Devolution jobs boost

Grahame Carter, Matchtech

Matchtech’s Grahame Carter explains why the Scottish ‘No’ vote could boost engineering employment.

Following Scotland’s decision to remain in the UK, there has been much debate about what this will mean for business and jobs.

You could be forgiven for thinking that the Scottish Referendum is yesterday’s news but actually the wider economic and employment impact has yet to be felt.

The result of the referendum has been to prompt commitments from the government and opposition to back greater regional devolution of powers, including income tax and infrastructure investment, not just to Scotland, but to Wales, Northern Ireland, key UK cities and potentially to England.

“What will almost certainly unite any devolved regional or city administration is a desire to build and invest in infrastructure”

While I leave the politics for others to debate, devolution has the potential to deliver more jobs and employment for engineers across the UK, as long as the UK’s national framework of employment laws and corporate taxation remains uniform and red tape is minimised.

What will almost certainly unite any devolved regional or city administration is a desire to build and invest in infrastructure, in order to encourage businesses to locate in their areas and to provide a backbone for growth.

Infrastructure is a statement of intent and a driver for business. The CBI in the north is already calling for the development of a High Speed Rail of the North. Regional airport expansion and investment in high-speed internet will almost certainly be other areas that regions look to invest in as a driver for local jobs and the economy. 

Matchtech received almost a 35% increase in specific engineering discipline requirements, both AutoCAD and design engineering when major projects such as HS1 and Terminal 5 at Heathrow were delivered. We would expect similar increased levels of engineering requirements to be produced if the High Speed Rail of the North and airport expansion projects were backed and funded.  

In September the International Monetary Fund released a report stating that infrastructure investment was one of the few policy levers left to governments to support growth. It calculated that raising public investment by 1% of GDP would increase output by around 0.4% in the same year and by 1.5% after four years. 

Westminster led investment in infrastructure has increased significantly in recent years, with projects such as HS2, Crossrail, the Intercity Express Programme, AMP6 and fibre-based broadband projects all generating jobs and driving growth. The result is a buoyant employment market for engineers, with significant skills shortages emerging in some sectors of the industry as a result.

If the UK can strike a balance between devolved regional governments financing local infrastructure projects, and national UK government funding and commissioning UK-wide infrastructure then we could see a significant additional fillip for jobs and engineering as we move forward. 

However, striking the right balance will be key; having to get four or five different parliaments to agree major infrastructure projects, and then get buy-in from a series of devolved regional assemblies may have the opposite effect and hinder the progress of the infrastructure investment and economic growth that the IMF identifies as being so beneficial. We need a plan for the UK as well as a plan for the regions.

Think tank ResPublica issued a report on the back of the Scottish Referendum making the case for Manchester to become the UK’s first devolved city and in the process gain control of its £22.5bn public sector budget, in order to empower it to invest in the infrastructure and services it needs to drive economic growth. The impact on infrastructure spending and jobs for Manchester’s budget could be significant – it could be a game changer. 

Investment in helping nurture business and jobs in UK regions is frequently built on providing better infrastructure. Engineers are at the vanguard of change and the UK’s infrastructure is now seeing renewed investment after several years of stasis and decline. That change could accelerate with greater devolution. 

Whatever the final shape of the current devolution debate, new jobs in engineering look likely to follow.

Want advice?

You can contact Grahame at grahame.carter@matchtech.com