Why the Nationalised OAN doesn’t matter when you consider Employment Policy+

The new national standard OAN is ‘policy off’ when it comes to employment projections.

Imagine a are like Greater Manchester that is above the national average in terms of affordability.  The ‘fudge factor’ formula assumes people will be net migrating out of such areas towards places that are above the national average.  The employment policy aims to prevent this with employment growth.

So what do you add the +employment factor to, to the demographic baseline or to the adjusted OAN in the national formula.  If you add it to the national formula it will assume affordability gets worse not better because you will be building less than demographic baseline +employment induced baseline supply

Consider a county are next to London where its employment EDNA report would normally add +12% to OAN, but with nationalised OAN would be +16%, so where do those additional 4% come from?  The formula assumed they would be moving net from  ‘net giving’ areas such as Manchester. It is also double counting arguably, so it makes sense to adjust the employment uplift to around +8%, the SHMA + employment figure.

This is not how migration works, people are are more likely to move from even less affordable areas closer by such as London.

So in all cases when you consider employment based assumptions that make sense it cancels out the nationalised OAN fudge factor.

Im all for a standard OAN method but it has to include employment and migration assumptions that make sense to avoid silly conclusions.

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