Inclusive Growth in Greater Manchester 2020 and beyond

Executive summary

The Inclusive Growth Analysis Unit (IGAU) has taken stock of the progress that has been made in Greater Manchester (GM) towards inclusive growth, in the period since 2016 when inclusive growth started to become a prominent objective for UK cities. It has reviewed developments in policy and practice, principally those of the Mayor and GM Combined Authority (GMCA), but also of local authorities, businesses and organisations in the voluntary, community and social enterprise sector. In this legacy report, IGAU ask whether what has been done is sufficient and if not, what else could be done. The report learns from case studies from around the UK and abroad.

Inclusive growth and why we need it in GM

Inclusive growth is the idea that economic prosperity should create broad-based opportunities and have benefits to all. It challenges economic models which have produced large rises in income and wealth for some, while sustaining high levels of poverty and high levels of inequality. Since the global financial crisis, sustained economic inequalities, increasing social divisions and the rise of nationalism and populism have led to calls for different models of economic and social policy which will involve more people in economic opportunity and result in prosperity that is more widely shared.

Greater Manchester needs more inclusive growth

While the Greater Manchester economy as a whole performs relatively well compared to other UK cities outside London, it underperforms the UK economy as a whole and that of other leading European city regions, such as Munich, Helsinki and Barcelona. There are significant problems with low pay and insecure employment, with around 620,000 people in relative poverty, a majority in working households. More neighbourhoods are in the top fifth of the national indices of deprivation in 2019 than in 2015. The centre of the conurbation has seen the lion’s share of job growth since before the financial crisis, although not always benefiting local residents, while outer areas like Rochdale and Tameside continue to struggle on many economic indicators. Women, minority ethnic groups and disabled people tend to fare much worse in terms of jobs and pay than men, white, and non-disabled people.

Tackling these social and spatial inequalities would enable GM to make more use of the talents of a wider range of its people. Changing economic behaviours and labour market practices would spread the benefits of economic activity more widely, raising living standards and combatting poverty and injustice.

Greater Manchester is about to enter a new policy period with a Mayoral election in 2020 kicking off a new four-year Mayoral term and a refreshed GM strategy. The report makes recommendations about what could be done in this period to consolidate and extend the work started to date, and to set out on a more ambitious path towards a fairer economy and society in the future.

Inclusive growth policy and practice has two broad spheres of activity:

working towards economic structures and activities that are more inclusive by design, for example: fairer systems for profit-sharing and reward; more equitable employment practices; and better quality jobs.

making sure that local people are connected to economic opportunities, physically (in terms of housing, transport and digital connectivity) and in terms of having the education, training, health and care services they need.

Within these spheres, IGAU expect to see a particular emphasis on areas or groups of people more likely to have been excluded in the past.

Progress towards inclusive growth in GM

IGAU assessed progress in GM against a wide range of ideas and examples that are emerging as cities in the UK and internationally (and countries, including Scotland and Wales) experiment with policies to achieve inclusive growth. It looked at the two main spheres of inclusive growth policy – designing more inclusive economies and linking people to opportunities – and at policies to tackle social and spatial inequalities. IGAU also looked at how GM is approaching inclusive growth in terms of strategy, leadership, delivery and measurement. Table 1 summarises those findings.

Overall, these developments represent substantial progress. They will need to be sustained and built upon, and there will be new opportunities, such as bus franchising, which will need to be approached with an inclusive growth lens.

What has not yet happened in GM is the bringing together of these emerging policies in a clear vision and integrated approach. Inclusive growth still means different things to different people and is more prominent in some policy areas than others. This is in contrast to some other parts of the UK where inclusive growth is being adopted as the central objective of economic plans and/or it is becoming embedded into policy-making and investment decisions through the use of inclusive growth metrics, decision tools, and new funds. Nor is inclusive growth yet a long term vision, shared by the citizens of GM, which sets out goals, values and principles about the kind of growth GM wants, how it will be achieved, and how it will serve wider social and environmental objectives and ensure a successful inclusive transition into a low-carbon, high tech future.

Full report PDF available here

To set the scene for the report, IGAU took a brief look at the challenges to inclusive growth in Greater Manchester, starting with an overview of the economy. As is widely recognised, the GM economy as a whole performs relatively well compared to other UK cities outside London in terms of economic growth. In 2017 (latest available figures), GM was the third largest city region economy outside London, with total GVA of £66.4 billion. This compares to £66.7bn for West of England combined authority and £69.6bn for Leeds City Region. Of the seven English core city regions outside London, GM ranked third highest in terms of GVA per filled job, with a figure of £48,1848. Figure 1 shows that, both in nominal terms and when controlling for inflation, the GM economy performed slightly better than the city region average over this period.

However, GM continues to lag behind the UK average on measures of productivity. Since 1991, it has accounted for only around 90% of the UK average on GVA per head. Just as the UK tends to underperform other comparable economies on measures of productivity, GM’s productivity is also behind that of many leading European city-regions, such as Munich, Helsinki and Barcelona, as well as Naples, Stuttgart, Cologne, and Utrecht.

