This government won’t narrow the regional gap without proper investment in skills

Proponents of regional investment are drawn to metaphors of latent potential springing to life, citizens no longer held back. Whether it’s the Northern Powerhouse or the Midlands Engine, the promise is new wealth resulting from greater investment and powers. Every government has tried to use the levers of the state to encourage higher rates of growth outside of London and the south east. New Labour opted to relocate public sector jobs to compensate for a lack of private sector investment. The coalition government focussed on increasing the economic momentum of Manchester and encouraging others to learn the lessons from that city’s reinvention over the past 20 years.

The instinct of Boris Johnson’s government is to foster a scattering of tech hubs: in effect the UK equivalents of Raleigh, Pittsburgh, Ann Arbor and other midwestern cities which have successfully reinvented themselves as start-up economies. Whether or not this extends all the way to creating an “MIT of the north,” in the budget we are likely to see the first steps towards more science funding for research projects outside the Golden Triangle of universities in Cambridge, London and Oxford, and a continued focus on transport and digital connectivity to support places which have been held back from economic revival.

It is right that the government should concentrate much of its spending and regulatory firepower on creating growth centres that will benefit every region. But the private sector will only follow public money if there is a skilled workforce on which new supply chains and allied industries can depend. A more effective system for delivering vocational and entrepreneurial skills will be crucial, both for the young and their parents, who may need to change industries as technology renders types of work or patterns of trade redundant. Putting this system in place is easier said than done, but contrast the amount of thought, effort and money that has gone into narrowing the school attainment gap or boosting universities. An equivalent sense of mission must now be adopted in relation to adult skills, with money and a shift of mindset both necessary.

Specifically, to upskill the 8.5m workers whose only qualifications are level two or below—the group most at risk of being stuck in low-paid work and the poverty that often comes with it—we must start with people’s needs rather than just those of specific industries. Any “levelling up” agenda should mean that those who have been locked out of well-paid, stable work can compete for jobs in newer more dynamic sectors. But many of the towns that gave Johnson his majority don’t have a local university nearby teeming with ideas that could be spun into high-growth technology firms and clusters. The real challenge is to equip people, often in traditionally-low paid sectors with few routes to progression, to get ready for whichever economic changes come down the track, most of which cannot be predicted with any great certainty.

This will require personalised and holistic advice so that people can navigate new learning opportunities; a process for recognising existing skills acquired on the job; the provision of interesting and engaging content, and paid time off so that people can focus on learning. Culturally, much of this is at odds with practice in many of the sectors with the largest proportions of low-paid workers such as retail, hospitality and care, and the costs of this will need to be shared between the state, employers and workers. The government should work with industry leaders in low-wage sectors to explore how this might be achieved, as well as to create the kinds of opportunities that will see these skills being used.

Additionally, while people are infinitely resourceful, they are more likely to keep their footing if Whitehall ensures that the right foundations are in place, including the “soft” infrastructure that holds our society together. The NHS and preventative healthcare services are vital but so too are other public services, including a social security system that serves as an anchor in hard times, and a properly resourced local government that imparts to the users of public spaces a sense of optimism and pride. Tired tropes about borrowing only to invest in roads and railway tracks won’t help us to unlock the energy and potential that exists across the country. The budget must aim to leverage the social and human capital all around the UK to help communities drive forward their own growth.