West Midlands jobs market to be worst hit

The tradition of manufacturing across the West Midlands makes it more vulnerable to unemployment following the coronavirus crisis, experts said today.

The Jaguar production line at Solihull
The Jaguar production line at Solihull

The Institute of Chartered Accountants in England and Wales says that the factory-intensive region, which has a below-average share of office-based and hospitality jobs, will slightly under perform the rest of the UK in terms of output and employment over the next five years, despite a quick recovery expected in 2021.

It adds that it is unlikely the region’s employment levels will return to pre-crisis levels until 2023.

The forecast, produced in partnership with Oxford Economics, found that employment in the West Midlands, including Shropshire and Staffordshire, was likely to contract nearly one percentage point more than in the East Midlands, despite both regions having the most manufacturing jobs of any UK region.

This was because of the types of manufacturing they rely upon. The West Midlands’ machinery and transport equipment sub-sector suffered during lockdown, whereas the East Midlands’ food and beverages production sector continued to operate.

Jobs placed in jeopardy during lockdown included at JLR, which has a major factory alongside the M54. More than 1,000 agency jobs were cut in June and more than 2,000 DHL jobs linked to the JLR supply chain were placed at risk in July.

The Oxford Economics report found that sectors that had to shut during lockdown – such as restaurants and airlines – were badly hit by the pandemic. Manufacturers dependent on global supply chains, or where demand fell sharply, were also affected.

The Institute said the report showed that an industrial strategy that focused on jobs for the future was essential to recovery, especially for areas like the West Midlands that are more vulnerable because of the nature of its manufacturing-based economy.

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