New research shows they are badly hit by Covid job losses
“Red wall towns worst hit by lockdown job losses” is the headline in The Times today:
The figures will make for difficult reading in Westminster, where a new cohort of Tory MPs has been voted in on the back of the Conservative Party’s manifesto pledge to invest in forgotten towns).
The story by Gurpreet Narwan, is based on a briefing from the Institute for Employment Studies.
Drill down into the detail, however, and a somewhat more confusing picture emerges. Compared to mid-March, job vacancies are down by more than 50% across all regions — but the percentage fall is greatest in London and least in the North East.
On a more local level, the worst affected areas are a geographical mix — the top five being the City of London, Bolsover, Watford, Aberdeen and Crawley. Grouped by productivity (measured by economic output per capita), the percentage declines are generally steepest in the most prosperous areas. On the other hand, breaking down the figures by salary level, the shallowest declines are in vacancies for the best-paid jobs.
This isn’t quite as contradictory as it might seem. It just means that the biggest impact has been on lower-paid jobs in the richest areas. That’s not surprising given the effect of the lockdown on leisure, hospitality and retail.
However, the pandemic hasn’t altered the long-standing geographical inequalities of the UK economy. In absolute terms, jobs are still hardest to come by in the same places that they were pre-Covid. Relative to the number of people claiming unemployment benefits, vacancies are scarcest in Red Wall type seats (i.e. the “Services and Industrial Legacy” category) and most abundant in the “Affluent England” and “London Cosmopolitan” categories.
Indeed, the most remarkable fact in the whole briefing is that, on the above measure, the best connected parts of the country are better-off now than the most left behind parts were before the crisis.
Obviously, everywhere is suffering — and no industry is untouched. When it comes to state funding for reconstruction, the queue will be a long one. Nevertheless, it’s vital that the winners of the pre-Covid economy do not, once again, push to the front. Now, more than ever, the Government must hold firm to its promises.
Levelling-up isn’t just the right thing to do, it is the smart thing to do — directing investment to those parts of the country with the greatest untapped potential.