Census Outlook – Skills.

The Office for National Statistics (ONS) began releasing Census 2021 data in June 2022. It has since released data on a number of topics, including skills and education. This note provides analysis of skill levels across England and Wales. It looks at changes between the 2011 and 2021 Censuses and considers the extent to which skills play a role in boosting productivity.

Skills in 2021

Figure 1. Qualification Levels for those aged 16+ across Regions in England and Wales, 2021

Across England and Wales, 81.8% of people aged 16+ have some form of qualification. An estimated 33.8% hold a qualification at degree or higher level, whilst 18.2% of people aged 16+ have no qualifications.

The region in which there is the highest proportion of people aged 16+ qualified to degree level or higher is London (46.7%), whilst the North East has the lowest proportion at 28.6%. The West Midlands has the highest proportion of people aged 16+ with no qualifications (21.1%) and the South East has the lowest proportion (15.4%).

Regional variations in skill levels are not a new trend, however, with the South continuing to outperform other regions when it comes to the percentage of people with higher level qualifications.

Change since 2011

Figure 2. Change in qualification levels amongst people aged 16+ (% points) 2011-21

The change in skill levels across between 2011 and 2021 has followed the same pattern across all regions in England and Wales. The proportion of people aged 16+ who are qualified to degree level or higher has increased, while the proportion of people aged 16+ who hold no qualifications has decreased.

The largest change was seen in London, which saw the proportion of people aged 16+ qualified to a degree level or higher increase by 9% pts, while the smallest increase in the proportion of those educated to degree level or higher was the East Midlands (5.5% pts). The North East saw the largest
decline in the proportion of workers with no qualifications (6.2% pts), while London saw the smallest decrease (1.4% pts).

Skill Levels in Local Authorities

Figure 3. Local authorities with highest proportion of people aged 16+ with a degree level or higher qualification, 2021

The City of London has the highest proportion of people aged 16+ qualified to degree level or higher at 74.2%.

Of the ten local authorities with the highest proportion of workers educated to a degree level or higher, nine are in the London region. Cambridge (55.8%) is the only local authority in the top ten from outside London.

Outside of the South, the highest proportion is in Rushcliffe with 45.3%. The local authority with the lowest proportion of people aged 16+ with a degree or higher is Great Yarmouth at 18.2%.

Skill Levels in Local Authorities (continued)

Figure 4. Local authorities with highest proportion of people aged 16+ with no qualifications, 2021

The West Midlands local authority of Sandwell had the highest proportion of people aged 16+ with no qualifications at 28.9% in 2021. More positively this figure has decreased since 2011 when 35.2% of those aged 16+ had no qualifications.

The ten local authorities with the highest proportion of people aged 16+ with no qualifications are in the West Midlands, the East Midlands, Wales, the North West and the East of England.

The local authority with the lowest proportion of people aged 16+ with no qualifications is City of London at 6.6%.

Productivity

Figure 5. GDP Per Capita across England 2021

In the same way that there are skills gaps between different regions, there are also regional productivity gaps. Skills gaps are not the only cause of these productivity gaps but they are a contributing factor.

In 2021, GDP per capita in England w as around £34,690. However, this figure varied significantly across the regions. GDP per capita was highest in London, the region with the highest proportion of people qualified to a degree level or higher, at £59,855. The lowest GDP per capita was less than half the value for London at £24,575, which was in the North East, the region with the lowest proportion of people qualified to degree level or higher.

For decades economic theory has linked human capital (skills) and productivity. A 2023 government report¹ found that acquiring education and skills enhances productivity. With university degrees being one of the highest qualifications available to workers, the report found that areas with more graduates are on average more productive.

A 2022 report published by the Resolution foundation² found that a 1% increase in graduate share increases productivity by 0.6%. The same report found that in 2019, looking at characteristics of the ten least productive areas in the UK, the least productive areas have few graduates.

It is therefore no surprise that investment into human capital is seen by many as a key aspect of improving productivity across regions in England. Retraining and upskilling formed

a central theme in the Government’s levelling up agenda as the country looks to build back better after the pandemic. From a planning and economic development perspective, investing in and developing new schemes that support the creation of higher skilled jobs across the country, especially in the Midlands and the North, is vital.

To put the productivity gap into perspective, if the regions in which GDP per capita is below the national average moved in line with the average, total GDP in England would increase by £235billion per annum.

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