Devo and the North

The ONS published its North is Buggered report yesterday. Well, OK, it wasn’t really called that but the North of England Economic Indicators contained a series of scary stats and charts highlighting the northern regions’ decline. (The North is defined as the three most northerly English regions, the North East, the North-West and Yorkshire and The Humber.)

The first, and most widely reported graph, shows the North’s share of the population peaking in 1911, then falling back almost to pre-industrial levels.

Screen Shot 2014-11-05 at 17.50.43

This isn’t saying the population of the North is actually falling. It’s just saying that of the rest of the country, notably the South Eastern corner, has risen faster.

It isn’t helped by the fact that the young tend to leave the North. Even the net gain from teenagers going north for university is cancelled out when most students leave the North as soon as they have graduated.

Screen Shot 2014-11-05 at 18.09.59

A quick look at the regions’ economic measures makes it clear why people leave.

Screen Shot 2014-11-05 at 18.14.28
While the drain of skilled people and economic activity from the North has been going on for decades, the recession has made things worse. A Resolution Foundation report earlier this year looked at the data from two surveys, one of households, the other of businesses, and found that almost all the increase in employed jobs since the recession came from London.

screen-shot-2014-05-07-at-13-18-14

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Most of the employment increase outside London was due to self-employment.

There has been some pick up in employment in the North over this year but, as Michael O’Connor said, the claim that “the North East is basking in the status of Britain’s job-creation hot spot” is a little overstated.

According to projections made by the UK Commission for Education and Skills (UKCES), the imbalance between London and the North isn’t going to get any better over the next decade or so. UKCES forecasts that, as the economy grows, there will be job growth everywhere but that growth will be greatest in London and the regions around it.

Employment change projection

Is this just a problem for northern England though? The economic indicators for the rest of the country don’t look much better. The two midland regions fare little better than their northern neighbours and on some measures Wales looks even worse.

Most parts of the country show below average GVA (the grey and white areas) with the picture hardly changing since the beginning of the century.

Screen Shot 2014-11-06 at 07.35.55

Screen Shot 2014-11-06 at 07.33.43Screen Shot 2014-11-06 at 07.35.01

Source: ONS

The solution of the moment seems to be devolution. If we just handed power to the cities and regions, they would be able to do their own thing and their economies would take off. To do this, we’d have to decide what we mean by regions and where the boundaries would be. Another option would be to devolve powers further to individual cities. Or perhaps to city-regions. Politicians from all sides are a bit vague on all of this. Giving Greater Manchester a mayor seems to be part of a piecemeal drift towards some sort of devolution that might take different forms in different places. Whatever it is, it’s a long way short of a strategy.

But even if there were a coherent devolution strategy, I’m not convinced it would do much to revitalise the North. A decade or so of devolved government may have given Cardiff a boost but it hasn’t done much for the rest of Wales. OK, maybe it’s unfair to expect dramatic results in such a short-time but that only shows how slowly the economic effects of devolution (if there are any) might be elsewhere. Scotland’s economic indicators hold up reasonably well against the South East but this has more to do with its long-established oil and financial services sectors than to devolved government.

Then there’s the simple maths of devolution. If devolved regions get to keep more of their taxes, that means the southern regions will keep more of theirs too. Surely that will reduce the geographical distribution of wealth even further. There is also the danger of beggar-thy-neigbour tax competition between regions.

Much is made of the civic pride in Victorian cities. If Joseph Chamberlain could transform Birmingham in the nineteenth century, shouldn’t high-profile mayors be able to do something similar now? But look at the graph at the top of the page. The golden age of northern municipalism happened at a time when the industries in these cities were growing and their populations rising. The great northern cities were a product of this industrial growth. Well-run cities helped it along but the industry and wealth came first. With declining industries and wealth ever more concentrated in the south, even a reincarnation of Joe Chamberlain would struggle to reverse the trend.

If we are serious about rebalancing the country away from London, it will take some very bold measures and a lot of investment. A higgledy-piggledy devolution of who-knows-what to God-knows-where will produce a few shiny buildings in Leeds, Manchester and other regional capitals but probably not a lot else.

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5 Responses to Devo and the North

  1. ChrisA says:

    Would any measures to slow down the depopulation of the North simply not just delay the inevitable? The history of the human race (at least outside of Africa) is in increasing urbanization, with the bigger the city the bigger it gets. This is partly due to networking effects (no need to explain I trust), also the movement away from manufacturing to services as services benefit from overhead sharing just as much as manufacturing, and services need to be near their customers. It is also due to virtuous circle effects, the more the brainy ambitious people move to the big city, the more opportunities that will be created in the big city by those people, versus the provinces, and then the more attractive the big city is to brainy ambitious people. These are all proven very strong effects and frankly, if we are to keep even a semblance of a capitalist economy, pretty much unstoppable forces which will support the continued growth of London. One or two small cities can buck the trend, Aberdeen for instance is now the European oil capital. Edinburgh is making a go of finance, tourism and government. Newcastle is far enough away from other cities it can benefit from the same concentration trends in its own region. But this is small beer compared to the “great attractor”.

    If we did decide to defy the odds, myself I would try the following improve the look and feel of the Northern Cities as living spaces. Some ideas – roof over large parts of the downtowns of the cities of the North. The weather in most of them is awful. But, like Norman Fosters tent over Astana, this can be solved by enclosing the main areas. I would suggest a Victorian Conservatory look for most places, perhaps Manchester would benefit from a space age approach. All traffic thoroughfares need to be re-routed to avoid the city center – get rid of the dieselly buses, walking or cycling only for most of the city. Then clean up the city centers and police them heavily (gated searches). Most of the Northern cities still have incredible architectural buildings and they will gradually become tourist centers. So cut out the nettles growing out the gutters. I want to be strolling through the main streets of Leeds in at 9 pm at night November in my shorts (benefiting from the overhead heat lamps), admiring the glittering shops and restaurants, swerving slightly to avoid the toddler on his trike as his mum and dad enjoy an alsfresco bottle of wine in one of the many cafe’s.

  2. stuart3ca says:

    Reblogged this on onlythelittlepeoplepaytaxes and commented:
    The North is Buggered

  3. David says:

    Two things strike me about that comment . Why the hell is that toddler not home in bed at 9.00pm and what are the parents paying for the wine with , buttons ? The rest needs no comment .

  4. Bob says:

    We need a Land value tax to rebalance the regions and save public services.

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