The best industrial strategy in the world, no matter how well considered, will fail to make real and lasting improvement if it is not rooted in the lives of ordinary people in towns and villages like my own in Redcar and Cleveland.
Economic growth is meaningless if it does not improve the lot of those working all hours on low wages to put food on the table. Most of us are in politics to improve lives and as I argue in People Power, a new Changing Work Centre report, an industrial strategy must start with the people living those lives.
Towns like Redcar have felt the sharp end of deindustrialisation as families have watched once strong industries like ship-building and steelmaking fade away. Redcar’s steelworks closed in 2015, leading to the loss of at least 3,100 jobs and massive shockwaves throughout the local economy. Average weekly wages fell from being some of the highest in the region to some of the lowest and whilst many steelworkers have found new work, most have had to take a pay cut. Some are still in desperate need. I recently spoke to a former steelworker who has had 13 different jobs in the three years since the works shut. And he is not alone.
There is hope though. Whilst its industrial base is now smaller, Teesside is on the cusp of a new industrial renaissance and with the right support its full potential could be unlocked. Our chemicals and process industry cluster is internationally renowned. Our thriving port and neighbouring bulk terminal are a gateway to the world. Big investment projects like the MGT biomass power plant and Sirius Minerals’ polyhalite mine are bringing lots of skilled jobs. But for communities to benefit from new jobs in growth industries, people need to be equipped with the right skills.
The groundwork has to start in our schools with better careers support. Youth unemployment in my area is double the national average, and many have to leave the area to find the jobs they want. A more joined-up approach is needed, working with education providers and businesses to help our young people get the best advice. Where particular skills are needed, there need to be clearly defined local pathways.
We also need to devolve decision-making and trust communities to make their own decisions. When the steelworks closed, a local task- force of community, business, trade unions, and political leaders was devolved central government funding to help those who were made redundant at the works to reskill. In total £11.5m was invested in 23,700 short and long-term courses at local colleges, universities and training providers. Local decision-making was a far more effective way of supporting people back into work than decisions made centrally.
For a people-focused industrial strategy to deliver growth that is inclusive, it needs to be effective at all levels of the labour market. Redcar has a high level of long-term unemployment and some people, especially older workers, find it hard to get into new work. But there is hope. Our award-winning employment and training hub at Grangetown has been a hugely successful initiative at the heart of one of the most deprived wards in the country. This partnership between the local council, community regeneration group FROG, and MGT has supported more than 1,000 people into work in just 18 months.
Local industrial strategies have to consider support for local businesses too, especially SMEs. They are the lifeblood of local economies, are central to job creation, and help retain wealth locally. That means access to finance, especially for new start-ups and established businesses with the ambition and capacity to grow, and utilising the power of procurement.
For an industrial strategy to be a success it must value and empower those at the coalface who are delivering it. If it does not create more better quality, better paid jobs and raise living standards then it is failing. Shifting towards developing local strategies is positive and gives communities like mine greater control over our future. However, national leadership when it comes to funding issues and state aid will remain paramount.