The LGPS local-investment talent gap: who's hiring, and the skill nobody has yet

This month, every fund in the Local Government Pension Scheme has to put a local-investment strategy on the table. It's the quiet end of a loud reform, and it's about to create a hiring problem that almost nobody is staffed for.

What's actually changing

The Government's Fit for the Future reforms have already done the visible work. Since 1 April 2026 the LGPS pools have been the principal investment advisers to their partner funds; Brunel and ACCESS have been wound down and their funds redistributed, so Border to Coast now serves 18 funds, LGPS Central 15 and Local Pensions Partnership Investments nine. Roughly £400bn now sits behind six pools.

The less visible part is local investment. Each fund must set out, in its investment strategy statement, its approach to investing in its own region and a target allocation range; the pools must carry the due diligence and implementation; and every annual report must now disclose the level of local investment and the impact achieved. The deadline for finalising those strategies is September 2026. That is now.

The money is real. Hymans Robertson's survey of funds last November found an average expected allocation of 4.6% of assets, which works out at about £18bn, with a quarter of funds targeting 5–10%. The asset classes are the ones this firm has spent a decade recruiting for: renewables and energy infrastructure, affordable housing, regeneration, natural capital, SME finance and social infrastructure.

The part the reforms don't say out loud

The same survey found that only 35% of funds had a local strategy prepared, more than half lacked confidence there was enough deal flow in their area, and fewer than half felt confident in their own capacity to implement one. Read those three findings together and you get the real picture: the ambition is set, the mechanism is set, and the people are not.

Three groups now need capability they largely don't have.

The pools. Due diligence on a solar park or a housing regeneration scheme in Tees Valley is not the same job as selecting a global equity manager. LGPS Central has said openly that it has brought former consultants and actuaries in-house and hired a local-investment director; London CIV has built a dedicated team with Mercer as a strategic partner. Others are earlier on that road, and all of them are hiring against public-sector pay bands for people the private markets pay a lot more.

The funds. Officers at 80-plus administering authorities are being asked to write, defend and report on a strategy in an asset class most have never run. The reporting requirement in particular, level of investment and impact achieved, lands on very thin teams.

The managers. This is where the near-term demand is sharpest. Every UK infrastructure, renewables, housing and natural-capital manager now wants a share of £18bn, and the pools' due diligence will ask a question most of them cannot yet answer well: show us the impact, measured, attributed and reported in a form a council pension committee can put in its annual report. The managers that can answer it will raise; the ones that can't will spend 2027 explaining why not.

The skill nobody has yet

The scarce person in all of this is not a portfolio manager, an ESG analyst or a sustainability reporting specialist. It is someone who can do impact measurement for place-based investment: define what "local impact" means for a specific fund, choose metrics that survive contact with a pension committee, build the data pipeline from the asset up, and write it into an annual report in a way that stands up to scrutiny from members, councillors and, eventually, the press.

That is a hybrid of three disciplines that rarely sit in one CV. It needs private-markets investment literacy, because the metrics have to attach to real deals and real cashflows. It needs impact-measurement craft of the kind built up in impact managers and the place-based reporting frameworks over the last five years. And it needs enough public-sector fluency to know what a fund officer actually has to defend and to whom.

We have been mapping this talent pool for some time, and it is small. Most of the people who can do it today sit inside a handful of impact-focused managers, the specialist advisory firms that have grown up around place-based investing, and a few of the larger LGPS funds that moved early. They are already being approached. And a second pool is about to appear as the Brunel and ACCESS teams disperse: experienced LGPS people who know how the scheme thinks and are, for the first time in years, available.

What this means if you're hiring

If you run a pool or a fund, the honest advice is to hire for the private-markets and impact-reporting gap before it becomes a governance problem, and to be realistic that the best people will not come for the pay band alone. The pitch that works is the mission and the scale: nowhere else in the UK offers the chance to shape how £18bn of pension capital lands in real places.

If you run a manager courting LGPS money, an impact-measurement lead is now part of your fundraising cost, not a nice-to-have. If a permanent hire is premature, an interim or fractional specialist for the raise is the fastest way to be diligence-ready; it is the model we are seeing the more commercially minded managers adopt.

If you are a candidate with impact-measurement, place-based or LGPS experience, your market just changed. The combination is rare enough that you should be having conversations with more than one side of it.

We'll be tracking this as it unfolds: who hires, who moves, and where the gaps open up. If you want to compare notes on what you're seeing, or need a view on what the market will bear for a specific role, get in touch.

Frequently asked questions

What is local investment in the LGPS? Under Fit for the Future, it means investment local to any of a pool's partner administering authorities or in the funds' own regions, across asset classes such as renewables, infrastructure, affordable housing, regeneration, natural capital and SME finance. Funds set a target range in their investment strategy and report annually on the amount invested and the impact achieved.

How much will the LGPS invest locally? There is no mandated figure, but funds surveyed by Hymans Robertson expected to allocate an average of 4.6% of assets, roughly £18bn, with a quarter targeting 5–10%.

What roles are LGPS pools and funds hiring for? Local-investment directors, private-markets investment professionals, responsible-investment and stewardship specialists, and impact-measurement and reporting leads. Managers seeking LGPS capital are hiring impact-measurement and RI leads to meet pool due diligence.

What is the hardest LGPS-related role to fill? Impact measurement for place-based investment: someone who combines private-markets investment literacy, impact-measurement expertise and public-sector reporting fluency. Very few people have all three.

Who is Farrell Associates? A B Corp certified executive search firm specialising in ESG, sustainability and responsible-investment hiring across the UK, US and Europe, with a long record in impact and sustainable-finance search