Business

The town with soaring wages and shrinking unemployment

The street market in Market Street, Tamworth
Image caption George Street in Tamworth

Where in the UK has unemployment fallen most - and where have average wages shot up by 16%?

It is the town of Tamworth, just a few miles north-east of Birmingham.

A combination of luck and good judgement means unemployment has fallen faster here than anywhere else in England, Scotland or Wales.

Between early 2012 and last September, the town's headline rate of unemployment more than halved, from 9.9% to 4.7%.

The number of people telling the Office for National Statistics (ONS) that they were out of work and looking for a job fell from 3,400 to 1,800 in just two and a half years.

The revival of employment in Tamworth seems to have had a dramatic effect on local wage rates.

According to the Annual Survey of Hours and Earnings (ASHE), the average earnings of people working full-time in the town rose by a whopping 16% last year to £28,000.

What has been going on?

'A marvellous drop'

Image caption Henry Murray at the Tamworth Jobcentre Plus

If you think the fall in the headline rate of unemployment is impressive, then talk to Henry Murray.

He is a manager at the town's Jobcentre Plus.

The fall in the more old fashioned measure of unemployment, the claimant count, has been even more spectacular than the headline rate.

In 2010 there were just under 2,500 people in Tamworth claiming job seeker's allowance. That is now down to 285, giving a claimant count unemployment rate of just 0.6%.

"It is a marvellous drop, and we have every similar reduction figures for nearby places such as Burton-upon-Trent, Lichfield and the South Derbyshire area," Henry says.

He reckons the vast majority of people who have left the claimant count have gone into jobs.

"We do have more jobs available in the travel-to-work area than the 4,000 people or so who are in receipt of out-of-work benefits, including those on income support and employment and support allowance."

Bidding war for staff

Image caption Barry Proffitt of BNJ Consultants

A lot of large companies, particularly logistics and delivery firms such as Ocado, TNT and UPS, have moved to the area in recent years, taking on a lot of the unemployed.

A key attraction for those firms has been the huge Birch Coppice business park, established a few miles outside the town on the site of a former coal mine.

At his recruitment business in Tamworth, BNJ Consultants, Barry Proffitt says the effect has been simple - pay rates are being driven up.

"People are moving from one company to another company, so we are starting to see a bit of a bidding war going on among employers," says Barry.

"Fork-lift operators have traditionally been paid £7 to £7.50 an hour but now we are starting to see that move to £8, £8.50 and beyond."

The legal requirement for lorry and bus drivers to have a CPC certificate of professional competence, introduced in 2009, has driven some older drivers out of the industry, he says.

Now demand for their skills has revived, HGV drivers have seen their local wage rates go up by £2, £3 and even £4 an hour.

"For straightforward day work, you could get £10 to £11 a hour, with shift work you could add £2 to £3 an hour on top of that," says Barry.

"They have seen massive increases; companies are fighting for staff, all the hauliers around here are recruiting staff, there is just a massive shortfall."

Cash buyers for homes

Image caption Claire Wax, manager of the Tamworth branch of Green & Co

The centre of Tamworth offers an odd sight.

There is a cluster of 15 different estate agency branches on two streets, all within about 100 yards of each other.

Sales and prices in the town have picked up in the past couple of years along with the rest of the country.

And at the Green & Co agency, the manager Claire Wax has noticed some interesting trends.

"A lot of people are buying properties to supplement their retirement, as a pension when they retire, so about 5% to 10% of all sales are buy-to-let," she says.

"In the Tamworth area property is still relatively affordable compared to neighbouring towns like Sutton Coldfield and Lichfield, so you can easily buy a 3-bed semi-detached house for £80,000 to £100,000 which will rent out for £650 or £700 a month."

"There are also lot of cash buyers, of all our sales in December about 90% were cash buyers - we were amazed."

The lucky town?

Image caption The Reliant Robin was made at the company's Tamworth factory until it closed in 2001

The days have long gone when Tamworth's employment scene was mainly about local jobs for local people, in big factories such as that of the car maker Reliant, and coal mines.

The town is part of the wider West Midlands economy and many people commute in and out of the area, particularly to and from Birmingham, and even further afield.

Two early morning fast train services to London are very popular, taking just over an hour to get to Euston.

One of the council leaders, Steve Claymore, says Tamworth's location has proved crucial to its recent revival.

"A lot of things have gelled in the past few years, with the work of our business development officers. And our geography is exceptionally good; we couldn't be better placed for the motorway network."

But is the local improvement in employment and wages tangible?

"Three or four years ago I got many many calls from people who were having financial problems, and as the years have progressed I rarely get that," Steve replies.

"I haven't had a call in probably two and half years - the fall in unemployment is quite visible."

'Business is strong'

Image caption Mark Stokes with some of the products of Stormking Plastics

Stormking Plastics has been in business locally for 30 years, making things like dormer windows, dormer canopies and door canopies, all in fibre glass, for the house building industry.

A few years ago, when the credit crunch led to a huge decline in house building, the firm had to make dozens of staff redundant, many of whom were very long-serving.

The firm's founders called it heartbreaking, but in the past 18 months the company has been expanding again as the housing industry has revived, and it has been taking on more staff.

"There has been a significant increase in turnover, business is good, business is very strong," says the recently appointed managing director Mark Stokes.

But he told me of a recent surprise.

"Just today we were expecting a candidate to turn up for a job as a clerk, and lo and behold they haven't turned up."

Mark's conclusion?

"I think it is a challenge to recruit good quality personnel who are reliable. We are always looking for skilled people and we can't find them readily."

Still tough for the young?

Image caption Rob Boucherat in the engineering training centre at South Staffs College

Conventional apprenticeships are very much in vogue, especially at the local technical college South Staffordshire College.

Of the 2,700 or so students at its Tamworth campus about 900 are apprentices, sent in increasing numbers by local employers from a range of industries.

"We have seen 25% more apprentices being sent here," says Rob Boucherat, the deputy principal.

"So apprenticeships are getting much more currency among young people."

Things are looking up. A few months ago the college staged a jobs fair which attracted more than 25 employers looking to recruit new, freshly trained staff.

"There is an increasing demand in the Staffordshire area from manufacturing," says Rob.

"There are clearly more job opportunities around for young people, but it's still quite competitive, they are not just walking into jobs, the signs are encouraging but it is still tough."

Related Internet links

The BBC is not responsible for the content of external Internet sites