Thus, on conventional measures it would appear both that GM has a relatively successful economy, within which it wants to ensure more widely shared opportunity, and that there is room to unlock further economic potential through drawing more effectively on the talents and efforts of a greater number of citizens. In the remainder of this chapter we consider some of the challenges to these ambitions.

GM’s industrial legacy

Though GM has, on the whole, successfully transitioned to a modern knowledge economy, the city region is still dealing with the legacy of its industrial past, and the rapid de-industrialisation that has followed. This transition entailed large scale job losses which had long-term economic and social consequences for individuals, their families and local communities.

One prominent manifestation of this is high levels of ill health, especially for older people. Life expectancy at birth for both male and female newborns in 2015-17 was almost two years lower in GM than for England as a whole, at 77.8 and 81.3 respectively. This figure is substantially lower in some parts of GM, with life expectancy at birth for males (2013-17) as low as 69.9 years in parts of Oldham, compared with 84.9 in parts of Stockport – a gap of 15 years. For older men, life expectancy at age 65 is 17.6 years in GM compared to 18.8 for England. GM lags behind the UK on almost all measures of public health. For example, around two-thirds of adults are overweight or obese, and one in five adults smokes. Across almost all standard published measures of alcohol harm, GM local authorities (LAs) fare significantly worse than average. In 2016, Manchester LA had the highest rate of preventable mortality in the UK, almost two and a half times higher than the area with the lowest rate. Correspondingly, more people are providing unpaid care in GM: for example, 26 people per 1000 of working age are in receipt of carers allowance compared to 21 for England overall.

Low levels of skills in the adult population also bear witness to a history of industrial employment and low employment opportunities in the post-industrial era. Around one fifth (20.6%) of working age people in GM (365,600 in total) have either no or low qualifications, compared to 18.2% for England overall, and this is higher (over 24%) in some older industrial areas Bolton, Oldham, and Rochdale. Having no or low qualifications is particularly prevalent among older working age residents (28.2% for 50-64 year olds), with a larger gap to the national figure (7.1 percentage points compared with 1.8 for 16-24 year olds). However, while educational attainment is higher among younger generations, the spatial pattern of attainment remains remarkably similar to that of earlier decades. At secondary school, the average ‘Attainment 8’ score of young people in GM was 45.4 points in 2017/18 – 1.2 points lower than England overall at 46.6 points – and lowest in Salford and Oldham (41.0 and 42.7 points, respectively). These LAs, alongside Rochdale, Tameside and Bury, have been identified as social mobility ‘coldspots’.

Changes in the economy and labour market

The figures in the previous section serve as a reminder that there is a continuing need for social investment in health, adult learning and retraining to support the development of ‘human capital’ across GM. But there are also wider changes underway in the GM economy, which are affecting the kinds of jobs that are available and the risks and rewards that workers face in different sectors. While these changes are not unique to GM they are making life more difficult in particular places and for people who are employed in less secure and poorly-paid sectors and roles.

Over recent decades, GM has broadly followed England in terms of labour market polarisation with faster growth in both professional, managerial and technical jobs, and operative and elementary jobs than ‘middle level’ and service jobs. Toward the top end of the labour market, these trends play out in rising earnings at the top and middle of the distribution – though this has come alongside rising house prices (and rental costs).

Low pay is a significant issue in GM. Median hourly pay for residents is 9% lower than the UK average, and in 2017 residents were paid over £1500 less in real terms per year than in 2008. In 2018, around 24% of employee jobs in GM were paid at or below the Living Wage (a fall since the previous year and slightly fewer than in England as a whole). Rates of underemployment have fallen since the recession, but remain higher than in 2007 at just under 6% in 2017, around one percentage point higher than in the UK (excluding GM). Job security is also an issue, with only 10% of all jobs created between 2007 and 2016 being full time positions. One in five of the GM labour force (21%) is either self-employed, employed on a temporary basis, or on a zero hours contract (ZHC), and in 2017 it was estimated that there were around 30,000 workers on ZHCs.

There has also been a marked spatial pattern to economic growth in GM. Nationally, economic growth based around finance, professional services and knowledge industries has largely benefited urban cores, fuelled by investment in an ‘urban renaissance’, while job growth and output growth in many former industrial towns has been sluggish. This spatial pattern is evident in GM’s growth story, with Manchester itself generating most of GM’s GVA growth since 2000 (Figure 2), due principally to growth in job numbers rather than productivity increases. Manchester also accounted for 54% of the growth in GM jobs in the period since the onset of the financial crisis. Together, Manchester, Trafford and Salford accounted for 75% of all new jobs created in GM across the ten years since 2007. In contrast, two GM LAs (Tameside and Rochdale) saw job numbers decline in this period.

