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21/09/2020

Economists call for government to level up North’s health and jobs

Words: Huw Morris
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The government’s ‘levelling up’ agenda in the North of England will only succeed if it supports people employed in the sectors hardest hit by the Covid-19 crisis and helps to improve health and wellbeing, according to leading economists.

The government has signalled it will focus on major infrastructure projects as it attempts to rebalance the UK economy. However, the Greater Manchester Independent Prosperity Review, which has been updated one year from its first report, says the Covid-19 pandemic has amplified existing economic inequalities between North and South, against a backdrop of highly centralised decision-making and significant regional disparities.

In the past decade, Greater Manchester - a £63 billion economy with 2.8 million people - has seen larger growth in lower paying sectors, such as retail, hospitality and leisure. These sectors have been hardest hit by the Covid-19 crisis with unemployment rising by 91 per cent since March to 8 per cent of the working-age population, the review reveals.

Almost a fifth of jobs are paid below the low-pay threshold of £15,000 a year, which is 60 per cent of the median wage. The employment rate of working-age residents with long-term health issues is 60 per cent.

Calls for further devolution to local areas so they can put a greater focus on re-training and upskilling to prevent a lost generation of young people. Given the threat of unemployment on a grand scale, the economists recommend more powers to allow local areas to design and test policies and programmes which directly respond to the needs of their residents and economies.

Greater Manchester set out ambitions to expand conversion courses that would allow thousands of young people to take up jobs in the green economy, such as construction and refitting of zero-carbon homes. This is part of the city-region’s efforts to create a greener economy as it aims to become carbon neutral by 2038.

“This report makes for difficult reading, but it confirms what we always feared: that the coronavirus pandemic has ruthlessly exploited the inequalities in our society, hitting the poorest hardest,” said Greater Manchester mayor Andy Burnham, who commissioned the review. “It’s essential that we build back in a way that makes us more resilient to the challenges of the future – that means sustainable infrastructure and investment, properly integrated health and social care services, and access to high quality education, training, jobs, and housing.”

The panel behind the review comprises Cambridge University professor Diane Coyle, and Mariana Mazzucato, professor in the economics of innovation and public value at University College London, Harvard University professor Ed Glaeser, EY's Government and Public Sector lead Darra Singh, professor Henry Overman of the London School of Economics and Bloomberg Economics head Stephanie Flanders.

The update is available at Greater Manchester Independent Prosperity Review: One Year On (pdf)

Image credit | iStock
 

 

 

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