"People don’t feel pay rewards workplace efforts, report on industrial strategy reveals

A growing disconnect between people’s efforts at the workplace and how well they feel their bosses reward them risks stalling Government’s industrial strategy, a report issued today by the think-tank Localis has argued.

Exclusive polling undertaken by YouGov for Localis showed exactly half of those surveyed felt they were paid less than they deserved, a third (31%) paid roughly the right amount and 7% felt overpaid. The polling figures also indicated nearly two-thirds (61%) of people felt unrewarded for hard work.

The findings are contained in a report entitled ‘The Delivery of an Industrial Strategy – Raising prosperity across England’ which examines how strategic authorities, such as Mayoral Combined Authorities and county councils, can take the industrial strategy forward at a local level to raise local prosperity and living standards.

The report includes analysis which finds the relationship between productivity and wages varies significantly across the country. The report finds the five worst areas for wage growth relative to productivity growth in England over the last five years were:

  • Hounslow (London) – 55 percent increase in productivity, 11 percent rise in wages
  • Mendip (Somerset) – 22 percent increase in productivity, 10 percent drop in wages
  • Camden (London) – 33 percent increase in productivity, 2 percent rise in wages
  • Rushmoor (Hampshire)– 19 percent increase in productivity, 12 percent drop in wages
  • Three Rivers (Hertfordshire) – 37 percent increase in productivity, 7 percent rise in wages

By contrast, residents of the following five areas received the greatest increase in wage growth relative to gains in local productivity:

  • North Dorset – 8.8 percent increase in productivity, 31.3 percent rise in wages
  • Weymouth and Portland (Dorset) – 0.7 percent increase in productivity, 19 percent rise in wages
  • Wyre (Lancashire) – 3.7 percent increase in productivity, 18% increase in wages
  • East Dorset – 9.5 percent increase in productivity, 21.2 percent increase in wages
  • East Devon – 11 percent increase in productivity, 22 percent increase in wages

The report also argues Government’s choice to focus attention and resources for industrial strategy on three of the most-advanced areas of England – Greater Manchester, the West Midlands and the Oxford-Cambridge corridor – risks neglecting the economic fortunes of the bulk of England, including parts of the country being left behind by the rest of the economy.

The report is a follow up to last year’s report ‘The Making of an Industrial Strategy’ which found areas in more than two-thirds of England lacked governance structures with the strength and capacity to help deliver the Government’s national Industrial Strategy.

Jack Airey, head of research at Localis, said: “These figures show too often the relationship between the individual and the economy is broken, or seen to be broken, and too often works disproportionately better for some than others.

“Across the world, recent votes against the status-quo suggests this to be politically unsustainable for mainstream politics. Tackling many peoples’ estrangement with the economy should be a primary aim of current and future governments.”

Cllr Paul Carter, leader of Kent County Council, said: “The Local Industrial Strategy is an opportunity to re-connect employers and employees to local growth and for government and counties to work together in new and creative ways relevant to local business.

“In planning for new jobs and homes, successful Local Industrial Strategies must attract new local investment and connect local people and places – with their impressive track record of enabling economic growth, Counties must be at the heart of these plans.”

Cllr Kevin Bentley, deputy leader Essex County Council and cabinet member for economic growth and infrastructure, said: “Local Industrial Strategies will outline the opportunities we have to equip our localities for the future, as part of the next industrial revolution. We will ensure individuals and places benefit from increased productivity, not just for the benefit of Essex, but for the wider economy as a whole.

“We have a number of opportunities across the county; including through the North Essex Garden Communities, and in the south with the Association of South Essex Local Authorities. As the Government highlighted, our opportunity around the life sciences in Harlow - as referenced in the Industrial Strategy White Paper - will create one of the world’s largest health innovation hubs. Attracting international and national companies, this will help Essex, and the UK, become a global leader.

“We believe that the strategic authorities, such as county councils, have a central role in supporting the delivery of the industrial strategy. We look forward to working with Government on this in future.”


Press enquiries:

Jonathan Werran, Head of News and Events, Localis
(Telephone) 0870 448 1530 / (Mobile) 07967 100328 / (Email) jonathan.werran@localis.org.uk

Notes to Editors:

  1. The report is being launched at RICS, Parliament Square, on Monday 26 March from 9.30 to 10.30. – limited press places are available upon request.
  2. A full copy of the report can be downloaded here: ‘The Delivery of an Industrial Strategy – Raising prosperity across England’
  3. All figures, unless otherwise stated, are from YouGov Plc. Total sample size was 1,641 adults. Fieldwork was undertaken between 21st - 22nd February 2018. The survey was carried out online. The figures have been weighted and are representative of all GB adults (aged 18+). Full polling figures, including breakdowns by age, gender and politics, are available in the appendix of the report.
  4. Report recommendations:

