Summary
Almost every economic strategy over the last decade has committed to inclusive growth. Rather fewer explain how anyone would know whether it had happened. Four UK cases suggest the problem is solvable but the useful evidence came from places that decided what they were measuring before they spent the money, not in the year that the strategy was completed.
Why the headline figure and local communities move independently
Regional GVA and neighbourhood deprivation are only loosely coupled. An area can post creditable GVA growth for a decade while the same less affluent communities sit in the same Index of Multiple Deprivation decile throughout. Three mechanisms explain it.
Geography. GVA is measured where output is produced, deprivation where people live. Where commuting flows are meaningful, growth in the workplace economy accrues substantially to residents elsewhere.
Composition. GVA per job is highest in capital-intensive activities that employ few people. A distribution park, data centre or energy asset moves the headline figure appreciably while generating few jobs, with even fewer accessible to residents furthest from the labour market.
Distribution. Even where earnings growth is local, it is rarely evenly spread, and the lowest-decile households are disproportionately affected by health, caring responsibilities, transport and housing costs which output measures do not capture.
The practical conclusion: GVA is a context indicator, not an outcome measure.
Preston: a well-measured output is still an output
Preston is the best-documented UK example of anchor procurement redirection. Working with CLES since 2013, the council and local anchor institutions analysed where they spent their resources and then changed it. Locally retained procurement rose from around 5 per cent in 2012/13 to 18.2 per cent by 2016/17, £112.3 million kept within the city, up £74 million, with roughly £200 million more retained across Lancashire. Some 4,000 additional Preston employees were brought onto the Real Living Wage, and the city was named the most improved in the 2018 Good Growth for Cities index.
Those are real numbers, and the approach has been widely emulated and is now known as ‘Community Wealth Building’. It is important, however, to note that in this example the key measure was the destination of spend. That is a clear output and the original objective. The chain from retained spend to reduced deprivation runs through employment, wages and business survival, and has been asserted rather more often than traced. It is also the channel most exposed to displacement - spend redirected from a supplier in the next authority is not new activity regionally. This is the main real-world criticism of Community Wealth Building, it can be typified as pulling up the drawbridge on a local area rather than fulfilling an enhanced role that supports a broader workforce across a regional area.
Community Wealth Building is an interesting consideration and gives serious attention to local capital leaking away, but it doesn’t necessarily make a difference to those communities hardest to reach.
Sheffield and the West Midlands: one intervention, two answers
The most methodologically valuable case in UK practice, and badly under-used. The Health-led Employment Trials tested Individual Placement and Support for people with mild-to-moderate health conditions, recruiting 9,785 people across two sites through a randomised controlled trial. The same intervention produced this:
| West Midlands | Sheffield City Region | |
| Sustained employment | Substantial, strongly significant | Weak or absent |
| Health and wellbeing | No identifiable impact | Strongly significant |
| Return per £1 invested | c. 1 penny | £2.02 (out-of-work) / £2.32 (in-work) |
Two lessons follow, both uncomfortable. Two main takeaways come from these findings, both of which challenge standard assumptions:
Health improvements drive the real money: Improvements to people's health and quality of life generated far more measurable financial value than getting them into jobs did. Most local funding proposals overlook this and fail to claim these health benefits.
Results don't copy-paste: The exact same program delivered completely different results in two neighbouring regions. Assuming a program will work in one area just because it worked somewhere else without adjusting for local conditions—is a costly mistake.
It is also self-evident that different types of employment generate different levels of health and wellbeing, low-grade, poorly paid work in poor conditions with an uncertain future is unlikely to be helpful for future life planning and health and wellbeing.
Big Local: when the evaluation is the wrong size for the intervention
The Big Local Project - Impact vs Expectations: Big Local gave £271 million from the National Lottery to 150 disadvantaged neighbourhoods. This was roughly £1 million each over 10–15 years, with the process letting resident-led boards decide how to spend the funding provided. Evaluating the program using matched control groups revealed two key findings:
-Hard numbers showed little macro change: Large-scale population surveys found only weak evidence of key measures such as improved mental health and lower burglary rates.
-Local experiences, however, showed real progress: In-depth interviews revealed increased community trust, stronger social bonds, and a greater sense of safety around local issues that residents chose to tackle.
Why Scale Matters for Evaluation: These results aren't a failure, they reflect the realities of funding scale. Spreading £1 million over 15 years across thousands of people improves lives for those directly involved, but it is too small to shift area-wide statistical averages. Expecting it to do so leads to unfair evaluations and risks shutting down valuable programs prematurely.
It does, however, demonstrate that dealing with intransigent issues, even at the community level, requires enormous funding if the strategy for change is to be delivered solely by public intervention.
The Wigan Comparison: Wigan provides a contrasting example: by reshaping its relationship with residents around local strengths since 2011, the borough achieved a notable rise in healthy life expectancy while the rest of the country stagnated. The King’s Fund confirmed Wigan's progress was genuine rather than just good PR, while openly noting their study was an observational critique rather than a rigorous formal evaluation, a level of honesty every assessment should adopt.
What a measurable framework does differently
- Measure at the right geography and unit. Residence-based, LSOA- or ward-level, tracked against matched comparators. Difference-in-differences is not exotic, and it is the difference between a claim and an estimate but it must be designed in at the start.
- Separate outputs, outcomes and impact ruthlessly. Procurement pounds retained is an output. Jobs taken by residents of target neighbourhoods is an outcome. A sustained fall in the share of working-age residents in the lowest income decile is an impact. Most frameworks report the first and imply the third.
- Value health properly rather than as a qualitative afterthought. Quality-Adjusted Life Years (QALYs), unit cost databases, and Green Book-consistent valuation belong in the business case, not a qualitative annexe.
- Handle social value proxies with care. Proxy-value calculators compare bids consistently. They are not an estimate of value created and cannot be aggregated into a deprivation-reduction claim.
- Set fewer indicators and state the theory of change. Five indicators with an explicit causal chain will inform decisions. Thirty without one will inform nothing.
The conclusion
The approach involved Preston through spend analysis, the trial sites through randomisation, Big Local through matched comparators. Each approach was different, but each place that produced useful evidence invested in measurement before it needed to produce meaningful results. Inclusive growth becomes measurable when an authority decides what it is trying to change, for whom, where, and against what comparison.
The conclusion is that shifting the dial is not easy, but a long-term perspective and a clear line of sight to the impacts from the beginning is essential if seldom achieved.
There is more to say on each case particularly on displacement in the procurement channel, and on how far the trials evidence transfers at all. Mickledore works with local and regional government on inclusive growth frameworks, social value methodologies and programme evaluation. We are always keen to engage and develop a bespoke approach. Mickledore is reached at nwilcock@regionaldevelopment.co.uk