Oldham’s
Local Economic Assessment
2015
Section 2: Labour Market and Skills
An analysis of the local economic conditions in Oldham
Jon Taylor
Business Intelligence Team
Labour Market and Skills:
Key Points
Overall
Oldham has traditionally had a weak skills base as a legacy of generations of manual
employment, meaning that Oldham residents have found it disproportionally difficult to enter
new growth sectors over recent years. This has made it difficult for Oldham to attract the
inward investment that it is looking for to improve its own economic base and act as a labour
market for the rest of Greater Manchester.
Employment
 The employment rate in Oldham (64.2%) is the third lowest across Greater
Manchester, and continues to be significantly lower than national average (72.5%).
 The gap between Oldham residents, GM and England is largest in the 25-34 year
old group. If the employment rate is to be improved, then this cohort needs to be
tackled.
 With more people commuting out of the borough each day (36,340) than commuting
in (29,137) Oldham is a net exporter of labour (-7,203).
 Oldham’s economy has created jobs within the Caring and Leisure, Sales and
Customer Service, and elementary occupations. Unfortunately for Oldham, these
are typically low skilled and poorly paid.
 There has been a large increase in the proportion of people having to work part-time
across Oldham, GM and England.
Unemployment
 Rates of unemployment in Oldham have been consistently above that of the
Greater Manchester and England averages.
 Since early 2013, rates of unemployment steadily fell to approach pre-recession
levels, but have now levelled off.
 This is likely to be a result of a strengthening economy, more local job
opportunities and the impact of tougher sanctions imposed on unemployed
claimants.
Economic Inactivity
 Oldham has a large economically inactive population with high rates of long term
illness/disability, and high numbers of residents choosing not to work.
 Oldham has a large South Asian population, where culturally it’s more common for
women to choose not to take paid employment.
 Recent trends suggest that there has been a cultural shift, with greater numbers of
younger Pakistani and Bangladeshi women accessing the local labour market.
Income and Wages
 Median household income in Oldham (£25,116) is lower than GM (£26,370) and
England (£28,360).
 Oldham continues to have lower median wages than across GM and England.
 This is likely a reflection on the industry mix within Oldham and the relative skill
levels of the local workforce.
 Average wages, which have been stagnant since the recession are not expected to
rise in Oldham over the next 20 years.
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Skills and Qualifications
 GCSE attainment in Oldham has continued to improve and the gap in performance
between Oldham and England has narrowed.
 While adult skills in Oldham have improved in recent times, Oldham still has both a
higher proportion of residents with no qualifications and fewer residents holding
degree level qualifications compared to GM, North West and national averages.
 The forecast growth sectors in GM are going to be found both in the high skilled
occupations and low skilled occupations. It is therefore imperative for Oldham to
comprehensively improve its skills base, allowing residents the opportunities to
access the more skilled and therefore more lucrative new jobs.
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Labour Market and Skills:
Recommendations
The Labour Market and Skills chapter has demonstrated opportunities for Oldham to
capitalise on cultural shifts and growth sectors suited to our young workforce.
Key points are:
Recommendation 1 – Increase Employment – aim to move towards Full Employment
The data demonstrates that a factor in the economic wellbeing of the Borough is to tackle
the underlying issues that have frustrated the achievement of Full Employment.
Key issues include:




Reduce ESA Claimant rates
Improve female employment rates.
Improve employment rates of 25-34 year olds as well as 16-24 year olds
Support Pakistani and Bangladeshi women into the workplace and men into full-time
employment.
Recommendation 2 – Maintain the focus on improving the Skills base.
In order to tackle the low wage/low skill employment cycle, more focus is needed on:

Adults with no qualifications - Oldham is 8 percentage points higher than England
and nearly 5 percentage point higher than GM. This affects not only employment and
productivity but also links to wider inequalities.

Improve the skills base of adults in BME community, particularly those aged 25-34.

Level 4 or higher qualifications – the preferred economic model demands that
business needs will be defined by higher level vocational opportunities which require
investment by individual and business community. There is a need to develop
accessible pathways and promote the value of higher level study and how it can be
financed and return on that investment.

Retention of skilled workforce - the skills dynamic is linked to wider functions of the
economy, including housing offer, employment offer and cost of living/income
generation. The Borough has pursued as skills agenda previously, which did not fail
but clearly suffered with a population dynamic that has led to citizens with skills
leaving.
