David Hearne is an early career researcher at Birmingham City University’s Centre for Brexit Studies. Prior to joining the university in 2017, David worked as an economist in a regional think tank. David’s primary research interests lie in regional economics and the sectoral and regional impact of Brexit. Ongoing research includes measurement issues within the regional economy as well as the north-south divide in Britain’s labour market.

Like all academic disciplines, the essence of good regional science (whatever one’s specific branch) is the art of simplification. Perhaps the most effective, if extreme, simplification we make is to divide places into the prosperous and the less-prosperous. Often this takes the form of a dividing line splitting an area in two, thus witnessing the emergence of terms such as the “global south” (Mahler, 2017). Indeed, such divides are common across the world: 30 years after the fall of the Berlin Wall, Germany continues to be divided into East and West (at least in an economic sense). Similarly, Italy has its mezzogiorno and vast swathes of the USA are sometimes referred to by the derogatory term “flyover country” (Bullard, 2016).

One of the oldest such divides is in the UK between a prosperous “south” and an unproductive, impoverished “north”. Much excellent work has been done on mapping exactly where this divide lies in practice (Dorling, 2010). Nevertheless, the English Midlands has always sat somewhat awkwardly within the North-South dichotomy. Indeed, the early 1980s effectively saw the western part of the Midlands “reclassified” as part of the North as a result of its dire economic performance over the past decade (Martin, 1988).

What is particularly fascinating, however, is that whilst both the Midlands and the North of England have seen their economies grow more slowly than the South over the past half century, the reasons behind this are very different. In the case of the North (North East, North West and Yorkshire & Humberside), approximately two-thirds of this relative underperformance has been due to slow population growth (with the remaining one-third being due to a deterioration in relative GDP per capita). In contrast, in the Midlands population growth has actually (almost) kept pace with that of the Greater South. Almost all of the Midlands’ underperformance vis-à-vis the South of England has been driven by a fall in its relative GDP per capita.

A graphical illustration demonstrates this point dramatically. The two graphs below demonstrate the cumulative “growth shortfall” relative to the “South” since 1966[1]. Note that the graphs actually show a logarithmic transformation of the shortfall (which gives an additive relationship rather than a multiplicative one)[2].

Figure 1. North Growth Relative to the South.

Figure 2. Midlands Growth Relative to South

As can be seen, although the total deterioration in GDP growth vis-à-vis the South of England is broadly similar in both regions, in the North of England this has been predominantly driven by falls in relative population whereas in the Midlands it is primarily due to a fall in relative GDP per capita[1]. In many ways this opens more questions than answers. What is driving the slower population growth in the North of England and why has the population of the Midlands grown relatively rapidly during a period of apparent economic decline? Could it simply be that the working-age population of the North is slowly migrating to where opportunities lie (in London and the South East)? If so, why have those in the Midlands not done likewise?

At the moment, the data are insufficient to fully answer these questions. However, there are clues and subtle hints, at least for the most recent period (since around 2004). Firstly, it appears that most (but not all) of the disparity in population growth of working-age adults between regions has been driven by growth of the non-UK born population. This has grown rapidly (in percentage terms) in all meso-scale regions across the UK, but due to the much larger base in the South (principally London) this has had a substantially bigger impact on total population in that region.

In any event, these figures have potentially important ramifications for regional living standards and this is particularly stark for the West Midlands. In 1971, nominal disposable income per capita in the West Midlands standard statistical region was higher than all of the northern regions, East Anglia and the South West. Indeed, as late as 1975 the region had per capita nominal disposable income of less than 2.3% below the South East and greater than any other region bar London. By 1981 it was the poorest region in England on this measure. Why? Undoubtedly a complex array of factors were responsible – not least the collapse of much of the area’s once world-leading automotive industry. Coventry – the UK’s “Motor City” saw the loss of an astounding proportion of jobs in the late 1970s and early 1980s.

However, regional policy also played its part – albeit rather more subtly. The effective 2-decade ban on office construction in Birmingham from 1965 onwards (Overman, 2013), together with hugely restrictive planning legislation, in effect prevented the diversification of the West Midlands’ economy just when it was needed most. Hard though it might be to envisage today, in the 1950s and early 1960s, service sector employment grew faster in Birmingham than anywhere else in the UK. It seems reasonable to conclude that Government policies (whether regional, vis-à-vis the automotive sector or macroeconomic) were an important factor in the Midlands’ fall from (economic) grace.

We ignore the unique economic history of the Midlands at our peril. The West Midlands in particular fell from grace dramatically in the 1970s: this wrenching dislocation was experienced by an area whose closest comparator is not the North of England but rather Detroit. It also fails to hold to account those who share a degree of culpability for the economic decline of a region that 50 years ago was the prosperous heartland of Britain and is now amongst the poorest. Perhaps it is no surprise, then, that it was the English Midlands where the 2016 vote to leave the EU was at its most extreme (Electoral Commission, 2016).

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References

Bullard, G. (2016). The Surprising Origin of the Phrase ‘Flyover Country’. National Geographic. Retrieved from https://news.nationalgeographic.com/2016/03/160314-flyover-country-origin-language-midwest/

Dorling, D. (2010). Persistent North-South Divides. In N. M. Coe & A. Jones (Eds.), The economic geography of the UK. London ; Los Angeles: Sage Publications.

Electoral Commission. (2016). EU referendum results. Retrieved Date from https://www.electoralcommission.org.uk/find-information-by-subject/elections-and-referendums/past-elections-and-referendums/eu-referendum/electorate-and-count-information.

Mahler, A. G. (2017). Global South. In E. O’Brien (Ed.), Oxford Bibliographies in Literary and Critical Theory.

Martin, R. (1988). The Political Economy of Britain’s North-South Divide. Transactions of the Institute of British Geographers, 13(4), pp. 389-418. doi:10.2307/622738 Retrieved from http://www.jstor.org/stable/622738

Overman, H. G. (2013). Booming Birmingham and the Need for Rebalancing. Retrieved from http://spatial-economics.blogspot.com/2013/05/booming-birmingham-and-need-for.html

[1] Whilst all three regions have seen growth in population and GDP per capita over the period, this growth has been notably faster in the South than in the North.

[1] The “North” is defined as the North East, NorthWest and Yorkshire & Humberside.

The “Midlands” is defined as the East Midlands and the West Midlands. The “South” is defined as London, the South East, the South West and East Anglia.

[2] As a useful side-effect, the well-known approximation (as derived from the first two terms of a Taylor series expansion) applies, such that 0.01 ≈ 1%.