Understanding the link between geographical inequalities, geographical mobility, and social mobility

Geographical inequalities in labour market outcomes in England are large and persistent, and high by international standards. Previous research shows that pay disparities between places can largely be attributed to differences in workers’ skill levels. Higher-skilled people, who earn more wherever they work, are concentrated in certain places. Further to this, they are concentrated in high-paying places – places that pay more for any given type of worker – which increases their individual advantages.

Understanding why skill levels differ so much across different places in the country is therefore key to understanding geographical inequalities, and making progress on the UK Government’s levelling up agenda.

In this project, I will use the Longitudinal Education Outcomes (LEO) linked dataset to study how differences in labour market opportunities between places shape differences in skill levels. Created by the Department for Education, LEO contains de-identified information on people’s characteristics, education, employment, benefits and earnings for people.

Three ways this research will develop new insights into geographic inequalities

Migration patterns: First, local labour market opportunities are likely to affect where young people choose to live after finishing education. ‘Brain drain’ – the migration of individuals from ‘left-behind’ areas to areas that are thriving economically – could widen skills gaps between places. This limits the extent to which improvements in local education provision can benefit the local economy.

Incentives for education: Second, people who grow up in different places may face different levels of incentive to acquire skills in the first place. Those who grow up in places where degrees are not rewarded in the labour market, perhaps due to a lack of higher-skilled jobs, may be less inclined to invest in higher education.

If these effects are large, then the effect of place on local skills, and the effect of skills on the local economy, could contribute to the persistence of geographical inequalities over time.

Geographic and social mobility: A key concept underlying the link between people and places is geographical mobility: who moves, where, and why? Such patterns of mobility impact not only geographical inequalities, but also inequalities between groups. If young people from poorer families or certain ethnic groups are less likely to move, or less likely to move in search of economic opportunities, then geographical inequalities could create barriers to social mobility.

By using linked, de-identified data, I plan to study whether people from less advantaged backgrounds are less likely to move in response to local labour market opportunities, compared to those from more advantaged backgrounds. I will also analyse whether conditions in the local labour market play a larger role in the educational choices of people from more advantaged backgrounds.

Informing policy to support better economic outcomes

This research will advance our understanding of the link between place, geographical mobility, and earnings inequality. It will also help policymakers deliver the levelling up agenda and improve social mobility.

For example, the research will shed light on which socio-demographic groups are most constrained by where they grow up, and would benefit from policies that reduce barriers to geographic mobility. It will also shed light on whether improvements in local skills provision are likely to improve local economic outcomes, or whether – because of mobility and incentives – skills policy needs to work alongside wider policies to create higher-paid jobs across the country.

I have convened a policy advisory group with representatives from the Department for Education, the Department for Levelling Up, Housing, and Communities, His Majesty’s Treasury, and the Social Mobility Commission to tailor my research to policy priorities and disseminate the findings of the project.

Xiaowei is part of a cohort of ADR UK Research Fellows using ADR England flagship datasets. Find out more about the fellowships.

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