Skills
Assessments
Islands Composite
December 2016
Introduction
•An Introduction to Skills Assessments
•Key Data for Eilean Siar, Orkney Islands
and Shetlands Islands
•Implications for Skills Investment
Planning
An Introduction to
Skills Assessments
What are Skills Assessments?
• A single, agreed evidence base on which to base future investment in
skills, built up from existing datasets
• Partnership between Skills Development Scotland, Highlands and
Islands Enterprise, Scottish Enterprise, the Scottish Funding Council
(SFC) and the Scottish Local Authorities Economic Development
Group.
• Purpose:
• Support SFC, Regional Colleges, Strategic Bodies and College
Boards in negotiating Regional Outcome Agreements (ROAs) for
Academic Years 2017-2020
• Provide a framework for aligning SDS investment in individuals and
businesses
• Assist partners in planning their strategic investment in skills
• Highlight gaps in national and regional skills evidence
Why are they important for skills
planning?
• They provide a high quality and consistent source of evidence about
economic and skills performance delivery at various spatial levels.
• They can be used to identify strengths and any issues or mismatches
arising, and so inform thinking about future planning and investment.
• They are accessible online to support all partners in their planning.
• They provide a core evidence base to support the Scottish Skills
Planning Model.
Scottish Skills Planning Model
What do they cover?
• Economic Performance, Profile of the Workforce, People and Skills,
Education and Training (Further and Higher Education, MAs and
Schools), Other Economic Activity, Skills Mismatches and Forecasting
• Underpinned by the 2016 data matrix of 7 workbooks, containing data
on over 100 social and economic indicators
• With data at various spatial levels: Regions; City Region Deal; Local
Authority
• The matrix only draws upon official datasets (including APS, BRES,
UKCES, UK Business Counts, Census, Scot Gov datasets) and
partner data (SFC, SDS, SE, HIE).
• The data matrix is found here:
https://www.skillsdevelopmentscotland.co.uk/what-wedo/partnerships/regional-skills-assessments/
• This slidepack provides a summary of
the data for the area except for data on
Further and Higher Education. The
reason for this is provided on slide 15.
Business Trends
In 2015 the Eilean Siar business base
grew by 9.8% and those in both
Orkney and Shetland increased by
c.5% (Scotland 7.3%)
Higher representation of Growth
Sector businesses than at the
national level in 2015
1,600
1,400
1,200
1,000
800
600
400
53%
66%
61%
47%
200
0
2010
Eilean Siar





2011
2012
2013
Orkney Islands
2014
2015
Shetland Islands
Eilean Siar +105, Orkney +70, Shetland +65
businesses in 2015
Over 99% of Eilean Siar, Orkney and Shetland
businesses are small or micro (<50 employees),
slightly above the national average (98%)
No businesses employ 250+ people
Business density rates well above the national
average (313 per 10,000 population) - Orkney
683, Shetland 608, Eilean Siar 436
Self employment rate in Eilean Siar (15.5%) and
Orkney (14.3%) above Scotland (10.8%) Shetland is below (10.4%)
Eilean Siar
Orkney
Growth Sector
Shetland
Scotland
Other
 Dominated by food and drink sector. It
accounts for 73% of all growth
businesses in Orkney, 68% in Shetland
and 49% in Eilean Siar (Scotland =
22%)
 Much higher share of total employment
(2014) is in Growth Sectors compared
to Scotland (28%) - Eilean Siar 60%,
Orkney 44% and Shetland 37%,
Population and Projections
Populations: Eilean Siar 27,070,
Shetland 23,200, Orkney 21,670
(2015)
Forecast Population Growth,
2012-2037:
Eilean Siar
 Each less than 1% of Scotland’s total
population
 Between 2005 and 2015 Orkney’s
population grew by 8% (Scotland 5%),
with lower growth in Shetland (4%) and
Eilean Siar (1%)
 Growth driven by increase in 65+ age
group. Working age population rose in
Orkney and Shetland but fell in Eilean
Siar
Population change 2005-2015
Eilean Siar
Orkney Islands Shetland Islands
33%
Scotland
30%
22%
18%
3%
-2%
-3%
-10%
4%
3%
-7%
-8%
0-15
16-64
65+
Orkney Islands Shetland Islands
9%
8%
6%
Scotland
-4%
-11%
-10%
-8%
Total
Working Age
-28%
 Total population forecast to increase in
both Shetland and Orkney, although
below the national rate. Eilean Siar
population forecast to fall by 11%
 Working age population forecast to fall
at a higher rate than in Scotland:
Shetland -8%, Orkney 10%, Eilean Siar
-28%
Workforce Trends
Total Employment
18,000
16,000
14,000
12,000
10,000
8,000
6,000
4,000
2,000
0
45% work in higher level
occupations in Eilean Siar, above
Scotland average (42%) - Orkney
(32%) and Shetland (34%) (2015)
2009
Eilean Siar
2010
2011
2012
Orkney Islands
2013
2014
Shetland Islands
Each area has less than 1% of Scottish total
employment in 2014:
 Shetland = 14,900 (+7.2%)
 Eilean Siar = 11,100 (+4.7%)
 Orkney = 10,100 (+2.0%)
Growth in Eilean Siar and Shetland above
that in the Highlands and Islands (3.4%),
Scotland (3.2%) and GB (2.7%) - Orkney
below
Note: Data on total employment relates to 2014, having been prepared in
advance of 2015 BRES release.
