Rescue plans must support future growth industries
The Young Foundation has published an analysis of how to mitigate the recession and identify ways of turning a crisis into an opportunity
Fixing the Future – Innovating more effective responses to the recession, by Geoff Mulgan and Omar Salem, argues for a greater emphasis on future growth industries rather than bailing out failing ones. The authors predict that the biggest employers of the next decade will be in health, education, care, environmental services and tourism. ‘Yet recovery plans have been primarily oriented to sectors with smaller shares of employment and that are likely to further shrink in the years ahead. The care industry should be a higher priority than cars. The voluntary sector is more likely to grow jobs than retail banking’, they argue.
The paper suggests a series of options for public agencies and foundations to consider which include ideas for direct job creation; youth and adult apprenticeships; creative uses of empty high street buildings (e.g. for fast colleges providing training and gyms); and local financial institutions that can rebuild habits of saving.
The authors argue that the national emphasis of policy needs to be balanced with a much bigger role for local government and voluntary organisations which in previous recessions proved more agile in finding ways to use wasted resources. The web and social networks should, they add, be used to mobilise creative ideas, and provide small grants for their development.
Their central argument is that the majority of current policy responses have been – inevitably – designed to fix the past, putting right the mistakes of the banks and others. The priority in the next phase is to shift direction towards fixing the future.
Franklin Delano Roosevelt argued in 1932 for ‘bold persistent experimentation’, and said: ‘It is common sense to take a method and try it. If it fails, admit it frankly and try another. But above all, try something.’ Mulgan and Salem believe that the need for better solutions to the short-term problems of recession and the need for better solutions to the long-term challenges of climate change and ageing, healthcare and expanding education are inextricably linked and represent ‘two great challenges of
our times’.
The paper also quotes from the Venezuelan economist, Carlota Perez. Her work has shown that frenzies of investment in new infrastructures and technologies have repeatedly been followed by dramatic crashes, after which, the potential of the new technologies and infrastructures is realised once new social, political and economic institutional arrangements come into being, which are better aligned with the characteristics of the new economy. ‘This is when economies grow, with swarming and bandwagon effects,’ she says.
Author: Clarissa Dann
Clarissa Dann was the editor of Caritas as well as an HR and management online service,he People Bulletin until July 2011.
She is now the editor of the specialist trade finance magazine, Trade and Forfaiting Review which can be viewed at www.tfreview.com but does write on charity finance and investment from time to time.
Clarissa has a background in legal and professional publishing, as well as business journalism and holds an MBA from
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