The State of Britain

SE

The SE retains its R&D top spot and the UK’s highest level of employment

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A nowcast for the SE for the 12 months ended March 2021 which incorporates the second lockdown, published by the Economic Statistic Centre of Excellence (‘ESCoE’) on a rolling 4 quarter basis, has estimated that the SE economy contracted by 12.2%.

This ranked the SE seventh in the UK (previous ranking seventh). Over the same period the East Midlands was ‘best’ with a fall of 9.4%, with Wales’s 13.4% contraction the ‘worst’. The UK overall posted -11.8% on the same measure.

ESCoE is a partnership of research institutions and the Office for National Statistics (‘ONS’) and has highlighted that during these unprecedented times, with differing lockdowns, there is no historical data that their model can use to fully understand how the pandemic will impact regional economies.

Consequently the partnership emphasises the uncertainties that exist with their nowcast at this time. This is the last nowcast that will be published by ESCoE with the ONS taking over the running of the model in the future.

ONS GDP to December 2020

Official ONS figures for an earlier period which reflect a mix of continued recovery from the first lockdown but also a slowdown from the second lockdown show the region’s performance relative to other parts of the UK.

The ONS’s figures for the quarter to December 2020 showed the SE post growth of 1% compared with 19.1% in the quarter to September 2020.

This placed the SE fifth (previous ranking fifth) out of the twelve UK ‘regions’. London was top with quarterly growth of 3.1% whilst the East Midlands was bottom, posting growth of -0.8%. UK growth was 1%.

In this period, the SE’s best sector was manufacturing at 6.7% whilst accommodation fell by 16.3. Overall Production, Construction and Services were 5.2%, 1.1% and 0.4%.

Labour

Data from the ONS showed the Job Retention Scheme continued to mitigate unemployment across the UK. Unemployment in the region increased by 35,000 to 195,000 between March and May 2021; the uplift of 0.7% took the rate to 4.1%. At 6.5% London was the highest; Northern Ireland had the lowest rate of 3.6%, with the UK rate at 4.8%.

The South East had the highest employment rate at 77.7%, this compared with 70.3% in Northern Ireland which was the lowest; the UK rate was 74.7%.

Public sector employment in the SE increased by 4.9% to 676,000 in the year to March 2021, which was 15.5% of the workforce. At 25.9% Northern Ireland had the highest level of public sector employment which compared to 14.8% in London which was the lowest.

Productivity

ONS figures also showed that in 2020, output per hour worked grew by 0.8% in the SE which ranked the region sixth out of the 12 UK ‘regions’. Productivity growth in 2019 was best in the North West, increasing by 4.6%. and fell the most in the West Midlands, decreasing by 1.4%. Output per hour worked in the UK increased by 0.4%.

Research and Development

The region attracted £7.5bn of R&D spend in 2019, up from £7.1bn in 2018. This ranked the SE first in the UK (previous ranking first). Over the same period the North East only attracted £0.7bn.

Overall UK R&D spend rose by £1.3bn (3.4%) to £38.5bn in 2019 – the lowest percentage growth since 2013. Most R&D expenditure was in the business sector at £25.9bn (67% of the UK total), followed by the higher education sector at £9.1bn (24%).

Total R&D expenditure represented 1.74% of GDP in 2019; compared with 1.59% in 2008 and 1.72% in 2018. Overseas funding increased by 4.1% to £5.6bn in 2019 compared with 2018; this was 0.8% higher than the peak in 2014 of £5.5bn.

Housing

The SE’s average property price increased by 1.4% in May to £350,016. The uplift took the annual increase to 9.1%. In comparison, UK prices grew by 0.9% to £254,624, an annual growth rate of 10%.

The South East’s labour market the best in the UK and the economy posts good growth after the first lockdown

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Official ONS figures which reflect the economy opening up after the first lockdown show the region’s performance relative to other parts of the UK.

These stats compare GDP in the quarter ended September 2020 with the same quarter a year earlier. These showed that the SE’s growth was -8.3% compared with -23.3% the previous quarter. This placed the SE ninth (previous ranking tenth) out of the twelve UK ‘regions’.

Northern Ireland topped the table with growth of -2.9% whilst UK growth over the same period was -7.5%. The West Midlands was bottom, posting growth of -11.3%.

In the same report, the ONS’s figures for the standalone quarter to September 2020 showed the SE post growth of 19.1% compared with -20.4% in April to June 2020.

