Unemployment in Britain

"Boom turns to bust in Britain's jobs blackspot"

by Aida Edemariam in the Guardian

Doncaster Central has the fastest growing number of benefit claimants of any constituency in the UK, despite big regeneration projects employing local people. Photograph: Christopher Thomond
It's only been a couple of weeks since the Doncaster Trades Union & Labour Club moved into its new premises, and it still feels as if the members are settling in. Part of the issue might be that the surroundings are so unexpected: no battered, dark snug, but a shiny, brightly-lit bar in the also shiny, brightly-lit Frenchgate shopping centre.
Grizzled men in work clothes and fluorescent bibs perch experimentally on pristine banquettes and watch the ladies' darts team take on Balby Bridge. The only overt sense of 111-years of history comes from the photographs of old Doncaster on the walls, and the lock boxes under the snooker tables containing the regular players' cues. The woman behind the bar likes this better than their old haunt. "Bit classier."
Doncaster generally feels like a town still uneasily trying to meld old and new. It came of age as an industrial centre. Seventeen pits produced coal for the steel factories of Rotherham, Scunthorpe and Sheffield; the Flying Scotsman was built here (London Underground trains are still manufactured here, by a company called Wabtec). And then came Margaret Thatcher, and the closure of the pits.
"Twenty to 25 years ago, there was almost like a social mourning going on," says Steven Shaw, the chief executive of Doncaster Chamber. "You'd lost a huge chunk of the rail industry, virtually all the mining and virtually all the steel." It became a byword for unemployment and economic depression, and took nearly 15 years, says Shaw, before a strategy for the future emerged.
You can see that process physically, in the townscape: narrow brick streets and alleyways at the centre, bumping into the Frenchgate; or on the outskirts of Doncaster Central, the 16,000-seat new Keepmoat stadium, the new racecourse, the new bloodstock sales centre, the brand new Robin Hood international airport, and the counter-intuitively wood-clad new fire station.
"Doncaster's like a boomtown," says the town's first elected mayor, Martin Winter. He has dispensed with his driver and is showing the Guardian around himself, a big ex-rugby league player hunched over the wheel of a car that seems too small.
Between 2000 and 2007 £1.4bn was invested in Doncaster, creating more than 22,000 jobs. (Long-term worklessness is still high, however. About 20,000 people claim incapacity benefit, often due to physical injuries from mining, although about 7,000 are stress related).
Most of this money is private, but the council contributed about £5m to the Frenchgate and £30m of taxpayers' money went into the Lakeside sports complex; the New Deal for Communities has, over 10 years, put £52m into crime reduction, education, job training, health and housing in deprived areas, which includes Doncaster Central, whose MP, Rosie Winterton is minister of state for pensions reform at the Department for Work and Pensions. (This area seems to provide a disproportionate number of cabinet members: there is also Ed Miliband, the energy secretary, in Doncaster North, and Caroline Flint, minister of state for Europe and the Foreign & Commonwealth Office, who is MP for the Don Valley.)
Regardless of who was paying, there was a deliberate attempt to have Doncaster people trained and working on the big projects; there were strictures that materials be locally sourced. The airport alone is predicted to create employment for 1,500 people by 2016.
But things seem to be changing. Last week government figures showed that Doncaster Central had the fastest increase in benefit claimants of any English constituency in the 12 months to September. There are now 2,343 claimants, a rise of 537 since last year. The mayor and his staff say they don't recognise this picture, but elsewhere the story is a little different. Even the employed start straight in with "It's too many foreigners willing to work for minimum wage", and concern is rising, the harbinger, perhaps, of how the expected recession might look.
At the Trades Club, Peter Buckenham, 52, still in work clothes after a day driving timber lorries through Derbyshire, is nursing a pint. For the first time he only got two days of work this week. The company he works for is feeling the pinch, and laying people off. "I'm worried." Other people he knows are too.
No-one's been made redundant quite yet, but a friend has shut his computer shop. When he joined the club they asked, "Are you working?" and told him he was one of the few.
Unless you count the 600 workers laid off last week at Sheffield car parts supplier LSUK (which has a knock-on effect in Doncaster as many people commute), or McCormick tractor factory, which closed in 2006, with the loss of 325 jobs, there haven't yet been huge redundancies. Rather it's a case of a little here and a little there, "a creep of lots of things," as Graeme Huston, editor of the Doncaster Free Press, puts it. At the local Jobcentre Plus, Jonathan Kay, 23, who's just moved back after finishing a degree in Leicester, is finding it slow. "There doesn't seem to be a lot going on, unless you want to work in a call centre." Most of the job losses so far seem to be a direct result of the bank crisis - and thus in new building and home sales. "Probably the first tranche of heavy losses were in the legal sector," says Shaw. "A lot of the conveyancing lawyers were the first people to notice." One high street practice had to lay off 60 of its 360 staff in April.
Colin Wright, managing director of Wright Investments, which specialises in property, transport and storage, has just had to liquidate his building division, and lay off 20 people. "What's happening with the housing market started affecting us last Christmas," he says. "I carried on funding projects myself, thinking it'll come back - and then all this happened a few weeks ago." He says the bigger national builders were closing down their sites six months ago. "The thing with the construction industry is that most of the guys are quite highly paid. When they go out of work it has quite an affect in the economy. They're big spenders and don't tend to save."
The Chamber is a membership organisation, and they have noticed a spike in companies failing to renew because they've gone bust - 10 in August alone, mainly in retail and the service sector. The pubs are quieter and the volunteering organisation CVS has seen a sharp rise in inquiries, mostly unemployed people looking for work experience as opposed to people looking to help, says manager Julie Cox. Last year the largest group was under 25s; this year they are between 29 and 34 years old.
What's interesting is that the effect hasn't been felt across the board. "This economic downturn has been like nothing I've experienced," says Shaw. "It's been much much quicker, and less indiscriminate than in the early 1990s. Then everybody suffered. It was universal.
"In this current cycle we're still seeing areas that are doing exceptionally well - the Primarks, the Nettos. In the early 90s the engineering sector was absolutely decimated. But we're still seeing engineers and manufacturers of hi-tech products - aviation, hi-tech metals, fibre optics - doing exceptionally well."
They have been so battered over the last 25 years "that if you're still in business you're probably a lean mean business anyway". But the large-scale job-creating investments, New Deal or otherwise, seem to be holding up OK too. "The jobs that they've created are real jobs and they're still there."
Shaw is keen to stress Doncaster's potential: its transport links, development space and the national firms that have been moving in. "It's a much nicer place to be than 20 years ago." But they have to be realistic too. A lot of the really big projects are now finished, says Wright, and "the new big projects won't start for a long time. I think it'll get a lot worse before it gets better".