Executive summary
This report presents insight on how local and combined authorities are working on employment, skills and growth. This is a dynamic and interlinked policy area where further change is flowing from the 2024 Get Britain Working and English Devolution White Papers. A set of case studies captures the role that local government is already playing in linking their work on employment and skills to the nationally salient priority of growth.
The report is structured around three themes of local government activity: supporting the skills system, Support to Employer Representative Bodies (ERBs) in the development and delivery of Local Skills Improvement Plans (LSIPs), and Integration of Local Enterprise Partnership (LEP) functions.
Supporting the skills system
This describes how local and combined authorities facilitate the local functioning of a fragmented system so that it more closely responds to local economic, social, and environmental priorities. This includes activities such as:
- Convening partners to influence whole system operations and to address gaps in provision that inhibit growth potential.
- Co-ordinating use of funding streams so that there is some permanent support infrastructure in the system for individuals and for employers – a support 'hub' approach.
- Using local authority procurement to focus social value on support to the skills system.
Support to Employer Representative Bodies (ERBs) in the development and delivery of Local Skills Improvement Plans (LSIPs)
The report identifies ways through which local authorities have added value to this process. This is important in anticipation of the joint ERB - strategic authority role in future LSIP ownership trailed in the English Devolution White Paper.
Themes of added value include:
- Adding reach to ERB business engagement, through their business-as-usual work, including with small and medium size enterprises (SMEs).
- Sharing labour market analysis and other data.
- Advising on sector priorities.
Integration of Local Enterprise Partnership (LEP) functions
A year on from the transfer of the responsibility for former LEP functions to local government and combined authorities, the report identifies some examples of integration in practice and the added value that has been realised to date.
Examples include:
- Linking former LEP functions to wider local authority services – for example using insight from the Growth Hubs to shape support to SMEs.
- Finding pragmatic ways to maintain functions on a functional economic area level where a former LEP crossed upper tier authority boundaries.
The research shows that local and combined authorities are making strong efforts to influence employment and skills support work so that it is consistent with growth ambitions. The insight from the fieldwork for this report points to some recommendations which would help to sustain the effective local practice identified and in turn underpin the linkage between local employment, skills and growth.
Recommendations
Supporting the skills system
For central government
- The LGA has previously called for a ‘duty to co-operate’ concept to encourage partners to work together to improve services. The findings from this report reiterate that a duty to co-operate could help to mainstream the interesting practice identified with the potential to influence the whole system to support local growth ambitions.
- The findings highlight the benefit of stable local infrastructure – ‘hubs’ - to support individuals into work and training and to support SME employers. Introducing a single local pot, as advocated by the LGA in its Work Local vision, would help bring certainty to the future of these mechanisms in places where they have been established and open the door to their roll out elsewhere.
For the LGA
- Encourage active sharing of experience by local and combined authorities about the work they are undertaking to influence the design and operations of the employment and skills system locally. This will highlight pragmatic actions that can be taken to shape the system pending further devolution developments.
LSIPs
For central government
- Work with local government partners to set out an expectation of areas where strategic authorities will add value to future LSIP development as joint owners with ERBs, including, but not limited to, business engagement, data and support for sectors that are key to local growth.
- Specify a role for local government in joint ownership of LSIPs in areas where there is not yet a strategic authority. This could potentially be linked to local Get Britain Working Plans which have coverage across England.
For the LGA
- Building on the findings of this report, work with councils to build up a model of how local authorities in areas that do not yet have a strategic authority can co-own the LSIP covering their area. Present this model to the Government to support recommendation.
LEP integration
For central government
- Planning future delivery of former LEP functions requires more certainty about funding, but also a sustainable model that maintains capacity and relationships to deliver local growth. The work of integrating former LEP functions has often involved the loss of key staff with local knowledge and a reduction in business relationships built up by LEPs over time. This shows the importance of establishing a clear and sustainable future model for local growth funding. A 2024 LGA report set out a ten-point plan for the future of local growth funding, which included matching resources and delivery mechanisms to the scale of challenges and opportunities.
For local authorities
- Integration involves an important element of culture change, with a shift of functions from a quasi-public sector context to one of local political control. Deepening integration requires making former LEP activity visible internally to assist staff in making the links between these roles and the work of policy and delivery teams. This also needs to be carefully managed to ensure that relationships are re-set and business connections are maintained and nurtured, particularly in the context of local government reorganisation, devolution, and the creation of strategic authorities.
Introduction
Local employment support and skills development are at the heart of place-shaping. The work spans economic development, life chances for individuals as well as wider health and wellbeing. The outcomes of this work are increasingly high profile, with relevance for the policy agenda in areas including welfare reform; economic inactivity; young people's participation in training and employment; net zero delivery; and economic growth.
Local authorities, and where they exist, combined authorities, are part of a much wider delivery system of employment and skills support. The system has evolved over many decades through changes to national policy and is changing further with initiatives in two late 2024 national policy statements, the Get Britain Working and English Devolution White Papers.
