Engineering: turning ideas into reality - Innovation, Universities, Science and Skills Committee Contents


Memorandum 67

Submission from NEPIC

1.  EXECUTIVE SUMMARY

  1.1  The NorthEast Process Industry Cluster (NEPIC) has, over several years, been actively seeking the views of those parties involved in the Process Industry of the region, including those in the engineering supply chain, regarding the current and anticipated skills position affecting their interests. This information has been used to provide a breakdown of the engineering needs associated with the sector in this region and these are broken down in the body of the response.

  1.2  NEPIC has around 350 member companies and has conducted skills surveys within this membership in recent years. Additional knowledge has been based on an understanding of other sectors in the region. This has indicated that there is a need for around 3,100 graduates and 3,750 vocational level candidates to enter the engineering industries by 2018.

  1.3  NEPIC is creatively seeking ways in which to add to the available pool of labour available to industry, and in particular the Process Industries. This seeks to address the issue at several levels, beginning with engagement with young people of primary school age and continuing throughout education to graduate attraction.

  1.4  It is clear that there is a need for other schemes to attract young people into engineering, both through vocational and graduate routes, but also to attract other groups, including those in employment but seeking to transform their career, to be able to change direction and retrain in engineering disciplines if we are to be able to meet the anticipated demand for skilled people in the future.

2.  INTRODUCTION

  2.1  We would like to thank you for providing us with the opportunity to provide information on the situation within the Northeast of England with regard to engineering skills, and in particular that affecting the Process Industries of the region. The response detailed below relates to both the state of graduate and vocational level engineering personnel and includes an estimate of the requirements for these people for the period up to 2018.

  2.2  The Northeast Process Industry Cluster (NEPIC) was formed three years ago from a merger between the Teesside Chemicals Initiative and the Pharmaceutical and Speciality Cluster that were in operation in the region. The main remit of NEPIC is to ensure that the cluster of Process Industry (PI) companies, and their associated supply chain, in the region can develop and thrive by the development of a strong cluster working in collaboration to resolve issues and so ensure the sustainability of the manufacturing base.

  2.3  Within the region the PI sector accounts for around 25% of the regional GDP, employing around 40,000 directly and 400,000 indirectly. It is estimated that there are around 520 companies in the region that are involved in the cluster, out of which NEPIC has around 350 member companies.

  2.4  The information contained within this submission is based on a detailed knowledge of the Process Industries, gathered from many years experience of working in this field, and some detailed skills surveys, as well as an understanding of other sectors based on a good understanding of other industrial sectors in the region.

3.  PROCESS INDUSTRY-MANUFACTURING BASE

  3.1  The process industry in the Northeast of England is currently undergoing a period of significant capital investment, with around £5 billion currently being invested and a similar amount planned for the future. The anticipated additional engineering intake as a result of these activities is set out below:

Chemical Engineers
    -  New Graduates
140 per year
    -  Mature Graduates
30 per year
Mechanical/Control/Electrical Engineers
    -  New Graduates
110 per year
    -  Mature graduates
30 per year

Total Graduate intake
310 per year

Vocational Engineering Apprentices
200 per year
Vocational Engineering Mature Tradesmen
175 per year

Total Vocational Intake
375 per year


  3.2  This equates to a requirement for the period 2008 to 2018 of around 3,100 new engineering graduates to enter the industry and around 3,750 new vocational level entrants to the industry.

4.  NON-PROCESS INDUSTRY-MANUFACTURING

  4.1  The level of change and development within other industries in the Northeast of England is also leading to a rise in demand for engineering staff. The other industries that we have considered include, but are not limited to, Iron and Steelmaking, Shipbuilding/Offshore Capital Construction, Power Generation/Utilities, Food Processing, Engineering Manufacture/Fabrication and Automotive.

  4.2  We have assumed that the combined size of these industries in terms of employment, GDP etc is approximately 1.5 times that of the Process Industries and that the requirement for Chemical Engineers in this field is around 15% of that in the Process Industries. This results in the following anticipated demand:

Chemical Engineers
    -  New Graduates
23 per year
    -  Mature Graduates
7 per year
Mechanical/Control/Electrical Engineers
    -  New Graduates
300 per year
    -  Mature graduates
135 per year

Total Graduate intake
465 per year

Vocational Engineering Apprentices
300 per year
Vocational Engineering Mature Tradesmen
260 per year

Total Vocational Intake
560 per year


  4.3  Because of the spread of the projects currently identified within the region, we would expect the demand for these employees to be at different levels during the period under consideration, and the anticipated total engineering graduate and vocational level needs are thought likely to fall by around 50% for the period 2013-18. Clearly this is based on the level of understanding at the time of writing, but this may change as new projects are developed. The anticipate demand, taking this into account, is set out below:

2008-12 Total Engineering Graduate Demand
2,325
2013-18 Total Engineering Graduate Demand
1,150

Total Graduate requirement 2008-18
3,475

2008-12 Total Vocational Engineering Resource Requirement
2,800
2013-18 Total Vocational Engineering Resource Requirement
1,400

Total vocational requirement 2008-18
£4,200


5.  NORTHEAST INDUSTRY ENGINEERING SUPPLY CHAIN REQUIREMENTS

  5.1  This section includes requirements for Project Management, Project Construction, Contracted Plant Maintenance, Logistics and Engineering Machining. The estimated requirements are based on the following key parameters:

    5.1.1  Process Industry

    -  £7 billionn Capital expenditure over 10 years.

