Can collaborative economics see Birmingham return to its glory days?
July 2, 2015
A collaborative approach to local economics
In terms of economics, Rogers is keen to move beyond the one-size-fits-all policy that has seen local authorities and local enterprise partnerships (Leps) work primarily with private sector providers to boost growth and inward investment.
Just as the paternalism of the city’s past now feels outdated, so too does an economic strategy that is increasingly out of synch with the needs of its young population and that has failed to turn around its poorest places.
In a borough the size of Birmingham, focusing on high profile inward investment schemes has meant large swathes of the city have been left behind. Birmingham and the broader west Midlands region are splintered geographically and have failed to have a strong narrative about where their economic destiny lies. Mark Rogers has vowed that his council will do more to stimulate grassroots local enterprise and involve a plurality of actors in economic strategy, but has yet to set out that vision. What would a broader, more collaborative, local economic policy for the region look like?
That was the question posed by a New Start event held in the city last month as part of its Activating Local Alternative Economies programme. Led by Localise West Midlands, it brought together council officers and third sector and social enterprise representatives from Birmingham and its regions to discuss how greater collaboration between sectors could improve economic outcomes. For while the region’s local enterprise partnerships are working well at boosting the region’s growth, they are rarely looking beyond the growth agenda – at the health of the small businesses sector, for example, and how it can be joined together and linked with local supply chains. Or towards greater collaboration with the region’s social economy.
What would a more collaborative, ‘civil’ approach
to local economics in the region look like?
Karen Leach, co-ordinator at Localise West Midlands, opened the event with findings from her study into the impact of a local economic development approach that, rather than looking outside of a city for investment, makes the most of the networks, small enterprises, supply chains, community assets and human potential that already exist within a place.
Her Mainstreaming Community Economic Development report proved that businesses that come from and are rooted within their local areas help circulate money within a place and unlock greater economic power than inward investors that have no links to place and tend to extract money for shareholder value. Locally-led businesses are linked to better performing local economies with higher levels of job creation, social inclusion and civic engagement, the report found.
It cited examples of locally-led businesses including Birmingham Wholesale Markets, one of the largest in the UK, which sustains around 15,000 jobs; the Jericho Foundation, based in Balsall Heath, which sets up social enterprises to help disadvantaged people into work; and Encraft which provides support for low carbon projects.
These organisations – and many others of a similar scale – play a vital role in the economic health of Birmingham and its regions but do not currently feature in their economic strategy. Linking small businesses and social organisations together, allowing them play a greater part in local supply chains and the region’s overall strategy would change the economic picture.
‘Government is like an absentee landlord, focusing on inward investment which leads to a cycle of decline’, Leach said. ‘Good practice is the opposite. A virtuous circle of greater money circulation and greater commitment to a local area.’