Dermot Finch: Universities can drive West Midlands economic revival
Dec 17 2009 By Dermot Finch
As the UK edges towards the end of recession, government, cities and commentators alike are looking at where new jobs will come from. And Birmingham is no exception.
The city economy has survived a tough year and, with the end of the recession in sight, it’s a useful time to take stock of Birmingham’s economic prospects.
Birmingham is one of the UK’s most economically important cities. Over 40 years the city and its wider economy have undergone a dramatic transformation from industrial to services-based. The share of jobs in manufacturing has fallen from 25 per cent in 1998 to just 14 per cent in 2007.
The public sector has been a key driver of growth in Birmingham and its wider economy in recent years, adding an extra 80,000 net jobs, alongside employment expansion in financial and business services and construction. But as industrial decline continued there was a significant net loss in private sector jobs.
What’s clear is that, with a government spending squeeze on the way, public sector jobs growth will not support Birmingham’s recovery. So where will future growth come from?
Over the past year, there’s been much speculation about tomorrow’s boom sectors – from green jobs to social care. The truth is future growth industries can be difficult to predict.
What we can foresee is that spending will shift to higher-value products.
This has resulted in the rise of “knowledge-intensive” industries – a wide mix of occupations from architecture and computer-programming to R&D and hi-tech manufacturing.
The good news is that Birmingham and its wider economic hinterland is well placed to develop these jobs, drawing upon the strengths of its world-class local universities, like Warwick and Birmingham – which are highly successful at spinning out innovative businesses from university research – and Birmingham City and Wolverhampton, with high numbers of graduate start-ups.
Aston recently invented the innovative INDEX scheme, which gives small firms vouchers to purchase research and consultancy from West Midlands universities. One way to encourage more private sector jobs is for universities to learn from each other’s successes.
So this is my new year’s resolution for the region’s leadership – prioritise increasing the number of high-value private sector jobs – and deploy your local universities to help you do so.
Dermot Finch is chief executive of Centre For Cities