The surf and sand that surround the South-west of England make Malcolm Gillespie a man with a problem.

But it is a problem that makes the regional director for the Learning and Skills Council the envy of his counterparts in the eight other areas.

While the other LSC regions all suffer a skills shortage, the South-west has a surfeit of highly skilled people with degree-level qualifications and above. Why so? Because its beaches, moors, fishing villages and cathedral cities make the area an attractive place for people to live and work.

The region has the highest proportion of people with degrees and higher degrees, those with level 4 and 5 attainment. People who reach these levels are loath to leave because of the lifestyle.

Population growth is largely driven by inward migration from people seeking a better way of life. These incomers have driven house prices above the national average.

Mr Gillespie explained: “People come to the South-west because it is lovely place to live. They don’t have great ambitions to be big employers but are happy to start a small business to fund their boating or surfing.

“Only a couple of the country’s top 100 businesses have their headquarters in the South-west. That has its effect in that we have high numbers of graduates, but they are not doing graduate-level jobs.”

His solution is to attract more large companies to the region, to turn the South-west into the UK equivalent of the USA’s flourishing “sun belt”.

In America, the major players in the high-technology sector fled the old industrial cities of the “rust belt” to southern California where employees enjoy a better climate and lifestyle.

“We need to set our sights on attracting more of the corporate big hitters into the region because there isn’t the skills shortage, but a surplus,” he added. “It is the only region with that problem, but it is a problem.

“It is on the agenda for the South-west to attract more big companies and more value-added business that will drive the economy forward.

“All the main cities have fantastic access to lovely countryside and coastline, so quality of life issues are a real potential draw. More employers should move to the UK’s sun belt.”

He is aware that attracting big companies to the region, which includes Cornwall, Devon, Dorset, Somerset, Wiltshire and Gloucestershire, will inevitably give rise to “nimby” issues.

Even so, he feels there are enough brownfield sites available for new firms to move into to appease the locals who resent development in their backyard.

He points to regeneration programmes already under way in, for example, inner-city Bristol and in Gloucester docks. Central to the Gloucester docks development will be a pound;20 million rebuild of Gloucester College of Arts and Technology.

Mr Gillespie added: “Gloucester is a city with more problems than people would expect. It has been very dependent on manufacturing, unlike most cathedral cities that are doing okay. It has always been a manufacturing city and was a docks city. We are hoping to completely rebuild the college in a docks regeneration site. Gloucester needs it. The college site is very tired.

“The rebuild is going to be the anchor of the development of the docks. We are hoping to open that in September 2006. Building is due to start soon.”

The high numbers of high-achievers do, though, mask a shortage of people with level 2 and level 3 skills. That means there is a shortage of middle-managers as well as a shortage of plumbers.

He said: “Public-sector employers say they cannot get enough design engineers and planning professionals. There is a lack of ambition among employers and employees.

“Employers need to aim higher and raise aspirations, and to drive up the value-added chain so that aspirations for employees become higher.”

Mr Gillespie cites the Eden Project in Cornwall as one example of how a development can help to transform the local economy.

“The Eden Project has been a success in an area of Cornwall blighted by industrial change,” he said. “It has had a significant impact on hotel development around it and other attractions to pick up on the people drawn into the area.

“Policy-makers see the South- west as a region that is doing okay - in many ways it is, but there a quite a lot of challenging issues hidden in all that. They range from inner-city Bristol where there is poor academic achievement at 16, though it picks up at post-16. In remote parts of Cornwall there is severe rural deprivation. There is a big basic-skills issue that is harder to tackle because it is rural. In the rural economy, low aspiration and low attainment are rife.”