Posted by Andy Pike, 15th April 2016

Andy Pike is Henry Daysh Professor of Regional Development Studies and Director of the Centre for Urban and Regional Development Studies (CURDS) at Newcastle University

The idea that cities are engines of economic growth has become a central focus for policymakers across the UK and is core to the current devolution agenda. Yet in the wake of the global financial crisis, economic downturn and faltering economy, anxieties have grown about the kind of growth being pursued and its social and geographical character and reach. It is vital that devolution deals are focused on inclusive growth that is open and spreads prosperity to all.

 International organisations such as the IMF, OECD and World Bank have raised concerns that policymakers are pursuing growth that is economically, socially and environmentally unsustainable and becoming more unequal between people and places.

While ad hoc, piecemeal and rapid, devolution in England is an opportunity to deliver new forms of growth that are more equitable, just and inclusive. This means creating economic opportunity in the form of decent, sustainable and productive employment that is accessible to people across society, regardless of economic status, ethnicity or location. The new governance institutions and spaces being opened up through devolution provide opportunities to think differently about growth, albeit in the context of austerity and a still highly centralised political economy.

International experience from the US, Europe and beyond suggests that there are three key steps that need to be taken to ensure devolution delivers the inclusive growth required.

Firstly, those running to be elected mayors and to lead combined authorities must set the agenda and set out a vision and commitment to inclusive growth. This requires recognising that inequality is a drag on further growth in our cities and generates huge economic and social costs both nationally and locally. Innovative solutions are required that are tailored to the local areas and address local challenges.

Secondly, combined authorities and elected mayors must work to remodel city development strategies and policies around inclusive growth. They should prioritise sectors such as construction and manufacturing in which more productive and better quality jobs with opportunities for development and progression can be pursued. Support can be provided by institutional reform of the local training and skills system.

Finally, authorities must open up their structures and processes to include a wider range of voices in formulating and designing locally appropriate inclusive growth strategies and policies. Community engagement is central to ensure that a broader range of interests is involved in developing initiatives to create more and better jobs and ensure prosperity is spread more evenly across cities and regions. Such endeavours will also help increase the accountability and transparency required for devolution to have legitimacy in the eyes of the electorate.

Devolution offers a unique opportunity to improve the social character and geographical reach of economic growth. Elected mayors and combined authorities must grasp the potential of inclusive growth and remove the brake on the ambition of achieving more and better jobs for all.