01Implications for policy
For cities looking to increase the number of graduate workers there should be a focus on improving the number of job opportunities available by improving the economic fundamentals of a city, rather than explicitly focusing on graduate retention schemes. Both research by Centre for Cities, The Great British Brain Drain, and others shows that job opportunities are the big driver of where graduates move to.4 And this isn’t just about the first job – potential career progression is important too. This means that graduate retention policies will have little impact in those places that can’t currently provide these opportunities – there must be a reason for these people to stay.5
The focus of explicit skills policy, particularly at the local level, should be on improving the skills of people with no or very few qualifications, especially given the large number of people that this applies to in struggling cities.
There are two main challenges for policy in attempting to do this. The first is the lack of understanding at both the national and local level about who is providing skills programmes, and how this money is being spent. Recent work for the Local Government Association showed that there were at least 20 different funding streams for skills and employability policies, which were managed by eight delivery agencies or government departments, spending £10.7 billion in the process.6 Getting a better understanding of how the system works would allow any duplication and poor use of money to be uncovered.
The second is to decide how this money can be best spent. Despite the huge sums of money that has been spent in this area in recent decades, there is little understanding around what works and what does not. In its review of evaluations of policy in this area, the What Works Centre for Local Economic Growth found that in-firm or on-the-job programmes tend to work better than classroom-based training, while short programmes are best for less formal training, and longer term programmes may be more suitable when content is skill intensive.7 But there is too little evidence in this area, and any skills programmes implemented should be rigorously evaluated to better understand what works in the area of skills interventions.
Delivery of such programmes is likely to be difficult, as both reaching those most in need and being able to effectively engage them in any skills programme is not an easy task. Because of the qualifications profiles of people who live in social housing, many housing associations run skills and employability programmes with their tenants.8 Greater support of the existing activities of housing associations, allowing them to extend beyond their own tenants, or getting their assistance when designing new programmes could be a way to improve skills in a city.
Apprenticeships are another established route which in principle can help address skills challenges in weaker cities. At the local level there is likely to be a role for local authorities in making businesses aware of the opportunities to improve the skills of their staff through the apprenticeships system.
While not often considered to be so, another very important area of skills policy is a good transport network, which increases the pool of workers available to businesses in a city. Much recent transport policy, particularly for the North of England, has focused on the impact that improved intercity links can have on widening this pool. The reality is that a single line link between different cities will have little impact – cities instead require stronger radial transport links to widen their catchment areas.9
Transport investment is often considered in terms of large infrastructure investments. But large improvements to the transport networks in and around cities can be made for relatively little cost by better managing the transport network that is already there.
The Transport for London (TfL) model holds a number of lessons for how the management of transport systems can be improved in other cities. Its control over a number of different transport modes (e.g. Underground, Overground, light rail, roads etc) allows for a much greater degree of coordination and smart ticketing to be used across them, its five year funding settlements give greater certainty for investment, and its control of fares creates a revenue stream that it can borrow against.9
The recent passing into law of legislation that will allow mayoral authorities to reregulate bus services will improve local control over transport services. But giving TfL style powers to all big cities in particular should be seen as the flagship transport policy for any strategy looking to improve economic performance across the country, giving these cities greater control over both the expansion and maintenance of their transport networks and the running of them.