Shared Intelligence was commissioned by the LGA to gather insight on how local and combined authorities are working on employment, skills and growth. The aim is to highlight the role that local government is already playing in supporting the successful operation of the system; and to highlight how their experience can be used to inform the detail of the next stages of system evolution.
The research focuses on three themes of local government's work in this area:
Supporting the skills system
The LGA has over many years highlighted the fragmentation in the skills system. This is manifested in the range of funding streams, owned by different parts of government, and targeting different cohorts. But it is also fragmented in terms of a complex delivery landscape. It is into this context that the Government is launching the requirement for all areas in England to produce local Get Britain Working plans. These should set out how areas are tackling local labour market challenges, including skills shortages, and be developed with local partners with local or combined authorities as the accountable body. They should be designed to complement LSIPs and Local Growth Plans. This report aims to draw out examples of how local and combined authorities are already using their convening role to facilitate the local functioning of the system, improving the experience for job seekers, learners, providers and employers, while also driving the overall direction to match local economic, social, and environmental priorities.
Support to Employer Representative Bodies (ERBs) in the development and delivery of Local Skills Improvement Plans (LSIPs)
LSIPs were developed in 2023 to present priorities and actions that employers, providers and other stakeholders in an area supported to improve local skills acquisition. Employer organisations, such as Chambers of Commerce, were funded to lead their development in 38 areas covering the whole of England. This report gathers examples of support and added value that local authorities have brought to this process, in particular with a view to the joint ERB - strategic authority role in future LSIP ownership envisaged in the English Devolution White Paper.
Integration of Local Enterprise Partnership (LEP) functions
From April 2024, the Government ceased funding of LEPs as local institutions and transferred responsibility for their functions to local government, including combined authorities where they exist. These functions included being the business voice for the LEP functional economic area; Growth Hubs; Careers Hubs; Enterprise Zones and Freeports. This report identifies some examples of integration in practice and the experience to date.
The scope of the research project was limited to the three themes identified above. Wider issues, such as, how local councils could help drive growth through flexibility on financial incentives, for example, through business rate reductions, or more fiscal devolution was not considered as part of this project.
Approach to this study
The work has been informed by four principal inputs:
- An initial literature review to provide a baseline view of policy and research in this area.
- A workshop with a group of local government employment and skills officers to undertake an initial scan of challenges, solutions and achievements.
- Follow up individual interviews with officers to gather more detail on the approaches used, and to develop case studies.
- A workshop with members of the LGA's People and Places and City Regions Boards to review findings and to consider the policy implications.
The local areas involved were selected to provide a balance of geography, devolved and non-devolved area, type of authority and political control.
This report presents:
- A summary of findings about approaches in use.
- Conclusions about the challenges local authorities face in delivering this work.
- A set of recommendations that would assist with wider adoption of the practice described in the report.
- Case studies from eight areas.
Findings
Supporting the skills system
We engaged with a mix of devolved and non-devolved areas. The experience between devolved and non-devolved areas is necessarily different. Devolved areas allocate some funding streams that are delegated to them from the government, for example, the Adult Skills Fund and they have access to other opportunities such as the Trailblazer scheme under the Get Britain Working White Paper to focus on economic inactivity. However, it is important to recognise from the outset that even in combined authority areas devolution only addresses a small part of the whole public sector employment and skills system, which involves a complex provider landscape with private skills providers, and third sector organisations, as well as colleges in competition for funding, tutors and clients.
Our research and the associated case studies highlights several ways in which local and combined authorities are working to provide some integration to the skills system and to link this coherently with local ambitions for employment, health and economic growth. This integration is achieved through their local convening, strategic and delivery roles and the intersection of the three. Some of the features of local approaches are described in the sections below.
Shaping whole system operations
Many local authorities convene local employment and skills boards to bring together local public services, employers and providers to discuss local needs, build consensus about local priorities and to have oversight of local action. Our research highlights the importance of establishing a clear focus for local boards, in collaboration with local partners and stakeholders, and supporting this with structures that can drive action:
- In East Sussex, for example, there is a sub-structure of sector task groups, which reflect the county’s growth priorities. This provides a forum for employers, providers and DWP to address gaps in provision or to address weaknesses in take up. The groups are agile enough to develop approaches in response to government policy or how to use new funding.
- As part of its devolution agreement, the North-East Combined Authority is creating a new Regional Labour Market Board which will bring together local authorities, the voluntary sector, employer representatives, housing associations and DWP to oversee delivery plans on unemployment and skills. The board will also provide a focus for sector-based employer networks to collaborate in developing action plans. This is expected to provide a focus to support the skills needs of key regional investments, such as from the Energi Coast Cluster.
Local and combined authorities also work day-to-day to influence the mainstream operations of the skills sector as a whole, increasingly guided by growth priorities. Examples include:
- West Yorkshire Further Education Compact. This is between the Mayor and the West Yorkshire Consortium of Colleges in the area. Its starting point is the Local Growth Plan and it recognises the role colleges have in meeting the skills needs of the region's high growth sectors and forthcoming large infrastructure investments, notably mass transit and housing retrofit. It contributes to a shared understanding of skills priorities, and the ways of joint working to support that, beyond the contract based Adult Skills Fund relationships.
