Insights
With announcements on the Towns Fund and the Levelling Up Fund in the budget, What Works Growth has been reviewing the evidence on how investments in high streets and town centres can support local economic growth.
We’ve published an evidence briefing, designed to support people making decisions about investments, including those bidding for the Levelling Up Fund, and other place-based funding pots.
If you don’t have time for the full eight-page briefing, here are three headline messages for local decision-makers.
A more vibrant high street needs more customers
The first is that investments are unlikely to deliver sustained change if they only focus on the ‘supply-side’: for example, if activity is focused on the quality of shops on the high street or the availability of non-retail activities (supply) without addressing where consumers for these new amenities will come from (demand). For a struggling place with few affluent residents, creating demand to sustain a bustling high street can be challenging. Current residents won’t suddenly have more money to spend, and attracting new more affluent residents is difficult until changes are embedded. Diverting demand from neighbouring places is possible, but as with attracting new residents, it can create problems elsewhere. Despite these difficulties, it’s often hoped that if you invest in a good enough high street offer, demand will respond. The evidence suggests that while this can be successful, that’s relatively rare. In general, if investments in the high street and town centre are to bring greater economic activity – with all the benefits that follow – then places also need to think about how they will address demand.
Growth requires investment in skills as well as infrastructure
One way to increase demand on the high street is to increase the number of higher skilled (and therefore higher paid) people living nearby. That’s why we advise that investments for local growth should address skills as well as infrastructure. The new array of funds to support local growth offer mainly capital funding, which might make it difficult for places to get this balance right. However, as the UK Shared Prosperity Fund comes online over the next few years, more cash should be available for places to invest in skills. This needs to be viewed by local decision-makers as a crucial ingredient for economic growth, rather than an unrelated public service.
Growth and regeneration are not the same thing
Finally, we highlight that regeneration and economic growth, although related, are distinct. Growth is not the only reason to improve struggling town centres and high streets: regeneration to deliver better housing, public spaces and community services is important in and of itself, regardless of the economic impact. At the same time, the evidence is clear that regeneration investment does not necessarily result in growth. This makes it important that we assess regeneration projects on their own terms against desired goals. We also need to recognise that places are being set up to fail if we assume that investment in physical or cultural regeneration will automatically deliver economic growth.
For places bidding for, or in receipt of, the various place-based funds, making evidence-informed decisions will help to improve bids and deliver better outcomes for communities and for individuals. That’s why we want to support and work with local decision makers to use evidence effectively and find out what works. If you want to know more about our offer – from evidence summaries to bespoke support – you can go to our website, or contact us at info@whatworksgrowth.org.