To deliver a successful industrial strategy, government should:

  • Aim to agree a local industrial strategy with every part of the country by the end of the Brexit transition period. To achieve this, we recommend government should direct more resource and attention towards agreeing local industrial strategies.
  • Enable all places to deliver effective and reforming local industrial strategies by:
    • Emphasising the importance of strategic authorities in leading and delivering the local industrial strategy where they are not already embedded into the process (i.e. areas without mayoral-combined authorities).
    • Clearly identify the role of all strategic authorities in promoting economic development, like how mayoral combined authorities and non-mayoral combined authorities have functions and responsibilities specific to promoting economic development in their areas.
    • Provide strategic authorities and LEPs with capacity funding appropriate to delivering against the aims of the national and local industrial strategies.
    • Amend the General Power of Competence to introduce a presumption in favour of strategic authorities being permitted to raise revenue when it is tied to achieving local industrial strategy outcomes. This would act as a new General Power of Economic Competence.
  • Confirm local industrial strategies as a primary conduit by which places can achieve bespoke sets of powers and devolved budgets. Government should include this in and publish the promised Common Devolution Framework.

To deliver successful local industrial strategies, places should:

  • Devise local industrial strategies that mark a departure from the Strategic Economic Plan (SEP) in ambit, veracity and evidence base. To those ends, local industrial strategies should:
    • Begin to address the fundamental, day-to-day issues that entrench low wages, low skills and low rates of productivity.
    • Be grounded in a granular understanding of the local economy: the areas of genuine comparative advantage, the issues holding them back; and an honesty about the places where nothing but the economic equivalent of open heart surgery will suffice.
    • Achieve a more productive relationship with government.
  • Include a set of interventions that influence decisions made by people and businesses to improve the prospects of a place. Interventions should flow from a baseline of intelligence and each intervention must have a clear articulation of how they will be funded.
  • Aim to use the local public sector’s existing legal and legislative capacity more fully. Where interventions are outside the local public sector’s existing legal and legislative capacity, places should outline which government department(s) may be able to support them, whether the intervention requires a transfer of powers or budgets; and, whether legislative change is required to deliver the intervention.
  • Each local industrial strategy should include a set of interventions that aim to raise an area’s productivity, growth and, ultimately, living standards. They will necessitate design and delivery by all tiers of government – in some cases with central government support, though often without – and should address three components: the local labour market, the availability of good jobs and places’ commercial commons.
  • The local labour market strategy should provide lifelong support for people to be economically active and appropriately skilled. Interventions could include:
    • Providing bursaries to teaching graduates who commit to working in their area upon training.
    • Putting in place schemes that will upskill and reskill workers most at risk of falling out of the labour market early.
    • Transport graduate subsidisation schemes by, working with DfT altering rail and bus invitation to tender documents.
    • Reallocating unused funds in businesses’ Apprenticeship Levy accounts locally to be ring-fenced for the development of the local skills base.
  • The good jobs strategy should stimulate demand for jobs that are more secure and better-paid. Part of this should include measures to encourage businesses to take more risks on initiatives that generate more and better. It should also strengthen the contract between place, employer and worker by introducing measures that nudge local businesses, where they don’t already, to pay and invest in their workers more. Interventions could include:
    • Supporting fledgling businesses in the local area by establishing a) seed funding investment boards that provide low-interest gap funding and b) bridging loan facilities that support businesses facing cash flow problems.
    • Use the local industrial strategy as a catalyst for anchor institutions – namely, local government, universities and the local NHS –to leverage their assets and role in the local economy by prioritising local hiring and local sourcing.
    • Introduce a local employment charter – advisory, non-statutory standards on ‘good work’ – that covers issues such as wages, benchmark levels of investment in work-related training, hours and leave provided; and, workers on boards. Anchor institutions could amend their procurement policies to take account of the local charter.
  • The commercial commons strategy should aim to make places more attractive to people and investment, addressing physical and perceptual constraints to growth. Interventions could include:
    • Establishing time-limited local development corporations in partnership with businesses, universities and/or other civic institutions.
    • Making publicly available, where possible, the data it collects about its transport network. This should include, under an Open Government Licence, live arrivals, timetables, accessibility and more. The explicit aim of open data sets should be the facilitation of it being used for commercial and non-commercial purposes, namely the development of journey planning apps.
    • Developing evening economy zones by designating an areas where:
      • Streets are fully-pedestrianised after 6pm.
      • Day-time premises pay no application fee or annual charge for alcohol licensing.
      • Pavement café license fees are waived and, where necessary.
      • Using local development orders, planning permission is automatically granted for any change of use to facilitate the night-time economy
    • Developing commercial zones by designating areas where:

Press release distributed by Pressat on behalf of Localis, on Monday 26 March, 2018. For more information subscribe and follow https://pressat.co.uk/

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