The extent to which GM residents can take advantage of these patterns of job growth depends partly on skill levels and other supply-side factors including health, and also the availability and cost of transport relative to wages. GMCA’s analysis of commuting to the regional centre suggests that a large majority of workers travel in from South Manchester, Stockport and Trafford, with far fewer coming from the Northern LAs, particularly Bolton and Wigan. Competition from longer-range commuters is also an issue – 21% of workers in the regional centre commute from outside GM, with many coming from south of GM in Cheshire and High Peak, as well as Calderdale and Chorley. Manchester LA has the largest gap between weekly workplace and weekly resident wages of all core city LAs, at £63, both because workplace wages are relatively high in Manchester (third highest at £556 per week in 2018) and because resident wages are low (second lowest at £493 per week).

Spatial and social inequalities

These trends and others, not least policies of ‘austerity’, have produced a situation in which the benefits of economic growth are not currently being felt in all parts of GM and among all population groups. According to the most recent estimates, there are around 620,000 people living in relative poverty in GM, of which 61% are of working age. 3 in 5 working-age households in poverty in GM include someone who is in work. Three of GM's ten LAs (Manchester, Salford and Rochdale) are in the top decile of all LAs in Great Britain (GB) in terms of destitution rates, with Manchester being the only LA in GB in the top decile on all three types of destitution (complex needs, migrant destitution, and UK-other).

The most recent release of the Index of Multiple Deprivation (IMD) shows an increase in the proportion of GM neighbourhoods (small statistical areas known as LSOAs) among the top 10% and 20% most deprived areas in England. 23% of GM neighbourhoods were among the 10% most deprived in 2019 compared to 21% in 2015, and 38% were among the 20% most deprived in 2019 compared to 35% in 2015. This reverses a trend of improvement evident in successive releases of this data since 2004. The trends partly reveal an ‘inner- outer’ issue. Manchester, Salford and Trafford are the only LAs with a smaller proportion of LSOAs in the most deprived 10% than in the IMD2004, and of the 42 extra GM LSOAs that are now in England’s most deprived decile, 26% (11 areas) are in Oldham.

IGAU’s research also shows that between 2001 and 2013, areas of severe income deprivation within the outer ring road (i.e. the M60 motorway around GM) tended to decrease in size and on rates of income deprivation, while similarly deprived areas beyond this boundary were more likely to have stayed the same or grown in size, while experiencing an increase in income deprivation rate. But this is not the whole picture. It remains the case that the majority of GM’s poorest neighbourhoods are in inner areas of North and East Manchester and Salford, in relatively close proximity to economic opportunities in the centre of GM. Many of these areas have seen reductions in deprivation rates, but in some cases this is due to more affluent people moving in rather than to decreases in the number of people in poverty. In fact, the number of people in poverty increased in the regional centre between 2001 and 2013.

Economic disparities between social groups are also large and persistent in GM. 2016 figures show that all Black and Minority Ethnic (BME) groups in GM were less likely to be employed than White people. Some appear to be particularly affected by low pay. According to the GMCA, 33% of Black employees in GM are low paid, compared to 22% in Birmingham and 21% across GB.

People from BME groups are also less involved in apprenticeships. The apprenticeship ‘ethnicity gap’ for BME groups overall was 5.8 percentage points in 2015/16 meaning that whilst 16.2% of GM residents were from BME groups, they only accounted for 10.4% of all apprenticeships. They were also under-represented in higher level apprenticeships.

Employment rate gaps between disabled and non-disabled people are narrowing slightly but still large and higher in GM than for the country as a whole (in 2019, 37.5 percentage points in GM compared to 33.8 in England). There also remain marked gender disparities in the labour market with men over-represented in higher-paid occupations, making up two thirds of managers, directors and senior officials while women are over-represented in roles which often attract lower pay, including caring, leisure and other service occupations. These differences manifest in the gender pay gap. While, at first glance, GM fares well on this measure, this is only because men in GM are paid poorly compared to the national average, rather than being due to women receiving relatively better pay (men in GM are 10% below the average for England, compared to 5% for women).

The future

These data indicate the scale of the challenge of inclusive growth in GM, and the need to approach it as a long term agenda not a quick policy fix. Forward projections for some of these measures indicate that some of these challenges may deepen in coming years. For example, employment forecasts suggest that Rochdale and Tameside, as well as Oldham and Wigan, are set to experience falling employment over the period to 2038; whereas jobs are forecast to grow in central and southern areas of the city region.

Since we last reported, however, it has become increasingly obvious that inclusive growth must not only be seen as a response to current inequalities and their origins in contemporary economic organisation and labour market structures, but as a way to navigate the challenges of environmental, technological and demographic change, some of which are already firmly upon us. The situation described in this chapter is in many ways the product of a failure to fairly manage the transition from an industrial to a post-industrial economy. Finding a way to achieve inclusive growth whilst addressing the challenges posed by economic and environmental change is the urgent task that national and local policy makers now face.