 Much lower share of employment in
private sector, than nationally (Scotland
= 77%, Shetland 68%, Orkney 64%,
Eilean Siar 61%, the lowest of any
Scottish local authority area)
 32% of the employed Eilean Siar
population work part time and 31% in
Orkney. Shetland rate (26%) is the same
as the Scotland average
 11.3% of Orkney employees are in nonpermanent jobs, 9.1% in Eilean Siar and
8.2% in Shetland; all above the national
average (5.3%)
Employment and Unemployment
The unemployment rate in Eilean
Siar was below the national
average (4% v. 6%),
Employment rates much higher
than in Scotland (73%): Shetland unemployment fell by -1.2ppts
which was greater than the
87%, Orkney 87%, Eilean Siar
national decline (-0.4ppts) over
78% (2015)
the same period (2014 – 2015)
 Almost all residents work in their
Unemployment data for Orkney and
local authority area: Shetland
Shetland Islands is not available
98%, Orkney 97%, Eilean Siar 96%
 Those working elsewhere mostly
do so outside the Highlands and
Islands - notably in Aberdeen
City
Participation rates of 16-19 year olds
are above the Scotland level (90%):
 Shetland 97%
 Eilean Siar 96%
 Orkney 94%
2% are not participating in each of
the three areas, less than in Scotland
(4%) (2016)
Qualifications and Earnings
At 48%, Shetland has a higher
proportion of working age adults
holding SCQF qualifications at
levels 7-12 than in Scotland (43%)
and the UK (37%). The figures are
lower for Eilean Siar (42%) and
Orkney (31%) (2015)
Workplace and resident earnings
in Shetland are above the Scottish
averages, whilst those in Orkney
and Eilean Siar are below the
national levels
£700
50%
45%
£600
40%
£500
Scotland = £527
35%
30%
£400
25%
£300
20%
15%
£200
10%
£100
5%
£0
0%
Eilean Siar
Workplace
Eilean Siar
Orkney Islands
Shetland Islands
Scotland
Orkney Islands
Residents
Shetland
Islands
Scotland
Education and Training
Schools
Orkney
Modern Apprenticeships
Orkney
MA uptake increased by 85% from
The secondary school roll in the
2014/15 to 120, 0.5% of national total
Orkney Islands in 2015 was 1,126,
0.4% of Scotland total
Food & Drink is the most popular MA
framework group, 36% of uptake
94% school leavers had a positive
Gender of apprentices - 60% male, 40%
destination in 2015, compared to 92% female
across Scotland
80% achievement rate 2015/16
Shetland
Shetland
The secondary school roll in the MA uptake increased by 1% from
Shetland Islands in 2015 was 1,379 2014/15 to 140, 1% of national total
0.5% of Scotland total
Food and Drink is the most popular
96% school leavers had a positive
framework group, 29% of uptake
destination in 2015, compared to 92% Gender segregated - 83% male
across Scotland
81% achievement rate 2015/16
Education and Training
Schools
Eilean Siar
Modern Apprenticeships
Eilean Siar
MA uptake decreased by 20% from
The secondary school roll in Eilean 2014/15 to 90
Siar in 2015 was 1,474, 0.5% of 0.3% of national total in 2015/16
Scotland
Construction most popular framework
97% school leavers had a positive group, 44% uptake
destination in 2015, compared to Heavily gender segregated - 100% male
92% nationally
77% achievement rate 2015/16
Further and Higher Education
Scotland’s colleges and universities play a major role in developing a
skilled workforce. In the Highlands and Islands, the University of the
Highlands and Islands (UHI) provides educational opportunities to
residents and also attracts students to the region.
Due to the unique and complex tertiary nature of the University of
Highlands and Islands, data for UHI and its associated campuses has
not been included.
The Scottish Funding Council (SFC) and Skills Development Scotland
(SDS) are working with UHI to develop the most appropriate way of
presenting these complex data sets.
Jobs and Skills Changes (1)
Total employment (jobs) is forecast to decrease by 0.1% on average each year from 2016 to 2024,
an equivalent rate of 0.2% growth is expected for Scotland as a whole. Growth at this rate
equates to a loss of 600 jobs in the region over the forecast. Construction is expected to enjoy
growth of 300 jobs, whilst professional, scientific and technical and administrative and support
activities will see some moderate growth too (100 jobs each). Most of the other sectors are
largely static although losses are expected in public administration and defence (400 jobs) as
well as education, manufacturing and the wholesale and retail trade sectors (200 jobs each).
Forecast Demand for Jobs (2016-2024)
Total Employment Growth
Islands Composite Employment
% annual average change
Change in total jobs (‘000s), 2016-2024
Islands Composite
Scotland
25%
2002-2015
2016-2024
20%
15%
10%
5%
0%
-5%
Note: chart uses total employment (jobs) rather than total employment (people).
