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The Training and Employment Research Unit in conjunction with Cambridge Policy Consultants were commissioned by the Scottish Government, through the Scottish Centre for Regeneration, to identify and explore good practice approaches to connecting regeneration investment to the needs of disadvantaged areas and groups in the United Kingdom. This paper highlights the findings from the linking opportunity and need ( LOAN) case study research. The research does not attempt to generate a generic solution, rather it sets out to explore and understand the main challenges that need to be addressed and the key lessons that can potentially help inform the design, development and implementation of a LOAN approach, and so improve our record at linking opportunity and need.

Main Findings

• In recent years local economies across the UK have enjoyed greater economic buoyancy than for a considerable period of time. However, the gap between the poorest communities and the average has remained stubbornly resistant to change.
• LOAN is an approach to capture the interventions that seek to enable disadvantaged individuals and communities to compete for and access the employment opportunities arising from regeneration investments.
• These investments offer the potential for jobs at the construction stage, end-use stage or both. To secure these community benefits, the LOAN case studies took either a mandatory approach, supported by the contracting process or a voluntary 'best endeavour' approach.
• The key challenges identified in the case studies for the successful design, development and implementation of a LOAN approach were setting it up at the outset, balancing 'opportunity' and 'need', embedding the approach into the area's wider economic development strategy, engaging effectively with employers and target client groups and ensuring clients sustained outcomes over the longer term.
• The key lessons identified in the case studies were the need to secure a fit with existing services, clarity about what the public sector wanted, the need for strong branding and partnership working, an effective project manager and/or team, early engagement with employers and the local community, keeping things simple and delivering on promises, playing to partner strengths, having an effective monitoring and performance management system, delivering a lasting legacy and widely disseminating successes.

Background

In recent years local economies across the UK have enjoyed greater economic buoyancy than for a considerable period of time. However, the gap between the poorest communities and the average has remained stubbornly resistant to change. This disconnect between investment opportunities, particularly those generating large numbers of jobs, and more disadvantaged communities is a critical issue. It is this imperative to link opportunity and need that is the basis of this research.

LOAN is an approach used to capture interventions that seek to enable disadvantaged individuals and communities to compete for and access the employment opportunities arising from regeneration investments, aiming to connect opportunities on the demand side of the labour market to need on the supply side. While the approach is simple, the evidence base suggests that delivery has generally fallen short.

LOAN tends to focus on employability interventions, but can be extended to wider local economic development issues seeking to engage the local business base, improve area connectivity, raise area profile and increase place competitiveness.

Methodology

The research is based on 12 good practice case studies, which vary by type (project versus process-based), project lifecycle (tried and tested, honing their approach or early stage), scale (neighbourhood versus wider area) and focus (construction phase, end-use phase or both).

The case studies were identified from a trawl of web-based sources, the evaluation research knowledge and expertise of TERU and CPC, a review of the evaluation literature, suggestions from stakeholder contacts and input from the Steering Group.

A standardised approach was used for each case study which involved:

• An in-depth review of relevant project documentation and websites, including annual reports and formal evaluations.
• Semi-structured face to face interviews with the project manager and other key personnel in the lead agency.
• Semi-structured interviews with key funders and public, private or third sector partners.

This standardised approach made it possible to read across the case studies to draw key lessons.

Findings

Design and Development of LOAN Approach

To develop a successful LOAN approach there needs to be a comprehensive understanding of both the nature of the ' opportunity' on offer and the ' need' in a particular area or amongst specific groups. This knowledge and understanding should form the basis for the design and development of the approach and its subsequent implementation.

The types of opportunities that arise from a specific regeneration investment are likely to offer the potential for jobs at the construction stage, end-use stage or both. Although a challenging exercise, a mapping of the scale and timing of investments can be used to indicate the number, type and timing of potential jobs.

The identification of need amongst the residents of a particular area or members of specific target groups is critical, although the evidence from the case studies suggested that a detailed understanding of the labour market was relatively weak.

In the LOAN case study approaches focusing on the construction phase:

• Where the public sector was the developer it was able to impose LOAN aims and objectives through the procurement process. This was either through a mandatory approach supported by the contracting process or a voluntary approach supported by strong contractor commitment.
• Where the developers were in the private sector 'best endeavour' agreements persuaded employers to sign up to the LOAN agenda.

In the LOAN case studies where the emphasis was on the end-use stage a voluntary approach was taken, built upon strong, mutually beneficial working relationships and shared benefits.

