Local Labour Markets Essay

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Why should economic geographers accord central importance to the study of local labour markets?

Block (1990 in Peck, 2000: 133) called labour “the most inherently problematic of all economic categories”. Labour is fundamental to the operation of the economy, but is also contingent on social, cultural and political factors which vary between locations. Hence, local labour markets are a natural focus for economic geographers since they are one of the central geographically varying elements in the way the economy works. However, this essay will argue further that labour markets are particularly important since they exist at an intermediate scale that interfaces between different scales and processes. This will be illustrated here by examining some of the main approaches to local labour markets and the way they emphasized different linkages.

Prior to the 1980s labour was typically conceived simply as a factor input into the economy in accordance with a de-contextualised neoclassical economic model (Martin 2001). However as Harvey (1989) wrote, “labour, unlike other forms of capital, has to go home at night”. The changes associated with post-Fordist deindustrialization stimulated the study of the (often adverse) effects of the global mobility of capital at the local scale. Massey’s (1984) theory of the Spatial Division of Labour considered how variation between local labour markets influenced the movement of capital while, conversely, capital left behind successive imprints of past movements or “rounds of accumulation” on local landscapes. Local labour markets were thus seen an interface between the local (personal or social) and larger (economic) scales – comprising both a geographical influence on the economy and location of investment, and a reciprocal influence of capital on geography. Local labour markets remained the key geographical context in explaining the pattern of economic activity –for example Hanson & Pratt (1992) described how employers in Massachusetts were competent “social geographers” when choosing their location, while Cox & Mair (1988) describe competition between regions for capital. Conversely many geographers have documented the effect of what Peck called the
“tyranny of capital mobility” on communities and local spatial geographies (Bluestone &
Harrison 1982).

These ideas remain important; however, with the development of the post-Fordist debate and the growing enthusiasm around ideas of flexibilisation there emerged another role for labour markets in economic geography: as part of the explanation for agglomeration in the ‘new economy’. Piore and Sabel (1984) advanced the concept of flexible production as crucial to the post-Fordist economy. Drawing on flexibilisation, Scott (1988) saw a series of links between flexible production and spatial agglomeration

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