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Cities, employment and skills: what works? Max Nathan Senior Researcher, Centre for Cities

Cities, employment and skills: what works? Max Nathan Senior Researcher, Centre for Cities 31 October 2005. The Centre for Cities. What? An independent urban research unit based at ippr. Sponsored by Lord Sainsbury

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Cities, employment and skills: what works? Max Nathan Senior Researcher, Centre for Cities

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  1. Cities, employment and skills: what works? Max Nathan Senior Researcher, Centre for Cities 31 October 2005

  2. The Centre for Cities • What? An independent urban research unit based at ippr. Sponsored by Lord Sainsbury • Why? Taking a fresh look at how UK cities function, focusing on economic drivers • When? Launched March 2005 • Where? We’re working in Liverpool, Manchester, Birmingham, Sunderland, Derby, Barnsley, Doncaster and Dundee

  3. What we’re doing • Key projects City People: city centre living (January 2006) City Leadership: financial devolution (February 2006) City Markets: enterprise in deprived areas (April 2006) • Discussion Paper series Creative Class model, Lyons Inquiry, city centre housing markets, enterprise in deprived areas • Seminars and events Working Cities series, UK – Bilbao, Brookings Institute

  4. About this presentation • Cities agenda: cities are important, are doing better Our urban areas are once again the locomotives of economic and social progress in this country. David Miliband, October 2005 • Employment and skills agenda: cities are where the problems are The Core Cities and London need almost 500,000 jobs to bring their employment rates up to the national average. DWP / HMT, 2003

  5. Why cities matter • Economic activity is concentrated in and around cities. Britain’s 20 biggest cities contain around half the population, half the jobs(Moore & Begg, 2004) • Economic, social problems are also concentrated around cities. 40% of concentrated worklessness is in cities and urban areas (SEU, 2004) • Better performing cities will help the UK do better. Big cities, city-regions are the hotspots of regional growth(SURF, 2004)

  6. What’s going on? • Big cities are in recovery mode. Output, employment growth • Some Northern towns are in trouble. Low performance, high deprivation, industrial legacy • Cities tend to under-perform on employment, skills, inactivity: • In Core Cities, more people with lo/no skills, shortfall of graduates • Employment rates are lower than UK average, inactivity higher (Westwood, 2004)

  7. What explains this? • Legacy of long term industrial, occupational changes. 1971-2001, Britain’s 20 biggest cities lost 2.8m manufacturing jobs, gained 1.9m business service jobs and 0.8m public sector jobs (Moore & Begg, 2004) • Increasing returns to skills, especially for graduates. Future polarisation of city economies(Machin & Vignoles, 2001; IER, 2001) • Macro stability and growth. National conditions have helped cities recover

  8. What are the challenges? • Jobs are being created that the workless can’t easily fill.Cities face worklessness and overly tight labour markets • Drivers of economic growth may change: • Big rise in public sector employment now starting to slow • What if the macro economy starts to turn down? • Three big challenges for cities: • Improve low and intermediate skills, attract and retain graduates • Reduce inactivity, connect people to the labour market • Long term, build and diversify cities’ economic base

  9. What works? • Strategy:two key points: • Cross-Whitehall consensus on importance of cities, city-regions. • Better understanding of the future sources of growth in cities. • Players: simplify overlapping roles, geographies of JobCentre Plus, LSCs, local authorities • Scale: less emphasis on the neighbourhood level, more focus on the city-region system • Powers: we should aim to move control of budgets, delivery to emergent city-regions

  10. What works? (2) • Strategy:better national co-ordination, thro Departmental floor targets • Players:Strong case for GLA to get strategic control of employment and skills. Outrunner for other city-regions • Scale:need to focus on fiscal incentives to encourage cross-boundary working within city-regions • Powers:emerging ideas from City Leadership work: • Metro contracts to align economic development in city-regions • Stronger LAA 4th block for smaller cities, large towns

  11. www.ippr.org/centreforcities m.nathan@ippr.org

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