Page 15 - Regional Employment & Skills Plan 2018

2.2 Cross-cutting Priorities
There are a number of cross-cutting priorities which permeate every sector operating within the region which must be taken into consideration, these are detailed below;
2.2.1 Labour Market Failures
Labour market failure occurs when the supply and demand elements of a labour market fail to result in an economic efficiency of labour, or when they do not reach an efficient and/or equitable outcome from society’s point of view.
The most commonly cited reasons for labour market failure include;
• The existence of skills gaps,
• Labour immobility, • Inequality.
It could be argued that a number of the aforementioned factors are prevalent in Wales which possibly combine to worsen or stagnate regional economic recovery and ultimately its improvement.
The existence of Skills Gaps
The existence of skills gaps is an issue for the region, RLSP evidence indicates that 51% of businesses surveyed face skills challenges. Furthermore, 62% feel that new entrants to their sector are not completely work ready. These issues cause significant challenges for businesses through reducing productivity, increasing training costs and hindering the growth and development of that business. Of course, this has a detrimental effect on the wider economy.
Labour Immobility
Labour immobility relates to the lack of movement of labour to where it is in greatest demand. 52% of business surveyed indicated that they experience difficulty in recruiting for specific roles. The region needs to be further promoted as an attractive place to live, work and invest, with on average lower house prices than neighbouring nations and a good quality of life.
In addition, Wales has seen a shift-change in its labour market profile in recent years as a result of the decline of the manufacturing sector and the growth of service industries. More work needs to be done especially with older workers to understand where there may be opportunities to increase industrial mobility. Many skills are transferrable and are not sector specific, support should be given therefore to further understand the parity in skills between some sectors. This could provide a significant lift to the economy and ensure that more individuals remain in long-term meaningful employment.
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Regional Employment & Skills Plan South West & Mid Wales Policy Context