This challenge requires work that is well beyond the scope of the report: forecasting implications for GM; working out what action is needed, and perhaps even developing the concept of inclusive growth itself, so that it is fit for a broader purpose. Our contribution here begins to signal some of the links and future directions but much more will need to be done.

Full report PDF available here

Key points:

■ Emerging work on inclusive growth suggests that cities need to take systemic approaches, making inclusive growth a ‘mission’ shared and delivered by multiple organisations. New metrics are needed, measuring inclusion as well as growth.

■ There are clear political commitments to inclusive growth in GM and these have strengthened in recent years. Approaches to governance in general have also broadened, with more people and organisations having a say in GM strategy.

■ However, there is no clearly articulated definition of inclusive growth at the GM level and the term means different things to different people.

■ GM has not yet established any central resource or tools to support and embed inclusive growth across policy areas.

■ Examples from other places in the UK and abroad point to ways in which organisations can embed inclusive growth thinking into policy development and appraisal, how they can broaden the leadership of inclusive growth and how they can engage in longer term visioning processes involving citizens in determining the inclusive growth outcomes they want to see.

Making inclusive growth happen

If one thing is agreed about inclusive growth, it is that it is a multi-faceted and long term agenda – not a single policy but an approach. In particular, inclusive growth brings an integration of social with economic policy spheres and so cuts across established administrative arrangements and responsibilities and requires the collaboration of multiple organisations in the private and third sectors as well as public administrations.

For this reason, considerable attention has been given to how cities can initiate, implement and sustain an inclusive growth approach. In the UK, this work has been led by the RSA Commission on Inclusive Growth and subsequently followed up by the RSA50 and by the Centre for Progressive Policy in a series of articles on ‘how to do inclusive growth’. Leadership strategies for inclusive growth also emerge in international research and from the OECD Champion Mayors for Inclusive Growth Initiative. Box 4 sets out some of the key ideas.

Work in this area is typically suggestive of what could be done, supported by innovative examples, rather than based on evaluation of what has ‘worked’. It is recognised that different economic, political and institutional contexts will shape how inclusive growth is led in any given place.

Inclusive growth as a strategic principle or ‘shared mission’ in GM

Inclusive growth as a principle has been recognisable in Greater Manchester and LA strategies for a long time, including in the 2013 GM strategy (GMS) which we cite in the introduction to this report. But how this vision of inclusive growth has been articulated and what it means for actual policies and practice has changed considerably in recent years.

Although it expressed the desire for everyone to contribute to and benefit from economic growth, the 2013 strategy had a clear economic/social divide. The growth strategy focused on the regional centre and other key growth sites and sectors, a market-led investment strategy and business support targeted on firms with greatest growth potential. Separately, ‘reform’ strategies (around early years, troubled families, justice, health and social care and worklessness and skills) were developed to re-design public services to build independence and self-reliance, and to reduce demand for (and cost of) public services, making GM a net contributor to the public finances.

By contrast, the GMS of 2017 was a substantially different document. Entitled ‘Our People, Our Place’ it was billed as a document for everyone in Greater Manchester, in which change would be driven “by our communities themselves… harnessing the strengths of Greater Manchester’s people and places [to] create a more inclusive and productive city region where everyone, and every place, can succeed”. “A thriving and productive economy in all parts of Greater Manchester” was only one of ten priorities covering all aspects of urban life from the early years to ageing, and the economy to the environment (Box 5).

Although the strategy did not mention inclusive growth specifically, politicians and officers often make reference to inclusive growth being “at the heart of the GMS” and the new GMS marking a move away from assumptions of social and spatial ‘trickle down’ that critics associated with previous versions of the strategy. Moreover, in launching GMIPR – an economic review designed to shape the GM local industrial strategy (GMLIS) – in May 2019, both Mayor Andy Burnham and Deputy Mayor Sir Richard Leese argued that inclusive growth was their central objective for the GMLIS. In this sense, inclusive growth could be seen as a strategic principle and a shared mission in GM. Again, however, the GMLIS document itself mentions inclusive growth only infrequently (9 times). By contrast, work towards London’s local industrial strategy (LIS) states in its first sentence (p. 2) that “the aim of London’s Local Industrial Strategy is inclusive growth – ensuring all of London’s places, people and communities can contribute to and benefit from the city’s growth, both today and in the future. As such inclusive growth also requires growth to be sustainable”.

The decision not to use the term ‘inclusive growth’ explicitly in GM leaves a situation in which it has different meanings in different articulations of GM strategy. As we describe in Chapter 7, inclusive growth is a prominent objective in the GM Spatial Framework (GMSF), referring to plans to ‘spread prosperity more widely’ by providing high quality investment opportunities across Greater Manchester. However, in the GMLIS, six of the nine mentions refer to investment in infrastructure for ‘digitally-driven, clean and inclusive growth’, while two are general aspirations and one relates to a business support programme. Nowhere in GM strategic documents is it yet set out what inclusive growth means and what policies and actions will follow from it.