The design and development of a LOAN approach must include a full consideration of how the approach will be resourced in terms of staffing and funding. This may involve lengthy deliberation and negotiation amongst partners.

Working in partnership is a challenge and requires significant time, effort and commitment from organisations. Where possible the partnership process must begin well in advance of the opportunities coming on stream.

Implementation of LOAN Approach

Consideration of how the LOAN approach will be managed to deliver its strategic objectives should be at the forefront of its design and development. Although there was some variation by case study, each had a project management function placed in a dedicated, lightly resourced project management team. In general its role was to oversee and drive forward the implementation of the approach, act as the designated point of contact, co-ordinate partner activities and monitor project outcomes. This required specialist skills, qualities and experience.

Working effectively with private and/or public sector employers at both construction and end-use phases is a challenge that must be overcome if opportunities are to be maximised for groups and communities in need. There is a need for clarity, realistic targets, supply-side support, targeted early engagement, mutually beneficial outcomes and industry expertise. Approaches must be professional and customised, with a strong brand and a single point of contact.

To sustain employer involvement approaches must deliver on promises, particularly where involvement is on a voluntary or 'best endeavour' basis.

Beneficiaries can be effectively engaged from the outset through the adoption of strong branding, innovative outreach and building on existing linkages. Sustaining the engagement of target groups, particularly those who are not job ready and may be some distance from the labour market, requires early identification of beneficiary needs, a range of employment-focused supports, alternative options for those with specialist needs and ongoing communication

Although there was a strong interest amongst project managers in the quality and effectiveness of the LOAN approach, there was considerable variation in terms of target setting and formalised monitoring of outcomes. In the main the rationale for monitoring appeared to stem from the requirement to report to funders, rather than seeking to capture the progress around outcomes and wider benefits on an ongoing basis.

Challenges for Successful Design, Development and Implementation

The main challenges that were identified from the case studies in relation to the design, development and implementation of a LOAN approach are as follows:

• Getting started, which encompasses selecting an appropriate approach, setting challenging but realistic strategic objectives, getting the timing right, securing the necessary resources, developing an appropriate management structure and engaging with relevant partners.
• Balancing 'opportunity' and 'need' by ensuring a focus on the two key sets of customers: employers and the community.
• Fitting in to the wider context, with the LOAN approached embedded in a strategic approach to economic development in the local economy, rather than being viewed as a specific initiative.
• Engaging effectively with employers and developing a strong two-way relationship. Without the support of employers (private and/or public sector) it will not be possible to access the opportunity.
• Engaging effectively with target client groups. If appropriate clients cannot be engaged, the approach will not deliver.
• LOAN should not be a short term fix, but should be focused on sustaining outcomes. If clients do not sustain their positions and employers withdraw their engagement, then it has failed.

Key Lessons from the Case Studies

Building from the challenges outlined, the case studies presented a number of lessons that can help to inform the design, development and implementation of a successful LOAN approach. These lessons are not designed to be prescriptive, but present the main areas for consideration.

They are as follows:

• There should be a consideration of fit with existing services, seeking to reconfigure activity and signpost to existing services where possible.
• Clarity is needed from the public sector from the outset about what it wants from the LOAN approach, with community benefit a key consideration.
• Strong branding is required to raise profile, engage employers and motivate beneficiaries.
• Strong partnership working is needed, with long term commitment and tangible benefits for all partners.
• An effective project manager and/or project team must be in place.
• There is a need to work closely with construction and end-use employers to influence them to hire local people and engage local businesses. Early engagement with employers will ensure the maximum returns.
• Keeping things simple is important, with a need for clarity at all stages of the design, development and implementation, particularly in any dealings with employers.
• Promises have to be delivered in relation to the level, volume and quality of service, which may require caution in terms of the claims made for the approach.
• Early engagement with local communities and potential beneficiary groups is needed to raise the profile and highlight the opportunities on offer.
• There should be a mechanism in place to signpost individuals in the target client group who are unsuccessful through the LOAN approach to alternative support.
• An effective performance management system is essential.
• The approach needs to play to the specific strengths of public and private sector partners.
• The approach should leave a lasting legacy, with successes widely disseminated.

This document, along with "Linking Opportunity and Need: Maximising the Regeneration Benefits from Physical Investment" the full research report of the project and further information about social and policy research commissioned and published on behalf of the Scottish Government, can viewed on the Social Research website at: www.scotland.gov.uk/socialresearch. If you have any further queries about social research, please contact us at socialresearch@scotland.gsi.gov.uk or telephone 0131 244 7573.

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