interpretation of lmi by promotional agencies; their need to maintain business confidence alan...
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Interpretation of LMI by promotional agencies;their need to maintain business confidence
Alan Townsend Durham University
(also previously DTI, Manchester & Glasgow; Wear Valley District Councillor; Planning consultancy for Teesside)
Enterprise Zones as example
24 announced across England, 2012Target of jobs for 2015 54,000Achieved, December 2013 4,649Achieved, December, 2014 15,500 Achieved, August, 2015 19,000
In 540 businesses with £2.2bn. investment, including £450mn. from government New round being decided, funded 2015-2020 My previous research suggested jobs peak after 25 years
Types of interpretationby Economic Development Agencies, Chambers of Commerce, LEPs, politicians,
consultants and press
• Interpretation of past data trends• Interpretation of current data• Jobs to be gained and lost from openings and closures• Business bias to new projects and training (replacement jobs?)• Projections of demand (often in consulting reports)• Labour force projections, with/out migration• Broader sweeps of the future regional economy CONCLUSION; M. Hodge; “thorough scrutiny of forecasts” Personal view; need for a new “code of conduct”
Some sources of exaggeration
Firms seeking grant-funding and/or Planning permission have an interest in claiming their higher figures of job creation/preservation (Planners downplay due to malleability for most projects)Local politicians and newspapers also have an interest in boosting the job numbers, notably the multiplier effect (competitive practice).It is part of the marketing operation to sow optimism, but it doesn’t help good planning for an area to be a victim of its own propaganda.There is a reasonable case to be made for providing a surplus of employment land, to allow for underestimation and choice.Aspirational targets do have a place in the work of LEPs, but they do cause confusion when they cannot be compared with housing and training numbers
“Bigger cities have not grown faster”R. Martin, Cambridge University
Annual average % change, 1981-2011, 63 Primary Urban Areas, GB, ranked
All in employment decline, GB Leading “northern” Cities in growthBurnley (-0.7% p.a) Telford (NT)(+2.1% p.a.)Hull Warrington (NT)LIVERPOOL CardiffStoke Preston (NT)Dundee LEEDSBirkenhead DoncasterSunderland YorkBIRMINGHAM NewportBlackpool EdinburghGrimsby Aberdeen (+0.5% p.a.)BlackburnMiddlesbroughWigan (-0.1% p.a.)Source; ONS ; “NT” = New Town
Travel-to-work of 8 Core Cities of England, 1981-2011, thousands
Source: Censuses of Population
Workplace population
Daily travel IN
Daily travel OUT
%Commuting IN
1981 Males 1276.0 499.4 195.4 39.12011 Males 1182.5 466.0 280.2 39.4
1981 Females 905.4 264.3 60.0 29.22011 Females 1031.1 415.7 191.8 40.3
The 9 Core City Local Authorities versus rest of City Regions
Employment as full-time equivalents, 1984=100 (Champion & Townsend)
80
90
100
110
120
130
1984
1987
1989
1991
1993
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
19
84
= I
nd
ex
10
0
Inner London
Rest of LCR
9 City LAs
Rest of 9CRs
Change in FTEs for 10 City Regions, 2008-14, % for period (Townsend & Champion)
London CR
Sheffie
ld C
R
Nottingham
CR
Man
ches
ter C
R
Bristo
l CR
Newca
stle
CR
Leeds
CR
Birmin
gham C
R
Liver
pool CR
Glasg
ow CR
-8.0
-6.0
-4.0
-2.0
0.0
2.0
4.0
6.0
8.0 .
2008-2010 2010-2012 2012-2014
% f
or
per
iod
The truth about the Core Cities group
• The advantage of Core Cities is volume, richness and variety of jobs; not the RATE of increase (unless you count the last 2 years?); the Core City people admit its not about rates, its about Volume of jobs, as they have 40% of the City Regions' jobs
• IF they're not the "Drivers of change" on that front, the evidence is that its through increased net inward commuting to some extent, with little dispersal of new growth out to surrounding LAs
• There may be everything to say for concentrating transport and other public investment across areas with a lot of people, but that doesn't rule out that there might be more value for money in say Northampton or Hull for a particular kind of spend.
• Big cities have not grown faster since 1981 (see slide evidence including Cambridge)
Need for an Inter-Departmental Code of Conduct; BIS, DfT,CLG,DfE at al.Forward Estimates of Employment Gains
My recommendation is that statements of future employment should be treated as seriously as population projections, but that if they can’t match specified standards, they should be barred under a government code. Thus• A circular around relevant ministers and government bodies requiring
caution.• A statement that bodies must be clear as to which objective they are seeking;
unless there is a particular reason these should be cautious median forecasts.• Otherwise one as a ”confidence booster” and another as a “fail-safe” working
figure for Planning docs.• In particular, there needs to be a clear distinction between
“basic” employment, in factories and offices bringing income to the area (both can be identified in surveys) and the “multiplier” in the general run of local services with a fixed total of demand at any one time (CLG circulars faulty).