The former figure will be higher as a person can have more than one job.
2024
2022
2020
2018
2016
2014
2012
2010
2008
2006
2004
2002
-10%
Construction
Profess, scientific and technical acts
Administrative & support activities
Information and communication
Arts, entertainment and recreation
Accommodation & food servs
Real estate activities
Financial & insurance activities
Other service activities
Water supply & sewerage
Electricity, gas, steam & air
Transportation and storage
Mining
Human health & social work
Agriculture
Wholesale and retail trade
Manufacturing
Education
Public administration and defence
Source: ONS / Oxford Economics
0.3
0.1
0.1
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
-0.1
-0.1
-0.2
-0.2
-0.2
-0.2
-0.4
Jobs and Skills Changes (2)
Replacement demand will result in 9,200 openings within the Islands over the forecast.
Expansion demand is expected to fall by 800 openings between 2016-2024. Together with
replacement demand, this will result in 8,400 openings over this period. Openings will be
highest in elementary and professional occupations, driven by replacement demand. The total
requirement for workers in skilled trades occupations is also expected to rise significantly over
the 2016-24 period, again driven by replacement demand.
Forecast Demand for Jobs (2016-2024)
Managers, directors & senior officials
Professional occs
Associate professional & technical occs
Administrative & secretarial occs
Skilled trades occs
Caring, leisure & other service occs
Sales & customer service occs
Process, plant & machine operatives
Elementary occs
Total
Expansion demand
0
-200
-100
-200
0
-100
-100
-100
0
-800
Notes:
1. table uses total requirement (people)
2. totals may vary from previous slide due to rounding within the body of the table
Source: Oxford Economics
Replacement Demand
400
1,900
500
900
1,500
300
1,000
300
2,400
9,200
Total Jobs Requirement
400
1,700
400
700
1,500
200
900
200
2,400
8,400
Implications for Skills
Investment Planning
The Islands: Key Implications (1)
.
Key Labour Market Changes and Dynamics
 The fragility of the economic recovery is evident across the Islands, with job
losses in Eilean Siar in 2015 and static or limited growth in the Shetland Islands
and Orkney. Although there had been some jobs recovery there are still 1,300
fewer jobs than in 2009, -3.5%, similar across the Island authorities.
 There have also been some modest sector shifts in 2015. There continues to be
lob losses in agriculture, forestry & fishing (-200 across Eilean Siar, Orkney) and a
challenge to retain and grow higher value added professional, scientific &
technical services sector (-100 in Eilean Siar). There is a continued reliance on
public sector - Eilean Siar has the highest jobs dependency on the public sector in
Scotland - and a dominance of lower value added sectors including tourism,
where there was growth in Eilean Siar in 2015 but job losses in the Shetland
Islands. Business services employment increased in the Shetland Islands.
 The business base continues to grow, as it has across Scotland, and almost all
are micro-businesses. Self-employment remains a feature of the islands. Overall
output is higher in the Shetland Islands (mainly oil and gas) and output per worker
remains below the Scotland average, reflecting sector composition in all parts of
the islands. Growing the higher value added private sector employment base
remains a major challenge.
The Islands: Key Implications (2)
.
Skills demand and supply
 There has been above average population growth in Orkney over the last 10
years, less so elsewhere. Below average growth or negative growth (Eilean Siar)
is forecast to 2037, and the working age population is expected to fall across the
Islands. Attracting and retaining young people continues to be a priority.
 There are fewer in professional occupations across the Islands than the Scotland
average, highest in Eilean Siar, lowest in Orkney. More than 9,000 replacement
demand openings are expected to 2024 despite no overall jobs growth, highest in
professional and elementary roles, care (Eilean Siar), and in Orkney and the
Shetland Islands in skilled trades and administrative & secretarial occupations.
 More from the Islands go into employment from school than the national average,
highest in Eilean Siar.
 The top MA frameworks taken up in the Islands are food & drink and construction,
more than half of the 350 starts in 2015/16. There were just 12 in hospitality &
tourism, despite the importance of the sector, and few in health & social care.
The Islands: Key Implications (3)
.
Recommended
Areas of Focus
Priorities for the Islands include:
•
Increasing the number of private sector jobs. Job recovery has been weak, with
fewer jobs than 2009, and a strong reliance on the public sector. Creating new job,
progression and learning opportunities is essential to retain and attract young people.
•
Increasing the quality of and diversity of jobs. This will help broaden and
strengthen the employment base, particularly developing the higher value added
professional services, which can be linked to quality of life benefits.
•
Creating a culture of employer investment. Employers continue to need to be
encouraged to invest and innovate, which includes investment in skills, including
investment in young people. They also need an outward focus for new markets.
•
Meeting the skills needs of employers. There are important local sectors, including
skilled trades, health, and tourism. Local skills activity must be encouraged, and
focused on employer demand.
•
A need for progression routes and pathways. Demand for skills in the region is
strongest amongst the skilled trades, care and professional occupations. Progression
needs engendered and supported.
•
A need for flexible provision. Non traditional employment is increasing. Skills
provision must be equally flexible, with work-based learning routes part of this.