Older industrial Britain being left behind

A report by the Industrial Communities Alliance documents how the older industrial areas of England, Scotland and Wales are being left behind in the current national economic upturn.

The report focuses on older industrial Britain and on the geography of economic growth during the period of recovery.

Older industrial Britain has been defined as 96 local authorities across Britain with a combined population of 18.9m, or 30% of the total British population. This is compared with local authorities in London and the south east (17.1m).

In London and the south east there was continuous employment growth from 2009 onwards. In older industrial Britain, by contrast, employment at the end of 2013 was still lower than at the end of 2009. So whereas the number of jobs in London and the south east was 540,000 higher at the end of 2013 than in 2009, in older industrial Britain employment was 70,000 lower.

When the coalition government came to power in 2010 it placed strong emphasis on the promotion of private sector jobs across the UK economy as a whole and in the regions beyond London and the south east in particular.

London and its immediate hinterland are pulling away

from the rest of the country and in particular from older industrial Britain

Private sector employment in London and the south east grew every year between 2009 and 2013 – by 600,000 (9%) over these four years as a whole. By contrast, although growth in private sector employment resumed after 2011 in older industrial Britain, by the end of 2013 it was only 60,000 higher (0.9%) than it had been in 2009. Or to put this another way, the rate of growth in private sector employment in older industrial Britain has been only one tenth of the rate in London and the south east.

In London and the south east virtually all the job growth since 2010 has been in full-time employment. By contrast, in older industrial Britain almost a fifth of the increase has been in part-time jobs. In London and the south east for every part-time job created between 2010 and 2014, there were 16 full-time jobs. In older industrial Britain the ratio is just one to four.

Combined with the much slower overall growth in employment away from London and the south east this begins to paint a disturbing picture of the economic recovery in most of older industrial Britain.

Between 2010 and 2014 the number of self-employed residents in older industrial Britain rose by 117,000 or almost 12%. The increase in self-employment accounted for almost 40% of the overall increase in employment in older industrial Britain over this period.

Average earnings in older industrial Britain remain far behind those in London and the south east. In London and the south east average earnings were 14% above the national average, in older industrial Britain average earnings were 7% below the national average. In money terms, this gap was around £110 a week.

Professor Steve Fothergill, director of the Industrial Communities Alliance, said: ‘Many people have suspected that the recovery is primarily a ‘London and the south east’ phenomenon. The new report is the first to confirm that this is indeed the case.

‘Long-established divides in economic wellbeing are widening still further, with London and its immediate hinterland pulling away from the rest of the country and in particular from older industrial Britain – communities hit by years of job loss long before the recession.’