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Discussing policy approaches to major economic shocks with Andy Pike and David Bailey

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On Wednesday 12 February we held another event in our series reviewing topics covered by our toolkits. This one was on Major Employment Losses arising from economic shocks.

Andy Pike of Newcastle University and David Bailey of Birmingham Business School have each studied responses to major economic shocks for over a decade, and kicked off the discussion by giving us a summary of their thinking on the subject.

They presented an overview and critical assessment of the use of Task Forces to bring together stakeholders and provide a coordinated response to, for example, the closure of a major auto production plant. They emphasised the strengths of the task force model: they are collaborative and often innovative, can evolve into a longer standing institution in a local area, and demonstrate the political commitment to a strong response. They can however, be overused, and there have not been any robust evaluations of their effectiveness at mitigating the impact of a major closure. Their slides are required reading for anyone considering their options in response to the announcement of a major employer upping stakes.

The discussion among the experts from government, academia, and local authorities that followed raised many interesting points that we want to follow up on in the next few months, including:

  • It is easier to respond quickly to these types of shocks if you can see them on the horizon. Too often resources are scrambled without reference to the institutional knowledge about what has been done in the past and how well it worked. This is exacerbated by the loss of the Manufacturing Advisory Service and Regional Development Agencies as potential participants in future responses.
  • Having accurate data is essential in being able to track the effectiveness of any response. We will continue to work with government to make anonymised datasets available so that, for example, the employment outcomes for workers made redundant can be tracked over time.
  • Our website could do a better job of signposting people to useful resources on topics like this, even when they do not meet our standards of evidence. We will be looking at how to make this work over the next year.
  • There are many evidence gaps to fill on specific interventions – e.g. is retraining more cost-effective than outplacement? What interventions are effective in affected businesses in the supply chain?

Ongoing structural changes, as well as Brexit, mean that we will continue to find ourselves looking for effective responses to largescale layoffs. We want to make sure that when this happens our response is based on experience in the past and the pieces are in place to learn more lessons for the future.