Recommendation 3 – Maintain focus on improving Wage levels.
In order to improve resident and workplace wages, seek to target improvements in:
 Connectivity to higher value jobs across GM (with transport infrastructure and skills
being key enablers)
 Business stock numbers
 Inward investment
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LABOUR MARKET
This chapter of the assessment looks to explore Oldham’s labour market and provide insight
on its wider interaction with the Greater Manchester economy. The diagram below illustrates
Oldham’s labour market as it stands.
Figure 1 – Oldham’s Labour Market
Working age population (aged 16-64)
141,500
Economically Active
Economically Inactive
104,200
37,300
Unemployed
Employed
Other
Reasons for Inactivity
4,100
94,200
5,900
Long-term sick: 11,600
Looking after home: 9,000
Full-time
Part-time
Students: 8,100
74,400
19,800
Retired: 7,000
Other: 1,600
Economic Activity
Oldham is home to around 104,000 residents, aged 16-64, and classed as economically
active. That means residents are employed, self-employed or unemployed. As previously
identified, Oldham’s economy only provides approximately 75,000 jobs; including for nonresidents, therefore there is a surplus of around 29,000 people that can’t be supported by
the local economy.
Typically, a high level of economic activity demonstrates that a high proportion of the
population are willing and able to supply their labour. Oldham (73.9%) has a smaller
proportion of its population economically active, compared to that of Greater Manchester
(74.4%) and England (77.0%).
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Employment
High levels of employment are a key indication that an economy is in good health. Oldham
(64.2%) has the 8th highest employment rate within Greater Manchester, and is significantly
lower than the national average (72.5%). Within Greater Manchester, Stockport (76.8%) has
the highest rate, whereas Rochdale (62.9%) has the lowest.
Figure 2 – Employment Rate by Local Authority
Source: Annual Population Survey Oct 2013 – Sept 2014
The employment rate in Oldham has fluctuated fairly significantly over time. In 2005 72.5%
of the working age population were employed, which at the time was higher than the GM
average (69.9%) and nearly identical to the national average (72.6%). Unfortunately since
then, the employment rate in Oldham has not performed as well. The onset of the recession
in late 2008 clearly had a disproportional impact on Oldham’s economy as the employment
rate fell more sharply than across Greater Manchester and nationally. However, as the
economy started to show some growth during 2011, the employment rate did start to
gradually increase again, with a similar pattern taking place across the region and nationally,
however, since 2013, the unemployment in Oldham has fallen once again.
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Figure 3 – Employment Rate since 2005
Source: Annual Population Survey Oct 2013 – Sept 2014
Compared to men, women are less likely to work, particularly on a full-time basis. However,
as the chart below shows, the proportion of females employed in Oldham is lower than
across GM and England. It is also significant that the variation between male and female
employment is larger in Oldham and this variation has been consistent overtime.
Figure 4 – Employment Rate by Gender
Source: ONS 2011 Census
Analysing employment rates by age can provide further insight, and it is notable that across
all age groups, the employment rate is lower in Oldham, compared to the Greater
Manchester and national average. Significantly, the gap (variance) between Oldham
residents, GM and England is largest in the 25-34 year old group , whilst the employment
Oldham’s Local Economic Assessment – 2015. Labour Market and Skills
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rate is second highest, it is the relatively low proportion of employed 25-34 year olds in
Oldham (71.2%), compared to GM (76.0%) and England (78.9%) . If the employment rate is
to be improved, then this cohort needs to be addressed.
Figure 5 –Employment Rate by Age
Source: ONS 2011 Census
Since 2005, the younger age cohorts (16-24 and 25-34) have fared worst in terms of overall
employment rates and have seen the largest decreases. This suggests that the younger
generations are finding it more difficult to access the labour market. It is therefore important
for Oldham to improve employment rates for these age groups moving forward
Figure 6 –Trend in the Employment Rate by Broad Age Bands
Source: Annual Population Survey Oct 2013 – Sept 2014
Across the borough there is a rich mix of people from different communities, cultures and
faiths, with almost 18% of the population being of Pakistani or Bangladeshi origin.
