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Published on Games Monitor (http://www.gamesmonitor.org.uk)

Sport as catalyst. A critique of Olympic economic development strategy

By Carolyn Smith
Created 27 Dec 2006 - 16:24

The LDA estimate that in the 'red line area' alone, somewhere between 11,000 and 12,000 jobs could be created (private conversation). Later projections are as high as 35,000 (E. Goodwyn and K Munn, October 11, 2006). However, it is clear that social actions and relationships, development plans and economic strategies, have all been defined by a discourse of uneven development, that of poverty in the Lower Lea Valley and Olympic boroughs (a continuing product).

Local baseline data indicates that a majority of wards around the masterplan boundary fall within 5% of the most deprived areas of England in terms of income, with related impacts on health and with a relation to qualifications and perceived skills. Within the Inner Impact Zone (the 12 wards with territory in or immediately adjacent to the masterplan area) the wards of Bromley-by-Bow (16.3%) and East India and Lansbury (15%) suffer unemployment rates over three times the national average (LDA, 2004/2, pp 8 10).

Economic development strategy is set out by the London Development Agency in the Socio Economic Assessment: Lower Lea Valley Olympic and Legacy Planning Applications, January 2004 (Appendix 5 to the Environmental Statement). Direct intervention in the Olympic application area seeks:

(a) To maximise the potential of construction employment in the period of Olympic development, particularly targeting the more marginalised unemployed: migrant workers, women, and youth; proposing apprenticeships and taster courses before full training for those unsure. EU sectoral regulation appears to be achieving prominence in the construction industry, particularly via public sector contracting (see ), and here, training benefits are to be sought via local labour agreements, and a signed 'Construction Charter' to prioritise the employment and training of local residents, and to enable smaller local firms gain subcontracting preference.

Such a minimal intervention into the internationalised labour market servicing Olympic developments is striking. Certainly sector representatives point to a pressing need to train existing construction workers, and not only those to work on prestigious Olympic developments. Peter Lobban, chief executive of Construction Skills, (a national body representing construction employers), states that 100,000 existing construction workers need to reach NVQ2 standards each year until 2010 to achieve a "fully qualified" workforce (E. Fennell, The Times, September 12, 2005/1). Lobban also estimated that the sector must attract and train 88,000 new entrants every year for the next five years to meet (general) demand.

Three quarters of the skilled people in the industry are self employed and this presents a distinct problem for skills training as responsibilities are passed down the supply chain and costs foisted on to the worker. One might also note that in what is known as 'building services engineering', (electrotechnical, heating, ventilation, air conditioning, refrigeration and plumbing), small firms are reported as viewing trainees as tomorrow's competition, thus inhibiting small firm apprenticeship schemes (E. Fennell, September 12, 2005/2).

Consultants might worry that their strategies exacerbate unevenness - between localities, but also between workers and thus have formulated policy with extreme restraint (Gough, 1996). Divisions of labour within construction are highly segmented and international disparities reflect the racism of corporate wage and status setting, a recomposing secondary market, an intensity of subcontracting, and the institutionalisation of peripheral economic relations forged through Empire and the regulatory arrangements of EU accession (and re mediated through national strategies of exposure , socialisation and containment).

As a result of these proposals, trainees local to the Olympic boroughs and migrant workers face the prospect of being labelled 'contingent' in an already flexibilised sector by dint of existing marginality and a process of conscious social selection (existing social inequalities a hiring criteria). Contingent workers are prey to greater substitution pressures by employers and are more vulnerable to exploitation . It is not clear from the planning literature whether recruitment for training schemes will be via the coercive New Deal programme or organised on a more open principle.

Martin Jones and Kevin Ward suggest that training interventions can be regarded as response to "a devolved rationality crisis", and within a discourse of competitive advantage under globalisation, displaced from the political sphere of the state onto vulnerable groups such as the unemployed, who are then stigmatised for the state's own economic failings and forced to shoulder responsibility (Jones & Ward, 2002, pp 480 481). Critics charge that within labour market policies, the production and emphasis on qualifications, and the importance laid on institutionalised knowledge and practice in the classroom as well as the workplace, lies in a process of social exclusion rather than technical or personal advance (Bourdieu and Paseron in Willis: 128). Qualifications reproduce class privilege and the state regulative framework - from tax and accounting principles to the institutionalisation of consent in a labour process context. In Hackney, HTEN report that certificates issued by training contractors to the New Deal, and technology network Learn Direct, as well as government promoted NVQs, are regarded by employers as "largely useless" (Hutton et al, 2003). Definitions of 'skill', intrinsic to job classification, are nuanced by the distributions of power in the labour market and the sphere of social reproduction, (most noticeably around gender and race, but also with regard to the Olympics, international divisions of labour) and exhibit a strong ideological component. Craft unionism continues to be a strong force for demarcation.

