Spatially concentrated worklessness and neighbourhood policies: experiences from New Labour in the UK

1. CEEDR Spatially concentrated worklessness and neighbourhood policies: experiences from New Labour in the UK Stephen Syrett and David North Centre for Enterprise and Economic Development Research (CEEDR), Middlesex University s.syrett@mdx.ac.uk Paper presented at ESRC seminar Neighbourhood effects, neighbourhood based problems and international policy solutions’, 7-8th December, 2011, Department of Urban Studies, University of Glasgow

2. context • persistence and worsening of worklessness concentrated in particular neighbourhoods • policy challenge of tackling this problem • interrelations with other dimensions of deprivation • need to address issue across spatial scales • series of policy initiatives under New Labour (1997-2010) • assess impacts and findings of policy evaluations • CEEDR research work for JRF, ODPM/CLG

3. structure • causes of concentrated worklessness in deprived neighbourhoods • differences between neighbourhoods • policy responses • neighbourhood based worklessness policies • sub-regional approaches • impact of policy interventions • lessons for policy development

4. causes of concentrated worklessness (1) • economic restructuring and labour market polarisation • deindustrialisation: worklessness entrenched in certain groups and regions • job growth: new jobs in edge of town/ out of town locations but weak migration & commuting flows • enduring spatial inequalities: inner cities, outer suburbs, one-industry towns etc. • polarisation: growth of insecure low pay employment, unattractive jobs

5. causes of concentrated worklessness (2) • ‘vicious circles’ (re)producing concentrated worklessness • mutually reinforcing multiple dimensions of deprivation • social forces reproducing concentrated worklessness: individual/household (education, health, family fragmentation, lack of experience/contact with work) • key processes • lack of equilibrating processes (migration, commuting) • housing market: residential sorting • ‘scarring effect’ from past unemployment • labour market externalities: ‘neighbourhood effects

7. Causal Links in the Reproduction of Concentrated Unemployment Lower Occupational Attainment Shorter Employment Spells Poorer Local Information Networks Limiting Illness Local Unemployment Single Job Seekers Educational Under-Achievement Family Fragmentation

8. neighbourhood effects and worklessness • minimal additional impact but compound problems of labour market exclusion • socialisation processes: ‘cultures of worklessness’ • perception, attitudes, aspirations (peer pressure; lack of role models, low self-esteem; limited work experience) • social capital: contacts & networks • job search; job information • stigmatisation and discrimination • ‘postcode discrimination’ • ‘place-based’: physical isolation & poor public transport

9. differences between ‘deprived neighbourhoods’ (1) • people-based • population characteristics (e.g. ethnic diversity, age) • population change and turnover • place-based • housing • relation to city centres/transport networks • wider local/regional economy

10. differences between ‘deprived neighbourhoods’ (2) • employment-deprived neighbourhoods in England (Lupton et al, 2011) • highly deprived social housing neighbourhoods • older workers in declining areas • high churn neighbourhoods with younger workers • ethnically mixed neighbourhoods in stronger labour markets • Inner London • regional variation in types • need for different policy mixes and delivery mechanisms sensitive to these differences

11. New Labour policy responses to tackling concentrated worklessness (1) • New Labour: aim to raise employment rate to 80% • work as the ‘best route out of poverty’ • ‘tight’ national labour market (to 2007) • ‘lack of competitiveness’ (personal/household characteristics) • ’supply side programmes (job readiness, training) • institutional barriers • changes towards ‘conditional’ benefits system; affordable childcare • multiple causes & interplay of factors • mainstream policies complemented by area based initiatives (ABIs)

12. New Labour policy responses to tackling concentrated worklessness (2) • succession of ABIs (e.g. Action Team for Jobs; Working Neighbourhoods Pilot’) • neighbourhood policies: worklessness’ addressed as part of ‘integrated strategy’ • New Deal for Communities (1998) • National Strategy for Neighbourhood Renewal (2001)