Below the GM level too, interest in inclusive growth is expressed in different ways. Our consultation with GM LAs indicates that only one (Manchester, with Salford currently developing one) has an inclusive growth strategy per se, but almost all identify inclusive growth ambitions in other strategies including economic strategies, anti-poverty strategies. work and skills strategies and overall corporate plans. There are differences in positioning and action. In Manchester, Oldham and Salford, there is an emphasis on ‘inclusive economy’. Principles of community wealth building feature strongly in Oldham. Trafford’s approach has more emphasis on growth and connecting people to opportunity. In Wigan inclusive growth has become a key element in the ‘Wigan Deal’, which is reconfiguring relationships between residents, businesses, the Voluntary, Community and Social Enterprise (VCSE) sector and the local authority (LA) to work collectively towards a better borough.

Inclusive growth is also differently interpreted by other organisations within GM. A VCSE leadership group established in response to devolution has established an inclusive economy (not inclusive growth) sub group, while our consultation with GM housing providers indicates that although inclusive growth is a well-used term, ‘growth’ tends to relate to housing development. Thus ‘inclusive growth’ often refers to the social value that can be created through those activities as well as initiatives to support tenants to access economic opportunities (such as employment support and training).

There has been no strong lead on inclusive growth from the GM business community, except in the sense that the Local Enterprise Partnership (LEP) works exceptionally closely with the Combined Authority. The GMS and GMLIS are jointly owned, and in the case of the GMLIS, jointly produced with the LEP. Business representatives have consistently reported to IGAU that ‘inclusive growth’ per se is not a term that businesses recognise or identify with, although many subscribe to the principles and practices of good employment. The GM Good Employment Charter (see Chapter 5) is bringing the Combined Authority into direct liaison with businesses over that aspect of inclusive growth. However, our various consultations with business representatives also suggest that the term can often be seen as only being about corporate social responsibility (i.e. growth should contribute to inclusion through businesses ‘giving back’) rather than as beneficial to business sustainability, productivity and growth.

A plurality of views, political objectives and different organisational usages is to be expected and should not be seen as problematic, given the principles of subsidiarity which underpin CA/LA relationships and the spirit of collaboration and co-ownership which now underpins GM policy-making. However the lack of a clear articulation of what the CA means by inclusive growth and what actions it therefore intends to take at GM level could hinder progress in a number of ways. If the term is not clearly understood, it makes it harder to align and integrate the interests of ‘growth actors’ (such as politicians and officers responsible for economic development, and business leaders) with those of ‘inclusion actors’ (politicians and officers responsible for public services, and leaders of voluntary, community and other social economy organisations). Goals to improve both growth and inclusion may co-exist but in silos. It will be harder to see why social investment or measuring impacts on poverty should be the concern of ‘growth actors’, or how economic strategies might need to be reconfigured to produce better social outcomes. Equally it will be harder to see how inclusive growth and carbon reduction strategies might be linked, or inclusive growth and digital strategies. Arguably this then weakens the power of inclusive growth as a shared mission to which other stakeholders can respond and contribute, and which they can shape. It may make it more difficult to put leadership, delivery and accountability mechanisms in place to support a long term inclusive growth agenda.

Structures, delivery and measurement

Consistent with its decision not to adopt the terminology of inclusive growth as a central mission, GMCA has not established any central unit/resource to develop its inclusive growth policies and actions ensure their embeddedness across multiple areas of policy. This approach contrasts with that of the West Midlands combined authority (WMCA), which has established an internal Inclusive Growth Unit, to ensure that inclusive growth is “hard-wired” into mainstream West Midlands investment, economic growth and local industrial strategy. The Unit provides research, analysis, insight and citizen engagement to support more inclusive policy and investment decisions, and is intended to give long term strategic support for the WMCA and its public service partners within the region. The existence in GM of IGAU as an independent evidence resource and convenor of stakeholders may be a factor in GM’s different approach. GM has also chosen not to allocate a political portfolio holder within the Mayor’s Cabinet responsible for inclusive growth. Current portfolios most relevant to inclusive growth are those for: ‘the economy’, ‘education, skills, work and apprenticeships’; ‘community, voluntary and co-ops’; and ‘age-friendly and equalities’. However almost all other portfolios could have an element relating to inclusive growth.

Specific inclusive growth metrics, based on a re-thinking of what inclusive growth means and what measures would signal success, have also not yet been developed in GM. IGAU’s research suggests that there are many different approaches to inclusive growth measures, some more radical than others. Some simply involve measuring indicators of inclusion alongside measures of growth or prosperity. Some involve attempts to combine indicators in a single measure, so that the value of economic output is effectively weighted by the extent to which other social goals are achieved.  Some keep multiple existing measures of growth and of social outcomes such as education and health, but pay much more attention to their distribution between places and population groups. Others develop frameworks which give more attention to citizens’ understanding of the meaning and value of growth and inclusion, or to the conditions and processes which underpin inclusive growth (such as resilience, participation or social and cultural infrastructure).

