%

13%

Other

760

5%

2,760

4%

4%

Total

16,420

Unemployed Sick & disabled Lone parents

68,700

Source: Department for Work and Pensions

SOCIAL EXCLUSION Benefits Dependency This indicator enables an understanding of the extent of social exclusion. This is a term to describe marginalisation from employment and income, and often includes the attendant issues of quality of life. Benefit dependency is the proportion of the working-age population claiming at least one of the key working-age benefits, which are: Income Support, Incapacity Benefit, Severe Disablement Allowance and Jobseekers Allowance. Table 9: Benefit dependency – proportion of the working age population claiming key (working-age) benefits, Nov 1999 – Nov 2003 West Lothian

Edinburgh & Lothian

Scotland

Numbers

%

Numbers

%

%

Nov-99

16,200

16.3

70,760

14.3

18.3

Nov-00

16,080

15.9

68,920

13.8

17.9

Nov-01

16,620

16.3

68,380

13.7

17.5

Nov-02

16,220

15.8

68,040

13.5

17.4

Nov-03

16,420

16.0

68,700

13.7

17.2

Source: Department for Work and Pensions

EARNINGS The level of wages can be measured in two ways: • By the average weekly wage of jobs located in any given area, otherwise known as “workplace based” earnings; or • By the average weekly wage of employed persons resident in an area, irrespective of the location of their workplace, also known as “resident based” earnings. Average Wages In 2003, the average weekly wage at workplaces in West Lothian was £369 (Table 11 on the following page) - on a par with the Scottish average but only 94% of the average weekly wage at workplaces in Edinburgh and Lothian.

Table 11: Average gross weekly wage, 2002 – 2003 (workplace based) West Lothian

Edinburgh & Lothian

2002

£368

£ 397

£ 358

£ 385

2003

£369

£ 391

£ 366

£ 393

% change

0.1%

-1.5%

2.3%

2.2%

Proportion of Scotland

101%

107%

100%

107%

93%

100%

Proportion of UK 94% 99% Source: New Earnings Survey, Office for National Statistics/Nomis

Scotland

United Kingdom

In contrast, Table 12 shows that the average weekly wage for residents of West Lothian was £356 in 2003 - equivalent to 97% of the Scottish average and 92% of the Edinburgh and Lothian average. The average weekly wage for residents of West Lothian is lower than the average workplace wage because many people living in West Lothian are commuting to better paid jobs out-with their home area. Table 12: Average gross weekly wage, 2002 – 2003 (resident based) West Lothian

Edinburgh & Lothian

Scotland

•

United Kingdom

• •

The working-age population of West Lothian is becoming steadily more qualified. In 1999, only 17% held the highest level of qualifications (HND, degree or above). In 2002, this had increased to 26%, similar to the Scottish average of 28% but lower than the average for Edinburgh and Lothian (35%). The proportion of working-age residents in West Lothian with no educational qualifications was estimated at 14% in 2002, lower than the proportion for Scotland as a whole but unchanged since 1999. The high level of qualifications held by Edinburgh and Lothian residents is skewed by the dominance of the Edinburgh economy in requiring highly qualified workers to work in Financial Services and information and knowledge-based sectors of the economy. Table 13: Estimated proportion of working age population by qualification group West Lothian (numbers) 1999 2002

West Lothian (%) 1999 2002

Edinburgh & Lothian (%) 1999 2002

Scotland (%) 1999 2002

NVQ4

17,000

26,000

17.1

26.2

29.7

34.6

24.5

28.0

NVQ3

16,000

17,000

16.3

16.6

15.0

15.5

13.6

15.4

9,000

6,000

9.2

5.9

8.0

6.2

10.5

8.8

NVQ2

16,000

16,000

16.3

15.5

12.5

12.1

11.8

12.4 12.2

Trade apprenticeships

2002

£357

£380

£354

£385

NVQ1

17,000

15,000

17.0

14.6

10.9

11.5

12.5

2003

£356

£387

£367

£393

Other Qualifications

10,000

7,000

10.1

6.7

10.2

7.8

9.2

7.3

-0.2%

1.7%

3.7%

2.2%

No Qualifications

14,000

14,000

14.0

14.2

13.9

12.2

17.9

15.7

97%

105%

100%

107%

93%

100%

% change Proportion of Scotland

Proportion of UK 91% 98% Source: New Earnings Survey, Office for National Statistics/Nomis

