Marcus Johns, researcher at IPPR North, discusses their recent work with northern local authorities to encourage high quality jobs for residents – and what other councils can learn from their experiences.
Local authorities can help fight the enduring, severe job quality crisis we are facing. This crisis is characterised by low pay, insecure houses, and little (if any) progression opportunities for many workers, and concealed by record high employment figures.
About 1 in 4 workers and 1 in 3 women in the UK are paid less than the real living wage (£9 per hour in 2019/20). These figured are slightly higher in the North.
Our recent IPPR North report investigated the steps that local authorities are taking to tackle this crisis from the ground up. We found that they have innovated to overcome the financial and legal challenges to embed ’decent work’ policies—for example, requiring that contractors pay the real living wage, or setting out employment charters. As the North of England’s dedicated think tank, the report focuses on best practice from northern local authorities, but we know that local authorities in other regions are embedding decent work policies too.
The financial challenge is perhaps the most difficult to overcome. Austerity is undermining local government, and we know councils need fairer funding—and more funding—to remain viable. When a price tag is attached to a decent work policy (such as requiring contractors to pay a living wage) many local authorities are understandably deterred.
But in fact, councils may find such policies are more cost effective than first thought: officers in Preston, Warrington and Salford told us that introducing a living wage cost less than initially anticipated . Elsewhere, other councils have explored cost mitigation – like aligning implementation to overarching changes to the pay spine or tying living wages to upskilling. Our work overall suggests that the financial cost is more a perceived barrier than an actual one.
Legal issues in commissioning and procurement are also often cited as a barrier to decent work policies. Some have argued that either EU or UK laws prevent decent work policies in procurement. But this is mistaken: EU procurement law and the UK’s Social Value act permit, and indeed encourage, decent work considerations as part of procurement. In practice, Manchester considers the payment of a real living wage as part of its social value weighting, which is set at 20 per cent (relatively high compared to other authorities). Salford references its employment charter in procurement so that they can score prospective contractors against it—something that Greater Manchester Mayor Andy Burnham has now pledged to do across Greater Manchester.
Our project also considered other opportunities to embed decent work more widely, beyond commissioning and procurement. For example, Greater Manchester and Liverpool City Region are developing employment charters in partnership with employers, trade unions and employees—and Liverpool City Region includes decent work criteria in allocating its £500 million Strategic Investment Fund. Local authorities can also use their direct control over businesses and premises, by adding real living wage clauses to commercial leases or ensuring directly owned companies are Living Wage Foundation accredited – as is the case in Wirral’s Evolutions.
We also call for a Living Wage North – where every worker in the region receives at least the real living wage by 2025; a Northern Employment Charter, built up from the charters of constituent local authorities; and recommend that every local authority explores and implements the practicable steps to embed decent work that are outlined in our report.
But what can Councillors do? Our report also contains a ten-point Councillors’ Guide to Decent Work in Commissioning and Procurement—simple and practical steps that elected members can pursue. These include: pushing for and adopting living wage policies; using wider Council strategies to embed decent work issues across the organisation; pushing for the development of an employment charter; and scrutinising the standards of work in directly employed or contracted staff.
The UK’s job quality crisis is likely to remain a severe problem for some time. But local authorities can act to improve this situation – and they are acting across the North and across the country. The financial and legal obstacles can be overcome. There is no good reason why all local authorities can’t take these steps, and try to do as much as possible for their low paid residents.