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 Paper presented at ESRC seminar Neighbourhood effects, neighbourhood based problems and international policy solutions’, 7-8 th December, 2011, Department of Urban Studies, University of Glasgow

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 ( ) assess impacts and findings of policy evaluations CEEDR research work for JRF, ODPM/CLG

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

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

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

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

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

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

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

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)

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)

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 % ( ) 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

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)

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

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)

impact of policy interventions (1) 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)

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.)

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

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

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

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 Paper presented at ESRC seminar Neighbourhood effects, neighbourhood based problems and international policy solutions’, 7-8 th December, 2011, Department of Urban Studies, University of Glasgow