The Informal Economy in Coalfield Communities in

Yorkshire:Preliminary Thinking

John Erskine

20 April, 2012

Presentation Structure

My background Understanding the informal economy Scope of the study Local context Policy context

The Informal Economy: Definition

'paid production and sale of goods and services that are unregistered for tax, social security and labour law purposes, but are which are otherwise legal'

European Union 1998

Studying the Informal Economy: Why?

Recurring policy interest in enterprise as a solution for disadvantaged areas – Enterprise Allowance/New Business Grant; Social Exclusion Unit; LEGI

A test for deregulatory and neo-liberal policy approaches

A realisation that communities survive in very difficult circumstances – how?

Exploring the disconnect in planning, employment, economic and housing policy and programmes

The Informal Economy: Current Research

Weakness of quantitative approaches (ONS, 2005)UK and European research – Hart (1973, 2011), Pahl (1984), Williams (2004, 2005)US research – VenkateshNeo-liberal approaches – De Soto (2002)Entrepreneurship literature – Greene, Mole et al.(2008); Armstrong (2005); Rouse (2006)

Context and Specificity: England 2012

Geography

Coalfield communities

Relative isolation

Homogeneity and identity

Institutional Factors

The institutional behaviours of a centralised state

The enterprise consensus

Business Climate

Recession

Agglomeration and the end of cash

Casualisation and agency working

What will the study look at?

Substantial programme of qualitative fieldwork in three disadvantaged communities in Wakefield, working with stakeholders, residents and participants in the informal economy.

Initial survey work will use a modified version of the framework developed by Pahl (1984).

Detailed follow-up with participants will continue over 18 months to identify developing issues

There have been limited opportunities to assess the impact of the 2007-2008 recession in economically fragile areas.

Current research on the informal economy in the UK is also limited

Wakefield: The Economic Context

Job Losses 1981 – 20 pits; 18,000

employees

2011 – 0 pits; 500 employees

Job Growth Logistics, logistics,

logistics

12,000 employed by 2003

143% growth, 2000-2003

A8 Migration – 2004 onwards

Manufacturing Berwins

Bombardier

British Jeffrey Diamond

Double Two

SR Gent

Wakefield: The Regeneration Context

Planning – motorway junctions, housing development

Housing investment – Estate Action and after, SRB, LSVT/Decency

Major projects – Waterfront, Westgate, Trinity Walk

Community-based economic development – Employment Programmes, Community Learning Centres, Business Support, Social Enterprise

However, high levels of geographically concentrated deprivation in South East of District, Castleford, Knottingley and Inner Wakefield still persist.

Enterprise Myths?

Enterprise Policy: Four Phases

1970's – Policy off? Bolton Report, NEB,Common Ownership, Regional Policy

1979-1992 – Enterprise as policy, discourse, and politics

1992-2010 – Evidence-based policy? Business Link, RDA's, LEGI

2010 – Year Zero.....

Enterprise Policy: Implicit Assumptions

Nascent businesses exist in disadvantaged areas. Some already operate in the informal economy

Individuals in disadvantaged areas have entrepreneurial aspirations. Some have potentially useful skills and experience

People are entitled to be entrepreneurial, which should be supported through public policy

Making legislative and regulatory compliance possible will help informal businesses move into the formal economy, but as an implicit outcome of public policy, not an explicit one

Policy: Interelationships

Welfare Policy

The Work Programme and Conditionality

Housing Benefit Changes

Working Tax Credit

Childcare Policy

Regional Policy

The end of RDA's

The end of WNF, and spatial targeting

Regional Growth Fund

Public-sector dependence

The Big Society

Civil society as a substitute for the state

Social investment and social responsibility

Localism

Enterprise Policy

Reintroduction of the Enterprise Allowance

The end of state-funded face-to-face business support

BIS leadership

Contribution of the study

Economics

The challenge to neo-liberal models

The role of regulation

Competition within local markets

Management

The nature of entrepreneurship

Knowledge, learning and skill

Organisation within small businesses

Sociology

Understanding social exclusion post-2007

Expectations and aspirations, legality and legitimacy

The role of self help and social capital

Geography

The limits of existing approaches to regional economic development

The nature of local economies in post-industrial communities

Networks and connectivity

Contact Details

johnerskine1961@gmail.com