Oldham’s Local Economic Assessment – 2015. Labour Market and Skills
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Employment rates within these communities are particularly low, suggesting there is
difficulties in accessing the local labour market. However, in addition to this there is also a
cultural connection, as women (particularly the older generations) chose not to work.
Figure 7 – Employment Rate by Ethnic Group
Source: ONS 2011 Census
Some progress has been made in improving the employment rate for Oldham’s ethnic
minority groups, particularly over recent years.
Figure 8 – Employment Rate by Ethnic Group and Gender
Source: Annual Population Survey April 2013 - March 2014
There is anecdotal evidence to suggest that there has been a gradual cultural shift amongst
young Pakistani and Bangladeshi women, where more of whom are now accessing the local
labour market. However, a large cultural gap remains.
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Full-time/Part-time Employment
Since the last recession there has been a large increase in the number of people working
part-time. This in part is a result of the more challenging economic conditions with limited
availability of jobs, particularly those which are full-time. This has not just been a pattern that
has taken place in Oldham, but is a national trend. Oldham (29.0%) does however have a
slightly larger proportion of residents working part-time, compared to Greater Manchester
(28.1%) and England (28.2%).
Figure 9 – Full-time/Part-time Employment
2001
Full-time
2011
Part-time
Full-time
Part-time
Oldham
78.4
21.6
71.0
29.0
Greater Manchester
78.6
21.4
71.9
28.1
England
78.0
22.0
71.8
28.2
Source: ONS Census 2011
Within Oldham, the proportions of part-time work vary considerably by ward. Coldhurst
(48.2%), Werneth (43.6%) and St Mary’s (42.5%) have the largest proportions of residents
employed part-time. These wards are three of Oldham most deprived wards and are also
home to Oldham’s Pakistani and Bangladeshi populations.
Figure 10 – Part-time Employment by Ward
Source: ONS Census 2011
Gendered patterns in employment rates are broadly the same across Oldham, Greater
Manchester and England. The data shows that women are significantly more likely to be in
part-time employment compared to men and this pattern has remained relatively unchanged
over the past ten years. Child care responsibilities are the main determinant for a much
greater proportion of women working part-time compared to men. The vast majority of men
work full-time, compared to just over half of all women. More women work full-time than they
do part-time, however, unlike men, the difference between those working full and part-time
are not as stark.
Oldham’s Local Economic Assessment – 2015. Labour Market and Skills
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Figure 11 – Full-time/Part-time Employment by Gender
Source: ONS Census 2011
Travel to work
Oldham is a net exporter of labour (-7,203) with more people commuting out of the borough
each day (36,340) than commuting in (29,137). Oldham has strong labour market
interconnections with its neighbouring boroughs, particularly the City of Manchester, which
sees the greatest flow of labour out of Oldham (11,712). This represents nearly a third of
residents commuting out of Oldham. Oldham’s commuting flows with Tameside and
Rochdale are smaller than Manchester but more equal in terms of in and out flows as
highlighted in Figure 11. It is also notable that there is no significant out-commuting to
Yorkshire and only marginal in-commuting, despite Oldham’s gateway location. This
highlights the physical barrier presented by the Pennines that increases the time and cost of
travel to an extent that limits labour market interaction between Greater Manchester and
Leeds.
The relative net migration levels have not changed significantly between 2001 and 2011 but
there is a significant increase in mobility across Greater Manchester with more residents
working outside Oldham being offset by more GM residents travelling into Oldham to work.
Interestingly the significant exporting of labour is to Tameside (increased by 855 – 23%),
Stockport 539 – 47.5%), Bury (396 – 48.1%) and Trafford (324 – 19.3%). The inflow
dynamics is equally interesting with increases from Tameside (937 – 23.8%), Stockport (500
– 56.2%), Manchester (1551, 52.2%), Rochdale (1,189 – 17.4%). The Rochdale dynamic is
the most significant as there is a net increase of 850 people travelling into Oldham.
This data is drawn from the 2001 and 2011 Census, during which time the M60 circular had
been completed and pre-dates developments such as Kingsway.These travel-to-work
patterns reinforce the picture of Oldham having opportunities to further exploit its quality of
life offer in order to become a more successful commuter location (the current housing offer
doesn’t appear strong enough to attract professionals to live in Oldham and commute into
the conurbation core), whilst also needing to increase higher-value economic opportunities
internal.
