by Alex De Ruyter, Director of Research at Birmingham City University’s Business School

The Centre for Regional Economic Development and Investment (CREDIT) at Birmingham City University held its inaugural event at the institution’s Curzon Building on the 27th October. The launch featured several keynote speakers, led by an opening contribution from Councillor John Clancy, Leader of Birmingham City Council. Other speakers included Professor David Bailey from Aston University, Dr Pam Waddell from Birmingham Science City, Corrin Crane from Black Country Chamber of Commerce, Professor Paul Forrest of the West Midlands Economic Forum (WMEF), and Professor Alex de Ruyter from BCU. The event drew over 90 strategically important attendees from across the region’s public, private and third sectors.

Councillor Clancy highlighted that whilst Birmingham City Council faced budget cuts over the foreseeable future and had experienced a significant decline in its workforce over recent years, it was still the “biggest local authority in Europe”. More importantly, Birmingham was described as a significant economic player in its own right, owning some 40% of the land in Birmingham, and 60% of “developable” land. Councillor Clancy reiterated the importance of devolution as being something that regional stakeholders should not wait for “permission” from Westminster to enact, but rather something that the region should run with now. He also identified housebuilding to be the most important priority for the Authority, noting the fact that Birmingham City Council was the largest house-builder in the region as a pertinent example of market failure.

A cross-cutting theme from the day was skills, specifically the marked lack of skills in key sectors across the region, as highlighted by a number of contributors from the floor. I explained that the region was not only characterised by higher than average unemployment, but also significant “hidden unemployment”. In this regard it was suggested that the real joblessness rate in Birmingham was more in the order of 1 in 6, once those “economically inactive who want a job” persons were accounted for. It was reasoned that high rates of joblessness posed particular challenges for the region in terms of trying to address skill shortages in key sectors such as automotive, especially when coupled with the need to ensure the “inclusive economic growth” as highlighted by Councillor Clancy.

An important issue raised was deemed to be the relative lack of training by companies, and whether this was attributed to a more fragmented regional supply chain dominated by smaller enterprises. I argued that the current situation facing the region only reiterated the importance of flexible, life-long learning and that tax could be used as a vehicle to promote training and R&D – suggesting a “training levy” should now be considered seriously by regional (and national) authorities.

Professor Forrest rounded the discussion by calling for a Midlands Fiscal Commission (MFC) to champion devolution of resourcing and spending decisions to the region. In this regard, a key area of research for CREDIT over the next 12 months would be to make the academic case for a MFC, and also to gain a better understanding of skills atrophy in the region, and what policy interventions would be required to address skills gaps.

Alex De Ruyter is the Director of Research at Birmingham City University Business School. Learn more about the Business School here.

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