Paid leave to volunteer: A lesson in economic geography

John Mohan, Professor of Social Policy and Director of the Third Sector Research Centre

The Conservative Party has suggested that people who work in businesses with at least 250 employees should be entitled to 3 days paid leave each year in order to volunteer. This includes public sector workplaces, prompting obvious questions about how this might be paid for. There’s a suggestion that this could generate as much as 360 million extra hours volunteering a year. That surely has to be taken with a pinch of salt. The assumption being made there is that 15 million people – presumably, this is an estimate of total employment in enterprises of at least 250 employees – will all either begin to volunteer for at least 3 days, or will do so for an additional 3 days, as a result of the incentive. Those are pretty heroic assumptions.

However, here I want to focus on which communities might be best placed to benefit from these proposals. This is a longer version of a piece which appeared in Third Sector and I’ve included a table showing where these businesses are.

According to data on UK businesses available from the NOMIS website, there are just over 9000 enterprises in the UK which have at least 250 employees. As you might expect, you don’t find too many of them in rural areas and you don’t find too many in disadvantaged areas. 22% of such businesses in England and Wales are in London, which has 17% of registered charities in England and Wales and 15% of the population. The South East of England has 17% of large employers, just over 17% of charities, while its share of population is 15%. So you can argue that if there is to be an expansion of volunteering, taking advantage of proposals to introduce paid leave, charities in these regions are going to be in a position to benefit from it. London’s share of large businesses is significantly larger than you would expect from its share of population.

Conversely, consider Wales – it has fewer than 300 businesses with over 250 employees, representing 3.5% of the total for England and Wales, whereas it has 5.4% of the population in England and Wales combined, and 5% of charities. There is a similar argument to be made about the north-east of England, with 3.6% of large businesses, but 4.6% of the population and only 3.1% of registered charities.

Around 500 large employers in the UK are local authorities – and this poses the problem, as critics have suggested, of how cash-strapped services would pay for staff to take leave in this way. It looks like the areas most heavily affected would be those where funding is being cut most severely.

The figures are harder to analyse for individual local authorities which have very small numbers of such enterprises; for reasons of confidentiality the figures are rounded to the nearest 5, and you can’t break them down either by size or by sector. But there’s something like 70 local authorities with 10 or fewer such large businesses, including many local authorities in rural Wales and Scotland. There’s also several local authorities in the former industrial heartlands of Scotland, Wales and the North East of England with very small numbers of such enterprises. In total around 5.7 million people live in local authorities with such numbers.

Paid leave might be a good idea for various reasons in terms of direct benefits to voluntary organisations, employee development, and relationships between enterprises and communities. But on these figures it’s hard to argue that it’s a good mechanism for getting volunteers to where they are most needed. The concentration of headquarters functions in the UK economy in London and the south-east is a staple and stable feature of the country’s economic geography. This proposal will reproduce those inequalities within the voluntary sector.

Employment
 Employment size (N of employees)
Region 25-499 500-999 1000+ Total 
 North East  155  65  75  295
 North West  440  210  230  880
 Yorkshire and the Humber  295  145  200  640
 East Midlands  315  140  155  610
 West Midlands  370  160  210  740
 East  410  205  250  865
 London  805  475  555  1,835
 South East  335  370  360  1,395
 South West  665  150  175  660
 Wales  125  70  95  290
 Scotland  330  155  180  665
 Northern Ireland  110  55  40  205
 Total  4,355  2,200  2,525  9,080