A year on, Tottenham still struggles to shake off the legacy of the riots

The group of teenagers who walk into the Turkish cafe on Tottenham High Road are wearing blue T-shirts emblazoned with a single word in red: "Sorry." Members of a north London church group, they stop in front of the counter and explain that, while they were not involved in the devastating riots that began in the street outside a year ago, they believe that someone from their generation should "stand up" and apologise for the damage that was done.

They have also been into the police station a few doors down, the place where what started as a peaceful demonstration against the police killing of Mark Duggan turned violent, the flashpoint for the UK's worst riots in a generation.

Not everyone was happy with the group's initiative. In the police station, one of the group tells me, they were informed by a local man – arriving to report a crime – that it was the "police who should be saying sorry", not the teenagers. When I leave the cafe it is behind two British African-Caribbean men carrying motorcycle helmets. I overhear angry comments about the teenagers in the group and the "bitch" – a member of their own community – a fact that seems to anger them most.

On the first anniversary of the riots, Tottenham – the place where I live – is these days a place of contradictions. At Tottenham Hale tube station, next to the retail park that was comprehensively looted on the first night of rioting, you can see officials from Olympic delegations in their team kit walking to the student accommodation they are occupying for the Games. On the High Road itself most of the shops that were looted or burned have been reopened, some like the post office in better premises.

Those few premises that were demolished because they were too badly damaged are behind fences, many waiting to be rebuilt. The Aldi supermarket that was burned out is coming back. Even the old art deco Carpet Right building, a local landmark where many lived in the upper storeys and that became a symbol of the riots, is set to be reconstructed.

Finally there is the long anticipated redevelopment of Tottenham Hotspur football club's stadium.

Everywhere are positive signs of the money being spent to aid Tottenham's recovery. In my local park, hugely popular new exercise equipment has been installed. There is talk of trying to bring a new market to the High Road, and banners everywhere proclaiming "I Love Tottenham".

I am in the cafe to meet Lorna Reith, my ward councillor, whom I first met in the immediate aftermath of the riots. We talk about the good news: more than £40m promised for reconstruction and redevelopment; the efforts to help young people into work; the completion of the latest phase of the student lodgings by the tube that will bring 500 new people. Even Peacocks – a company that has had deep financial problems – is reopening its store.

And we talk about the bad news as well: how the investigation into Duggan's shooting by the Independent Police Complaints Commission remains unresolved and a continuing source of tension, and how so many of the problems identified as contributing to the riots remain acutely present in this area.

"For a lot of London," says Reith, "it is now almost as if it never happened. But Tottenham is still carrying the baggage of it because this is where it started. I speak to kids who still don't want to put the postcode on their CVs because they are worried it may count against them."

But Tottenham's biggest problems are the ones that existed before the riots and have only been exacerbated by the reality of recession and the government's economic and social policies in the last year.

With high and still rising unemployment already – especially youth unemployment – there is no prospect on the horizon of any major new employer. If that is true for many parts of the country, what is unique about areas of London like Tottenham is how they have been affected by recent government welfare policies, especially the cap on housing benefit which, all the anecdotal evidence suggest, is pushing families out of areas with higher rents into areas like this.

That problem will be made worse when new rules capping total benefits that can be paid to large families come into force.

"I've been knocking on doors recently and the issue of houses in multiple occupation comes up a lot. We are seeing sheds and outbuildings with aerials that we know people are living in," says Reith. "When, as a council, we researched where people who could not afford to live even in Tottenham when the new rules come in would go, we could only find Snowdonia and Dumfries and Galloway.

"The reality is that this has always been an area of high churn of people coming through."

Tottenham's problems go deeper still. What businesses there are are largely small and medium-sized enterprises that offer little employment opportunity. Its shops are often small and very marginal.

It is locked in the classic Catch-22 of poorer urban areas; because its population is largely poor, it lacks "purchasing power" to attract the kind of businesses that would contribute to its civic amenities – restaurants, pubs, shops and cafes that might attract economically better-off residents who might fuel renewal.

Perhaps unsurprisingly, when Haringey council undertook a public consultation in the wake of the riots many of these factors emerged as key issues: the role in the community of the police, employment, but also the strong desire for the kind of housing that would persuade people to stay longer and make their lives in Tottenham, make it less transient in nature.

While Reith is broadly optimistic, that view is not shared by everyone, among them Aaron Biber, the 89-year-old Jewish barber whose tiny premises were looted during the riot.

On the surface at least, Biber, whose plight became one of the poignant symbols of the riots, should be one of Tottenham's good news stories. Well-wishers raised more than £30,000 to help save his 70-year-old business. He has been visited, too, by Boris Johnson, London's mayor, and by Prince Charles. The money left over from the fund raised for him was given to local youth groups.

But when I ask him how he feels Tottenham has progressed since the riots, he is angry and pessimistic. "It is finished. Tottenham is over," he says. "I don't see it getting better. It used to be I could make between £150-£200 a week on the mornings that I worked before the riots. A few weeks ago I took £14 and in another week £40. One week I took nothing at all. I feel like a bloody fool just sitting here."

Whether Biber is a victim of the recession or the riots – or a combination of both – is difficult to calculate, but he says that many small businesses in the area have similar complaints. The fact of the riots, he believes, is a strong factor. "I used to have a barrister whose hair I cut who used to come from New Eltham. I haven't seen them since the riots. They don't want to come."

And despite having lived in the area most of his life, Biber no longer feels entirely welcome here. He says he was told recently by a member of one of Tottenham's other communities that he "should not be here".

Heading home from Biber's barber shop I am reminded of how six months after the riots I had accompanied a group of young Arabs on an educational exchange to the UK who had asked to visit Tottenham, including two from Gaza, who were surprised how quickly the damage of that night a year ago had been repaired.

The destruction may be almost invisible these days, but the reality is that within those who live and work in Tottenham deep scars remain.