How do we level up the UK?
Focus on quality jobs that work for people
This article originally appeared in the New Statesman.
Attracting the inward investment of big capital doesn’t always lead to better outcomes. People need well-paid, good-quality jobs in the communities where they live.
Regardless of your views on levelling up as a political catchphrase, there’s no doubt it hints at a remedy for feelings of place abandonment that have become all too common over the past 30 years as communities across the UK have seen their jobs, identity and hope slowly sucked away.
But from what we’ve heard about the Levelling Up white paper through leaks and rumours in recent weeks, there is plenty of fluff and blue-sky thinking but not a lot of tangible outcomes, particularly when it comes to jobs.
“decent work is arguably what will make the most difference in raising living standards”
Decent work is arguably what will make the most difference in raising living standards, instilling a sense of vibrancy and local pride in so-called left-behind neighbourhoods. Decent work is about the real living wage and about greater security but it’s also about progression, training and good working conditions.
But the world of work is changing rapidly, and so our approach to supporting people to take up employment, particularly our approach to supporting those furthest from the jobs market, needs to adapt too.
Policy to improve employment opportunities in left-behind places have tended to rely on inward investment. The theory goes that if you put enough public investment into improving infrastructure, deregulating planning and promoting the benefits of your place, you can incentivise big capital to invest there. This has been one of the main strategies of economic development for the past 30 years and the truth is that while we have seen more money coming into towns and cities across the UK, very little of it has touched the sides when it comes to the social and economic challenges faced by many, particularly in the so-called “Red Wall” constituencies both parties now regard as their primary battleground.
Boroughs like Oldham and Rochdale in and around Manchester have typified the loss of status that the government claims it wants to address through its white paper. Indeed, it’s striking that cities such as Manchester have seen a dramatic transformation of their urban core during the past ten years, but regardless of the shiny new city centre architecture and rising house prices, the fundamentals of low income, poor health and poverty have remained the same. The advantages of having the regional offices of corporate titans headquartered in central business districts have yet to trickle down to ordinary Mancunians.
Over the past few decades we’ve learnt that it’s possible to get new money into an area. But having secured the investment there’s no guarantee that it will pay out in terms of a better future for the people who live there. The deregulation of planning policy has made the negotiation process even harder, particularly in those areas with the greatest human need.
“inward investment […] ends up doing little for existing residents”
There is a similar dynamic at work in many London boroughs, which have benefitted from large inward investment but found that much of it ends up doing little for existing residents. Instead it pushes them further out of the centre, with many families getting left behind in the scramble for decent homes, minimum-wage jobs in the hospitality and service sectors, and trapped in a cycle of in-work poverty. Levelling up isn’t just about the north – intra-regional inequality is just as glaring as the gaps between the regions themselves.
The government’s other favourite strategy has been to frame the public sector as a roadblock to economic growth. This found expression following the 2008 financial crisis in George Osborne’s austerity agenda, calling for a “breaking open of the state monopoly” based on the assumption that this would release latent private sector demand and result in better services and more local jobs. The real outcome has been a reduction in the quality and quantity of local council services, and in the availability of decent, well-paid, quality jobs.
While successive governments have continued to rely on tired, outdated orthodoxies, the labour market has been transformed, with lower wages, greater insecurity, shorter-term contracts, and bogus self-employment. Jobs that are generally lacking in opportunities for what Michael Gove calls “human flourishing” are now commonplace. This makes the task of squeezing decent jobs out of investment even more challenging, and it further widens the UK’s regional economic gap. Yet the government, through policies such as freeports, continues to demonstrate its continued attachment to the old belief that further deregulation is the answer to promoting levelling up.
“building wealth from within”
If Gove is really interested in human flourishing, then we need a different plan. A plan that starts by building wealth from within, by working with what people, places and businesses already have to set the course for a more inclusive economic future.
In many areas, the economic role of “anchor institutions” – organisations rooted in their own places, such as councils, hospitals, universities and housing associations – can be significant in terms of employment, procurement and commissioning. So how can they use this economic footprint to level up employment and investment? How, for example, can they make their recruitment process open to people not in employment and support them to gain the skills, confidence and experience required to help them progress? This is the type of work being taken forward in Birmingham through a network of seven anchors, which together have a workforce of 50,000 and a turnover of £5bn. During the first wave of the pandemic, they pioneered a programme known as Hospitality to Health, which helped broker new job opportunities in health and social care for people losing work in the city’s many hard-hit hospitality venues.
In Birmingham, anchor organisations are also changing the way the public sector recruits, to open jobs up to more potential applicants. In a world where anyone can set themselves up for hire on platforms like Upwork, the public sector and its partners can play a key role in helping people find their way through new landscapes.
“anchor institutions can have a significant impact”
Through their purchasing power, design choices and in their use of local assets, anchor institutions can also have a significant impact on shaping new markets, helping to build demand, strengthening business supply chains and creating new employment in their local economy.
Levelling up can never be delivered by just a few clever men in Westminster and their blue-sky thinking. It can only be achieved when people at the local level have the opportunity to see the bigger picture, to trust each other and to work together on shared missions to use their economic footprint to support people into decent jobs. What they need to do this is an enabling legislative environment, devolved resources and time.
This is what the Levelling Up white paper needs to focus in on, providing that supportive framework that identifies what’s important in a country as divided by regional inequality as ours. Building a decent, inclusive economic future that belongs to everyone is the only version of levelling up that is worth having.