Manchester Monitor Quarterly January 2014
Business services to drive growth in GM over next decade
Jobseekers fall for ninth consecutive month GVA data highlight GM growth Record month for hotel occupancy GM housing market remains flat Crime volumes continue to decline
www.neweconomymanchester.com research@neweconomymanchester.com
Monitor Focus Business services to drive growth in GM over next decade This issue of the Manchester Monitor Quarterly includes a
GVA data published by the Office for National Statistics
detailed feature on the latest results from the 2013 edition
(ONS) show a significant rise in GM’s performance between
of the Greater Manchester Forecasting Model (GMFM). The
2011 and 2012, with the conurbation now the fastest
focus is on which sectors are expected to lead Greater
growing NUTS2 area outside the South East. This is
Manchester’s (GM) employment growth over the next
reinforced by the findings of the latest English Business
decade, which industries will contribute towards increased
Survey (EBS) by the Department for Business Innovation and
economic output and how the conurbation’s occupational
Skills (BIS), which show that the economy is continuing to
structure will change up to 2023.
pick up, with almost half of GM businesses reporting higher levels of activity in the third quarter of 2013.
From an employment perspective, professional, scientific & technical activities and administrative & support service
The latest data on hotel occupancy reveal that Manchester
activities are expected to be the largest contributors to jobs
city centre achieved its highest monthly average occupancy
growth in GM over the next decade – with almost 54,000
figure to date, with an average of 87% occupancy achieved
new opportunities being created in these sectors. The long-
in November 2013. The Manchester Christmas Markets
term decline in manufacturing employment is still evident,
contributed considerably to occupancy rates in November,
although manufacturing’s contribution towards economic
boosted further by a number of high-profile events such as
output is expected to grow considerably up to 2023 as the
the Rugby League World Cup Final at Old Trafford. Civil
sector becomes ever more productive in order to remain
Aviation Authority (CAA) data on airport passenger numbers
globally competitive. The 2013 GMFM results also suggest
are also positive, with Manchester Airport handling nearly
that an increasing number of occupations in the conurbation
1.9 million passengers, a 6.8% (120,000) increase on this
will be created at the higher and lower ends of the skills
time last year.
ladder over the coming decade, with fewer at intermediate levels. This is likely to impact on the type of job opportunities that become available in GM, and significantly on the level of qualifications needed by the workforce.
Land Registry data show that the average cost of a house in GM remained flat over the 12 months to November 2013, increasing by only 0.3% (£290). A typical property now costs just over £104,000. House prices in the North West also
The latest figures from the Department for Work and
remained fairly stagnant over the same period, rising by
Pensions (DWP) show that the number of people claiming
0.8% (£888), in contrast to the overall growth in England &
Jobseeker’s Allowance (JSA) in GM has now fallen for the
Wales of 3.2% (£5,170).
ninth month in a row. There were 65,400 JSA claimants in GM in November 2013 – a decline of 3,800 (5.6%) compared to October 2013, and faster than the declines in the North West (4.4%) and Great Britain (3.7%). However, as a proportion of the resident working-age population, 3.7% of people in GM were claiming JSA in November, which remains higher than the North West (3.4%) and Great Britain (2.9%) figures.
1 | Manchester Monitor – January 2014
Data from Greater Manchester Police (GMP) for the year ending December 2013 show that the number of reported crimes is continuing to fall, declining by 3.7% over the last 12 months. However, there has been a slight fall in the number of crimes solved in GM, which at 28% is 3.0 percentage points lower than December 2012.
Monitor Dashboard Jobseeker’s Allowance (JSA) claimants
Airport Passengers
21.6%
6.8%
since last year
since October 2012
Business Activity
Hotel Occupancy
43% of GM firms reported higher levels of activity in Q3 2013 when compared to Q2
House Prices
2.0%pts since November 2012
Crime Volume
0.3%
3.7% since December 2012
since November 2012
Manchester Monitor – January 2014 | 2
People Monitor Jobseekers fall for ninth consecutive month The number of people claiming Jobseeker’s Allowance (JSA) in GM has now fallen for the ninth month in a row. There were 65,400 JSA claimants in GM in November 2013 – a decline of 3,800 (5.6%) compared to October 2013, and faster than the declines in the North West (4.4%) and Great Britain (3.7%). However, as a proportion of the resident working-age population, 3.7% of people in GM were claiming JSA in November, which remains higher than the North West (3.4%) and Great Britain (2.9%) figures. JSA Claimants
Vacancies
The number of male JSA claimants in GM fell on a monthly basis by 5.2% (2,300) to 42,700, while the number of female claimants fell even faster by 6.2% (1,500 to 22,700). On an annual basis, male JSA claimants are now 23.3% lower (a decline of 12,900) and female claimants 18.1% lower (a decline of 5,000) than this time last year.