QUALIFICATIONS The qualification levels of residents are another key indicator of the economic performance of an area. Therefore, an appropriately qualified workforce is one of the factors that can help improve economic performance. The Labour Force Survey records the highest qualification held by each adult7, as shown by Table 13. The results show that: 7 The highest qualifications held by the working-age population are grouped as follows: NVQ 4 equivalent and above: e.g. HND, Degree and Higher Degree level qualifications or equivalent NVQ 3 equivalent: e.g. 2 or more A levels, advanced GNVQ, NVQ 3, 2 or more higher or advanced higher national qualifications (Scotland) or equivalent. NVQ 2 equivalent: e.g. 5 or more GCSEs at grades A-C, intermediate GNVQ, NVQ 2, intermediate 2 national qualification (Scotland) or equivalent.. NVQ 1 equivalent: e.g. fewer than 5 GCSEs at grades A-C, foundation GNVQ, NVQ 1, intermediate 1 national qualification (Scotland) or equivalent. Other qualifications: includes foreign qualifications and some professional qualifications.

Source: Labour Force Survey, Office for National Statistics. # Sample size is too small for reliable estimates

SCHOOL LEAVERS The decisions made by young people regarding employment, education or training after leaving school has long-lasting consequences for their futures and for the future of the economy as a whole. Recent changes in the destination of school leavers from publicly funded schools are shown in Table 14 (on the following page). Between 1998 and 2003, the proportion of school leavers from West Lothian entering full-time Higher Education has declined slightly from 26% to 24%. Over the same period, the proportion entering full-time Further Education increased by 3% points to 19%. The proportion of school leavers entering the labour market (employment and/or training) has fallen over recent years - from 44% in 1997/98 to 30% in 2002/03. The proportion of school leavers entering the labour market in Edinburgh and Lothian and Scotland during 2002/03 was broadly similar – 31% and 28% respectively. With the proportion of school leavers entering Higher and Further Education stable and numbers entering employment or training falling, there has been a simultaneous rise in the proportion of school leavers entering other known destinations (either seeking

employment/training or not seeking employment/training). This trend is not restricted to West Lothian but appears to have increased across Edinburgh and Lothian and many areas of Scotland. In 1997/98, the proportion of school leavers entering other known destinations was 12%. By 2002/03, this had increased by 5% points to 17%. The proportion of school leavers who were unemployed and seeking employment or training was 14% in 2002/03 – slightly above the Scottish average. Table 14: School leaver destinations West Lothian

Edinburgh & Lothian

Scotland

1997/98

2002/03

1997/98

2002/03

1997/98

2002/03

Full-time Higher Education

26

24

26

26

30

31

Full-time Further Education

16

19

15

19

19

21

Training

9

6

10

3

10

5

Employment

35

24

37

28

26

23

Other known destinations (of which unemployed*) Destination unknown Number of school leavers

12

17

9

16

13

16

NA

14

NA

14

NA

12

2

10

3

7

3

4

1,771

1,772

7,120

7,264

59,286

57,266

Source: Destination of Leavers from Scottish (publicly funded) Schools, Scottish Executive. *Refers to unemployed and seeking work or training. The data relate to the latest known destination of leavers as known at 6th October. The category other known destinations refers to unemployment, either seeking either employment/training or not seeking employment/training. This category also includes school leavers undertaking unpaid voluntary work, taking time out, and school leavers who are employed and/or in education part-time (less than 21 hours per week) or more than one part-time placement. Please note that the Employment category also includes school leavers undertaking employment-based training such as Modern Apprenticeships.

OFFICIAL DATA SOURCES AND USEFUL LINKS The following are the main Scottish and national web links for labour market and economic information, analysis and reports. Futureskills Scotland - www.futureskillsscotland.co.uk: the main gateway to information and statistics on the Scottish labour market, including an interactive map toolkit and research library. Scottish Executive Statistics - www.scotland.gov.uk/Topics/Statistics: provides a broad range of information and statistics on Scotland’s economy and labour market, including economic profiles for Scotland’s local authorities. Office for National Statistics (ONS) – www.statistics.gov.uk: provides the main source of official statistics for the UK, including labour market trends and local authority profiles from the Labour Force Survey (www.statistics.gov.uk/llfs/scotland.asp). General Register Office for Scotland (GROS) – www.gro-scotland.gov.uk: provides the main source of data on Scotland’s population and demographic change. SCROL (Scottish Census Online) – www.scrol.gov.uk: provides free online access to the majority of data from the 2001 census. NOMIS – www.nomisweb.co.uk: is an on-line information system containing an extensive range of government statistics concerning the labour market. Data covers the UK, regions, LEC areas, local authorities and some data is available at ward and postcode level. NOMIS is a free service but registration is required. For further information about any of these sources or enquiries about labour market information please contact the LLMU on 0131 313 6079/6021.