Two years on from the UK government’s promise to level up, this year’s State of the North report by IPPR North exposes the gap between levelling up rhetoric and reality. I highlight how the report states businesses can help.
Despite being an important agenda with the potential to address the UK’s longstanding regional divides (the UK is one of the most regionally unequal countries in the ‘developed’ world), a clear definition of the term ‘levelling up’ and the policies it will involve are still yet to be announced.
The report revealed that levelling up is currently far too centralised and underfunded, with just £0.5 billion of the Levelling Up Fund having been allocated to the North, which represents and investment of just £32 per Northern resident. This funding is just not good enough, considering that there has been a £413 per person fall in annual council service spending from 2009/10 to 2019/20. In fact, the North East has had the largest change in total revenue service expenditure from 2009/10 to 2019/20 at -24%, which is twice the South East’s -12%.
The authors also state that the economic, environmental and education challenges that face the North are longstanding and cannot be fixed by the small-scale interventions that the government has promised so far. Stating that the interventions need to be more ambitious, they outline three missions that would truly help the North thrive:
- building a new economy that promotes widespread prosperity
- making the North the engine of the net zero transition
- providing everyone with access to high-quality, life-long education.
Jobs
The North remains behind England overall across different employment metrics, including economic activity, employment rates, and unemployment rates. For every job created in the North, just under three were created in London and the ‘Greater South East’. There is also an issue of poor job quality, with an estimated 21.5% (13 million) jobs in the North being paid less than the real living wage and in-work poverty is rising.
The report states that good work and decent jobs will be crucial to levelling up the North. You can read the Chamber’s own Good Work Toolkit here.
Good work includes:
- a voice for workers, such as through trade unions and recognition agreements
- fair and decent pay, of at least the real living wage
- regular, dependable hours
- fair treatment and respect
- healthy workplaces
- opportunities for learning and progression.
High-quality job creation and the improvement of existing work across the region will require significant structural change in the North’s economy to build a more prosperous, fairer region and close the productivity gap.
The report states that businesses should recognise their own role in contribution to this economic mission as the principal providers of jobs and economic activity. You are encouraged to harness your links to local places and instigate meaningful collaborations with communities, councils and combines authorities with an aim to identify how you can better contribute to improving local living standards.
Net Zero
The report states that it will be a challenge for the North to reduce its carbon emissions and build a more sustainable future. CO2 emissions are considerably higher in the North when compared to other parts of the UK. While this is partly due to significant concentration of carbon-intensive industry in the region, There has also been a repeated underinvestment in initiatives to increase the energy efficiency of homes or provide credible public transport options.
Early signs suggest that the UK government’s flagship policies for reaching net zero remain unbalanced – both in terms of their prioritisation of certain sectors over others and in their focus on certain places. Existing industries that employ tens of thousands of people in the North, such as the steel industry, risk being left behind as part of the net zero transition.
The authors suggest that a fair allocation of funding and an inclusive system of devolution that allows local leaders to better shape future green industrial policies would be a much better approach which could enable all places in the North to share in the opportunities that net zero presents.
The report also emphasises that there is significant economic opportunity to be gained from developing the North’s green economy. While home to many of the UK’s most carbon-intensive industries, the North also has the potential to lead the net zero transition. Much of the northern coast such as the North Sea and Irish Sea are already being harnessed to cultivate renewable energy, with three out of the five biggest offshore wind farms are currently located in the North. As of 2020, the North is said to account for 51% of England’s total renewable energy generation, and over one-third of the UK total.
Despite its potential, however, there remains a real risk that the North will not benefit fairly from the transition to net zero. Without further powers and resources, the North’s mayors will be unable to implement the radical solutions needed to reduce emissions from people’s homes and develop a sustainable transport system. Without these, the North is starting from a position of and will have to tackle the climate crisis on uneven footing.
The report states that business must play its role by investing alongside government in the North’s net zero transition and ensuring that any future opportunities created by the net zero transition support local economic growth and prosperity
Education and Skills
Education results in economic, social and health benefits and therefore should be at the centre of any attempts to level up, states the report.
There continues to be a large attainment gap between the North and the rest of England at every level of assessment, from Early Years, through to GCSE level, and beyond (it is perhaps notable, however, that the North East fares above average in Early Years attainment). The authors state that closing this gap and providing people with the skills they need to access productive, high-skilled jobs will be crucial if we are to address widening economic divides in the future.
Children across the North have also been disadvantaged when it comes to attending school during the pandemic and when it comes to partaking in extra-curricular activities. Austerity measures have resulted in the closure of many facilities such as youth centres, libraries and leisure centres where extra-curricular provision
may be provided.
The report states that it is essential that employers develop strong relationships with skills providers. Employers should also be supported in strategically developing their businesses and workforce in order to create realistic progression routes that benefit both the organisaton and the workforce.
Overall, the authors state that they remain optimistic about levelling up, despite underwhelming government policy so far. They state that the North’s institutions are already doing the things needed to level up. We simply need to further empower those institutions and make sure no community is left behind, which will require devolution and a collaborative approach across all levels.
Freya Thompson
Knowledge and Research Executive
Photo by Loujane Alasi on Unsplash