The Labour Insight database reveals that there were 13,900 job openings in GM in November 2013, down by almost half (46.7% or 12,200) on the same month last year. Whilst it is not clear why there has been such a large fall vacancies data can be subject to seasonal variations. The highest proportion of vacancies were in professional occupations (32.2% or 4,500), followed by associate professional & technical roles (19.9% or 2,800).
Youth unemployment (JSA claimants aged 16–24) in GM decreased on a monthly basis between October and November, falling by 1,500 to 16,400. On an annual basis, the number of youth JSA claimants is now 30.0% (7,100) lower than this time last year, above the declines seen in the North West (28.0%) and Great Britain (26.5%). There was a decline in long-term (6 months+) claimants in GM in November 2013 to 30,400, a monthly fall of 2,200 (6.8%). On an annual basis, the number of long-term claimants is now 15.9% (2,000) lower than this time last year, a fall greater than the Great Britain average (15.7%) though not as large as the North West (17.2%).
Total Jobseeker’s Allowance Claimants in November 2013
Nearly-two thirds of the vacancies in GM (8,900 or 64%) in November were found in Manchester, followed by Stockport (919), and Bolton (820). The top three detailed occupation types in GM in November 2013 were: programmers & software development professionals (600 postings); nurses (600 vacancies); and business sales executives (400 postings).
Jobseeker’s Allowance - Annual Change
65,398 Decreased by 21.6% year-on-year
Vacancies - Annual Change
Women
Men
Youth
Long-term
$18.1% $23.3% $30.0% $15.9% $46.7%
3 | Manchester Monitor – January 2014
Business Monitor Top five NUTS2 regions by GVA growth 2011 - 2012
Absolute change: £2.3bn
Outer London
Absolute change: £1.1bn
Eastern Scotland
Absolute change: £1.5bn
Greater Manchester
Absolute change: £1.3bn
Hampshire and Isle of Wight
Surrey, East and West Sussex
Absolute change: £3.3bn
0%
1%
2%
3%
4%
5%
6%
GVA data highlight GM growth GVA data published by the Office for National Statistics (ONS) show a significant rise in GM’s performance between 2011 and 2012, with the conurbation now the fastest growing NUTS2 area outside the South East. This is reinforced by the findings of the latest English Business Survey (EBS) by the Department for Business Innovation and Skills (BIS), which show that the economy is continuing to pick up, with almost half of GM businesses reporting higher levels of activity in the third quarter of 2013. ONS GVA Data
English Business Survey
Workplace GVA data show that GM South grew at 3.7% between 2011 and 2012 (rising from nearly £33.5m to around £34.8m), which is in the top 10% fastest growing NUTS3 areas. As it is also one of the largest NUTS3 areas in economic size, only Surrey and Inner London (West) contributed more to national GVA growth in absolute terms. The fall seen in recent years in GVA per head compared to the national average also reversed slightly and GVA per head grew from 108.2% of the national average to 110.2%. GM North’s growth performance grew by 1.5% (rising from nearly £16m to just over £16.2m) between 2011 and 2012, making it a mid performer compared to other NUTS3 areas.
In total, 43% of GM businesses surveyed stated that their level of business activity or output in Q3 2013 was higher than in Q2. This increasing level of activity was above the rises seen in the North West (40%) and England (42%). In addition, 47% of firms in GM were expecting activity to increase in the next quarter, compared to 42% of firms in the North West and 44% of firms in England.
More broadly, looking at the whole of GM between 2011 and 2012, GM was the fastest growing NUTS2 area outside the South East (only Surrey, East and West Sussex and Hampshire grew quicker), with a 3.1% rise in GVA growth.
20% of GM businesses said that employment had risen in Q3, the same figure as in Q2, with two-thirds stating that it had remained the same over the quarter. Looking ahead, 22% of GM firms expected employment to rise over the next quarter, with 68% believing it would stay stable. The employment picture for the North West and England was similar to that of GM; however the challenge in all areas is to translate the rise in activity into substantial growth in job numbers.