    -  £2 billion/annum maintenance costs, including overheads, and minor capital works.

    -  £800m/annum revenue projects.

    5.1.2  Non-Process Industry

    -  £4 billion Capital expenditure over 10 years.

    -  £2 billion/annum maintenance costs, including overheads, and minor capital works.

    -  Potential for reducing the scale of the regional non-Process Industry Manufacturing Group from 2013 onwards.

  5.2  This gives an anticipated demand for these groups as follows:

Chemical Engineers
    -  New Graduates
150 per year
    -  Mature Graduates
100 per year
Mechanical/Control/Electrical Engineers
    -  New Graduates
200 per year
    -  Mature graduates
100 per year

Total Graduate intake
550 per year

Vocational Engineering Apprentices
600 per year
Vocational Engineering Mature Tradesmen
200 per year

Total Vocational Intake
800 per year


  5.3  This gives a total Graduate engineering requirement of around 5,500 over the period 2008-18 and a total Vocational engineering requirement of around 8,000 for the Engineering Supply Chain.

6.  NEPIC'S CURRENT WORK

  6.1  As a result of our analysis of the ongoing requirements, based on many years of experience within the region and a detailed industry led analysis of the skills needs for the next ten years, NEPIC has instigated several projects aimed at addressing some of these anticipated requirements. NEPIC will also be developing, alongside the new National Skills Academy for the Process Industries (NSAPI) other ways of attracting and training engineering personnel into the region's industrial base. The main projects in operation are set out below:

    6.1.1  Graduate Attraction

    -  NEPIC is attending an increasing amount of Graduate Recruitment Fairs around the UK, to improve knowledge and understanding of the opportunities available to new graduates. During 2007 there was a NEPIC presence at eight such fairs.

    -  NEPIC is working with University Careers Advisory Services to improve the awareness of Advisors about the status of the Process Industries and the opportunities that this presents.

    -  NEPIC has produced a Graduate Recruitment DVD promoting the region as well as the manufacturing companies of the region to potential new entrants from university. This can be viewed online at .www.nepic.co.uk.

    6.1.2  Apprenticeships

    -  NEPIC is supporting several programmes aimed at improving the attractiveness and uptake of apprenticeship programmes across the region.

    -  NEPIC has produced an information DVD for schools promoting the vocational access route to industry, including highlighting this as an alternative route to study for a degree. This can be viewed online at .www.nepic.co.uk.

    6.1.3  Retraining of other skilled people

    -  NEPIC is developing retraining programmes aimed at several groups of potential employees that are currently not suitable for entry to the Process and associate industries. These include:

-  Armed Forces personnel who require some reskilling to be able to work in the industries.

-  Long term unemployed who require both vocational training and workskills training before being in a position to enter the pool of available workers.

-  ex-offenders who similarly require both vocational and workskills training, but who may also provide difficulties due to other restrictions that are placed on them.

    6.1.4  Engagement with Young People

    -  NEPIC is a supporter of Children Challenging Industry in the region, encouraging young people to study STEM subject and potentially entering the available workpool when they leave school:

-  NEPIC operates the SETPOINT contract for Northumberland, providing STEM advice and support to schools and educationalists in the region. This also involves the coordination of the Science & Engineering Ambassadors scheme for the county, which provides Ambassadors who work within the STEM subject areas to help enthuse and encourage children in the STEM arena.

-  Two Science Education Units that operate within NEPIC's geographical area provide further opportunities for trained educationalists to provide schoolteachers and students with an opportunity to see the positive benefits of science and encourage the uptake of these subjects by children.

  6.2  NEPIC aims, by the continued development of this multi-faceted approach, to close some of the gap in skills that have been identified. It is not possible, however, for one organisation to do this alone and other programmes are needed if we are to fill the gap between the current and future positions.

  6.3  It is important that any programmes that are developed utilise the expertise contained within industry, and that funding is made available in such a way that the available pool of workers can be enriched without undue burden on employers, but that those with transferable skills can be brought to an acceptable standard for entry to the workplace and can be developed further in future years.

  6.4  NEPIC would welcome the opportunity to be involved in the development of such programmes and to work with Government, RDAs and other bodies to find ways of closing the gap in skills that exists at this time.

March 2008





 
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