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March 4, 2019

Highly skilled dual-income couples have the potential to reduce regional inequality, but they require better-connected cities

In the UK and other advanced economies growing numbers of households contain two highly-skilled individuals, each with a successful career in a demanding and highly specialised role. This phenomenon is driven by:

  • Increased female workforce participation: even in the last couple of decades this has increased significantly. Between 1996 and 2018 the employment rate went from 66.1% to 69.7% for working-age women without dependent children and from 61.9% to 74.0% for those with them. [1]
  • A more highly-skilled economy: the percentage of the workforce in highly-skilled occupations increased from 38.7% to 45.4% in the 17 years to 2018, with this shift reflected among both male and female workers. [2]
  • Associative mating: individuals are not randomly matched with one another, but are disproportionately likely to pair up with those of similar education. Given that university and work are common opportunities to meet romantic partners, this is not surprising – but it is becoming more important. In the US, the proportion of men with degrees marrying similarly-educated women climbed from 25% in 1960 to 48% in 2005. [3]

 

An often-overlooked impact is what this means for households’ locational decisions. Households with one main breadwinner can choose where to live based on proximity to their work alone. Decisions become more complicated when each half of the couple works in a well-paid, highly-specialised job; relocating for the sake of one person’s career may jeopardise their partner’s. Weekly commutes are workable but financially and emotionally difficult, particularly for couples with children. Recent Cebr research found that employers could boost productivity and staff retention by allowing more remote working. This has to be part of the solution, but will not work for all industries and occupations; those in scientific, medical, or legal roles will be required ‘on-site’ most or all of the time, and many office jobs cannot be done entirely from home.

 

These couples therefore need access to a highly diverse labour market – such as that in London and the South East, with its range of employment centres covering high-skilled sectors, connected to residential areas by a complex transport system. This is being supported by further investment – when Crossrail eventually opens, it will become easier for two people to live together, with one working in east London and the other in west London or the Thames Valley.

 

Locations hoping to emulate London’s success should take note. The Northern Powerhouse growth vision relies on attracting and retaining highly-skilled workers to grow knowledge-intensive sectors in city centres. Faster population growth in well-connected Greater London than its northern peers [4] suggests that despite housing affordability issues it maintains an edge here. Increasingly, the skilled workers who will fuel Northern growth come in pairs, and they require connectivity between employment centres. Presently, the North does not compare well to London and its environs. A peak-time train can cover the 65 miles from Cambridge to London’s King Cross in under an hour; the 73 miles from Liverpool to Leeds takes 84 minutes. Commutes of over 60 and particularly 90 minutes are detrimental to well-being [5] and willingness to commute falls off sharply.

 

Transport investment is therefore central to the UK’s regional rebalancing aspirations. Economic growth demands skilled workers, who will be attracted to locations that offer access to a wide range of specialised employment opportunities. If Northern Powerhouse Rail and other transport investments succeed in creating a true network of cities connected to each other and their hinterlands, the North of England should be in a position to thrive.

 

[1] ONS Families and the labour market, England: 2018. [2] ONS Employment by Occupation. High-skilled workers are defined as those in the following three occupational categories: Managers, Directors and Senior Officials; Professional Occupations; Associate Professional and Technical Occupations [3] Marry Your Like: Assortative Mating And Income Inequality, by Jeremy Greenwood, Nezih Guner, Georgi Kocharkov and Cezar Santos, NBER Working Paper 19829 [4] ONS Population dynamics of UK city regions since mid-2011. [5] ONS Commuting and Personal Well-being, 2014.

 

Contact: Robert Beauchamp rbeauchamp@cebr.com
Phone: 0207 324 2872

 

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