A social turn to the local economic growth agenda?


Our local economic approach is working for the few, not the many. A dominant ‘growth at all costs’ agenda is not delivering socially or even working particularly well for local growth. Backed by the treasury, the agenda has worked for some areas, but, overall, growth is anaemic: low wages, insecure work, and inequality.

However, there is change afoot. Inclusive growth appears to be slipping onto the mainstream agenda.

Economic development practitioners have been forced to accept the flawed ‘growth at all costs’ model.  A model which is centred around a narrow agglomeration economics which is over-reliant on trickle down. In this approach, social gain is not an upstream principle, but a mere downstream benefit.  It’s also an economic model that favours existing winners – big city centres – at the expense of the losers – city region peripheries and smaller towns. Practitioners, however, have had to accept this approach, as it was backed by the treasury and a key frame to devolution and growth deals.

‘I hope the converts to social inclusion now grow some backbone, and start to insist that we forge a truly socially just economy’

Now with public service demand and costs and cuts biting deeper, its increasingly acknowledged that weak growth has failed to reduce demand on public services and brought precarious work.  As a result we are experiencing meagre savings to local public services and we have problems nationally via slower reductions in-work tax credits and welfare.

Any change of focus, which seeks to make growth more social is welcome. However, lets not succumb to an idea that this social turn is some evolution and development of a local growth policy which is succeeding and we can now just add on social inclusion.  Worsening social issues and public service demand problems, have prompted this.  The social turn has been prompted by the failings of a narrow ‘growth at all costs’ model.

So the agenda is moving. That is good. However, we cannot merely reduce social justice to ‘in-work progression’.  Wages are important, but not the only issue faced by the poorest. The converts to social inclusion must grow some backbone and insist we forge a truly socially just economy.  We must aim for an inclusive economy.

It will not be enough to just put a social gloss on growth.  That is why we must confront the pre-eminence of agglomeration economics.  We must look less to the US-inspired mainstream urbanism of cities and ‘metro revolutions’ – often beacons of inequality.

We need an alternative which creates new organisational and democratic relations between the economy, people, and civil society.  We need to grow the local economy from within and amplify the effect of that growth.  We need investment approaches that are less driven by hard infrastructure and more by the soft inputs of education, social and human capital.

We must also look at other local economic alternatives, hitherto ignored at national policy level.  And at the rich array of new experiments, that are starved of funds and capacity.  We must accept that cuts stymie the ability of public services to be a virtuous input into successful economies. Social growth is an input to economic growth, not just an outcome.

The local economic growth agenda has discovered social inclusion out of financial necessity.  However, a true progressive social turn needs more than a mild treasury-led policy ‘evolution’. It’s about accelerating some great stuff which is already happening and creating genuine local economic policy that reflects local social need.

The original article can be read on the NewStart website here