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Employment: Moving Beyond the Supply Side
By Andy | July 7, 2009
Work readiness is fine and helping to get people the qualifications to work is clearly right. But this is not enough. Whether in government or in opposition Labour now has to really begin to think about its demand-side policies.I heard James Purnell on the radio this morning (7th July) talking about supporting the unemployed. Put aside any prejudices you might have for the moment. He was quite good, talking about how Labour had invested in a whole series of policies that would support skill development and work experience. The trouble is this is no longer enough. For too long this government has had an essentially passive view of employment policy, particularly in the area of manufacturing. Labour will have to work long and hard — whether in government or not — to consider how it can support key sector development on order to create a diversity of labour market demand.
Green Shoots or Roots
Those who trumped the sign of green roots nearly always do so from the perspective of the City and the financial sector. But away from these it is hard to not be rooted more in reality.
Last week’s economic figures showed the current downturn to be deeper than even that of the early 1980s, the recession that accounted for much of the collapse in manufacturing industry.
Consider the West Midlands, my own region and the manufacturing heart of he country. The west Midlands economy contracted by 6 percent during the first quarter of this year and is predicted to contract by 10%, overall, during this calender year. Such a collapse is catastrophic.
But it could be worse. Last week’s figures show that Chancellor Darling’s autumn predictions were way out of line, far, far too optimistic. Not only that but the figures showed that even those who thought Darling wrong had turned out to be too optimistic themselves.
While financial pundits argue as to whether this recession is a W or double dipped recession, or an L recession or even U shaped, politicians and activists on the left need to really turn their minds to manufacturing.
Much of the West Midlands recovered from the collapse of the 80s, though not everywhere did. Just take a look at Stoke on Trent. But the jobs that came — in retail and in services — were often less secure and less well paid.
Our problem now is that the economic upturn is likely to be a slow and long process. And many (myself included) consider that things may not be quite the same again, think of the retail sector and specifically that associated with new home buying.
So, it’s perhaps no surprise that we are talking more about manufacturing. But we talk little about what we are going to do and how we are going to do it. Here in Birmingham DLV vans are on their way out. Even the big guns like Jaguar and Land Rover are not immune from the pain.
Jaguar and Land Rover are now owned by Indian giants Tata. So far government has not intervened claiming that it is the responsibility of this rich, multi-national to save the day. But reality for Tata is not so good. Despite the group being so big they are still finding it difficult to operate internationally and to raise finance in the money markets. To keep Jaguar going in the West Midlands Tata have had to raise new bonds in India!
Whether we are talking about a future of advanced manufacturing or new, green technologies it is time for a proper national debate about these things. We cannot move forward just by seeing assets go to international corporations, after all this hasn’t helped at the moment. In times of crisis we have little home-owned industry to support. Ah, but we live in a global economy I here people cry. There’s not much we can do about it. Tell that to the French and the Germans.
It is not enough to talk about manufacturing, we need a clear strategy for growing new businesses and to support he development of those who are skillful enough to survive this recession.
Making things is not just old fashioned. If this crisis has shown is anything then it has shown us the importance of having a diverse economy. Left of centre governments should think seriously of how the stimulate demand and not just plan for supply.
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