- Norfolk County Council has worked locally to provide incentives to apprenticeship take up, particularly in growth and priority areas linked to net zero. This involved part funding an Institute of Environmental Management and Assessment course for identified provider champions to encourage the offer of ‘deep green’ apprenticeships which promote learning in technology such as heat pumps that directly relate to sustainability. In Broadland and South Norfolk, UKSPF money has been used to encourage businesses to tilt apprenticeships towards deep green learning.
Developing a local delivery design
One of the challenges with the skills system is to work within a set of often nationally designed funding streams. These change to reflect evolving national policy and this creates a challenge for local authorities in using funding in a way that is responsive to local needs and provides a consistent focus on local or regional priorities. Approaches which have been developed to address this challenge include:
- The West Yorkshire Combined Authority (WYCA) has developed a blueprint with its five constituent authorities for the geographical level at which functions should be delivered. These are associated with a set of design principles for how they would like the system to operate. The six authorities have established a senior officer employment and skills ‘design authority’ that will advise on how to apply these guidelines to the design and implementation of new initiatives. The targets and conditions of national funding streams will constrain some aspects of local action, but the design authority will provide a forum to shape action and use of available resources as far as possible in a way that reflects regional priorities.
- Norfolk County Council convenes district skills assemblies in each of its six districts. These bring together county and district representatives with local employers, the integrated care board and further education providers. They are a forum to review labour market data and provide local interpretation of employment and skills challenges. Support needs are different between market towns and more rural areas and the forums provide a place-based view that is used to tailor project delivery and commissioning in different parts of the county. It also in turn enables an understanding of the key issues in each district, which feeds into the wider growth discussion in Norfolk.
Co-ordinated use of funding streams to build critical mass services with a greater reach
The areas we have spoken to for this research have stressed the importance of understanding the needs of individuals at different points in their journey towards learning or entering the labour market. Needs can be complex, especially when they are associated with disability, wider physical or mental health problems, care burdens or difficulties in maintaining a housing tenancy. One local approach is to set up a critical mass service – often termed a hub – that pieces together support through different funding streams to provide some permanent infrastructure for tailored engagement, continuity and trust. Examples include:
- East Sussex County Council’s Employment Support, Training, Advice and Resources (ESTAR). This focuses on people who are economically inactive, as well as marginalised groups including refugees and migrants, and those at risk of homelessness. ESTAR staff work closely with housing teams at the district and borough levels to identify individuals at risk of homelessness and provide tailored support for them to remain both in employment and in suitable private housing.
- Gloucestershire’s Employment and Skills Hub. This draws on more than 15 separate funding streams and provides a single front door service with a team that looks across employment and skills programmes to find the best support pathway for individuals. This was achieved through mapping the customer journey, identifying and removing duplication and negotiating with partners on where gaps need to be filled. The hub includes the former Local Enterprise Partnership Careers Hub and also has funding directly from the county council and NHS Gloucestershire, the Integrated Care Board. It predominantly targets employment support and skills development services at those who are furthest away from the job market. This includes people with health conditions, disabilities, care leavers and young people who are NEET but is also open to any individual local resident. Outcomes achieved through the hub include 230 people into paid work, 120 people into work experience, 114 people taking up training or education and 94 young people into Supported Internships. 84 per cent of hub customers moving into work remain in work for 52 weeks.
- The North-East Combined Authority (NECA) is using funding from the Get Britain Working Trailblazer initiative to scale a model, the Working Well Employability Hub, across the region. It co-locates services, including local authority officers, DWP, mental health providers, housing associations, and skills providers, under one roof, offering residents holistic, personalised support tailored to their individual needs. Services are located in accessible areas like shopping precincts, ensuring they are visible and easily reachable. There is strong health integration and NECA is introducing triage systems to integrate mental and physical health services into its hub model.
- Birmingham and Solihull's ‘I Can’ programme highlights a coordinated approach to integrating funding and services to support individuals facing complex barriers to employment. The programme aims to simplify and create a clear pathway to entry-level employment in the NHS within the Birmingham and Solihull Integrated Care System (ICS), with a focus on increasing workforce diversity and improving employment in more deprived areas. The programme brings together multiple partners, including the Birmingham and Solihull ICS, NHS Foundation Trusts, University Hospitals Birmingham Learning Hub, Birmingham City and Solihull Borough Councils, and community organisations. By simplifying the application process and providing comprehensive support, 'I Can' has successfully assisted over 220 individuals in securing NHS employment.
A hub approach aims to be inclusive and provides some critical mass to help identify demographic groups which may otherwise fall into gaps between nationally funded programmes.
