Localising Prosperity – by mainstreaming community economic development

Tactics for LEPs & business networks

The Government’s purpose for Local Enterprise Partnerships is to help ‘strengthen local economies’ and ‘facilitate local economic renewal’. EU funding requires economic activity to address social exclusion. Alongside this, many LEPs have chosen to seek inclusive growth and address areas of deprivation as valuable aims in their own right. The Localising Prosperity agenda provides ways of distinguishing growth that creates local, shared prosperity from growth that does not.

Localising prosperity is a way of multiplying the benefits where investment is available, but it also works where external investment is not available, by rebuilding the economy from within. It involves rethinking how we support our localities, redesign the networks and mechanisms which make up our local economies and rebuild an area’s economic and social capacity.

Tactics for LEPs & business networks to maximise local economic benefits

Elements to integrate into strategies, programmes and bids include:

– Involve locally-owned businesses, those demonstrating local commitment and those based in disadvantaged areas in decision-making such as LEP boards and Chambers.

– Understand the power of the ‘local multiplier’ & act on it: plug ‘leaks’ from the local economy, particularly deprived areas, so that more money circulates and multiplies locally.

– Prioritise the needs of SMEs in infrastructure, access to funding and skills. Commit to “SME-proof” decisions.

– Seek opportunities for worker buyouts or co-operatives so that more people are ‘owners’.

– Use consumer, industry and public demand creators such as the retrofitting agenda or procurement to develop local supply chains and product or service innovation.

– Prioritise ‘infrastructure’ businesses that link and generate local supply and demand – such as project developers, wholesale markets, processors. Seek structural opportunities for new businesses.

– Foster networks of innovation based within local institutions, businesses and communities.

– Consider local connectivity as well as global: the latter depends on the former.

– Ensure physical regeneration projects, enterprise zones and inward investment support local supply and demand chains, rather than undermining them.

– Reflect the need for locally-controlled and locally-responsive support services (finance, business support, planning, training)

– Maximise local resource use, including through industrial symbiosis, to increase efficiency.

Have we got the right emphasis?

The public cost per job is 80% higher for Foreign Direct Investment than for indigenous businesses
92% of movements from unemployment or non-participation in the private sector, are down to SMEs
2/3rds of the world economy is controlled by 500 companies accounting for only 1% of employment
In a study of 3,000 US counties, those with a larger density of small, locally owned businesses had greater per capita income growth between 2000 & 2007

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