This placed the SE fifth (previous ranking sixth) out of the twelve UK ‘regions’. The South West was top with quarterly growth of 19.9% whilst London was bottom, posting growth of 13.3%; UK growth was 16.9%.

In this period, the SE’s best sector was accommodation at 236% compared with agriculture at 1.7%. Production, Construction and Services were 20%, 55% and 17%.

Labour

Data from the ONS showed the Job Retention Scheme continued to mitigate unemployment across the UK. Unemployment in the region was 12,000 lower at 164,000 between January and March; the drop of 0.2% took the rate to 3.4%. At 6.8% London was the highest; the South East had the lowest rate with the UK rate at 4.8%.

The South East had the highest employment rate at 78.5%, this compared with 69.1% in Northern Ireland; the UK rate was 75.2%.

Public sector employment in the SE increased by 4.6% to 668,000, which was 15.1% of the workforce. At 25.9% Northern Ireland had the highest level of public sector employment which compared to 14.5% in London which was the lowest.

In December, average earnings in the SE grew to £761 per week. London had the highest average earnings of £871 and the lowest average earnings of £584 were recorded in the North East and the East Midlands.

Earnings in Scotland increased the most in the UK by £37 per week whereas the biggest drop in wages was £50 in the East Midlands. The rate of annual pay growth was 4.0% for total pay and 4.6% for regular pay. In real terms, total pay is growing at a faster rate than inflation at 3.1%, with regular pay growth at 3.6%. Public sector pay grew at 5.6% compared with 3.7% in the private sector.

The public sector saw the highest estimated growth in total pay. All sectors saw positive growth, although construction (1.2%) and manufacturing (1.9%) had smaller growth than the other sectors. This is an improvement on the growth rates in April to June 2020, the three-month period with the biggest falls in average pay, when all sectors except for the public sector had negative growth rates.

Housing

The SE’s average property price increased by 0.9% in March 2021 to £348,615. The uplift took the annual increase to 7.9%. In comparison, UK prices grew by 1.8% to £256,405 during March, an annual growth rate of 10.2%.

The SE economy contracts by 23% during the first lockdown but employment remains high

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A nowcast for the SE for the 12 months ended December 2020, published by the Economic Statistic Centre of Excellence (‘ESCoE’), has estimated that the SE economy contracted by 10.5%. This ranked the SE seventh in the UK.

Over the same period the East Midlands was ‘best’ with a fall of 8.9%, with London’s 12.9% contraction the ‘worst’.

ESCoE also gave estimates of regional growth over a longer period. Over the last five years, London, the East of England and the West Midlands have grown relative to the other parts of the UK despite experiencing some of the largest declines in activity in 2020.

At the bottom of the table, the North East of England is an outlier in terms of weak economic performance and the devolved administrations have also posted below average results. The SE was ranked tenth.

ESCoE is a partnership of research institutions and the Office for National Statistics (‘ONS’) and has highlighted that during these unprecedented times, with differing lockdowns, there is no historical data that their model can use to fully understand how the pandemic will impact regional economies. Consequently the partnership emphasises the uncertainties that exist with their nowcast at this time.

ONS GDP to June 2020

Official ONS figures for an earlier period which reflects the full effect of the first lockdown show the region’s performance relative to other parts of the UK.

These stats are for the period six months before ESCoE’s estimates shown above and compare GDP in the quarter ended June 2020 with the same quarter a year earlier. These showed that the SE’s growth was -23.3% compared with -4.9% the previous quarter. This placed the SE tenth (previous ranking eleventh) out of the twelve UK ‘regions’.

London topped the table with growth of -16.3% whilst UK growth over the same period was -20.7%. The West Midlands was bottom, posting growth of -24.7%.

In the same report, the ONS’s figures for the standalone quarter to June 2020 showed the SE post growth of -20.6% compared with -3.4% in January to March 2020.

This placed the SE tenth (previous ranking eighth) out of the twelve UK ‘regions’. Northern Ireland was top with quarterly growth of -13.6% whilst the West Midlands was bottom, posting growth of -21%. UK growth was -18.8%.

In this period, the SE’s best sector was public administration at -1.7% whilst accommodation fell by -74.6%. Production, Construction and Services were -22.6%, -44.2% and -18.6%.

Labour

Data from the ONS showed the Job Retention Scheme continued to mitigate unemployment across the UK. Unemployment in the region was 22,000 lower at 176,000 between October and December; the drop of 0.4% took the rate to 4.4%. At 7% London was the highest; Northern Ireland had the lowest rate of 3.6%, with the UK rate at 5.1%.

