Gov Responses to Structural Unemployment in the UK post 1980s Flashcards
What was a key challenge in the 1980s related to employment?
Deindustrialisation accelerated, leading to mass unemployment in the North, Midlands, Scotland, and Wales.
This shift was particularly impactful in regions heavily reliant on manufacturing.
What policy focused on reducing inflation during the 1980s?
Monetarist Policies
These policies prioritized controlling inflation over addressing unemployment.
What were the interest rates in 1979 under monetarist policies?
Up to 17%
High interest rates negatively impacted businesses, contributing to job losses.
What were Enterprise Zones established for?
Tax incentives for businesses in designated areas
Examples include Canary Wharf, Liverpool, and Cardiff.
What was the outcome of the Enterprise Zones?
Limited success
They attracted some investment but failed to replace lost industrial jobs in other regions.
What was a consequence of Labour Market Deregulation?
Weakened trade union power
This increased labour flexibility but also led to job insecurity.
What was the government’s stance on regional investment during the 1980s?
Limited Regional Investment
The government believed the private sector should lead economic recovery, reducing public spending in declining regions.
What was the effect of limited regional investment?
Long-term unemployment persisted, particularly in ex-industrial areas
A lack of job creation in these regions continued to be a significant issue.
What did the Jobseekers’ Allowance (JSA) replace?
Some previous benefits
It faced criticism for not sufficiently addressing job shortages in deindustrialised regions.
Which areas recovered during the 1980s due to growth in finance and services?
London and the South East
This contrasts sharply with the persistent job losses in other regions.
What was the unemployment rate in 1984?
3.2 million (11.9%)
This was the highest rate since the 1930s.
What was a key challenge in the early 1990s?
The early 1990s recession hit both manufacturing and financial services, creating broader unemployment.
This recession also caused high interest rates, business failures, and home repossessions.
What caused business failures and home repossessions in 1992?
High interest rates.
These rates significantly impacted borrowing costs for both businesses and homeowners.
What persistent issue affected Northern cities during the 1990s?
Persistent regional inequality.
Northern cities continued to struggle economically compared to other regions.
What government response was introduced during John Major’s Conservatives (1992-1997)?
Regional Development Agencies (RDAs).
RDAs were aimed at encouraging investment in struggling regions.
What was the purpose of the ‘Back to Work’ schemes introduced in the 1990s?
Aimed at retraining unemployed workers.
These schemes were part of the government’s strategy to address unemployment.
What remained a focus during John Major’s government regarding the economy?
Labour market flexibility.
This included continuing privatisation and deregulation efforts.
What was the ‘New Deal’ introduced by New Labour in 1998?
Provided training and job placement schemes for unemployed young people.
It focused on the long-term unemployed but had limited success in ex-industrial towns.
What was a significant economic strategy of New Labour from 1997-2010?
Increased public sector employment, particularly in Northern cities and Scotland.
This strategy aimed to stimulate regional economies.
What was a heavy reliance of New Labour to boost regional economies?
EU structural funding.
This funding was crucial for economic development in various regions.
What significant economic change occurred in London during this period?
The financial sector expanded, particularly in London’s Docklands (Canary Wharf).
This expansion contributed to the UK’s economic growth but also increased vulnerability.
What vulnerability did the UK face due to the financial sector expansion?
Vulnerability to the 2008 financial crisis.
The heavy reliance on the finance sector highlighted structural weaknesses in the economy.
What was one effectiveness of the public sector jobs created during this period?
Helped reduce unemployment in some areas.
This was particularly evident in regions that benefitted from increased public sector employment.
What was the unemployment rate in the UK in 1993?
10.6%.
This rate fell to 4.7% by 2005, indicating a significant improvement in employment.
True or False: The dependency on finance made the UK resilient during the 2008 crisis.
False.
This dependency actually made the UK vulnerable to economic downturns.
What type of unemployment remained in ex-industrial regions despite efforts?
Structural unemployment.
These regions struggled to recover from the economic transitions of the 1990s.
