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Spatial labour market inequality and social protection in the UK

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  • Lee, Neil
  • Fransham, Mark
  • Bukowski, Pawel

Abstract

Spatial inequality in economic outcomes is increasingly seen as a problem for national economies. This paper considers spatial inequality in the UK labour market, its causes, and potential policy solutions. Relative to other European countries, the UK is highly spatially uneven, but it is not as unequal as the United States. The most common explanations for growing spatial inequality are economic, in particular the linked processes of manufacturing decline, the rise in knowledge-based services, and London’s growth as an international service hub. However, these explanations ignore the importance of spatial labour market institutions on different local economies. In this paper we argue that labour market institutions are one of the key missing explanations for the changing patterns of spatial inequality in the UK, and that the impact of labour market policy is likely to dwarf the limited funding provided for local economic development policy. We conclude with some suggestions for how policy might better address spatial labour market inequality in the UK and start to create good jobs across the country.

Suggested Citation

  • Lee, Neil & Fransham, Mark & Bukowski, Pawel, 2024. "Spatial labour market inequality and social protection in the UK," LSE Research Online Documents on Economics 122224, London School of Economics and Political Science, LSE Library.
    • Handle: RePEc:ehl:lserod:122224
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    File URL: http://eprints.lse.ac.uk/122224/
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    References listed on IDEAS

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    1. Patricia G Rice & Anthony J Venables, 2021. "The persistent consequences of adverse shocks: how the 1970s shaped UK regional inequality," Oxford Review of Economic Policy, Oxford University Press and Oxford Review of Economic Policy Limited, vol. 37(1), pages 132-151.
    2. Bauluz, Luis & Bukowski, Pawel & Fransham, Mark & Lee, Annie Seong & López Forero, Margarita & Novokmet, Filip & Breau, Sébastien & Lee, Neil & Malgouyres, Clément & Schularick, Moritz & Verdugo, Greg, 2023. "Spatial wage inequality in North America and Western Europe: changes between and within local labour markets 1975-2019," LSE Research Online Documents on Economics 121290, London School of Economics and Political Science, LSE Library.
    3. Rice, Patricia & Venables, Anthony J. & Patacchini, Eleonora, 2006. "Spatial determinants of productivity: Analysis for the regions of Great Britain," Regional Science and Urban Economics, Elsevier, vol. 36(6), pages 727-752, November.
    4. David Bailey & Lisa De Propris & Alex De Ruyter & David Hearne & Raquel Ortega-Argilés, 2023. "Brexit, trade and UK advanced manufacturing sectors: a Midlands’ perspective," Contemporary Social Science, Taylor & Francis Journals, vol. 18(2), pages 250-265, March.
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    More about this item

    Keywords

    public policy; labour markets; inequality; regions; ES/V013548/1;
    All these keywords.

    JEL classification:

    • J08 - Labor and Demographic Economics - - General - - - Labor Economics Policies
    • N90 - Economic History - - Regional and Urban History - - - General, International, or Comparative
    • R00 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General - - - General

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