Action in December 2004 in King's Cross against the imposition of contracts enforcing lower pay and longer hours by Olympic contractor Laing O'Rourke, (a contract incidentally agreed by UCATT), and the intimidation of migrant workers by company management, suggests a brutalised context for flagship Olympic developments and bleak prospect for local, national and international construction labour. The construction industry has a history of casualised labour, on site hazard and deaths at work. UCATT Building Worker (Spring edition 2005) reports more than 300 on site deaths since 2001, that 90,000 workers suffered musculoskeletal injuries during 2000 2001 (double the all industry average), and that over 1,500 workers have been fired in the last five years for raising safety concerns, a statistic exacerbated by subcontracting endemic to the sector .

The construction labour market is acutely international. UCATT estimate that 88,000 non UK workers were employed in construction in January 2003, mostly in London and the South East. The TUC report that "migrant workers in the UK are subject to such levels of exploitation and control that they meet the international definition of 'forced labour'" (UCATT Building Worker, ibid). A TUC report, Forced Labour and Migration to the UK, 2005, , found conditions in construction similar to those in sex slavery. Labour MP Geraldine Smith is campaigning for the extension of anti gangmaster legislation, introduced in the wake of the Morecambe Bay tragedy, to be extended across construction (UCATT Building Worker, ibid).

A bevy of schemes under the Rubric 'On Your Marks' have been announced, financed by the European Social Fund, including OLYSE003 Increasing access to Olympic construction employment for foreign workers, OLYSE004 OSAT qualifications for construction workers, OLYSE005 NVQ2 Maintenance qualifications, OLYSE006 Improving construction leadership and management, and OLYSE009 Increasing access for female workers in the sector (LDA, 2006). Contracts awarded to colleges in the south east include a Women in Construction course at Oxford and Cherwell College, and specialist construction courses at Central Sussex and Eastleigh colleges (V. Pattni, FE News, August 15, 2006). Other construction skills courses receiving funding in relation to the Olympic event are evident locally.

(b)To optimise synergies in the construction and Legacy periods by maximising cluster effects: the promotion of networking and inter-firm subcontracting; help with access to premises, finance and contracting opportunities; relocation aid; advice, information and marketing; and the integration of employers in training schemes. This comes with database support, ICT infrastructure, and a 'capacity register' with information on construction projects. Attention will focus first on the building industry, with advice and training to enable firms meet 'quality thresholds'. During the Legacy phase, cluster shifts (growth sectors) will be monitored in an attempt to keep training relevant (ie. business reflexive), with particular attention to trends in leisure, retail and entertainment.

Local economy specialist, Jamie Gough, clarifies such a strategy in his 1996 rejoinder to Peck and Tickell in the journal Area (28, 3, pp 392 398). The Olympic initiative focuses on a neo classical (and neo liberal) conception of competition, that is, the presence of many firms competing in a given market, and on market forms of cooperation, such as inter firm subcontracting.

It seeks to weight the strength of notionally local actors in international relations of subcontracting by capital subsidy (note that information is now a factor market); that is, to strengthen a reified 'locality' as bidder by facilitating mobile location of firms. This, while perfectly valid, exposes a fundamental contradiction: the exposure of existing firms to intensified market pressures. Potentially, this displaces historically established local construction businesses, in the short or the longer term.

Perhaps because of a flagship post Fordist policy maximising informational technologies and small firm support, Legacy expectations point strongly toward low wages (national minimum rates for younger workers) and highly casualised and insecure employment in the longer term. Athens 2004 corporation chief, Gianna Agelopoulou, has suggested that the Olympic Games would develop "a new model of labour" more flexible and intensive than before. While one might argue that any 'new model' has been with us since the 1980s, symptomatic of a polarising post Fordist tendency across specific sectors, 'flexploitation' (Gray, 2004), where the flexibilisation of the labour market is accompanied by a major increase of job insecurity and of under employment, and actively promoted by benefit and labour market regimes, appears implicitly defined as a Legacy principle. Consultation threw up demands from London and local networks such as London Citizen and TELCO for basic criteria to be met by Olympic and Legacy employment practices, wages and conditions, these are nowhere evident in the detail of the planning applications. The institutional attention toward a constellation of leisure related employers in the Legacy period (and training and infrastructural subsidy for these industries) stands in direct contradiction to these constructive demands.

