Despite cities being centres of growth in most countries, they are also centres of inequality, says the OECD.
To combat this, a new action plan has been launched in Paris (21 November) by the OECD’s Inclusive Growth in Cities Initiative to help mayors tackle inequality, boost job creation and harness economic development.
“The Tale of Two Cities–to refer to the famous Charles Dickens book–continues to ring true in too many places,” warned Angel Gurría, Secretary-General, OECD.
He said that although cities are thriving and account for 60 percent of total employment creation since 2001 in the OECD, and household incomes are on average 18 percent higher in cities than elsewhere, there is a flipside.
“Copenhagen, Brussels, Paris and Santiago, for instance, all record the highest Gini coefficients in their respective countries,” he said, referring to the economic measurement of inequality.
In areas of health, education and labour markets Gurría added that cities lag behind with “staggering disparities” and where life expectancies vary “by an incredible 20 years across neighbourhoods in London and Baltimore”.
The 50 mayors participating in the initiative have committed to work together across four pillars identified in the action plan.
- Certifying that education and training systems remediate–rather than reproduce–inequalities.
- Creating inclusive local labour markets in which workers across the skills spectrum have access to quality jobs.
- Ensuring investments in housing and urban development lead to more inclusive physical environments and connect people to economic opportunities.
- And leveraging investments in transport and critical public services to generate returns for both inclusion and sustainability.
Accompanying the action plan, was a new OECD report that highlights how in a globalised labour market, the competition for highly skilled workers and for enterprises creating quality jobs has intensified, both within countries and on a global scale.
Job Creation and Local Economic Development 2016 says the gap between leading and trailing areas has widened, imposing a major constraint on achieving inclusive national growth.
The report provides local policy advice that looks at the design and implementation of skills, employment and entrepreneurship policies to ensure that local economies are not trapped in a vicious cycle of poor quality, low productivity jobs.