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Figure 12 - Largest travel to work flows in and out of Oldham to/from the rest of the UK, 2011
BURY
BOLTON




610 from Oldham
806 to Oldham
1,220 from Oldham
1,911 to Oldham
ROCHDALE


5,869 from Oldham
8,003 to Oldham
SALFORD


2,178 from Oldham
993 to Oldham
OLDHAM
(75,000 jobs available in Oldham)
45,863 live and work in Oldham
TRAFFORD


KIRKLEES
29,137 commute in from outside Oldham
2,005 from Oldham
746 to Oldham
36,340 Oldham residents commute out
Net flow = -7,203


543 from Oldham
831 to Oldham
KEY
Live outside Oldham but work inside
Oldham.
TAMESIDE


MANCHESTER


11,712 from Oldham
4,525 to Oldham
Source: Census 2011
4,606 from Oldham
4,872 to Oldham
Live inside Oldham but work outside
Oldham.
Flow into Oldham greater than flow out
of Oldham.
STOCKPORT


Flow from Oldham greater than flow
into Oldham.
1,673 from Oldham
1,389 to Oldham
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Unemployment
Rates of unemployment in Oldham have been consistently above that of the Greater
Manchester and England averages. Whilst in aggregate over the last year unemployment
has been falling (-28.1%), since the New Year, Oldham has seen rising figures. While these
were likely led by seasonal factors, it is now apparent that the previous downward trend has
now begun to plateau.
Figure 13 –Unemployment Trend
Source: DWP –May 2015
The unemployment rate in Oldham currently stands at 3.2%, the highest rate across Greater
Manchester and significantly higher than the national average (1.9%).Levels of
unemployment have increased this month in Oldham (+0.6%), a higher increase than the
Greater Manchester average (0.1%), whereas unemployment has fallen across England
(-3.0%).
Figure 14 – Unemployment (aged 16-64) by Local Authority
Unemployed
Bolton
Bury
Manchester
Oldham
Rochdale
Salford
Stockport
Tameside
Trafford
Wigan
GM
England
% Unemployed
5,267
2,862
10,425
4,509
3,796
4,327
3,349
3,872
2,268
5,318
45,993
639,369
3
2.4
2.9
3.2
2.8
2.7
1.9
2.8
1.6
2.6
2.6
1.9
% Annual
change
-20.2
-12.5
-26.6
-18.0
-17.5
-19.7
-24.8
-20.3
-24.0
-19.8
-21.4
-27.2
Source: DWP –May 2015
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Sanctions
In October 2012 the government introduced significantly tougher conditions and rules for the
main social security benefits known as benefit sanctions. This came about as part of the
wider theme of welfare reform ending a perceived “something for nothing” entitlement
culture, whilst creating systemic incentives for people to find work. In October 2012 the
government introduced tougher conditions for the main social security benefits, resulting in
more sanctions of JSA claimants. While numbers sanctioned have fallen over time, this is
largely the result of falls in overall JSA numbers, and the sanctions rate remains high.
Between Oct 2012 and Dec 2014 there have been 9,885 JSA claimants in Oldham
sanctioned. Key reasons for sanctions include refusal of claimants to participate in the DWP
Work Programme, or that claimants have not been actively seeking employment (according
to DWP guidelines).
Figure 15 – JSA Sanctions in Oldham
Source: DWP – 2014
Oldham has currently the third highest (7.0%) sanction rate within Greater Manchester.
Figure 16 - JSA Sanctions by Local Authority
Local Authority
Manchester
Trafford
Oldham
Tameside
Salford
Bolton
Rochdale
Wigan
Bury
Stockport
GM
JSA Claimants
No. of JSA
sanctions
12,031
2,298
3,115
3,081
4,291
4,998
3,743
4,626
2,591
3,858
44,632
940
171
219
204
284
323
233
284
146
177
2981
Sanction rate
7.8
7.4
7.0
6.6
6.6
6.5
6.2
6.1
5.6
4.6
6.7
Source: DWP – 2014
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Economic Inactivity
Oldham is home to around 37,300 residents, aged 16-64, and classed as economically
inactive. That means residents are either not in work, not looking for work or are not
available to start work. The largest proportion of Oldham’s economically inactive population
has a long term illness, many of whom have never been in employment. Others may have
voluntarily left the labour market; reasons for this might include early retirement or care
responsibilities.