- Derbyshire County Council created youth hubs in response to young people being disproportionately affected by the impacts of COVID-19. Specifically, Derbyshire identified that 16 or 17-year-old NEETs, lacked formalised access to careers advice. The youth hub provides careers guidance to these young NEETs, while also supporting unemployed 18 to 24-year-olds by signposting them to training and employment opportunities. They use the term ‘honest triage’ for an approach which aims to identify root causes of need, including health, housing or a history of youth offending. By integrating multiple services and prioritising needs, the youth hub model improves employment pathways for young people, while addressing broader social issues.
- The team in Gloucestershire’s hub has also been working to develop the county’s approach to Connect to Work. Having the hub as core infrastructure in the system means that it will be able to offer some support to individuals who are referred but are not eligible for support under that initiative.
The benefit of creating permanent infrastructure in the system is not limited to individuals. Employers, especially small and medium size enterprises need help in understanding how they can benefit from the skills system.
- Southampton and Portsmouth City Councils run the Solent Apprenticeship and Skills Hub. This is designed primarily to support SMEs in accessing the skills system, helping them navigate the complexities of apprenticeships, training, and workforce development. Part of its role is to ‘demystify’ skills provision, filtering training providers, matching job descriptions to standards, and simplifying access to government schemes. The hub provides tailored one-to-one employer support, to help businesses navigate and make the most of available resources. The Hub also operates the Transfer to Transform scheme, a local initiative to co-ordinate apprenticeship levy transfers and make these consistent with local sector priorities. This programme has transferred over £3 million in funds and supported the creation of over 200 apprentice placements, making apprenticeships more accessible for SMEs and removing financial barriers to participation.
Addressing gaps in provision that inhibit growth potential
Local and combined authorities provide overall stewardship of the skills system and emphasise the need to ensure sufficiency of provision. In some cases, this involves addressing gaps in the system. In devolved areas, there is scale to support ambition. Examples include:
- The North-East Combined Authority has used its Investment Zones to provide some match funding, alongside local industry, to enhance FE training facilities. An example is the Newcastle College Energy Academy, where NECA worked with a group of colleges and the Port of Tyne to refurbish buildings and equip them for training in advanced manufacturing and engineering and wind energy. Further projects focus on the motor industry and electric vehicle technology. These initiatives directly support sector and growth priorities.
- Action by the West Yorkshire Combined Authority to address tutor shortages in FE, particularly in priority sectors such as engineering, digital skills, and green energy. This is a national problem but WYCA’s programme offers some regional mitigations through exploring knowledge transfer partnerships between businesses and education providers and use of digital and AI-driven learning tools to supplement technical education.
Using local authority procurement to focus social value on support to the skills system
Increasingly local and combined authorities are directing social value through procurement to link work, skills and growth and to supplement gaps in skills provision. This is particularly important in the context of large infrastructure projects where there is the potential to use social value clauses in procurement exercises to support to local workforce development. This is an approach being developed in West Yorkshire linked to plans for a mass transit system and green retrofitting in housing.
Council based examples include:
- East Sussex County Council’s Social Value Review Group sets out expectations of suppliers in its tendering processes about ways in which they can bring social value. , Skills East Sussex, the local partnership body for employment and skills has developed a set of key strategic priorities which help suppliers develop social value contributions including recruiting local people, supporting careers activities in schools, taking on apprentices or offering training and qualifications to local people. These are included in the county’s measurements in its Economic Social Value Charter.
- Gloucestershire County Council has developed a social value toolkit. From the skills system point of view, there is an emphasis on ensuring that social value outcomes, such as apprenticeship starts, are realised within the county. Part of the approach is also to direct suppliers to work with the employment and skills hub.
Summary findings
The range of approaches described here shows that local and combined authorities consistently take the initiative in finding ways to integrate funding and delivery arrangements in the complex skills system. At the heart of this is linking skills and employment support and making the system accessible for individuals and employers. Priority actions are increasingly shaped by sector growth ambitions and where they exist by Local Growth Plans.
Undertaking this role highlights some consistent challenges:
- There are clear benefits in establishing critical mass infrastructure to engage with individuals and employers. Hubs exist in many forms, but a large permanent effort is needed to chase funding to sustain this delivery infrastructure. This is exacerbated by the time-limited nature of many funding streams.
- Grant conditions for national skills support programmes remain tight and are seen by local authorities as limiting their ability to work with partners to match them to local needs, including growth. The areas we spoke to were working hard to make a success of Connect to Work but reported that it was tightly designed which was a constraint on using it to innovate and meet local needs.
- Devolution in the skills area offers the potential to catalyse ambition. When combined with investment and the soft powers of an elected mayor, there is potential to influence mainstream operations beyond devolved funds and to galvanise action that matches workforce development and growth priorities. However, in devolved areas national funding requirements and short-term allocations still continue to constrain local action.
The LGA has set out consistent recommendations, since the publication of its Work Local Vision Statement in 2022, about the benefits of a single pot of funding for local leaders to join up employment and skills services. Establishing this would reduce the challenges that we have identified to sustaining local action to integrate the skills system and tie it to local growth needs.
