Urban policy - helping people or helping places? New evidence from London on social exclusion and the spatial articulation of the distribution of income

That local job creation within a large urban labour market does not have a significant long term influence on the unemployment rates of local residents has long been documented (for example in Cheshire, 1979; Burridge & Gordon 1981; Gordon & Lamont, 1982). Urban ?regeneration policy? continues, nevertheless, to be targeted at small areas within large cities. This has been a continuing element in British urban policy, for example, since the Innner Urban Areas Act of 1978. An explicit aim of such urban policy has been to ?regenerate local economies and provide jobs for local people?. Increasingly European regional policy has also attempted to intervene on the basis of smaller areas within large urbanised regions. In the literature two mechanisms have been explored to explain the failure of local job creation to influence the unemployment rates of local residents. The operation of housing markets and social housing systems and the way that these generate social segregation means that the source of unemployment differentials across urban areas is primarily that poor neighbourhoods are where those with a higher propensity to be unemployed are concentrated. In addition it has been shown that interaction between local labour markets linked by significant commuting flows means that any differential opportunities that result from local job creation are quickly diffused throughout the set of interacting labour markets. Commuting flows adapt so that characteristic specific unemployment rates tend to equality throughout the urbanised region. This paper examines evidence relating to an additional mechanism: local migration. Data were collected for one area of regeneration in west London - Harlesden. This area was the recipient of a City Challenge grant of ?37.5 million running over 5 years from 1993. It is quite typical of disadvantaged neighbourhoods within large British cities. It grew up on the back of a successful industrial economy which has now been subject to 35 years of decline. It has a large concentration of ethnic minorities and - despite evidence of some success in local job creation - a relatively worsening unemployment rate over the 5 year regeneration period. Data for three samples of people of working age were collected: a sample of those who had lived within the area throughout the period of the regeneration; a sample of ?outmovers?; and a third of ?inmovers?. The samples were large enough for statistical analysis and the differing labour market experience of the samples over the five year period was compared. Differences were very substantial, with the out-movers having far the greatest labour market success. The results reinforce the important role of housing markets in articulating overall social inequality to generate the observed geographical patterns of poverty and social exclusion in urbanised regions. They also reinforce the need to distinguish between the goals of regenerating local economies within cities and that of improving the lives of the most disadvantaged. They also underline the need to think more carefully about what exactly is meant by the aim of providing jobs for local people. These and other implications for policy are explored. Burridge, P. and Gordon, I. (1981) Unemployment in the British Metropolitan Labour areas. Oxford Economic Papers, 33, 274-97. Cheshire, P.C. (1979) Inner areas as spatial labour markets: a critique of the inner area studies. Urban Studies, 16(2), 29-43. Gordon, I. and Lamont, D. (1982) A model of labour-market interdependencies in the London region. Environment and Planning A, 14, 238-64.