13. New Deal for Communities • 11% of NDC spending on worklessness (strategy development & working with local partners) • supply-side interventions (job brokerage, advice, guidance, skill development etc.) • worklessness rate within NDC areas fell from 22% to 18 % (1999-2008) • relative to ‘comparator’ deprived areas decrease in NDC areas was very marginally less • positive evaluations from local actors & beneficiaries & evidence for individuals of participation increasing likelihood of transition into employment • wider aggregate change versus individual level change

14. National Strategy for Neighbourhood Renewal (1) • local authority led worklessness programmes targeted at hard to reach clients (mainly advice, guidance, support) • at neighbourhood level: 10% most deprived LSOAs showed some improvement in relation to national average (but still seven times higher) • when most deprived areas compared to their district average – gap widened slightly • as economic growth slowed from 2006: negative impact • ‘variable rates of improvement and limited impact’ (CLG, 2010)

15. National Strategy for Neighbourhood Renewal (2) • ‘marginal positive impact on employment outcomes when integrated with wider worklessness strategies’ • positive impact • favourable national economic conditions • significant levels of focused long term investment • limited impact • embedded cultural factors • reduction in available job opportunities & access to decent work • population churn • organisational barriers

16. workless neighbourhoods in local/sub-regional contexts • neighbourhood policy refocused upon jobs & enterprise (from 2005) • integrate activity across spatial levels and greater freedom for local/sub-regional action • City Strategy Initiative (2007) – integrate employment, training & health provision targeting disadvantaged groups & neighbourhoods • variable degree of spatial targeting - impact difficult to assess • variation between strategies • dramatic changes in labour market conditions (recession and policies)

17. impact of policy interventions (1) • 1997-2007 success in getting more people into work but no significant diminution in gap in levels of worklessness between the most deprived neighbourhoods and rest • recession exacerbating this situation • intensive neighbourhood level interventions do not have a major impact upon reducing worklessness • importance of understanding linkages of neighbourhoods to local/regional labour and housing markets (e.g. mobility)

18. impact of policy interventions (2) • neighbourhood not best level to respond to wider changes in labour markets - bodies operating at wider spatial scales better placed to devise strategy • demand side conditions • largely ignored despite evidence of insufficient jobs in areas of high levels of worklessness • growth of low paid service jobs frequently not sufficiently attractive (pay, hours etc.)

19. impact of policy interventions (3) • evidence of relative effectiveness of place targeted initiatives aimed at those ‘most distant’ from the labour market • effective in filling gaps of mainstream provision – localised, flexible schemes • ‘what works’ - time consuming & resource intensive • outreach • voluntary initiatives and trusted delivery organisations • accessible community based services • personalised & holistic support • trusted and motivated advisors • long term support through process • active employer engagement

20. conclusions (1) • neighbourhood policies poorly positioned to address labour supply-demand issues but key role in tailoring initiatives to local circumstances • supply-side; neighbourhood effects; local institutional barriers • scale of the problem • deep seated processes of structural adjustment, major recession and rising levels of inequality • low levels of neighbourhood spending • need to integrate neighbourhood actions into wider economic strategies but barriers • complex policy & governance environment • lack of sub-national power & resources

21. conclusions (2) • crucial role of central state • labour market regulation at ‘bottom end of labour market’ • welfare provision • skills & education policy • institutional factors: childcare, transport, housing • failure to tackle concentrated worklessness in period of strong employment growth versus economic downturn • public sector funding cuts will effect weakest local economies most • Localism; danger of leaving deprived neighbourhoods isolated when need to be integrated into local/city economy

22. CEEDR Spatially concentrated worklessness and neighbourhood policies: experiences from New Labour in the UK Stephen Syrett and David North Centre for Enterprise and Economic Development Research (CEEDR), Middlesex University s.syrett@mdx.ac.uk Paper presented at ESRC seminar Neighbourhood effects, neighbourhood based problems and international policy solutions’, 7-8th December, 2011, Department of Urban Studies, University of Glasgow