The local implications of major job transformations in the city: A spatialmicrosimulation approach

The changing dynamics of regional and local labor markets during the last d ecades have led to an increasing labor market segmentation and socioeconomi c polarization and to a rise of income inequalities at the regional, urban, and intraurban level. These problems call for effective social and local l abor market policies. However, there is also a growing need for methods and techniques capable of efficiently estimating the likely impact Of social a nd economic change at the local level. For example, the common methodologie s for estimating the impacts of large firm openings or closures operate at the regional level. The best of these models disaggregate the region to the city (Armstrong 1993; Batey and Madden 1983). This paper demonstrates how spatial microsimulation modeling techniques can be used for local labor mar ket analysis and policy evaluation to assess these impacts (and their multi plier effects) at the local level-to measure the effects on individuals and their neighborhood services. First, we,review these traditional macroscale and mesoscale regional modeling approaches to urban and regional policy an alysis and we illustrate their merits and limitations. Then, we examine the potential of spatial microsimulation modeling to create a new framework fo r the formulation, analysis and evaluation of social and local labor market policies at the individual or household level. Outputs from a local labor market microsimulation model for Leeds are presented. We show how first it is possible to investigate the interdependencies between individual's or ho usehold's labor market attributes at the microscale and to model their acce ssibilities to job opportunities in different localities. From this base we show how detailed what-if microspatial analysis can be performed to estima te the impact of major changes in the local labor market through job losses or gains, including local multiplier effects.