However, some of the economically inactive population would like to work, but might need
additional support to do so, including lone parents and/ or those with disabilities. Recipients
of these other out-of-work benefits – e.g. Incapacity Benefit/ESA and Lone Parents on
Income Support - are far less affected by short term economic cycles, since the majority face
personal and structural barriers to employment – including lack of skills, poor health or
caring responsibilities.
Long Term Sickness
People who are unable to work due to long term illness or disability are able to claim an out
of work benefit known as Employment Support Allowance (ESA). ESA replaced Incapacity
Benefit (IB) / Severe Disablement Allowance (SDA) in 2008. In Oldham there are currently
11,730 residents (8.3%) in receipt of ESA, a slightly higher than the Greater Manchester
average (8.2%) but significantly higher than the England average (6.0%). Within Greater
Manchester, Rochdale has the highest rate (9.9%).
Figure 17 - Employment Support Allowance Claimants by Local Authority
Area
Bolton
Number
Rate
14,750
8.4
8,820
7.5
Manchester
33,240
9.1
Oldham
11,730
8.3
Rochdale
13,280
9.9
Salford
15,120
9.6
Stockport
10,710
6.1
Tameside
12,460
8.9
8,190
5.7
16,270
8.0
144,570
8.2
2,066,070
6.0
Bury
Trafford
Wigan
GM
England
Source: DWP August 2014
Within Oldham there is concentration of ESA claimants, typically in areas of high deprivation,
and where there are large proportions of social housing such as the Barker Street Estate, St
Mary’s Estate and Greenacres.
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Figure 18 – Employment Support Allowance Claimants in Oldham
Out of work benefit claimants
Out-of-work benefits claimants include both those individuals classed as economically active
(job seekers) and economically inactive (Employment Support Allowance claimants, Lone
Parent claimants and others on income related benefits). As of April 2014, Oldham has
13.1% of its working age population claiming an out of work benefit. This is similar to the
Greater Manchester figure of 13.0% but higher than the England average of 9.8%. Since
February 2010, the % of out of work benefit claimants in Oldham, Greater Manchester and
England has fallen, most specifically since early 2013 and the gap has been closed.
Figure 19 – Percentage of Out of Work Benefits Claimants
Source: DWP –2014
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The reduction of claimants can be mainly attributed to the large decrease in unemployment,
as can be seen in the chart below. Numbers of Employment Support Allowance and Lone
Parents claimants have also reduced, in part influenced by the government’s large scale
reforms to the welfare system. The Greater Manchester Combined Authority ESF
programme will target ESA and Lone Parents as key groups, included in the specifications of
Working Well 2.
Figure 20 – Out of Work Benefits Claimants in Oldham
Source: DWP – 2014
Within Oldham there is huge disparity in where the greatest concentration of benefit
claimants reside. Coldhurst, St Mary’s Estate and other similar deprived communities across
Oldham face a range of barriers. These include poor health, inadequate housing, poverty,
lack of education and skills and ethnicity. Many people in this client group are a long way
from the labour market, even when the economy is buoyant.
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Figure 21 – Map of Out of Work Benefits Claimants in Oldham
Source: DWP – 2014
Looking after home
In Oldham there are a larger proportion of economically inactive residents who are not
interested in finding employment and instead choose to look after their home. The table
below shows that Oldham has a larger proportion than any other GM local authority and the
national average. The vast majority of residents who do choose to look after their home are
female.
Figure 22 – Looking after home by Local Authority
Looking after
Number of
home aged
Males
16-74
Bolton
9,504
1,069
Bury
5,168
543
Manchester
18,697
2,279
Oldham
9,038
885
Rochdale
7,838
873
Salford
7,021
918
Stockport
7,139
739
Tameside
6,443
745
Trafford
6,426
523
Wigan
8,302
1,093
GM
85,576
9,667
England
1,695,134
156,757
Number of
Females
8,435
4,625
16,418
8,153
6,965
6,103
6,400
5,698
5,903
7,209
75,909
1,538,377
% Looking
after home
aged 16-74
4.7
3.8
4.9
5.7
5.1
4.1
3.5
4.0
3.9
3.5
4.3
4.4
Source: ONS 2011 Census
Oldham has a larger proportion because of its large South Asian population, where culturally
it’s more common for women to choose not to take paid employment. It is noticeable that
Oldham’s Local Economic Assessment – 2015. Labour Market and Skills
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over the last decade proportions of people choosing not to work are decreasing across all
ethnic groups.
