We’ve been researching how the employment prospects of people in deprived communities across England and France could be improved.
One thing in particular stood out: many of those who participated in the IncreaseVS programme offered by various housing associations were what we might classify as low-skilled. While the programme was successful in helping those outside of the labour market back into work, the jobs they were ultimately going into were often what are known as ‘non-tradeable’.
“The tradeable sector produces things that can be consumed away from where they are originally produced,” explain Ian Goldin and Tom Lee-Devlin in their recent book Age of the City. “The non-tradeable sector, by contrast, encompasses services that are intrinsically anchored in place, such as hospitality, construction, and most healthcare.”
These jobs are certainly not bad, and they are much needed in any society. However, research from the OECD suggests that for regions, and especially deprived regions, to improve, they need an influx of tradeable jobs. Indeed, Goldin and Lee-Devlin cite research from economist Enrico Moretti showing that each new tradeable sector job is enough to create 1.6 jobs in the non-tradeable sector. This multiplier effect is particularly strong in high-skilled domains, where up to 5 new jobs can be created.
Attracting high-skilled workers
This suggests that economic development is highly likely to result when an area succeeds in attracting high-skilled workers. Many hoped that the rise of remote working during the pandemic might have helped to shift such highly-skilled workers away from big cities towards towns and villages that offer a lower cost of living and a generally higher quality of life.
That hasn’t really materialised, however, as the hybrid working that is increasingly the norm still requires workers to be within touching distance of their place of work. One group who have become largely untethered from a workplace are the digital nomads whose work is almost exclusively performed online.
The last few years have seen various schemes created to entice digital nomads to communities. Indeed, a growing number of countries have created special digital nomad visas to make it easier for people who tend not to put down roots. One of the most notable schemes to attract digital nomads was in Portugal, which offered dedicated visas and attractive tax breaks alongside the promise of year-round sunshine.
While the scheme was largely successful, it wasn’t so popular with locals, who complained that the newcomers didn’t really integrate, and that it resulted in the gentrification of the areas they moved to.
Perhaps mindful of the response to these transient workers, a number of other locations around the world are taking a different approach. Knowledge workers may spend only a few months of the year in their town. So they are focusing more on people who will put down permanent roots. Rather than providing visas and tax breaks, therefore, these schemes are aiming to make it easier for people to move themselves and their families.
For instance, in the US, Choose Topeka offers people up to $15,000 to rent or buy a home there. Similarly, Tulsa has attempted to attract remote workers by offering up to $10,000 towards a downpayment on a new home in the city. Calabria, in Italy, has spent around 700,000 Euros trying to entice people to the region.
These schemes are an improvement on those designed to attract digital nomads, since they are longer-term and aimed at people who will hopefully make these locations their home. However, they do inevitably mean that new people are introduced into a community to which they have no real ties.
A third option is to focus on those people who have left the community and to try to entice them back. It’s common for people to leave deprived communities for study or work, due to the perceived lack of opportunities available to them in their hometown. If they can be encouraged to return, not only do they bring with them both skills and social capital, but they also don’t suffer from any adverse perceptions of them as “outsiders”.
Research from Iowa State University explores some of the ways people could be attracted back. The study suggests that graduates are more likely to return to rural communities if they had a strong attachment to their school. This is especially true when the attachment is driven by their involvement in the school community or connections with individual teachers.
The researchers found that the size of the school was also important. Former students of schools that had over 350 students were much less likely to return than those whose school had fewer than 125 students. Returnees were also seemingly more likely to return if their hometown had a lower population density and fewer fellow graduates. The authors argue that this is perhaps because people feel that they can make a more significant impact in the communities of such towns.
The levelling-up debate can often revolve around physical infrastructure projects, but an equally important aspect is that of human capital. The above examples illustrate how there is a right and a wrong way to inject some fresh blood into deprived communities.
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The East Anglian region is arguably ideal as a remote working location. The East Anglia Bylines editorial team would be interested to hear the experience of readers, either as remote workers, or as neighbours to remote workers. Has the local community been enhanced? What benefits/difficulties have emerged? Please write to [email protected].