It's the Economy, Stupid!

Will Gallagher

"It’s the Economy, Stupid!"

This may be the first comeback from the 90s, but Bill Clinton’s election winning mantra is very much back in fashion. At root, Clinton’s slogan highlights that politicians cannot ignore the concerns of their voters, which may explain the ebb and flow of attention that politicians pay to particular issues.

Public attitudes to supporting the vulnerable and tackling disadvantage have changed. Now more than half of the population thinks unemployment benefits are too high, which compares with just over a third 10 years ago. The number of people supporting higher taxes to pay for greater spending on public services and social benefits has halved since 2002. Faced with tough times, the public’s social conscience appears to be playing second fiddle to their economic consciousness. It should be no surprise if the government’s focus has changed too, as the country deals with a record budget deficit.

When a sector, like the social sector, is still growing and developing, it is useful to have a tail-wind blowing from government. To give the government credit, they have delivered on the Big Society Bank, and the social reform agenda has not sunk beyond trace. However, many social enterprises feel they are facing a strong head-wind, with grant funding cuts and a challenging commissioning environment.  For sure, the social sector is probably not receiving the direct financial resources we would have done in more plentiful economic times.

Complaining about this will not change it however.  We have to recognise that the social sector will struggle for sustainability if it comes in and out of fashion with the economic cycle, and we have to mitigate against this.  We are rightly very focused on the social impact of what we do, but the social sector has a role to play in the growth agenda as well...we should not forget we can – perhaps, should – have real economic impact too.  Here at SP, we recently totalled the number of jobs we have directly and indirectly created over the past 2 years, and that number is closing in on 200. One of our ventures, FranchisingWorks, is harnessing social investment (including a £1m Big Society Capital investment) to turn job seekers into job creators in Manchester. We are developing ‘Supported Enterprise Apprenticeships’ to help tackle the problem of youth unemployment. And we are in advanced discussions with a number of high profile businesses, to help them bring into their supply chains social enterprises which focus on employing those furthest from the labour market.   All of these initiatives are certainly in-step with the economic necessity for tackling long-term unemployment – plus they are not reliant on government spending!

The social sector needs to make the case not just for its social but its economic impact too. By doing so, our development ceases to be dependent on the economic climate, nor the political constraints of the day. We need a tail-wind from government if the sector is to fulfil its potential, and we should justify one by highlighting our contribution to both social and economic growth. For the social sector: it’s the economy, stupid, too!

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