Manchester Monitor – January 2014 | 4
Greater Manchester’s economy over the next decade Results from the latest release of the GM Forecasting Model (GMFM – December 2013) give an indication of expected longterm trends in the economy. GMFM is produced by Oxford Economics for New Economy on behalf of the 10 GM local authorities, and this month’s quarterly feature provides more detailed analysis of the forecasts. The focus is on which sectors are expected to lead GM’s employment growth over the next 10 years, which industries will contribute towards increased economic output and how the conurbation’s occupational structure will change up to 2023. Employment Figure 1: Top 5 sectors for employment growth in GM, 2013-23
30,000
Forecast employment change, 2013-23
26,900
26,700
25,000
20,000
15,000
13,700
13,100 9,900
10,000
5,000
0 Administrative & support service activities
Professional scientific & technical activities
Around 100,000 jobs are forecast to be created in GM from 2013 to 2023 with employment (including self-employment) estimated to rise by 7.6% to reach 1.43 million. This is above the regional growth forecast of 5.7% over the same period, as well as the other four Local Enterprise Partnership areas in the North West: • • • •
Cheshire & Warrington: 7.0%; Lancashire: 4.7%; Liverpool City Region: 4.0%; and Cumbria: 1.1%.
The North West is expected to see almost 200,000 additional jobs created between 2013 and 2023, meaning GM would account for half of all employment growth across the North West over the next decade.
5 | Manchester Monitor – January 2014
Wholesale & retail trade
Construction
Accommodation & food service activities
In absolute terms, the two largest contributors to the forecast increase in jobs in GM are professional, scientific & technical activities and administrative & support service activities. Combined, these sectors are expected to see nearly 54,000 new jobs over the next 10 years. (see Figure 1). Reflecting the challenges facing the sector nationally, only 2,300 news jobs are forecast in financial & insurance activities over the next decade in GM – albeit growth of 4.7%. Wholesale & retail is forecast to create the third highest number of jobs in GM in absolute terms, with an increase of just under 14,000 over the next ten years – a rise of 6.5%. Construction is just behind this, with a forecast of 13,100 additional jobs and much faster relative growth at 17.0%.
Almost 10,000 jobs are forecast to be created in GM’s accommodation & food services sector from 2013 to 2023, an increase of 12.5%. A further 6,300 additional jobs are estimated in arts, entertainment & recreation – growth of 22.9%. The increases in these two sectors confirm the continuing strengths of GM’s wider visitor & cultural economy. At the opposite end of the scale, the public administration & defence sector is forecast to see a decline of 9,200 jobs over the next decade – a fall of 15.9%. Education (4,400, or a decline of 3.8%) is also expected to see a decreasing number of jobs, although roles in health & social work activities are forecast to increase slightly by 1,400 (0.8%). The long-term decline in manufacturing employment is forecast to continue in GM, with 11,700 fewer roles between 2013 and 2023. However, the sector will remain a key contributor to GM’s economic output as manufacturing productivity continues to rise, which is explored further below.
Gross Value Added Estimates on gross value added (GVA) in GM suggest that real estate activities will experience the largest rise in economic output from 2013 to 2023 at £2.7 billion. However, it should be noted that the sector includes ownership of dwellings and imputed rents, which is likely to skew the results. The wholesale & retail trade sector is estimated to see the second highest rise in GVA at £2.1 billion, followed by professional, scientific & technical activities at £2.0 billion (see Figure 2). It is important to note that while manufacturing is forecast to see a fall in total employment, its importance to GM in terms of economic output is still expected to grow, with its GVA contribution increasing by £1.5 billion from 2013 to 2023.
Figure 2: Top 10 sectors in GM for GVA change (£million), 2013–23
£2,677
Real estate activities Wholesale & retail trade
£2,068 £2,037
Professional, scientific & technical activities Administrative & support service activities
£1,578
Financial & insurance activities
£1,562 £1,529
Manufacturing
£1,484
Information & communication £1,194
Construction £930
Human health & social work activities
£750
Transportation & storage £0
£1,000
£2,000
£3,000
Forecast Change in GVA, 2013-23 (£million)
Manchester Monitor – January 2014 | 6
Occupational Structure In line with results from the 2012 GMFM, the new forecasts again suggest that an increasing number of roles will be created at both the high and low ends of the skills spectrum in GM up to 2023. For higher-skilled roles, managerial & senior official roles in GM are forecast to grow by 9.9% over the next 10 years. Associate professional & technical occupations are estimated to increase by 7.9%, followed by professional roles at 6.9% (see Figure 3).