GM has developed an extensive outcomes framework to support the delivery of the GMS. This includes inclusive growth metrics at the level of priorities, particularly “good jobs with opportunities to progress and develop” and “a thriving and productive economy in all parts of Greater Manchester”. Elements of this framework are supported by performance dashboards, reported to the relevant body in the governance structure. This, in our view, represents advanced progress in command of data for monitoring purposes. Four things have not yet emerged or become established:

• A smaller set of high-level measures that would represent progress on inclusive growth, which might enable impact assessment tools to be developed for proposed policies or investments.
• Deliberative processes to determine priorities and trade-offs.
• A clear understanding of the relationship between measures across policy areas and the relationships between them. For instance, what measures of culture or social participation would support developments in skills, health and jobs?
• A critique of, or challenge to, existing goals or measures based on broader citizen participation and debate.

Turning to the question of wider involvement in leadership and governance, our consultation suggests that significant steps have been taken in recent years and particularly since 2017. These include the establishment of the VCSE reference group, a Mayoral accord with the VCSE sector, and various initiatives to increase voice and representation from marginalised groups (see Chapter 8). As we have documented in other work, devolution to GM has in any case (regardless of inclusive growth) fostered an increase in formal and informal partnership working and collaboration across local authority boundaries, across sectors and within and across policy boundaries. Examples include GM’s Ageing Hub, partnerships formed around the Mayor’s homelessness agenda, and the Education and Employability Board which brings together schools, colleges, universities, local authorities, DfE, Regional Schools Commissioner, GMCA, the LEP and others. High level VCSE representation has been sought for the GM Housing Commission. The University of Manchester has taken a lead with the Centre for Local Economic Strategies and GMCA in establishing a steering group to develop an ‘anchors initiative’ in GM. A number of local authorities in GM, particularly Wigan (the Wigan Deal), Manchester (Our Manchester) and Oldham (Co-operative Council/’Our Bit, Your Bit’) have sought to foster new relationships with communities, including community investments funds, asset ownership and wider involvement in decision-making. Since 2017, cross-GM conversation, partnership working and strategy formation have been mobilised on specific issues through ‘summits’ (on school readiness, social enterprise and the economy) and through formal commissions (on Cohesion and on Cooperatives). However, in respect of ‘inclusive growth’ as a whole, IGAU’s multi-stakeholder advisory board remains the key forum for discussion and representation. Our consultation also raised questions about effective representation of diverse communities, and of different parts of the VCSE sector (with voluntary, community and social enterprise elements all having very different perspectives and expertise).

Finally, we note the challenges of financing inclusive growth strategies, in the context of limited and piecemeal devolution to city-regions, a long period of austerity, and the phasing out of local government revenue support grant. Inclusive growth raises resource questions in multiple ways including but not limited to: how to finance the delivery of work at the city-region level such as good employment charters, policy development and appraisal; how to fill gaps in public funding or enhance services to meet city-region priorities (for example in relation to skills or transport); how to support innovation and evaluation; how to pool existing public and private resources in new ways; and how to increase access to finance for local business growth. Proposed solutions include establishing local financial institutions to enable local saving and lending; local investment of anchor institution assets and funds; municipal or social investment bonds; and municipal ownership or community ownership of local public assets. Devolution from central government and the capacity to pool budgets across service areas is a key issue, as will be any future settlement relating to the distribution of regional funds following the UK’s exit from the European Union (EU).

As we document throughout this report, new inclusive growth initiatives in GM are being financed in a variety of ways, including levies on taxpayers through the Mayoral precept, ‘earnback’ arrangements with central government, retained business rates, local authority and business contributions. GM Mutual, a local bank, was registered with the Financial Conduct Authority in 2019, with support from several of the GM districts, the GM Chamber of Commerce, the Federation of Small Businesses, and third sector organisations, but plans are still at early stages. As work on inclusive growth develops in GM there will be a continuing need to identify costs, benefits and financing mechanisms, including through any further devolution settlements following the government’s recently announced White Paper on devolution.

Learning from other places: see case studies 1,2,3,4

Education, skills and work

Improving educational opportunities and skills, and providing stronger routes into and through the labour market have been key priorities in GM’s approach to inclusive growth.

Successful transitions into the labour market for younger people are prioritised in the GMS through the ‘life ready’ agenda. Key initiatives include ‘Bridge GM’, which offers a framework for careers advice and guidance and work experience, and the Our Pass pilot offering free bus travel for 16-18 year olds. Bridge GM includes an ambition for all young people to have an ‘encounter’ with an employer in each year that they are in compulsory education. An apprenticeship portal has also been developed for young people studying with the colleges and training providers that are members of the Greater Manchester Apprenticeship Company, providing access to vacancies data and CV advice to support young people to think through next steps. In addition, an online ‘Levy Matchmaking Service’ has also been introduced which aims to create more apprenticeship opportunities for people in GM by enabling large apprenticeship levy-paying employers in the city region to transfer some of their unspent levy funds to small employers.

