Belfast Telegraph

Friday 19 September 2014

Bare statistics don’t tell the whole story

Nigel Dodds chose a setting in the town of his birth to make his first keynote speech as the new Finance Minister.

In his comments at a Londonderry Chamber of Commerce function, he acknowledged that the North West was under-performing economically, and vowed to support efforts to boost the region. His speech was interesting, containing as it did some statistics that showed how far the North West’s economy lags behind the performance of Northern Ireland as a whole.

He also highlighted some of the area’s strengths, ones that should help reduce its economic deficit in the long term. In many ways, he was preaching to the converted and much of what Mr Dodds said was not new. We have heard time and again about high unemployment on one hand, and about how, on the other hand, the North West has a large, high quality labour pool. We have also heard over and over about how it can exploit its position on the border.

And about the influence of growing Asian economies and how we must start doing business on a global, rather than local, scale.

Taken at face value, what Mr Dodds said is correct. Companies such as Fujitsu, Northbrook Technology, Homeloan Management, and Prumerica are examples of large ICT and financial services businesses investing in the North West. And it is probably fair to say that they were attracted by an available workforce. According to the Finance Minister, the North West has an employment rate that is 8% less than the Northern Ireland average, has lower than average wages, and longer dole queues.

Yet he said: “But education and training statistics show the North West in a much more favourable light — 17.3% of persons in this region had no qualifications, whereas the Northern Ireland average was considerably higher at 23.4%. Furthermore, while 23.4% of Northern Ireland citizens achieved NVQ level 4; this region's equivalent rate was again higher at 27.8%.

“So it is clear that this region has underperformed economically and yet there is obviously much potential in terms of skills resources etc to offer.”

Pointing to the financial services companies that have invested in the area, Mr Dodds said he believed their decision “was driven by the strengths that the region has — the size and quality of labour pool; an excellent location for delivering high-quality, cost-effective technology and business solutions; and the strong partnerships with local players, local universities and colleges”.

Again, who could argue? But sometimes statistics can cover up gaping holes in logic, and I’m afraid that’s what the figures produced by Mr Dodds did.

It is difficult to see how 17.3% of people having no qualifications can be regarded as a positive, even if other areas are worse off.

And as for the future, I can’t help but be reminded of the chilling warning sounded by the chairman of Ilex, Sir Roy McNulty earlier this year that the high number of people leaving school with few or no qualifications means that no development plan can achieve its full potential. Without tackling that issue, development plans would be “fatally flawed”, according to Sir Roy. So, if one accepts that point of view — and I think few people here in the North West would disagree with it — it doesn’t take a mathematician to work out that the skills equation outlined by Mr Dodds doesn’t add up.

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