Support to Employer Representative Bodies (ERBs) in development and delivery of Local Skills Improvement Plans (LSIPs)
When the Government issued its statutory guidance for LSIPs in 2022, the LGA welcomed the overall concept but argued that LSIPs should be implemented 'as part of a wider, integrated place-based employment and skills approach' (Local Skills Improvement Plans statutory guidance: submission from the LGA). Our engagement with local areas showed there was a varied experience of how the process had worked over the last three years. Where there were concerns, these centred on how to ensure the LSIP add value to existing skills strategies and are rooted in a shared understanding of local growth ambitions, rather than establishing a parallel track of strategy work and employer engagement that has to be joined up to the wider strategy landscape after it has been developed.
It was clear that local teams had worked hard to support the LSIP development process. We identified some common themes to the ways in which local and combined authority teams have added value to the process, which in turn offer indications about how they should be involved in future development of the concept.
Adding reach to ERB business engagement
A consistent message was that local authorities had supported the ERBs with the business engagement that was required to establish the employer view about their skills requirements. Local authorities bring a different reach into the business community through their business-as-usual work, including with small and medium size enterprises (SMEs). This complements the engagement that ERBs have – where ERBs are Chambers of Commerce, their routine prime business relationship is with their members.
- East Sussex County Council facilitated additional business engagement through the task groups of its skills board. It was also able to draw on its existing relationships with employers in the county through its Careers Hub champions, the Growth Hub, and its support to businesses with the Apprenticeship Levy transfer. It also has reach to businesses through 2,000 registrations on its work experience portal.
- In Southampton and Portsmouth, the Solent Apprenticeship and Skills Hub enhanced the ERB’s outreach efforts by bringing in the voice of SMEs. It received some funding from the ERB to undertake direct engagement, targeted email campaigns, and sector-specific employer roundtables to ensure broader business participation and links to strategic priorities. The hub regularly collects data from businesses seeking support with skill development and through day-to-day work, such as its skills needs analysis surveys. This meant it had up to date front line intelligence it could provide into the LSIP development process.
- Although Birmingham City Council, like other councils in the region, currently has a limited role in LSIPs, they are well-placed as a local authority and are starting to collaborate with the ERBs to support several key activities – especially regarding business engagement, priority sector support and strategic alignment. The council maintains strong relationships with businesses, some established through social value agreements and others through bidding processes. Additionally, the council provides extensive business support, a role that has expanded since taking over the Growth Hub. They also administer grants on behalf of other local authorities, such as those in Solihull and Shropshire. Given this, the council is well placed to enhance the ERBs outreach efforts by feeding in the voices of a range of local SMEs.
Connection to labour market analysis and other data
Local authorities have helped to ensure that the LSIPs were informed by labour market analysis and operational data that they use to shape strategic priorities. This has helped to make the process more efficient overall especially if the local authority data was collected as part of business as usual.
- West Yorkshire Combined Authority’s economic evidence manager worked with the ERB to provide labour market data – this helped the ERB to create an approach informed by the evidence that also supports the Mayor’s priorities. This has helped refine the LSIP’s contribution to regional workforce planning and engagement with businesses about their skills needs.
Advice about sector priorities
Local authorities have also provided insight about sector and place priorities to promote consistency between LSIP and economic and place plans.
- In Southampton and Portsmouth, the Solent Apprenticeship and Skills Hub provided advice on linking skills thinking with priority sectors, as had been identified in the former LEP’s area prosperity plan.
- Birmingham City Council has integrated LSIPs into broader growth strategies, as demonstrated by their economy and place strategy in East Birmingham. The council recognises that retrofit funding is set to be devolved but acknowledges the current gaps in supply chain capacity and relevant skills. To address this, they are collaborating with colleges to develop a comprehensive skills package and engaging with the council’s own existing retrofit supply chain which has 15 to 20 SMEs involved across the supply tiers to upskill their workforce in advanced retrofit technologies. Furthermore, the council is working to support SMEs who often lack opportunities to become accredited and bid for contracts with the potential to join the market. To bridge this gap, they are aiming to establish an accreditation scheme offering the opportunity for SMEs to gain the experience required to achieve the qualifications by working on one of the council’s own capital project, enabling SMEs to enter the marketplace. The council also plans to concentrate retrofit delivery through its economy and place strategy, thereby demonstrating the scale of the industry in the heart of deprived neighbourhoods, and working with local colleges to enable retrofit skills training for young people and unemployed people in the same local areas. This initiative illustrates how Birmingham City Council and other local authorities can contribute to LSIPs, integrating them into existing supply chains and linking them to employment and skills initiatives, especially local skills priorities for level 3 and above e.g. HealthTech, MedTech and PropTech.