Figure 23 – Looking after home by Ethnic Group in Oldham
Source: ONS 2011 Census
Household Income
The median household income for Oldham in 2013 was £25,116, which is lower than the
Greater Manchester (£26,370) and England (£28,360) averages. Within Greater Manchester
the Median Household Income varies from £23,780 in Manchester up to £31,476 in Trafford.
Figure 24 – Median Household Income by Local Authority
Area Name
Median household Income
Trafford
Stockport
Bury
Bolton
Wigan
Tameside
Oldham
Salford
Rochdale
Manchester
£31,476
£30,051
£28,699
£26,024
£25,947
£25,770
£25,116
£25,086
£24,963
£23,780
Greater Manchester
England
£26,370
£28,360
Source: Paycheck data, CACI 2013
The chart below compares the household income profiles of Oldham and England by £10k
bands for 2013. When compared to England, Oldham has a greater proportion of
households falling into the two lowest income bands, particularly the lowest band were
17.9% of all Oldham households have a median income less than £10,000, compared to
Oldham’s Local Economic Assessment – 2015. Labour Market and Skills
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12.6% nationally. At the same time, Oldham has a smaller proportion of households in the
highest income bands.
Figure 25 – Household Income by Income Bands
Source: Paycheck data, CACI 2013
At ward level, there is an income gap of around £20,000 between Saddleworth North– the
most affluent Ward, where median annual incomes are around £37,473 – and Coldhurst –
the least affluent with an income of only £17,411 per annum. Like many parts of postindustrial urban Britain, Oldham has a complex mix of relatively affluent and poor areas. The
poorest of these are concentrated in the inner urban wards such as Coldhurst, St Mary’s,
Alexandra and Werneth, whilst the most affluent wards are found in the more rural eastern
half of the borough.
Figure 26 – Median Household Income by Ward
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The chart below further illustrates the uneven distribution of household income within
Oldham. The large concentration of low income households, which are marked in red, mainly
surround the town centre, whilst the more affluent areas (green and Blue) are located
towards the outer periphery of the borough.
Figure 27 – Map of Median Household Income in Oldham
Wages
Whereas income data includes welfare benefits as part of household income, earnings data
only reflects wage levels paid by employers. Oldham has traditionally had low wage levels in
terms of residents and work place earning potential (as measured by median weekly wage
levels).This is likely a reflection on the industry mix within Oldham and the relative skill levels
of the local workforce.
In 2011, Oldham had both the lowest residential (£412 per week) and workplace (£399 per
week) median weekly wage levels in Greater Manchester, however, as of 2014 Oldham’s
position had improved to rank 8th and 6th respectively. Still, wages for both residents and
those working in Oldham remain significantly below the England average
Resident wages in Oldham are significantly higher than workplace earnings (£455 per week
compared to £425 per week), showing that the more skilled residents of Oldham are finding
higher-value employment outside the borough. It is likely that these residents live in the
eastern half of the district, where skill levels are much higher. Workplace based wages have
improved since 2011 but at a slower rate and remain considerably lower than resident
wages indicating the prevalence of more low wage/low skilled industry mix in the borough.
Oldham’s Local Economic Assessment – 2015. Labour Market and Skills
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Figure 28 - Resident and workplace earnings, full-time workers, median wages, 2014
Resident
Workplace
Bolton
Bury
Manchester
Oldham
Rochdale
Salford
Stockport
Tameside
Trafford
Wigan
Annual
22,819
26,303
24,580
22,927
23,842
24,006
27,991
22,148
29,993
25,308
Weekly
444
496
468
455
468
466
520
432
569
482
Pt
Hourly
8.0
8.1
7.7
7.5
7.9
7.7
8.2
8.1
9.5
7.7
Greater Manchester
England
24,945
27,500
479
524
7.9
8.4
Annual
22,068
24,563
28,291
21,588
21,916
26,525
25,619
21,070
26,389
22,226
Weekly
438
479
527
425
424
494
495
423
499
422
Pt
Hourly
7.7
7.5
8.5
7.5
7.3
8.5
8.1
8.8
7.5
7.9
25,108
27,487
482
523
8.0
8.3
Source: ONS - Annual Survey of Hours and Earnings 2014
Since the onset of the recession in 2008, wage levels have been relatively static in Oldham,
Greater Manchester and across England as a whole.