A free 16-18 bus pass, ‘Our Pass’, is being piloted for two years from September 2019 at an estimated cost of around £16 million. The pass aims to ensure that travel costs do not prevent young people from accessing or continuing with education, training or employment opportunities, setting them up for a prosperous working life. It is also anticipated that the pass may help to promote the use of public transport more generally and allow young people to experience the cultural opportunities that GM offers. The cost of the scheme is to be funded partly from the Transport Levy and Earnback monies, as well as potential contributions from businesses and/or education and skills providers.

A number of targeted initiatives are also working with young people and other groups to try to improve access to education and work opportunities. This includes Talent Match and the new ‘Hidden Talent’ programme.  For example, the youth panel for the latter project is holding workshops to review employers’ recruitment materials to check how accessible they are for young people. GMCA is also hoping to increase the take up of apprenticeships among under-represented groups, including BME young people and, in partnership with the GM Ageing Hub, older people. Here the idea is that apprenticeships can provide a route into work, as well as an opportunity for people to change careers or to support a return to work.

Providing better support for residents who were out of work and otherwise disconnected from the labour market was one of GM’s early priorities under devolution, with the development of a pilot initiative to improve employment outcomes for incapacity benefit claimants (the Working Well pilot initiative). The pilot ran from 2014 to 2016 and was designed and jointly funded by GMCA and Department for Work and Pensions (DWP). It was subsequently expanded and led to GM securing a co-commissioning role in the DWP’s Work and Health programme (see Chapter 5), before evolving more recently into a wider ‘whole population approach to work and health’. The goal is to offer interventions across the ‘employment lifecycle’ to ensure that people can stay in or return to work where possible and a ‘skills and work system that enables people to realise their potential, supports emerging industries and is responsive to employers’ (GMLIS, p.10). This includes not just employment support programmes for those out of the labour market but reforming training opportunities, and attempting to influence employer demand through the employment charter and other initiatives. Other targeted support is being developed for older residents (aged 50+) and the GM Health and Social Care Partnership (GMHSCP) has developed a working carer toolkit targeted at employers and carers which outlines examples of good practice that can enable people to combine caring with paid employment.

Other skills developments include proposals that have been brought forward for the devolved Adult Education Budget, including the offer of free education and training up to a Level 2 qualification (roughly GCSE A*-C) for residents with low or no qualifications, and for people in employment on a low wage. With the right support and advice, this could enable people with low skills to access qualifications that will enable them to enter and progress in work. A partnership has been established between GMCA, DWP and DfE to explore better co-ordination of post-16 education and training as part of the GMLIS.

Also at a strategic level, workforce development plans are being developed in education, health and social care sectors. An early years workforce development plan, along with a linked Academy, underpins ambitions to transform the way that early years provision is provided and enable the early identification of need, including special educational needs and disability.   

More broadly, the GMLIS highlights the need to address anticipated skills demands in GM’s priority sectors, supported by a proposed £8 million investment pot from the Local Growth Fund. There are specific proposals for key sectors including outline ideas for a centre of excellence around modern methods of construction, and ambitions to create a digital skills pipeline and a £3million digital skills pilot. In addition, GM’s ambition to be carbon neutral by 2038 creates new skill demands and opportunities. Activities are beginning to be outlined in the GMLIS implementation plan, the Manchester LIS and GM’s 5-Year plan for the Environment, including consultation around the kinds of skills that will be needed to ‘deep’ retrofit buildings in GM. There is scope to draw stronger links between this activity and more targeted efforts to connect people to these opportunities; for example adults with lower skills or who are out of work, people who could progress into better paid work through retraining; and young people in areas or groups currently under-represented in these industries and/or in the GM labour market in general.

Local authorities and local organisations are also coordinating a range of skills and employment initiatives targeting people who are out of work, and aiming to support residents to enter and progress in work. While there are too many to review individually, examples include Oldham’s pilot Career Advancement Service, setup in 2016, offering intensive career coaching and a personal training budget to low-skilled participants who had accessed its employment entry programme ‘Get Oldham Working’. Manchester funds the My Future Intermediate Labour Market scheme, which offers young people who are not in employment, education or training a 4 week accredited pre-employability programme followed by a three month paid placement which should be linked to a paid job opportunity or apprenticeship with the employer. Rochdale is supporting employees in sectors facing technological change and re-structuring to prepare for jobs in other sectors. The goal of connecting residents to employment is also supported by a range of local organisations. GM housing providers have introduced targeted services for residents, meanwhile ‘Recode’, a Community Interest Company, ran its first free 12 week coding course in Bolton over the summer of 2019, aiming to support people to access a career in software engineering.

