I am writing immediately after the RSA Jobs Summit which I co-chaired with our Chair of Trustees Luke Johnson and former RSA Trustee, and respected independent economist, Vicky Pryce. We had an amazing line up of speakers ranging from senior politicians (David Miliband and David Willetts) to respected academics and policy analysts (Paul Gregg, Jonathan Portes, Paul Johnson) to incisive writers on the economy (John Kay and Diane Coyle) to people with front line experience of business (John Makinson, James Mawson, Elizabeth Varley) and many more.
The conversation had a nice concertina rhythm, moving from broad debates about jobs, enterprise, and investment to more specific questions about industrial policy and labour market regulation. Overall, I was reminded that in policy making what matters is what is important not what may be most novel. Although the sessions spanned political perspectives ranging from Miliband to the unapologetically free market views of the IEA’s Mark Littlewood, and a wide range of expertise, there were some points which came close to achieving a consensus:
Despite the grim figures the UK has a good record on job creation (200,000 more jobs under the Coalition for example) and – by international standards - a reasonably flexible labour market.
Our problems lie most acutely in youth unemployment but also in other people and places consistently over-represented among the unemployed and under-employed, and the fact that a combination of fiscal and demographic changes mean we probably have to create about an extra 300,000 jobs a year over the next decade even to maintain unemployment at today’s levels.
We continue to have major problems with the employability of those young people not going into higher education. The roots of this are complex but we may need to speed up reform to the education and experience we offer 14-19 year olds.
The over concentration of power, investment and growth in London and the South East is a problem. Most agree that part of the answer is strengthening the city regional tier of government, particularly with elected mayors. There is also recognition of the need for greater flexibility in labour market factors at a city and at a population subgroup level, although what this should encompass (minimum wage level, public sector pay, tax, employment regulation) is more complex and controversial.
Notwithstanding the pressures of austerity there continues to be strong case for emergency action to create public works jobs for young people.
Although we should aim to increase skill levels, we will always need many low skilled jobs. But the attitude and life skills of employees and the management skills of employers are important to whether this work can be more or less well remunerated, satisfying and provide the basis for progression.
Entrepreneurship is vital to future growth and job creation and there are probably more budding entrepreneurs around now than ever before. But we are still quite in the dark about the characteristics which make for a successful entrepreneur and the context which most favours them. When we do find people who have, and act on, great ideas we should cherish them and encourage them to develop this talent in others.
In terms of its current areas of economic strength (for example, creative industries, pharmaceuticals, business services) the UK is pretty well placed to exploit growing global markets. Despite the abolition of the RDAs, the Government is increasingly willing to talk about the need for industrial policy but this needs to be based on an objective, evidence-based assessment of the emerging areas of technology that we may be able to exploit.There is little new in all this but it was useful to see the points of broad agreement and to focus minds on the key aspects of a strategy for jobs and growth. We will be publishing a fuller report of the day in a few weeks’ time.
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