Experience from London is also relevant here. London is a unique case in terms of the size of population that the LSIP covers but aspects of the development approach offer a model for bringing more local democratic input into the process. The ERB for the London LSIP is Business London and it distributed part of its funding to the four sub-regional economic partnerships, who have each been responsible for producing their own sub-regional LSIP report, feeding into the pan London document. Central London Forward (CLF), is the sub-regional partnerships for the central part of London and one of CLF’s contributions was to provide input on sector priorities and patterns of local need. This helped to highlight that while there are many shared priority sectors and common challenges across London, the emphasis and specific needs of central London boroughs can sometimes differ from those in outer London. This has enabled a more nuanced and locally informed response to skills challenges.
Strengthening governance
Norfolk County Council has worked closely with the ERB, the Norfolk Chamber of Commerce, on business engagement and linking that to develop sector insights. The organisations developed a memorandum of understanding (MoU) for this which formalised the organisations’ respective roles in relation to the LSIP.
Summary findings
While local and combined authorities have contributed to and supported the LSIP process, there is a sense that the process has created one further element in the system that needs to be integrated. The English Devolution White Paper commitment to create a joint role for ERBs and strategic authorities in respect of LSIPs offers an opportunity to create a much better linkage. Changes to guidance will need to recognise the close link that combined authorities are already driving between growth and priorities in the skills system and focus on supporting delivery not reframing strategic positioning.
However, there remains a gap for non-devolved areas. Our research has shown the contribution that local authorities outside of combined authority areas have made to the LSIP development process. They also need a formal role in the LSIP process - without that there will be further risk of development of parallel rather than integrated employment, skill and growth thinking.
Integration of LEP functions
Local and combined authorities have taken a range of approaches to integrating and sustaining functions previously carried out by LEPs. Experience is necessarily mixed, reflecting the range of geographic footprints LEPs covered. Some of the functional economic areas they represented covered several upper tier council areas; others mapped to one county. Most combined authorities already had close operational linkage with their LEPs. We have tried to capture messages about how local and combined authorities have linked the former LEP functions with other local employment, skills and growth services. However, with such a diversity of former LEP geographical footprints, some caution is needed in extrapolating experience from our research sample of eight areas to national scale. It is also the case that for some of the authorities we spoke to, integration is still a work in progress and they did not want to discuss in detail pending further internal reviews.
Finding ways to retain cross boundary functional economic area working where it adds value
Previous pieces of work commissioned by the LGA about LEP integration (Supporting the Integration of Local Enterprise Partnerships and Learning from LEP integration) identified their value in providing an institutional focus to work at a functional economic area level, and the risk of losing this post integration in non-devolved areas. Approaches adopted by local authorities include:
- Norfolk is an area where the former LEP covered a two-county area, with Suffolk. In this case, the councils have taken a pragmatic decision to retain some services on a two county, functional economic area basis. Both the Careers Hub and the Skills Bootcamps continue to operate as combined Norfolk and Suffolk services. This provides economy of scale. For the Careers Hub it also enables advisors to support areas with similar workforce challenges such as the coastal towns of Great Yarmouth and Lowestoft which sit either side of the county boundary.
- In East Sussex, officers recognised a potential gap in terms of regional networking for sharing best practice in relation to skills and employment work. This had previously been facilitated by the LEP. As a response, the officers now co-ordinate their own network – this covers the former South-East LEP (SELEP) area and also includes representatives from other neighbouring areas (West Sussex, Brighton and Hove, Hampshire and Surrey). This is a pragmatic approach – acknowledging the affinities not just within the former SELEP area but with close neighbours and other coastal areas.
Linking former LEP functions to wider local authority services
There is clear potential from linking former LEP Careers Hubs with wider employment and skills support. This can be part of the jigsaw of support and funding streams that is pieced together locally to provide a critical mass service. In the cases of the authorities we spoke to there was not always direct linkage to the 2024 LEP integration. East Sussex County Council historically ran its own Careers Hub, did not use a LEP hosted service and so had already linked this support to its overall skills offer. Gloucestershire Employment and Skills Hub did subsume the former LEP Careers Hub, but did this early, as part of a locally planned initiative in 2022. Other examples, post 2024 integration, show forward thinking authorities making the most of former LEP capabilities and any remaining national funding, and applying it to the local context.
- Norfolk County Council has been able to align the former LEP’s Growth Hub more closely with the work of the economic development team. This has strengthened the business engagement function across the council, through the sharing of practice, joint workshops and a shared events calendar.
- In Birmingham, the former LEP’s emphasis on sector and cluster skills, as well as its place-based knowledge and collaborative efforts, has been maintained within the Enterprise Zone for the BPFS sector. Additionally, some subject experts transitioned within the wider West Midlands policy and innovation leadership ‘ecosphere’, allowing some of the LEP’s expertise and knowledge to be retained. One notable success from this transition was the transfer of the LEP’s Growth Hub to Birmingham City Council. The Growth Hub was integrated with the council’s existing grants team, creating a stronger connection between the council’s services and the needs of SMEs. This integration has enabled better tracking of SME requirements and a clearer understanding of the council’s offerings, facilitating connections that would not have been possible without the transfer. The success of this transition can largely be attributed to its strong local authority focus. Birmingham City Council already had a well-integrated relationship with the LEP from the outset. The council acted as the accountable body for the LEP, while the LEP led on the council’s Enterprise Zone governance and fund management. This close partnership helped ensure that, when the LEP was eventually merged back into the council, along with its reserves, the collaborative working relationships remained agile and adaptable throughout.