Intermediate level occupations are also expected to increase in GM from between 2013 and 2023, but to lesser degree. Skilled trades are forecast to grow by 3.2%, while administrative & secretarial and process, plant & machine operative roles are both forecast to increase by 2.0%. The trends suggested by GMFM continue to indicate that the GM labour market is being reshaped and that jobs are being created at the top and bottom of the skills scale, while those in the middle tier are being squeezed.
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%).
Figure 3: Forecast Change in GM’s Occupational Structure, 2013–23
Forecast Change in Occupations in GM, 2013-23 (%)
Managers and senior officials
9.9%
Professional
Associate professional & technical Administrative & secretarial
7.9%
2.0%
Skilled trades
Process, plant & machine operatives
High Skill
6.9%
3.2%
Intermediate Skill
2.0%
Personal service
Sales & customer service
Elementary
5.5%
6.4%
Low Skill
7.1%
Summary From an employment perspective, professional, scientific & technical activities and administrative & support service activities are expected to be the largest contributors to jobs growth in GM over the next 10 years – with almost 54,000 new opportunities being created in the two sectors. In addition, they are expected to see GVA grow by more than £3.5 billion over the next decade. The long-term decline in manufacturing employment is still evident, although the sector’s contribution towards economic output is expected to grow considerably to 2023.
7 | Manchester Monitor – January 2014
The 2013 GMFM results also suggest that an increasing number of roles in the conurbation will be created at the higher and lower ends of the skills ladder in GM up to 2023, with fewer at intermediate levels. This is likely to impact on the type of job opportunities that become available in GM and significantly, on the level of qualifications people need in order to access them.
Place Monitor Record month for hotel occupancy The latest data on hotel occupancy reveal that Manchester city centre achieved its highest November weekend occupancy figure to date, with the Manchester Christmas Markets contributing considerably to occupancy rates, boosted further by a number of high-profile events. Civil Aviation Authority (CAA) data on airport passenger numbers are also positive, with Manchester Airport once again seeing an annual increase in the number of passengers. Hotel Occupancy
Airport Passenger Numbers
Hotel occupancy rates in Manchester city centre were recorded at 87% in November 2013, up from 86% the previous year. This monthly average has only ever been achieved once before in November 2006. November also generated the highest recorded weekend occupancy rate of 93%, up from 91% in November 2012. The weekday average occupancy in the city centre was 83%, the same rate as November 2012.
Manchester Airport handled nearly 1.9million passengers in October 2013, a rise of 119,600 (6.8%) from 12 months previously, marking the Airport’s seventeenth consecutive month of year-on-year growth. Month-on-month passenger numbers fell by 316,400 (14.4%), as would be expected seasonally.
For GM as a whole, average occupancy rates in November were 83%, up from 81% on the previous 12 months. The Manchester Christmas Markets contributed considerably to occupancy rates in November and are expected to have generated an estimated fifty million pounds for the local economy. Key dates for hotel occupancy in the city centre during November were: • 30 November – 99% occupancy achieved, with occupancy boosted by the Rugby League World Cup Final taking place at Old Trafford; • 23 November – 98% occupancy achieved, helped by the WBA World Boxing title bout between Froch and Groves at the Phones 4u Arena; and
The annual growth in passenger numbers at Manchester Airport was higher than all other major UK airports, with the London airports of Heathrow, Gatwick and Stansted, and Birmingham seeing growth of 4.6%, 4.2%, 4.3% and 1.6% respectively. The introduction of an abundance of new routes as well as increased capacity and frequency means that growth at Manchester Airport looks set to continue well into 2014. Jet2.com is increasing capacity by a third compared to winter 2012, with new destinations including Faro, Lyon, Palma, and Venice, as well as increasing flights to popular Spanish destinations. In addition, Thomas Cook has also recently launched new long-haul services to St Lucia, Barbados, and Antigua as well as increases in flights to winter destinations such as Fuerteventura, Tunisia, and the Gambia.
• 6 November – 97% occupancy, boosted by a number of conference and business events across the city including the CIPD Conference and the 26th Congress of the European Association for Personnel Management, both held at Manchester Central.
Airport passenger numbers
(+6.8%)
Hotel occupancy (city centre)
1,879,327
87%
Flights
Hotel occupancy (GM)
(+1.9%)
14,583
(1% pt)
(2% pts)
83%
% represents year-on-year change IMPORTANT NOTE: The source of the hotel occupancy data referenced in this newsletter is STR Global Ltd. Republication or other reuse of this data without the express written permission of STR Global is strictly prohibited.
