This paper examines how employment in the major UK regions has reacted to the four major recessions of the last forty years, namely 1974-67, 1979-83, 1990-93 and 2008-10. The notions of resistance and recoverability are used to examine these reactions. The analysis reveals both continuities and significant changes in the regional impact of recession from one economic cycle to the next. Further, while economic structure is found to have exerted some influence on the resistance and recoverability of certain regions, in general 'region-specific' or 'competitiveness' effects appear to have played an equally, if not more, significant role.
The financial crisis and consequential recession that brought the UK's long economic boom of 1993-2008 to a dramatic end have generated considerable debate about the need to 'rebalance' the economy, both sectorally and spatially. In this paper we examine the scale and nature of imbalance in the UK economy. We first review what different theories of regional growth have to say about the issue of spatial and sectoral imbalance. Next, against this background, the stylised facts of sectoral and spatial imbalance, particularly as between the South and North of the United Kingdom, are identified. We then use dynamic multi-factor partitioning methods to determine the relative contribution that sectoral composition has made to NorthSouth regional imbalance. In the light of our findings we argue that there is an urgent need for a clearly identified industrial policy that is coordinated with a regional policy that seriously begins to address the North-South imbalance in the UK's economy that has become so deep-seated over recent decades.
This paper examines the resilience of British cities to major economic shocks. Using a novel data set for 85 cities, it analyses their resistance to and recovery from the last four major recessions, over the period 1971 to 2015. It reveals a distinct shift in the relation between resistance and recovery between these shocks, as well as major differences between northern and southern cities. Some possible factors shaping these patterns are explored, and tentative estimates of the likely impact of the Brexit shock (Britain's withdrawal from the European Union) are also provided. A key implication is that differences in resilience to major shocks can contribute to the long-run growth paths of cities.
Stimulated by the global financial crisis of 2007-08 and the Great Recession that this triggered, the notion of 'rebalancing the economy' has risen to prominence in UK policy discourse. An important element of this new 'rebalancing' mantra is a concern that the national economy has become too dependent on and dominated by London and the South East, whilst the rest of the country is performing below its potential. 1 As Prime Minister David Cameron noted upon assuming office in 2010:Our economy has become more and more unbalanced, with our fortunes hitched to a few industries in one corner of the country, while we let other sectors like manufacturing slide. Today our economy is heavily reliant on just a few industries and a few regions -particularly London and the South East. This really matters. An economy with such a narrow foundation for growth is fundamentally unstable and wasteful -because we are not making use of the talent out there in all parts of our United Kingdom. We are determined that should change (David Cameron, Prime Minister, 2010).Part of the Government's policy is the aim to promote a 'northern powerhouse' to rival London and the South East in scale and scope:The cities of the north are individually strong, but collectively not strong enough. The whole is less than the sum of its parts. So the powerhouse of London dominates more and more. And that's not healthy for our economy... We need a Northern Powerhouse too. Not one city, but a collection of northern cities -sufficiently close to each other that combined can take on the world (George Osborne, Chancellor of the Exchequer, 2014). However, the UK Government is also anxious that the growth of London is not hindered or compromised in any way. As a recent UK Treasury statement put it: Successful rebalancing will not be achieved by pulling down the capital city, but by building up the Northern Powerhouse and creating strong city regions, led by powerful, democratically elected mayors, that benefit from investment in world-class transport and have the support they need to foster innovation (HM Treasury, 2015, p. 70).
Economic geographers and regional economists have long been concerned with the problems provoked by uneven regional development and the ways by which policy intervention may be able to reduce such inequalities. However, in recent years the traditional argument for seeking to secure a reduction in the spatial concentration of economic activity in particular regions has been questioned and in some cases it has been suggested that policies that try to reduce regional economic inequalities may even reduce national efficiency. This article examines the evidence for a link between growth in productivity and the degree of spatial agglomeration across the nations of Europe. In doing so it considers how spatial agglomeration should be measured and how the relationship between agglomeration and the growth of productivity can be modelled.
According to Moretti (2013), deindustrialisation has been responsible for a 'great divergence' between cities that have moved to become centres of innovation and ideas, and those that have continued to produce material goods. Other authors however, place more emphasis on trends in specialisation and differences in productive bases as the driving forces behind urban divergence. Somewhat similarly, Storper (2013) argues that recent divergence been fundamentally been driven by the fact that some cities have become more specialised in knowledge intensive sectors. While most of this interest in urban divergence has been based on US cities, recent European research also reports divergent processes. The aim of this paper is to examine the degree of divergence across UK cities and to analyse how far this has been driven by differences among cities in industrial structure and specialisation , tradable bases, and productivity.
This research for this paper was undertaken as part of a project funded by the ESRC (ES/N006135/1) into Structural Transformation, Adaptability and City Economic Evolutions, as part of its Structural Transformations Programme. We are grateful to the ESRC for its support. The full team on the project also includes David Bailey (Aston Business School, UK) and Andy Pike (Centre for Urban and Regional Development Studies, Newcastle University, UK). Their support for this paper is also gratefully acknowledged. We are also indebted to three anonymous referees for their perceptive and constructive comments on an earlier version of the paper: their reports proved very helpful in sharpening and clarifying the paper's aims, arguments and narrative.
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