Growth in the East Midlands ticked up by a modest 0.2% to 1.6% in the year to March 2019 according to estimates from ESCoE. At 2.7% and 0.7% London and Northern Ireland had the highest and lowest growth rates in the country. The East of England was the most improved region with growth accelerating from 0.9% to1.9%. The UK growth rate for the same period was 1.5%.
Unemployment in the East Midlands fell sharply by 23,000 to 98,000 between January and March; the drop of 1.0% to 4.0% was the best in the UK. At 2.4% and 5.4% the SW of England and the North East had the lowest and highest unemployment rates in the country. The UK unemployment rate stands at 3.8%.
In March, average earnings in the East Midlands increased to £574 per week. London had the highest average earnings of £762 whereas Northern Ireland had the lowest of £513. In the UK average earnings grew by 3.3% or by 1.5% after inflation.
East Midlands average property prices fell by 0.4% to £190,171 during the month which trimmed annual price increases to 2.9%. In comparison UK prices dropped by 0.2% to £226,798 during March which cut the annual growth rate to 1.4% although transactions were up by 1.4%.
In its estimate of regional public spending and regional tax revenues in 2018, the ONS concluded that the East Midlands had a deficit of £6bn. This compared with London which had the highest surplus of £34.3bn. On a per person basis the East Midlands deficit was £1,263, London had the highest surplus of £3,905 per person and Northern Ireland had the biggest deficit at £4,939. The only areas of the UK to run surpluses were London, the South East of England and the East of England. At a national level, the UK had a deficit of £636 per person which split into deficits of £106, £2,452, £4,395 and £4,939 for England, Scotland, Wales and Northern Ireland.
Positive news for Derby after Bombardier was named as the preferred bidder to develop and build monorail cars for two lines through Cairo and to the pyramids at Giza. The firm would potentially build 70 four-car units – as part of the £2.65bn project – to be exported to Egypt between 2021 and 2024. Thirty-four miles of monorail will connect the New Administrative City with East Cairo and a second line of 26 miles will run between Sixth of October City and Giza. The project will involve both the civil engineering of the monorail infrastructure as well as manufacturing the cars which could mean c100 new jobs. Derby has been making trains for 180 years but this is the first export of overseas rolling stock from the facility since a South African order in 2010. Also on engineering, Lotus Cars announced 200 new jobs as part of its expansion programme some of which may be at the sub-assembly manufacturing plant in Wellingborough. Lotus launched its new electric sports car, the Type 130, last month.
Another vote of confidence in Derbyshire after Sports Direct confirmed the sale of its Shirebrook headquarters in a £120m deal to a Malaysian pension fund. Mike Ashley’s discount sportswear retailer will take a 15-year lease and continue to operate from the site. The firm recently decided to close its Wigan warehouse offering the 300 Lancashire staff alternative work at Shirebrook. At least 3,500 agency workers and 500 permanent staff are employed at the site. Not such good news in Leicester as 82 year old well known café Brucciani has closed. The business had two cafes and a bakery in the city, employing around 50 people.
On the trains, The House of Lords Economic Affairs Committee has raised concerns that funding for HS2 through parts of the East Midlands could be at risk. Peers fear costs could be out of control leaving insufficient funding for the northern phase. Current plans would see a hub station built at Toton in Nottinghamshire. The region’s chamber of commerce says some companies are unsure whether to invest in new premises along the proposed route.
The operator of the East Midlands railway franchise is suing the government after it was barred from re-bidding for the contract. In April, it was announced Dutch government-owned Abellio will take over the service in August after the DfT rejected Stagecoach’s bids for the East Midlands franchise, the South Eastern franchise with Alstom, and a renewal of the West Coast franchise with Virgin Trains and France’s SNCF. Stagecoach said it could have been left with liabilities of £1.6bn if it had agreed to accept pension risks. In 2012, the DfT’s decision to award the West Coast Main Line rail franchise to FirstGroup was scrapped after mistakes were made in the way in which inflation and passenger numbers were accounted for by civil servants.
On regional governance, Communities Secretary, James Brokenshire, has approved the merger of South Northamptonshire, Northampton Borough and Daventry Councils into the new West Northamptonshire unitary authority. Also approved is a second unitary authority – North Northamptonshire – which will oversee Corby, East Northamptonshire, Kettering and Wellingborough. The unitary authority means all council services will be under one roof, whereas the county council was in charge of services such as education, health and social care, while the borough and district councils looked after waste, recycling and planning applications. The unitary authorities will be established following local elections in May 2020 (this month’s local elections in Northamptonshire were cancelled) and they will be operational by April 2021, bringing a conclusion to the future of local government in Northamptonshire after the financial collapse of the County Council.
Leicestershire County Council will spend £0.5m pa on new staff to support housing and economic growth claiming the county faces pressure for more roads, schools and transport infrastructure that could cost £600m over the next 25 years.
Derbyshire County Council will invest in ‘A Festival of Derbyshire’ to help boost the county’s tourism industry; showcasing the 70th anniversary of the Peak District National Park and 20 years since Derwent Valley Mills became a World Heritage Site. Tourism is worth £2.1bn to the local economy supporting 29,000 jobs directly and indirectly. Yorkshire has seen record numbers of overseas visitors since hosting the Tour de Yorkshire.