The LDA strategy would seem to fall into what economic geographer Jamie Peck (1996) characterises as the "low road from Fordism": based on a principle of 'defensive flexibility', that is, "deregulation, individualised employment relations, job insecurity and sharpened competition" (pp 130 131). To which one might also add 'mobility'. The London Chamber of Commerce and Industry has speculated that workers may be recruited abroad to plug skills shortages around the Olympic and Legacy developments in construction, transport, security, tourism and IT (G. Fuller, Personnel Today, May 24, 2006).

By an absence of geographical barriers to flows of money capital, contracting, labour and firm migration, neo liberalism imposes the discipline of value with full force:

Class relations may be reproduced through varied combinations of coercion and incorporation: the state is infused by this tension . One sees clearly the state here as imitation, neither serving the needs of capital nor acting as guarantor of social reproduction, but rather acting out the social relations of capitalist property, accumulation and exploitation. The LDA posits a consensus in the interests of locality calling forced removal of existing firms 'regeneration', throwing a false legitimacy over capital via the Olympic proposals and local labour agreements, and opening a path via training, contract compliance, and capital subsidy, for an intensification of the rule of value, a discipline on individuals and firms. As Gough notes: when labour is more geographically mobile it becomes more abstract and replaceable.
Harold Kaufman, Project Mimique

However, one advantage of the Lower Lea Valley proposals is clear. If landholding stays with the LDA this may stabilise tenure, avoiding the instabilities of an inflationary property economy, and allow local labour agreements to prosper.

Hackney Community College's Centre of Vocational Excellence at Morley Hall in London Fields, opened in January 2006, aims to enable local small firms maximise the 'opportunity' of the London 2012 Olympics with training on a wide range of skills development. Other initiatives proposed since the bid decision (and awarded funding) include a construction employment programme aimed at firms of all sizes, to maximise local recruitment and diversity of construction labour; and a business club and supply chain support to assist local firms competing for Olympic contracts (Host City News, December 2005). On Your Marks (above) also includes a course OLYSE007 Improving competitiveness of SMEs in the construction sector.

(c) A structural functionalist package of 'lifelong learning', (ie. vocational training and other skills development), social and micro-enterprise support, backed up by facilities for childcare. Mitigation of totalitarian proposals for 70,000 volunteers for Olympic Games staffing (reduced to 50,000 by the time of the bid decision) is promoted via training referral (after the event) and a partial choice in volunteer activity.

Economic development strategy seeks here to offset crisis engendered by flexible contracting and the volatility of technologised innovation (promoted by the other aspects of the stated proposals). Far from catalysing an improvement in prospects, the Olympics here is coopted into the New Deal paradigm: a marginalist experiment in social, labour market, and welfare state regulation.

Such strategies are central to an (increasingly coercive) mode of regulation underpinning post Fordist social democracy. Labour market interventions, 'foyer' institutions where young people receive mandatory training in return for accommodation away from the family home, capital subsidies to small firms, and the promotion of self employment to the long term unemployed, all define a marginalist current reflexive to the production and reproduction of variable capital (i.e. the disciplined worker [Melossi]) in the context of a wider regulatory compliance. Economic development and land use planning are regarded as among the defining 'technologies' of social democratic governance, while labour markets have been regarded as a central power mechanism of capitalist societies.

There is a sense of economic development as an elite project, of a socialised conception of disparity and uneven development informing a local acceptance of the Olympics themselves and promoted training, small firm promotion and infrastructural proposals. One can see this in the LDA's assertion that sports facilities built for the Olympics will catalyse development and attract business location after the Games (LDA, ibid). This is in many ways similar to the Gramscian notion of passive revolution, but in east London there is no failure of the neo liberal hegemonic project which would define the instance; no revolutionary counter to seduce workers from (Moore, 2005). Economic development strategy itself has stalled at a national level in what has been described as a 'centrist' framework and exhibits little critical thought or left innovation (Eisenschitz and Gough, 1993). Economic development is predicated routinely on the transience of opportunity, and of marginal increments in economic benefit. Yet even this limited horizon is overshadowed by the scale of job displacement and the 'flexi security' and hazard of projected growth sectors of the Olympic development and Legacy phases.

Two projects recently awarded funding under the Olympic rubric seem to back up this thesis of marginalism: something described as "a Job Brokerage and Employment Outreach Programme" or advice service to the unemployed, combined with a referral to basic skills and interview training (the New Deal by any other name), and an educational programme aimed at 'raising' young people's employment aspirations (Host City News, ibid). The Government has also outlined a new initiative, Building on Success: London's Challenge for 2012, bringing together business and local authorities, in a bid to tackle unemployment by exploiting opportunities in the City and Thames Gateway (D. Atkinson, FE News, April 11, 2006).

This essay is part of the Games Monitor briefing papers available for download from our Media Centre [1] page.



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