- In Birmingham, some aspects of the strategic partnership of the former Greater Birmingham and Solihull LEP board were successfully retained by integrating its individuals, knowledge, and practices into the Enterprise Zone board. A portion of the remaining LEP funding was also preserved, allocated proportionally across the constituent areas of the LEP. A strategic process was then established to determine how best to use these funds to continue pursuing the LEP’s aims as a ‘Future Impact Fund’. Part of the funding was earmarked for forward planning, while the remainder was deployed immediately. To ensure the sustainability and legacy of the LEP’s work, for example, to advance the employment and skills impact within the Enterprise Zone and for the city; a coordinator role was created and funded within the council’s employment service to organise partnership training and employment support for both the construction and then end-use professional and financial services opportunities, maximising the Enterprise Zone’s positive impact on employment and skills access for local residents.
Business boards and advising mayoral combined authorities
The LGA’s previous Learning from LEP integration publication highlighted concerns from local authorities about establishing business boards – how representative would they be of the business voice and would private sector members 'vote with their feet in the absence of mandate and funding?' In West Yorkshire, the business representation role in West Yorkshire transitioned from the Leeds City Region LEP board to a Mayor’s business board. The board’s chair, who represents a regional business, serves also as a dedicated business advisor to the Mayor. This has proved effective in creating a strong business voice to advise the Mayor, which in turn encourages proactive engagement from businesses who can see the line through to influencing policy development.
Summary findings
It is still early in the integration process to highlight benefits that have been fully realised. There is clear potential for the former LEP capabilities to add value to local authority employment, skills and growth work.
It is worth noting that the additional functions local authorities have inherited, particularly the Growth Hubs give them greater exposure to the requirements of business day-to-day. This gives local authorities more insight that they can share with ERBs for future LSIP development.
One challenge is that former LEP teams operated within a non-political organisation. For them, a key strength was operating with marketing brands and a private sector ethos. Integration therefore inevitably involves an important element of culture change. Local authorities need to support former LEP staff and teams in making their work visible internally to assist making the links to the work of policy and delivery teams. This has the potential to yield benefits in terms of deeper engagement with businesses about their skills needs and in influencing them to work alongside employment and skills teams to bring more people close to the labour market and to progress.
Finally, it is important to reflect on funding. Transitional integration funding was provided to local authorities for 2024/25, and has not been renewed for future years. Arrangements for Growth Hub funding beyond 2025/26, including through UKSPF are not known. There are opportunities from integration but they will have to show significant value for local authorities to justify sustaining them.
Conclusion
The context for this piece of work is the government’s mission-based emphasis on growth and the associated changes it is driving in employment and skills policy. This is a dynamic policy area and one where further change is flowing from the late 2024 Get Britain Working (GBW) and English Devolution White Papers. In the context of GBW, responsibility lies with local government to coordinate and develop in partnership with Jobcentre Plus and the local Integrated Care Board.
The case studies developed for this study look at work carried out over the last two years by local and combined authorities in support of the skills system and in tying this to national policy developments, notably the development of LSIPs and integration of former LEP functions.
Even in combined authority areas, devolution only addresses a small part of the whole public sector employment and skills system. This involves a complex provider landscape with private skills providers, and third sector organisations, as well as colleges in competition for funding, tutors and clients.
Our research shows that local and combined authorities are making strong efforts to influence employment and skills support work so that it is consistent with growth ambitions. The case studies illustrate the large ongoing effort needed to join up support and strategy work and to provide accessible permanent infrastructure for employers and users to engage with. This reflects the fragmented and complex nature of overall employment and skills system, which has long been a focus for LGA policy work, particularly through Work Local, and has influenced the building blocks for further devolution.
The insight from the fieldwork for this report points to some recommendations which would help to sustain the effective local practice described here and in turn underpin the linkage between local employment, skills and growth that local authorities and their partners are working so hard to achieve.
Recommendations
Supporting the skills system
For central government
- The LGA has previously called for a ‘duty to co-operate’ concept to encourage partners to work together to improve services. This report has highlighted the work that local and combined authorities undertake to shape the whole skills system, beyond what is devolved. Introducing a duty to co-operate can lift a set of examples of interesting practice into the mainstream with the potential to influence the whole system to support local growth ambitions.
- There are clear benefits in terms of service access and continuity from the establishment of stable local infrastructure – ‘hubs’ - to support individuals into work and training and to support SME employers. Introducing a single local pot that can be used for the design and commissioning of local support services would bring certainty to the future of these mechanisms in places where they have been established and open the door to their roll out elsewhere. It would continue to reduce the need for competitive funding bids and enable a greater focus on evidence and delivery.
