We know that economic growth passes many people and places by. Even in more successful urban economies there is no guarantee that all citizens will benefit from growth in their local economy, and growth may not reach all parts of a city. The persistence of poverty for households trapped in a low pay, no pay cycle and the persistence of acute deprivation in the same old neighbourhoods highlights the stark limitations of trickle-down economics. A rising tide will not lift all boats.
We know that job creation is the critical factor in linking growth and poverty reduction, and the quality of the jobs created matters, as well as the quantity. The face of poverty in the UK is changing, and families in which at least one adult works have become the largest group in poverty. In 2011/12 more than half of the 13 million people in poverty in the UK were in a working family. Britain has a larger proportion of low-paid, low-skilled jobs than most developed countries.
The situation is likely to worsen as the UK labour market ‘hollows out’ and the number of mid-level jobs decline, meaning progression opportunities will be increasingly limited for the growing bottom end of the labour market. Tax and benefit policy changes alone will not reduce poverty unless the bottom end of the labour market is addressed.
Cities are becoming increasingly important for economic growth and they also have high levels of poverty. The city growth agenda is spawning a new institutional framework around city regions, local enterprise partnerships and combined authorities and new central/local relationships negotiated through city deals and the single growth fund. This agenda has been squarely focused on growth. Issues around the distribution of growth, and who might benefit from the proceeds of growth have been marginalised.
We want to broaden the current growth discourse. Poverty should not be viewed merely as a drag on growth, an unfortunate outcome from growth or relevant only to public service reform. Poverty reduction is a key driver of growth. It is integral to creating a sustainable urban economy. Growth and poverty is a single agenda with a single set of objectives focused around raising skills levels, raising levels of employment, raising pay levels and increasing productivity. Local economic strategies need to cover local economies as a whole, not just high growth, innovative sectors.
Albeit within a highly centralised fiscal and regulatory framework here in the UK, we want to identify what can be done at city or city region level to deliver more and better jobs and to connect these jobs to households in poverty.
Our More Jobs Better Jobs partnership
The More Jobs, Better Jobs partnership provides an exciting opportunity for us to explore these issues in practice and in depth. We are going to be working together over the next four years to gain a better understanding of how these issues play out at a local level, and to identify and support adoption of new policy and practice.
The partnership is in its early stages and we have identified four cross-cutting themes to help unpack some of the issues and guide our activity:
The defining feature of our partnership is that we are approaching growth and poverty as a single agenda. This is complicated as it requires thinking well beyond the confines of traditional approaches to economic development. Households in poverty accessing jobs, sustaining jobs and progressing in jobs is multi-dimensional and cuts across economic development, skills, welfare and other areas such as childcare, housing and transport.
Alongside our work focussing on Leeds City Region we are also developing a wider evidence base of comparative international and UK wide research. We are hoping this wider body of work can be cross fertilised into our partnership with Leeds City Region and critically that our work with the City Region can be translated to other cities.