Manchester Monitor – January 2014 | 8
Housing Monitor GM Housing Market £140,000
7,000
November 2013 : £104,088 6,000
£100,000
5,000
HOUSE PRICES £80,000
4,000
September 2013 : 2,366
£60,000
3,000
House Sales
Average House Price
£120,000
HOUSE SALES £40,000
2,000
£20,000
1,000
£0 Nov-03
0 Nov-05
Nov-07
Nov-09
Nov-11
Nov-13
GM housing market remains flat Land Registry data show that the average cost of a house in GM remained flat over the 12 months to November 2013, increasing by only 0.3% (£290). A typical property now costs just over £104,000. House prices in the North West also remained fairly stagnant over the same period, rising by 0.8% (£888), in contrast to the overall growth in England & Wales of 3.2% (£5,170).
House Prices
House Sales
Property prices in England & Wales were almost flat in November 2013, rising by only 0.06% (£108) from October 2013 and now stand at £165,400. House prices in the North West saw a month-on-month rise of 1.5% (£1,637), whilst prices in GM also saw a slight month-on-month increase of 0.5% (£560).
Year-on-year, house sales in GM have increased by 17.7% (355 between September 2012 and September 2013). This was proportionally lower than the annual increases seen in the North West (23.5% or 1,268) and England & Wales (23.4% or 12,508).
At a local authority level, Manchester (4.8% or £4,377), Stockport (0.1% or £210), Tameside (0.3% or £304) and Trafford (1.4% or £2,493) saw house price rises between November 2012 and November 2013. The remaining six districts all saw declines, with the largest found in Rochdale (1.9% or £1,729) and Bolton (1.8% or £1,601). Nationally, house prices are widely expected to rise in 2014. In its forecast for the year ahead, the Royal Institution of Chartered Surveyors (RICS) said that it expected house prices to rise by up to 8% as demand continues to outstrip supply. Whilst house prices in GM have remained fairly stagnant over the last twelve months, there is clearly potential for prices to rise here too.
9 | Manchester Monitor – January 2014
Land Registry data reveal that there were 2,366 properties sold in GM in September 2013, a monthly fall of 20.8% (620). The North West (16.0% or 1269) and England and Wales (15.1% or 11,602) also saw a decline in house sales. At a local authority level, Manchester saw the largest number of house sales in GM (391), followed by Stockport (289) and Wigan (288). The lowest number of house sales in GM was seen in Rochdale (154) followed by Tameside (173) and Bury (176).
Crime Monitor Crime Volumes in Greater Manchester
165,113
Year to Dec 2012
Year to Dec 2013
140,000
161,991
150,000
Total crimes 186,642
21,529
Total crimes 179,789
17,798
160,000
Victim based crime
170,000
180,000
190,000
Non-victim based crime, fraud & forgery
Crime volumes continue to decline Data from Greater Manchester Police (GMP) for the year ending December 2013 show that the number of reported crimes is continuing to fall, declining by 3.7% over the last 12 months. However, there has been a slight fall in the number of crimes solved in GM, which at 28% is 3.0 percentage points lower than December 2012. Crime Volumes Figures for the year ending December 2013 show that there were around 179,800 reported crimes in GM – an annual decline of 3.7% or 6,850 fewer offences.
In terms of victim based crime 23% of cases were solved over the 12 months to December 2013, a year-on-year fall of 2.0 percentage points.
Victim-based crimes (stealing, criminal damage & arson, violence, and sexual offences) saw almost 162,000 cases recorded over the same period, representing an annual fall of 1.9%.
GM Fire & Rescue Service Data
While overall volumes of crime decreased, the number of sexual offences increased by 17.7% (471) across GM during the year to December 2013, possibly due to more people reporting sexual offences in the wake of the Jimmy Saville investigation. The number of stealing offences also rose by 2% (1,614) over the same period. Crimes Solved GMP successfully solved 28% of all crimes for the year ending December 2013 – a decline of 3.0 percentage points compared to the previous 12 months.
Deliberate fires in GM were recorded at 9,107 for the 12 months to December 2013, compared to a figure of 7,817 for the previous year, an annual rise of 16.5% (1,290). However, primary fires, which are those where owned property is involved, were recorded at 1,604 for the year ending December 2013, a year-on-year fall of 12.0% (-219). Hospital Attendances The latest figures (November 2012 to October 2013) in relation to assault attendances at local emergency departments show that there were 12,227 assaults over the last twelve months, a 4.4% increase when compared with figures for the previous 12 months (November 2011 to October 2012 – 11,713 assault attendances).
Manchester Monitor – January 2014 | 10