Alan McGregor, Andrea Glass and Alex McTier of the Training and Employment Research Unit (TERU) at the University of Glasgow explore LOAN, the process of maximising community benefits from physical regeneration.
Historically, the regeneration of our towns and cities has been
led by physical redevelopment. Poor quality housing was demolished
and replaced by social housing. By the 1970s, however, it was
widely recognised that this form of housing-led physical
regeneration did not create sustainable communities. One of the
frustrations in poorer communities was that major physical
investment programmes did not provide directs benefit in terms of
jobs and training opportunities.
Because of these frustrations, agencies have gradually begun to
consider ways to generate greater community benefits. This
wider set of processes is often described by the term Linking
Opportunity and Need (LOAN).
The Clyde Waterfront Partnership is working to support the
physical regeneration of the Clyde corridor but, taking on the
lessons of LOAN, is also encouraging links between the
opportunities that spring from new developments and the needs of
local communities for jobs and training.
What is LOAN?
LOAN involves bringing together opportunities and needs:
- On the one hand, we have the opportunities generated by
physical investments of one kind or another.
- On the other hand, there are areas of and groups with need for
employment and training.
The LOAN process is about finding the most effective ways to
link those with needs into current and prospective
Physical regeneration projects, such as Clyde Waterfront,
generate two sets of opportunities:
- Employment and training - and indeed business
development - opportunities are generated in the construction
phase. Find out more about Construction training
- End-use employment opportunities, particularly where the
developments involve commercial and industrial investments.
The physical regeneration process generates opportunities which
- Help individuals secure employment directly, through the jobs
that are available both at the construction and end-use
- Create training opportunities of various kinds which hopefully
then lead on to employment.
- Provide work for local businesses, particularly through
subcontracting arrangements of one kind or another, with subsequent
positive employment knock-on effects for neighbouring communities
and groups of the unemployed.
For example, Clyde Waterfront is promoting the opportunities to
maximize the community benefit of large scale
public sector procurement exercises.
Targeting the benefits
LOAN is not about the overall volume of job generation but
rather about targeting the benefits of the employment and training
opportunities created on those who would not otherwise be likely to
secure them. This tends to mean:
- Residents of deprived areas characterised by very high levels
- Groups of the population with a high incidence of unemployment,
and particularly long term unemployment.
- Clyde Waterfront has gathered together information about the
local agencies that support businesses in employing local staff.
Making the right links
The traditional weakness has been most clearly seen in relation
to the lack of linkage between major physical regeneration projects
and the employment and income generating opportunities available to
the residents of regeneration areas.
- Many major physical investment programmes have been located
in/or close to deprived areas of various kinds.
- At the same time, little or no employment legacy appears to
remain once the developments have been completed.
It is these two things which has generated the interest in
developing a much more effective LOAN approach.
Clyde Waterfront has gathered together some Employment case studies that
demonstrate how links can be made successfully been physical
regeneration projects and local employment needs.
Generating a better approach to LOAN
More recent studies suggest the following elements are
1. Make an early
Physical regeneration projects span a long period of time
from early development, through planning consents, into more
detailed planning applications, through to implementation and
completion. Likewise, raising the capacity of individuals and
small businesses to take advantage of the construction and end-use
aspects of major physical developments can also take a significant
period of time. An early start is required.
2. Exert influence
on contractors and end-use employers
A key process is to try and change the behaviour of contractors and
end-use employers more in the direction of achieving greater
community benefit. Essentially we are looking for these
larger players to offer more employment and training opportunities
to more disadvantaged groups within their travel to work areas, and
also more business development opportunities to local SMEs.
3. Involve private
sector where their leverage is greatest
The private sector has significant leverage and influence in a
number of areas and this must be exploited to maximise community
benefit through LOAN.
4. Build good
quality relationships with private sector businesses
This relationship building process is absolutely critical
for the development of an effective LOAN process. It is an
investment, but it is an investment that can pay off through
significant repeat business from major private sector employers
over the longer term as they seek to recruit labour on an ongoing
basis due to natural turnover.
5. Keep things
simple for businesses
Public sector agencies can simplify the process for businesses by
appointing a lead agency and an account manager as a single point
6. Start early to
build a supplier base
One of the more disappointing aspects of the LOAN process is the
limited success to date in engaging with SMEs. More
systematic attempts are now being made to improve this by
developing web-based portals that make available tendering
information to a wide range of potential suppliers.
7. Engage early with
regeneration community and unemployed groups
A long lead time is often necessary on the people side of the
process too. Longer term unemployed residents of our most
disadvantaged communities will need to have their confidence built
to go after those opportunities and their skillsets enhanced to
have a good chance of securing them.
8. Support the
unemployed and local SMEs
When planning a LOAN process there are a number of key
questions about service delivery that need to be asked and
- Do we have the right services to help unemployed people into
work and to link local SMEs to potential opportunities?
- Do we have a significant service delivery capacity? This
is a key issue as both the employment and contracting opportunities
are often squeezed into quite tight windows.
- Do we have the right connections with both the residential and
business communities to allow us to promote our services
effectively to them?
9. Design and deliver an action plan for the LOAN
It is not uncommon to have some kind of service mapping exercise
and possibly a strategic framework. The essential element is an
Action Plan which can guide the implementation of the LOAN
10. Design and deliver performance systems for the LOAN
In association with an Action Plan, it is important to design and
implement a system for measuring and managing the performance of
the LOAN process once it takes off. This can involve a number
of different elements.
- Monitoring the effectiveness of services to engage sufficient
numbers of unemployed people on an employability pathway that leads
to the opportunities developed through the physical investment
- Ensuring that sufficient skills training programmes link into
the opportunities likely to become available.
- Testing the penetration into the micro to small business
community where the LOAN process involves supplier
11. Appoint a project manager and a small project
management team to drive effective implementation
A well resourced project management component is essential for the
effective implementation of LOAN to deal with the intense and
complex nature of the work.
For more information on LOAN visit the jobs and training section of our
A report on good practice approaches across the UK, including
case study examples, can be found in Linking Opportunity and Need:
Maximising the Benefits from Physical Investment (Training and
Employment Research Unit and Cambridge Policy Consultants -
Published by the Scottish Government, 2008)
Alan McGregor, Andrea Glass and
Training and Employment Research Unit (TERU)
University of Glasgow
9 March 2010