An interesting paper “The big European sort? The diverging fortunes of Europe’s regions” has been published by the Centre for European Reform (CER). Such papers are of great interest at PP. The paper analyses regional productivity. As a single metric productivity is one of the best, but as Charles Adams says, in order to get a clearer picture multiple metrics must be used.
Different metrics will paint different pictures and the productivity metric flatters Ireland (because of the high multinational footprint and profits being repatriated overseas) and is considered to overstate the real position by about 20%.
As Irish I had to smile when I looked at the richest boroughs of London. The interactive map gives the country which the region most resembles in terms of productivity. The 930% of the European average was extraordinary though.
I Would highly recommend clicking on the link and exploring the interactive map, which does not just cover Britain and Ireland, but also the rest of the EU.
The main findings are given in the paper but this one is particularly important:
The most important question is: what makes a successful region? With a new regression analysis, we show that high productivity levels in regions are associated with three factors: they are part of – or geographically close to – successful cities; a larger proportion of their workforce are graduates; and their populations are younger. The association of a high share of graduates with productivity levels is also rising over time. This will, in turn, encourage more young graduates to move to places that are already successful.
In the analysis below the percentage figure is that of the EU average.
The productivity of the four countries in these islands will now be analysed. Ireland will be treated as a whole as the comparison between Northern Ireland and the Republic of Ireland is revealing.
There have been a lot of studies on regional disparity in England. This generally gives very similar results, with major disparities between the richest and poorest parts of England. In general London and the SE are the richest and peripheral areas such as Cornwall and the NE poorest. Even within London there are major disparities, with Westminster (930%) and the region with Kensington and Chelsea(234%) both resembling Ireland but Croydon (80%) resembling Greece and Redbridge & Waltham Forest (72%) resembling Malta.
The poorest regions are similar to other studies including: Northumberland (70% -Cyprus), Durham (72% -Malta) and Cornwall (75% – Greece). The granular detail however reveals other deprived areas such as Greater Manchester NW (69% – Cyprus ) and Dudley (70% Cyprus).
Inequality within England is a disgrace.
Two main findings jump out of the Irish data.
The disparity between Ireland and Northern Ireland is stark with Ireland dramatically better than NI in terms of productivity. The Irish SW region is similar in size to NI. The Irish SW region (225% -Ireland) is far more productive than the richest region Belfast (163%-Denmark) or North of NI for example, including Derry, (69%-Cyprus). It is a shame the granularity is not better in the Irish data as, Cork City pulls the entire region up. The Dublin region (266% – Ireland) is more likely to be similar to Cork City.
Northern Ireland sufferers from regional inequality far more than Ireland. A good comparator is the contrast between Belfast and outer Belfast and Dublin and Mid East (which is the Dublin commuter belt – essentially outer Dublin). Belfast (163%-Denmark) is far more productive than Outer Belfast (65% -Slovenia): very problematic. Dublin (266% – Ireland) is more productive than “outer Dublin” (179%-Luxembourg): quite acceptable. There are however areas of Ireland the Border region (120%-Austria) and the Midlands (124%-Finland) which are falling behind. These regions are most likely to be effected adversely by Brexit.
The Scottish data is broadly in line with other studies, with Aberdeen, Edinburgh and Glasgow being the most productive regions. The order Glasgow (150%-Denmark) Edinburgh (145% -Denmark) and Aberdeen (140%-Belgium) is interesting, as previous studies I have seen rank them in the opposite order. Aberdeen has of course been pulled up in the past by oil revenue and Edinburgh by its large banking sector. Possibly these are not as profitable as they once were?
The other surprise is the “Lochaber, Skye & Lochalsh, Arran & Cumbrae and Argyll & Bute” region (115% -Germany) is considerably more productive than the Scottish Borders (70%-Cyprus) or “East Ayrshire and North Ayrshire mainland” (67%-Slovenia). Possibly a Scottish reader would care to speculate as I’m not sure why this should be the case.
In terms of regional inequality Scotland is doing a better job than England, but probably not quite so well as Ireland.
The Welsh figures make depressing reading. Even the richest region Cardiff and Vale of Glamorgan (98%-Spain) is below the EU average, if only just. The poorest region – the Isle of Anglesey (61%-Portugal) is the poorest region in these islands.
On the positive side, Wales is most equal country in terms of the difference between rich and poor regions on this granular level.
An interesting study. The regional disparity in the UK is depressing and the current centralised Westminster policies are not working. Ireland may not be as far ahead as the data may suggest, but is clearly doing much better than the UK as a whole. My own view is that far more needs to be done to fight regional inequality.
I would go as far as to say that regional inequality causes an existential threat to the survival of the UK as a unit. I think there is a high probability than neither Northern Ireland or Scotland will be under Westminster control in a decade’s time. Unless, somehow there is a dramatic change, which is difficult to see, as Brexit is taking up the entire bandwidth at Westminster and almost none of the other problems are being addressed.