Halton is working hard for a better workforce – but there is still a way to go, says Alex Turner

THE towns of Widnes and Runcorn, in Halton, are divided by the River Mersey, and it could be said the gap between the ambitions of the borough and its residents is similarly wide.

However it is a suggestion that David Parr, Halton Borough Council’s chief executive, rejects.

“It’s a bit unfair,” he said. “We have worked very hard with our local communities to raise aspirations and ambitions. When we look at the performance of our schools – which is among the most improved in the last couple of years – it speaks volumes about our young people.

“But what we mustn’t under-estimate is we have a very challenging community that does not have the level of skills employers are looking for, so the work we are doing with colleges and universities is very important.

“We have got some long-term challenges, but we are trying to tackle those.”

The newly-published Halton Economic Review 2008 – commissioned by the council and produced by Pion Economics – has reached a more stark assessment.

In its analysis of the borough’s labour market, the report’s authors suggest a lack of ambition exists in some sectors of the population, and concludes that, despite a decade of benign economic conditions, “the most deprived areas may even be falling behind” and the profiles of young people not in education, employment or training “suggest a high risk of intergenerational inactivity and under-performance”.

The report continues: “Such structural inertia represents a fundamental challenge to the future local regeneration agenda.”

This feeds into a second faultline in the economic changes within Halton – a long-term skills shortage.

Once again, the report does not shy away, stating “it is unlikely that local businesses will meet their higher skill needs from Halton.”

This is crucial because, although much progress has been made within the borough, there is a sense that Halton’s residents are often secondary beneficiaries of its regeneration.

The earnings of workers in Halton, compared with the earnings of the borough’s employed residents showed the residents earned between 10% and 20% less than the comparative worker.

The report states that the “broad implication is that many of the ‘good’ jobs in the borough are taken by in-commuters”.

And there is little confidence among the report’s authors that this situation will change despite the clear and sustainable changes taking place in the local economy.

Starting from an estimate of a net gain of 4,600 jobs up to 2020, the HER suggests 42% will require a qualification of NVQ level 4 or above (equivalent to a diploma and one level below a degree).

The consequence, the report suggests, will be that without improvement in skill levels locally, “jobs coming on-stream at this level are likely to be taken by non-Halton residents” while at the same time “opportunities for those with no/low qualifications will continue to narrow”.

Which explains Mr Parr’s concern at tackling the long-term challenges as well as his emphasis on the £100m investment in the Building Schools for the Future programme which is under way in Halton.

But it is far from doom and gloom in the borough, which has much to be positive about in the medium and long-term.

Halton’s business base has grown each year in the last decade, from just under 1,900 VAT-registered businesses in 1998 to more than 2,400 in 2007. The 28% increase – which does mask a significant churn – is significantly higher than the growth rates for the North West and the UK.

HALTON is also projected to grow its gross value added (GVA) – a measure of the borough’s economic output – from £2.2bn to £2.99bn by 2020, with the borough again outperforming the regional and national growth rate averages.

There is serious investment in the area, with Stobart Group already having committed more than £60m in its 3MG scheme – the latest part of which will provide 3.5m sq ft of new warehousing and create 5,000 new jobs – while the Government has assigned a similar level to the science facilities at Daresbury.

Mr Parr said: “The fact that world-class science is delivered at Daresbury and will continue to be delivered there is a powerful statement about how Halton can deliver for the people of Halton and for UK plc.

“The Government has seen fit to identify Daresbury as one of only two sites they will invest in.

“The borough has made massive progress in recent years in terms of changing the profile of the economy away from manufacturing to a much more diverse economy.

“The strengths are our geography, the development of the logistics industry and the multi-million pound investment by Stobart Group in 3MG is significant and will generate thousands of jobs, even in the current climate.”

The report notes that the logistics sector – warehousing, transport and supply chain management – was helping to fill the gap left by the decline of traditional manufacturing sectors in the borough.

In 2007, manufacturing contributed 23% of the total GVA, compared with more than 30% in 2002 and nearly 50% in the early 1990s. The report said this “orderly” transition was producing “a more balanced economy”, although the dominance of the chemicals industry should not yet be underplayed.

Carl Cross, deputy chairman of Halton Conservatives, said: “The transition is being managed, but there isn’t enough of a dramatic movement.

“Trying to boost the skill-set in the borough will be key, boosting ambition, and then getting people to stay in the borough. There’s a brain drain and if you can develop more successful businesses it will attract people to remain.

“It is an issue for the council and the partner agencies to stimulate growth at a higher level, whether it is in retail, financial services or another sector – that’s happening, but the question is how it can be stepped up.”

And the situation within the retail sector does highlight a downside of Halton’s position, and good transport links, between Liverpool, Manchester and Warrington.

Not only is the sector suffering from the downturn on the high street, but in 2006 it was also affected by a £129m negative balance of retail trade. Since then, Liverpool One has opened and Golden Square shopping centre, in Warrington, has expanded, which are both likely to have attracted even more than the recorded 63% of the residents’ retail spend away from the borough.

“We have to be realistic,” said Mr Parr. “We are not going to attract to Halton the same retail businesses that Liverpool will.

‘WE NEED to create a retail economy that complements and supplements that core city retail offer for local people in Widnes and Runcorn, so let’s make it easy for our communities to get to Liverpool and Manchester, but let’s provide them with an offer locally that is readily available.

“Let’s not try to be a mini-Liverpool, but let’s be a successful local retail centre.”

And Halton does have its own advantages which it can press home, according to Mr Cross.

“The big benefit is the transport links, while the cost base in Halton for new businesses is likely to be much lower than anywhere around it,” he said.

“The council has to continue what it has been reasonably successful at doing, which is working with business to show Halton is a very dynamic borough. Halton has to be a place to do business.

“But the rate at which the larger urban conurbations has grown, for example in retail, makes it very difficult for Halton. Especially as the two towns are split by the river, and soon to be split by tolls.”

The £431m Mersey Gateway project will see, subject to a public inquiry, the creation of a second bridge across the Mersey which will overhaul the road network when it opens in 2014.

While it is expected to have a significant effect on Liverpool city region, the more local effect of tolling on both the new and existing Silver Jubilee Bridge is harder to predict.

It is symptomatic of the wider future for Halton – there is much to look forward to, but the impact on the borough’s residents is far less clear.

alexturner