The warning is contained in a new research report from the think-tank entitled ‘Guarantee of potential: place-based employment support within a new local policy ecosystem’ which analyses how councils and combined authorities should rise to the challenge of delivering the biggest reforms to employment support for a generation and help achieve a national long-term target of an 80% national employment rate.
The report authors claim although northern areas which have higher unemployment and levels of economic inactivity have used the power of their devolution deals to address sub-regional economic disparities, when southern counties with stronger economies and increased capacity implement their own devolved powers, there's a risk these regional gaps may widen.
Similarly, if revised funding formulas or political attention favour the country’s big cities, coastal, rural and post-industrial parts of the country risk having their unique employment support needs overlooked, the study points out.
Localis investigated in ‘Guarantee of Potential’, how decentralization of employment might be advantageously used for the benefit of a distinctly localist approach to tackling worklessness and in line with the government’s agenda for devolution, public service integration and commissioning reform.
Report author and senior Localis researcher, Callin McLinden, told That's Businesss: “With record levels of economic inactivity and expedited devolution frameworks, local government is being asked to tackle worklessness with more responsibility, but lacks either sufficient capacity or resources to do so with confidence.
“This report sets out a practical roadmap for transforming fragmented employment services into coherent, integrated, and place-based support systems; linking health, skills, and jobs in a locally tailored but nationally coordinated framework achieved through strategic design and procurement.
"But without proper investment in local capacity, long-term funding certainty, and shared governance between Whitehall and localities, the potential to reduce worklessness risks becoming perpetually stunted.”
Ayden Sims, CEO, AKG, added: “This report arrives at a pivotal moment, as the UK grapples with persistent economic inactivity and the need for more inclusive growth and offers a compelling case for enhanced local ownership, not as a theoretical ideal, but as a practical and necessary shift in how we design, fund, and deliver employment services.
“The findings underscore the value in empowering local authorities and strategic partnerships to lead the charge in tackling worklessness, particularly in communities that have been historically less well supported via previous approaches. It also flags the importance of having this future support strike the right balance between local empowerment and trust, alongside a consistent national offer, underpinned by strong accountability frameworks.
“What stands out most is the report’s emphasis on integration, between employment, health, and skills and the recognition that good work is not just an economic outcome, but a determinant of wellbeing. The insights drawn from trailblazer regions and emerging local models show that when local leaders are given the tools and trust to innovate, alongside the practical support to ensure their visions can be realised and delivered, they can build services that are more responsive, more inclusive, and ultimately more effective.”