A major sticking point in relation to further education, skills, and lifelong learning remains the current organisation of the education and skills system. Although the GMS sets targets for educational achievements at the end of primary and secondary school, school education has never been the responsibility of any regional or sub-regional body, instead residing either with central government or local authorities (and increasingly with individual schools and multi-academy Trusts). Capacity to influence educational achievements and equity in the years up to 16 is therefore very limited. Young people are now required to stay on in full time education or training until age 18, but the post-16 provider landscape is a complex one with multiple schools, colleges and independent providers facing competing incentives and very limited local oversight. GM has made some first steps towards a strategic approach to compulsory education in the establishment of an Education and Employability Board, which has adopted a focus on ‘championing the vulnerable’ and ensuring equity in the education system. In practice however, the board has neither delegated responsibilities (from DfE) nor funding from GMCA. Strategic approaches to workforce and professional development as envisaged in health, social care and early years have not yet been developed in this area. An important development in this respect was a GMLIS agreement to a partnership with central government to review the post-16 education, skills and work system, reporting in March 2020. This offers a significant opportunity to set out how greater local coordination could address some of the problems caused by the current system fragmentation.

As we indicated in Chapter 2, transport is a key issue in improving access to skills and work, as well as enabling inclusive access to the broader opportunities of the city-region. The Greater Manchester Transport Strategy 2040 lists as an ambition, “to develop a fully inclusive and affordable transport system for all”, pledging to make public transport not just affordable for low-income groups, but accessible for elderly people and people with disabilities. The importance of orbital transport is recognised, as well as the role of transport in broadening employment opportunities for those living near planned employment developments outlined in the GMSF. A key development is bus franchising, which would allow Transport for Greater Manchester (TfGM) on behalf of GMCA to set routes, timetables, fares and standards. In October 2019, GMCA became the first city-region to consult on a bus franchising scheme. In addition, an early bird fare scheme was trialled on GM’s Metrolink tram system in 2018, with a view to the possible development of a ‘pre-peak’ offer – designed to relieve congestion but potentially also of value to low income shift workers.

Wider public service reform and integration

Beyond education, skills and transport, there has been extensive activity around better public services in GM as part of a decade-long public service reform programme and the increasing devolution or delegation of powers and responsibilities from central government. Central to this is health and social care reform, which, with its emphasis on prevention, local integration and innovation, is seen as a major opportunity to address the poor population health outcomes and inequalities identified at the start of this report.  Other key planks include early childhood development, recognised as part of GM’s inclusive growth approach since the MIER in 2009, and given a new impetus in 2017 (renamed ‘school readiness’) as the first priority of the GMS.  Since 2012 the ten local authorities and partners have been working on the implementation of a new Early Years Delivery Model comprising universal and targeted services. From 2017, a new School Readiness Board and programmes of work have been established, including embedding best practice in particular delivery areas, digitising assessment processes, and establishing the early years workforce academy to improve the training and support of staff working in early years settings.  Housing has been a particular priority of the Mayor, who has made high profile commitments to end rough sleeping and reduce homelessness by 2020, and has indicated more recently that he would like further powers in this area (e.g., to vary Local Housing Allowance, and to address poor housing standards). The GM Housing Strategy (2019) details plans to improve the condition of the existing housing stock and deliver new homes in the ‘right places’. With regard to social housing, there are plans to increase delivery of new social and affordable housing and review the allocation process, as well as ambitions to scrap Right to Buy, which would require national government approval. Proposals to integrate social housing providers with the health and social care system are also put forward, with the example of developing supported housing for older households with care needs.

All of these developments contribute to inclusive growth, and it is a notable development that the GMIPR (and GMLIS) placed a strong emphasis on health and on health and social care reform as a “nationally unique opportunity to find new ways to improve the health of local residents, and link health interventions with local skills provision and other services to improve progression in work and address long-term unemployment among older age groups and people with multiple or complex needs” (GMLIS p27).  This is not the traditional domain of industrial strategy and demonstrates a strong link between the work of ‘growth actors’ and ‘inclusion actors’.

In 2019, the GM public service reform agenda took a major step with the publication of a  ‘white paper’ setting out  a unified public services model.  Building on developments in the last decade, this sets out a “completely new approach to public service” which will “completely break down the silos which exist between public services”. Instead of organising around themes or policy areas, the new model will organise people and budgets around neighbourhoods of 30,000-50,000 residents, each an integrated place-based team, with co-located professionals from all public services working together. Public services are defined broadly, to include formal services, voluntary, community and social enterprise sector, local businesses and assets within communities. Box 9 sets out key features of the model, including geographic alignment, integrated leadership and a single workforce, shared financial resources and shared programmes and delivery.  Importantly, the development of these neighbourhood teams is also identified as an important element in the implementation plan of the local industrial strategy.  Neighbourhood teams bring together local actors who can help to improve health and well-being, and facilitate the embedding of health priorities across a range of policy areas, including tackling poor housing, supporting access to and retention of work, tackling loneliness and debt advice.

Learning from other places: see case studies 9,10,11,12.