Figure 29 – Change in Annual Resident wages since 2008
Source: ONS - Annual Survey of Hours and Earnings 2014
For Oldham to increase its average wage levels, it is important that the majority of new jobs
created are of a quality to ensure they are paid above the current median wage. Average
wages vary considerable by sector. As outlined in the previous chapter, it was forecasted via
the Greater Manchester Forecasting model (GMFM 2013) that over the next 20 years there
will be 5300 new jobs created in Oldham. The majority of these new jobs will be in the
construction, health, admin and professional sectors. Using these forecasts it is therefore
possible to project future wage levels in Oldham. As the chart below shows, wage levels
over the next 20 years are unlikely to change a great deal, and in fact might be slightly lower
Oldham’s Local Economic Assessment – 2015. Labour Market and Skills
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than they are at present. This data suggests that if wage levels in Oldham are to rise with
any purpose then there needs to be a real significant structural change in the economy.
Figure 30 – Forecast Change in Wages
Skills and Qualifications
Skills are one of the most important determinants of socio-economic outcomes. Skills are not
only an important route out of poverty for individuals, but a key driver of economic prosperity.
Skills enhance productivity and competitiveness and are linked to attracting higher valued
businesses and the creation of jobs.
Supply of Skills
Successful economies require a highly qualified workforce. Oldham has traditionally had a
weak skills base, a legacy of generations of manual employment, and means that Oldham
residents have found it disproportionally difficult to enter new growth sectors over recent
years. This has made it difficult for Oldham to attract the inward investment that it is looking
for to improve its own economic base and act as a labour market for the rest of Greater
Manchester.
GCSE Attainment
Educational attainment at GCSE is seen as the first step in terms of developing the high
level of skills needed by the economy. Ensuring that pupils leave school equipped with good
and relevant qualifications is therefore a key priority.
The table below shows that within Greater Manchester, Oldham has the 4th lowest
percentage of pupils leaving school with 5 GCSE’s (grades A* to C) including English and
Maths. GCSE attainment in Oldham is also below the national average.
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Figure 31 – GSCE Attainment by Local Authority 2013
Source: Department for Education (DfE) 2014
GCSE attainment has markedly improved in Oldham over the last few years and there has
clearly been a narrowing of the gap with the national average. In 2006 only 35.4% of Oldham
pupils achieved 5 GCSE’s (grades A* to C) including English and Maths however, the
percentage now has risen to 57%. This is a positive trend but Oldham is still under
performing and needs to continue to raise attainment levels.
Figure 32 – Trend in GSCE Attainment since 2006
Source: Department for Education (DfE) 2014
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Adult Skills
The current position of Oldham’s working age population can been seen in the table below. It
highlights that Oldham has both a higher proportion of residents with no qualifications and
fewer residents holding degree level qualifications or higher compared to the Greater
Manchester, North West and national averages.
Figure 33 - Qualifications of the working age population (16-64) - 2013
GM
North West
Oldham (%)
(%)
(%)
NVQ 4 and above
20.3
26.6
26.6
NVQ 3
13.5
14.8
15.3
NVQ 2
18.1
17.5
18.1
NVQ 1
16.9
15.5
15.6
Other qualifications
5.4
5.0
4.3
No qualifications
22.2
17.5
16.8
England
(%)
29.8
14.5
17.1
15.2
5.6
14.8
Source: ONS 2011 Census
No Qualifications
Working age people with no qualifications will find it more challenging to find work, especially
work that is well paid. Oldham has a significantly higher percentage of its working age
population with no qualifications, which is a major issue for Oldham. Tackling this gap must a
prime objective to enhance economic prosperity to the area and enable Oldham to compete
with other Local Authorities in attracting new businesses to the area. Analysis of the map
below highlights the inequality found within Oldham. Large proportions of the unskilled
population live in close proximity to the town centre. It is no coincidence that these
neighbourhoods also suffer with high levels of unemployment, no doubt impacted by the
more challenging nature of accessing the labour market without any qualifications.