For the LGA
- Encourage active sharing of experience among local and combined authorities about the work they are undertaking to influence the design and operations of the employment and skills system locally. This will highlight pragmatic actions that can be taken, and how social value can be used, to shape the system pending further devolution developments.
LSIPs
For central government
- Work with local government partners to set out an expectation of areas where strategic authorities will add value to future LSIP development as joint owners with ERBs, including, but not limited to, business engagement, data and support for sectors that are key to local growth.
- Specify a role for local government in joint ownership of LSIPs in areas where there is not yet a strategic authority. This could potentially be linked to local Get Britain Working Plans which have coverage across England.
For the LGA
- Building on the findings of this report, work with councils to build up a model of how local authorities in areas that do not yet have a strategic authority can co-own the LSIP covering their area. Present this model to the Government to support recommendation.
LEP integration
For central government
- Local authorities have worked hard to maintain the value of former LEP functions and have found some economies of scale by tying these functions to their business engagement and skills work. However, integration has also come with challenges, including the loss of key staff with local knowledge and a reduction in the number and depth of business relationships that LEPs had built up over time. Where LEPs had hundreds of business relationships beyond the Growth Hub, this is no longer the case. Planning future delivery requires more certainty about funding, but also a sustainable model that supports the capacity and relationships needed to deliver effective local growth. LEP transitional core funding has now ended, and UKSPF, which part funds local Growth Hubs, is currently planned to continue only to the end of 2025/26. Continuing to deliver benefit from integrating former LEP functions shows the importance of establishing a clear and sustainable future model for local growth funding and delivery. An 2024 LGA report set out a ten-point plan for the future of local growth funding, which included matching resources and delivery mechanisms to the scale of challenges and opportunities.
For local authorities
- Integration involves an important element of culture change, with a shift of functions from a quasi-public sector context to one of local political control. Deepening integration requires making former LEP activity visible internally to assist staff in making the links between these roles and the work of policy and delivery teams. This also needs to be carefully managed to ensure that relationships are re-set and business connections are maintained and nurtured, particularly in the context of local government reorganisation, devolution, and the creation of strategic authorities.
Case studies
Derbyshire County Council
Derbyshire County Council recognised that in the provision of employment and skills support, certain demographic groups which may have been overlooked by national programmes. For example, Derbyshire County Council created youth hubs in response to young people being disproportionately affected by the impacts of COVID-19. Specifically, Derbyshire identified that 16 or 17-year-old NEETs, lacked formalised access to careers advice. To address some of the problems facing young people, the youth hub provides careers guidance to these young NEETs, while also supporting unemployed 18 to 24-year-olds by signposting them to training and employment opportunities.
Supporting the skills system
East Sussex County Council
Supporting the employment and skills system is an important priority for East Sussex County Council. The council runs an employment and skills function consisting of 30 staff with six sub-teams covering skills development (work experience, apprenticeships, Careers Hubs), targeted employment support, adult learning and multi-agency boards and working groups. East Sussex County Council’s approach to supporting the skills system highlights the role of local authorities in convening stakeholders, both from within the council and externally, to coordinate provision and support across workstreams.
Supporting the skills system
LSIP
LEP integration
Gloucestershire County Council
Spurred by the patterns of need seen following the COVID-19 pandemic, Gloucestershire County Council established an Employment and Skills Hub as a critical mass service. Building on approaches that were already in use, the Employment and Skills Hub from can provide a single front door service to individuals and businesses and which provides a focus for driving integration across the system. This hub approach has been complemented by the Gloucestershire Employment Alliance and a greater integration of social value into the council’s employment and skills approach.
Supporting the skills system
LSIP
Norfolk County Council
Norfolk’s Local Growth Plan and Economic Strategy 2024 to 2029 notes that the county’s economy has great potential with strengths in sectors such as clean energy, agri-food, financial services, advanced manufacturing and engineering and digital technology that will play a major role in growth in the UK. However, it is also has relatively low average wages and a low skills base. This provides a focus for its approach to supporting the skills system. There is a strong emphasis on supporting individuals into employment and upskilling the local workforce. One key focus is helping people to take their first steps back into education and employment, particularly those who lack aspiration or confidence. As employers report the need to recruit from outside the area to fill vacant positions, the challenge is to support workforce development from entry level, and in turn help employers to develop their own staff.
Supporting the skills system
LSIP
LEP integration
Southampton City Council
Southampton City Council, in collaboration with Portsmouth City Council, has taken a proactive role in shaping and supporting the local skills system. In a context of fragmented funding, complex national programmes, and increasing employer and individual need for clear guidance, the councils have developed tailored approaches to simplify access to skills and employment support. Their work spans employer-focused services like the Solent Apprenticeship and Skills Hub, individual support initiatives such as the Young Adults Employment Hub, and strategic engagement with regional planning processes including LSIPs. This coordinated effort reflects a broader ambition to build a responsive, inclusive, and health-conscious employment and skills ecosystem.