What were the key challenges faced during the 2008-09 financial crisis?
Mass job losses in banking and services, widening North-South divide, worsening unemployment due to austerity policies
The North-South divide refers to the economic disparity between London and ex-industrial regions.
How did the financial crash impact the North of England?
Stagnation compared to London’s quick recovery, exacerbated unemployment due to austerity policies
Austerity measures included significant cuts to public sector jobs.
What was the government response to the financial crisis from 2008 to 2010?
Bank bailouts, £500bn rescue plan, quantitative easing (QE) to stabilize markets
RBS and Lloyds were major banks that received bailouts.
What were the austerity policies implemented between 2010 and 2016?
£81bn in public spending cuts, mass redundancies in public sector, cuts disproportionately affected the North
Over 700,000 public sector jobs were lost.
What types of public sector job losses were most significant during the austerity period?
NHS, local government jobs
Areas where government employment was a major employer were hit hardest.
What was the aim of welfare reforms like Universal Credit?
To encourage work
However, these reforms failed to create jobs in struggling regions.
What initiatives were introduced under Localism & Devolution from 2010 to present?
City Deals, Metro Mayors, Northern Powerhouse
These initiatives aimed to empower local authorities and boost investment.
What was the goal of the Northern Powerhouse initiative launched in 2014?
To boost investment in the North
It struggled with sustained funding despite its ambitious goals.
What focus areas are included in the Industrial Strategy & Levelling Up initiatives from 2019 to present?
Regional infrastructure projects, tax incentives for investment outside London
Examples include HS2 and investments in ports and green energy.
What was the effectiveness of the recovery post-2010 in London compared to other regions?
London recovered quickly due to finance and tech growth; the North, Midlands, and Wales struggled
This struggle was due to public sector cuts and lack of private investment.
What trends contributed to job insecurity after the financial crisis?
Increase in zero-hour contracts and gig economy jobs
These employment types often lack stability and benefits.
What were the main policy approaches during the post-2016 period in the UK?
Brexit, COVID-19 response, ‘Levelling Up’ policy
These policies were implemented under the leadership of Theresa May, Boris Johnson, and Rishi Sunak.
What impact did Brexit have on manufacturing and agriculture?
Disrupted due to supply chain issues
This disruption affected the availability of goods and resources.
What financial impact did Brexit have on the City of London?
Lost financial jobs to EU cities like Frankfurt and Paris
This resulted in a decline in London’s financial sector.
How did Brexit affect regional disparities in the UK?
Widened as Northern towns lacked economic alternatives
This exacerbated economic inequalities between regions.
What was the purpose of the furlough scheme during COVID-19?
Protected 9.6 million jobs from mass unemployment
The scheme provided financial support to workers during lockdowns.
What types of jobs disappeared permanently due to COVID-19?
Low-paid service jobs, e.g., retail, hospitality
These sectors were heavily impacted by restrictions and changes in consumer behavior.
What is the aim of the ‘Levelling Up’ policy?
Reduce regional inequality via infrastructure investment
The policy focuses on enhancing economic opportunities in underdeveloped areas.
What types of infrastructure investments are included in the ‘Levelling Up’ policy?
Investment in transport, e.g., Northern Rail, Freeports
These initiatives aim to improve connectivity and economic prospects.
What criticisms have been leveled against the ‘Levelling Up’ policy?
Lack of clear funding strategy & slow implementation
Critics argue that these issues hinder the effectiveness of the policy.
What was the unemployment rate in the UK in 2023?
3.8%
Despite low unemployment, other economic challenges persist.
What ongoing economic issues are present despite low unemployment?
Wage stagnation & cost of living crisis
These factors affect the purchasing power of individuals.
What is noted about productivity growth in the UK?
Remains weak, especially outside London
This indicates a disparity in economic performance across regions.
Has the ‘Levelling Up’ policy delivered major structural change?
Has yet to deliver major structural change
The effectiveness of the policy in achieving its goals remains to be seen.
