This guest Q&A with Robert Hamilton is part of WSP’s energy economies campaign.
What challenges is the North East facing following the COVID-19 crisis?
The transition to low carbon is already supporting the economic recovery. But skills are usually cited as central to the extent which areas recover, and in the North East we have traditionally lagged behind the national average in terms of skills outcomes. Closing this gap is going to be important – particularly for the next cohorts of people leaving full-time education.
Also important – but harder to support – is the upskilling and reskilling of people who are already in the workforce. Relatively unusually for us here in the North East, we currently have skills shortages in a number of critical sectors; in the past, we were more likely to have an excess of unemployment than skills shortages. The North of Tyne Combined Authority is working with businesses to help address these challenges, with new programmes focussed on addressing businesses’ immediate needs.
Does that make it difficult to seize the opportunities of the energy transition?
We need to connect people to opportunities. That means retraining, and it means helping people to emerge from the education system with the right skills.
Skills shortages are our most pressing challenge. How are we going to secure the opportunities associated with batteries and offshore wind in particular? Those opportunities will not last forever, so we only have a window of time. It isn’t a complete first-mover advantage for the region, but it’s a real opportunity.
And there are also different types of green jobs, which is one of the challenges. In areas such as building components for offshore wind turbines – like foundations – this includes old-fashioned skills like welding technologies that are very similar to those that would have preceded them in shipbuilding or oil and gas. But these need to be merged with digital and technological skills.
So sometimes it's about using existing technologies and skills and adapting them to new opportunities. In other cases, there are going to be new skills and new requirements.
But it’s always about connecting people to those opportunities and making sure they have chances to progress into jobs.
Speaking of existing skills, what about opportunities in the oil and gas sector?
For oil and gas, there is quite a protracted period where some of the existing areas of expertise or capabilities are still going to be important – because of the need for energy security, the scale of the existing employment and because we have an existing energy cluster that is critical to the UK’s transition to low carbon energy. Many of those businesses are already going through the process of transitioning and working out what their future is going to be in a world that will be lower carbon.
Let’s talk about those opportunities. Which projects do you think represent the best opportunity for levelling up and contributing to net zero goals in the North East?
We definitely see the energy transition as providing a step-change opportunity. What can we do in the North East to become the centre not just of manufacturing but also of technology and innovation?
Battery technology is coming almost out of nowhere to be one of our most significant economic plays. But it's not a complete accident that we're the location of choice for two gigafactories, one is next to and in collaboration with Nissan, one of the biggest car plants in Europe, and Britishvolt’s location is in strategic proximity to the high voltage interconnector with Norway. So these new projects are also a result of old-fashioned economic geography: proximity to infrastructure or clustering of supply chains.
How will projects like this have an impact on productivity and the workforce over the next five years?
It’s already having an impact, and the opportunity is immense.
Battery manufacture in particular will generate large numbers of jobs. It will create highly productive and well-paid opportunities, and there is also a chance to close some of the employment gaps. Britishvolt is having an impact already, because its facility is due to be up and running by 2025 at the latest. That represents 4,000 jobs in south-east Northumberland, which has traditionally been a pretty deprived part of the region. That area has not had particularly good transport connectivity, so local residents have not had the opportunity to benefit from the success of Newcastle’s city-centre economy.
Offshore wind more complex. The North of the North East doesn't have huge available spaces with quayside access that could be used to assemble big bits of kit. Instead, we have a highly skilled workforce and existing sites, businesses, technologies, R&D and university assets. So our challenge is to present a higher value-added offer. We can position ourselves around some of the more technologically complex products and not necessarily all the biggest, bulkiest parts of wind turbines.
It's also necessary to generate and secure funding. The public sector can help create opportunities but securing private money and commercially investable propositions is central to delivery.
Find out more about North of Tyne Combined Authority at: www.northoftyne-ca.gov.uk
Want to find out more about delivering local economic growth as part of the energy transition, visit: www.wsp.com/energyeconomiesuk