Figure 34 – Oldham Residents (16-64) with No Qualifications
Source: ONS 2011 Census
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Inequalities also exist between the different ethnic groups within Oldham. The Pakistani and
Bangladeshi heritage residents have significantly higher proportions of residents aged 16
and over with no qualifications.
Figure 35 – Oldham Residents (16-64) with No Qualifications by Ethnic Group
Source: ONS 2011 Census
The reason why there are a disproportionately high percentage of no skills within the Asian
community is linked closely with age. The chart below identifies that 53.8% of all Asian
residents aged 35 and over in Oldham are without any qualifications. This is more than
double the rate of the white population (22.9%), and other BME population (22.3%).
Figure 36 – Oldham Residents (16-64) with No Qualifications by Age and Ethnic Group
Source: ONS 2011 Census
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Level 4 Qualifications
At the other end of the skills spectrum, obtaining a degree or equivalent level of qualification
is going to enhance the opportunities for individuals to find work and be employed in higher
paid jobs.
The data shows clearly that Oldham has a significant deficit in the percentage of the working
age population with a level 4 qualification (or above), compared to the GM and national
averages. This signals that there is a shortage of high end skills available in the borough.
Since 2004, Oldham has increased the proportion of residents with a degree level
qualification, but the chart below shows, the gap between Oldham and that of GM and
England has actually widened.
Although the chart bellows suggests that the proportion of residents in Oldham with a degree
level qualification has fallen recently, this is unlikely and is probably influenced by the small
sample size causing variability in the Local Authority level figures.
There is also some evidence to suggest that Oldham’s talent is being drained; by the lure of
the “bright lights” of the main cities, in addition to the availability of more graduate level jobs,
which Oldham is in relative shortage of.
Figure 37 – % of Residents with a Level 4 Qualification
Source: ONS 2013, Annual Population Survey
Unless there is a significant increase in the availability of local graduate level jobs it will be
difficult to address this loss of skills through migration. However, improving the proportion of
Oldham residents with a degree level qualification and narrowing the gap towards the
national average must be a priority for Oldham moving forward.
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Demand for skills
Understanding the demand of skills is critical in determining the provision of skills for now
and in the future. Oxford Economics, who develop the Greater Manchester Forecasting
Model (GMFM), has recently published the 2013 model which includes the new occupational
structure forecasts for Greater Manchester.
Figure 38 – Forecast changes in GM’s Occupational Structures
Oxford Economics 2013, Greater Manchester Forecasting Model (GMFM)
The GMFM predicts that the GM labour market will reshaped over the next 10 years and that
jobs will be created at the top and bottom of the skills scale, while those in the middle tier are
being squeezed. The higher-skilled roles, which include managerial & senior official roles,
professional and associate professional & technical occupations are estimated to grow over
the next 10 years by 9.9%, 6.9% and 7.9% respectively.
At the lower end of the skills spectrum, elementary occupations are forecast to rise by 7.1%,
followed by sales & customer service roles (6.4%) and then personal services occupations
(5.5%). Intermediate level occupations are also expected to increase in GM from between
2013 and 2023, but to lesser degree.
As the forecast growth sectors in Greater Manchester over the next decade are going to be
found both in the high skilled occupations as well as the low skilled occupations. It is
therefore imperative for Oldham to comprehensively improve its skills base, allowing
residents the opportunities to access the more skilled and therefore more lucrative new jobs.
Without this change, Oldham residents will continue to be over reliant on low skilled/low paid
employment.
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Insights from Business Survey
A key aspect of the latest GM business survey (2014) sought to understand whether there
were skills shortages amongst the existing workforce and whether particular skills deficits
were evident in relation to the jobs, businesses were attempting to fill.
Some 9% of Manchester employers had any hard-to-fill vacancies at the time of interviewing,
up from 6% in 2013. They are most likely to have experienced recruitment difficulties for
professional occupations (20% of those with difficulties, associate professional (20%) and
skilled trades (20%).
The main causes of hard to fill vacancies centre on a low number of applicants with the
required skills/qualifications (43% of those experiencing hard to fill vacancies). Other
reasons cited include a lack of work experience (19%), not enough people interested in
doing the type of job (18%), a low number of applicants with the required work ethic and
poor working conditions (7%).
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