Deconstructing Mayor Driscoll’s jobs claims

North of Tyne Mayor Jamie Driscoll, speaking after last week’s news, as reported here, that North East unemployment has fallen below the UK average for the first time on record, said the combined authority (NTCA) which he heads, was “set to create” more than 5,000 permanent jobs in four years with 1,280 already in post.

Mayor Driscoll said:

“Five thousand jobs – good jobs – in four years is a massive achievement. We’ve smashed the central government target out of the park on this one. This shows that devolution really works.”

He said in a press release that in addition 1,783 jobs had been protected that would have otherwise been scrapped were it not for NTCA investment, particularly during the Covid-19 crisis. Almost 1,500 would be safeguarded in future, thanks to further funding.

Under the devolution deal under which NTCA was established in 2019, the combined authority was committed to delivering 10,000 jobs over 30 years.

The Office for National Statistics (ONS) figures reported here last week show that between February and April 2023 the unemployment rate in the North East was lower than the UK average, at 3.6%. Commenting on the figures, Mayor Driscoll added: “This is great news for the North East. Last year we were the number one region in the country for job creation from inward investment. 

“I’ve said we can create full employment, and this is great progress. In the North of Tyne we’ve brought big tech companies here, we work with local small firms, boosted our offshore renewables industry and helped our creative sector. And these are good, permanent jobs – backed by our Good Work Pledge – that pay the decent wages people deserve. 

“I could talk about the statistics, but I’ve met hundreds of the thousands of people getting a pay packet this month as a result of the hard work all our partners have done.  It’s time the rest of the country took notice.”

Statistical considerations

The latest Labour Market Statistics (LMS) from the ONS and Driscoll’s follow-up press release provide a good opportunity to deconstruct the North East’s recent jobs record. Statistics are always worth looking at in context, and there are three factors worth bearing in mind in this case:

Mayor Driscoll’s North of Tyne is not the same as the North East region, and readers need to take care to distinguish between the two; jobs “in the pipeline” or “set to be created” are not the same as jobs in the bag, even if, as Driscoll says, they are jobs that NTCA partners are contractually obliged to deliver; and even those that are in the bag are not necessarily net gains – jobs get lost too.

It is also worth bearing on mind that LMS for the nations and regions of the UK, including the North East, are published by the ONS on a monthly basis, two months in arrears, and as a three-month rolling average. Thus, the figure released last week covered February-April 2023 and any recorded rises and falls were in comparison with November 2022-January 2023.

But the most recent statistics broken down to smaller geographies cover the calendar year ending in December 2022, so are less up to date. Unemployment has fallen quite rapidly in the North East in recent months, but whether that has happened evenly across the region remains to be seen.

The North East is, for now at least, in name both a region and a combined authority (NECA) and their geographies are not the same. NECA covers Tyne & Wear and County Durham and does not at present have a devolution deal and a mayor, for well-documented reasons, though it probably will have by next May.

To its north and south are two other combined authorities – North of Tyne (NTCA) and Tees Valley (TVCA) – which do have deals and mayors in Jamie Driscoll and Ben Houchen respectively.

Mayor Driscoll, commenting in his press release on last week’s unemployment figures said (as we have seen):

“This is great news for the North East…I’ve said we can create full employment and this is great progress.”

Great news for the region, but perhaps not quite as great for North of Tyne. Bearing in mind the different statistical time scales discussed above, the latest figures (Table 1) show North of Tyne’s unemployment rate of 4.5% to lie virtually mid-way between those of its neighbours – better than the North East’s 4.9% but not as good as Tees Valley’s 4.2%.

As Table 1 also shows, since 2019, when Driscoll was elected as mayor (and admittedly through the pandemic), unemployment in his area has fallen by 0.3% while in the NECA area it is down by 1.3% and in Tees Valley by 2.2%.

Table 1

Source: Nomis

Mayor Driscoll’s claim, however, is not so much as about falling unemployment but rather about the creation of new jobs. Most of these are for the future – jobs in the pipeline, as he puts it – and we must hope that his optimism is justified. But so far the record is comparatively disappointing, as least as reflected in the statistics.

The employment rate (those in work) in North of Tyne since 2019, when Driscoll took office in the May, and December 2022, as shown in Table 2 was actually down by 1.2%, while the North East’s was down by 0.4% but in Tees Valley actually rose by 1.3%.

There is no reason to doubt Driscoll when he says that there are 1,280 new posts in North of Tyne that have already been filled. But there have evidently been losses too, which is to be expected in any dynamic economy. Nevertheless, hopes that gains will outweigh losses have not yet been realised. Table 2 shows a loss of 8,600 jobs in North of Tyne between 2019 and 2022, compared with a loss of 4,100 in the North East but a gain of 7,300 in Tees Valley.

Table 2

Source: Nomis

When these ONS statistics were put to Mayor Driscoll by North East Bylines it turned out that he did not mean all jobs but “employee jobs” – defined by the ONS as excluding the self-employed, government-supported trainees and HM Forces. The mayor said:

“The number of employee jobs in the North of Tyne has gone up by 15,000 – from 367,000 in 2018 to 382,000 in 2021 [which is indeed what ONS statistics show]. And that’s despite the whole country seeing the effects of Covid and Brexit.  

“It is notoriously difficult to track some of the headline employment figures – they can include gig economy, bogus self-employment, and zero-hours contracts.  It’s no good if people don’t know how much they’re earning from one week to the next. You can’t expect people to pay mortgage or raise a family like that.  We need jobs where people get an actual, regular wage, and proper employment conditions.  The thousands of jobs we create at the North of Tyne are backed by our Good Work Pledge. 

“I’d like to see full employment – and that means helping people get the jobs. Last year we provided 33,000 training places so people can skill-up as chefs, HGV drivers, computer operators and so on.  And we support people with disabilities or other barriers so they can get a fair crack at a good, well-paid job.

“We must move to a world where work pays.

Comment

When Driscoll talks of 5,000 permanent jobs in four years in North of Tyne he is correct, but it is important to bear in mind that word “permanent”, by which Driscoll appears to mean “employee jobs.” He makes some valid points about jobs in the gig economy etc.

The increase in employee jobs in North of Tyne between 2018 and 2021 was 5,000 from 367,000 to 382,000 as Driscoll says. That was good news, certainly. It was a rise of 4.08%. It was a bit better than the region as a whole, which saw an increase from 1,049,000 to 1,090,000 – a rise of 3.9%. In the NECA area the increase was below the North of Tyne figure with a rise of 3.05% from 425,000 to 438,000

But Tees Valley enjoyed a rise of employee jobs from 257,000 to 270,000 – an increase of 5.05% – the best in the region, as it was for jobs overall, as already seen in Table 2.

So if Mayor Driscoll can boast of “smashing the central government [jobs] targets out of the park,” as he has done, presumably Mayor Houchen of Tees Valley can as well. Which just goes to show that we should all be careful in the use we make of statistics.