The South East had the highest employment rate at 78.6%, this compared with 69.4% in Northern Ireland. In the SE 2.6m are employed; the UK rate was 75%.

Public sector employment in the SE increased by 4.2% to 661,000, which was 14.9% of the workforce. At 25.3% Northern Ireland had the highest level of public sector employment which compared to 14.3% in London which was the lowest.

In December, average earnings in the SE increased to £727 per week. London had the highest average earnings of £862 and the lowest average earnings of £555 were recorded in North East.

Earnings in Wales increased the most in the UK by £44 per week whereas the biggest drop in wages was £27 in Yorkshire and the Humber. The rate of annual pay growth was 4.7% for total pay and 4.1% for regular pay. In real terms, total pay is growing at a faster rate than inflation at 3.8%, with regular pay growth at 3.3%.

The finance and business services sector saw the highest estimated growth in total pay, at 6.8%. All sectors saw positive growth, although construction (1.9%) and manufacturing (1.5%) had smaller growth than the other sectors. This is an improvement on the growth rates in April to June 2020, the three-month period with the biggest falls in average pay, when all these sectors except for the public sector had negative growth rates. Public sector pay growth is now 4.3%.

Housing

The SE’s average property price increased by 0.1% in December 2020 to £341,007. The uplift took the annual increase to 6.1%. In comparison, UK prices grew by 1.2% to £251,500 during September, an annual growth rate of 8.5%.

The SE’s economy sinks by 12% following lockdown

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A nowcast for the SE for the 12 months ended September 2020 on a rolling 4 quarter basis, published by the Economic Statistic Centre of Excellence (‘ESCoE’), has estimated that the SE economy contracted by 8.5%.

This ranked the SE seventh in the UK and suggests the regional economy has so far coped ‘reasonably’ with the pandemic relative to the other eleven UK ‘regions’ on this metric. Over the same period the North East was ‘best’ with a fall of 6.5%, with Wales’s 11.4% contraction the ‘worst’; the UK decline according to these figures was c8%.

However, the total percentage change in the SE’s GDP relative to the end of 2019 is about -12%. This compares with -8% across the UK and about -16% in the North East.

ESCoE is a partnership of research institutions and the Office for National Statistics (‘ONS’) and has highlighted that during these unprecedented times, there is no historical data that their model can use to fully understand how the pandemic will impact regional economies. Consequently the partnership emphasises the uncertainties that exist with their nowcast at this time.

ONS GDP to March 2020

Official ONS figures for an earlier period which reflects the start of the Covid 19 turmoil show the region’s performance relative to other parts of the UK.

These stats are for the period six months before ESCoE’s estimates shown above and compare GDP in the quarter ended March 2020 with the same quarter a year earlier. These showed that SE growth was -4.9% compared with -1.2% the previous quarter. This placed the SE eleventh (previous ranking eleventh) out of the twelve UK ‘regions’.

London topped the table with growth of 1.5% whilst UK growth over the same period was -2.2%. The West Midlands was the worst performer and grew by -5.3%. London was the only region to show positive growth.

In the same report, the ONS’s figures for the standalone quarter to March 2020 showed the SE post growth of -3.4% compared with -0.6% in October to December 2019.

This placed the SE eighth (previous ranking eighth) out of the twelve UK ‘regions’. No region showed positive growth. London was top with quarterly growth of -1.5% whilst Northern Ireland was bottom, posting growth of -4.5%.

In this period, the SE’s best sector was finance with growth of 1.6% but education fell by 12.7%. Production, Construction and Services fell by 4.9%, 2.2% and 4.9%.

Labour

Data from the ONS showed the Job Retention Scheme continued to depress unemployment across the UK. Unemployment in the region was 38,000 higher at 198,000 between July and September; the uplift of 0.8% took the rate to 4.1%. At 6.7% the North East was the highest; Northern Ireland had the lowest rate of 3.6%, with the UK rate at 4.8%.

The South East had the highest employment rate at 78.3%, this compared with 70.5% in Northern Ireland; the UK rate was 75.3%.

Housing

The SE’s average property price increased by 1.4% in September 2020 to £336,783. The uplift took the annual increase to 4.0%. In comparison, UK prices grew by 1.7% to £244,513 during September, an annual growth rate of 4.7%.

The SE economy shrinks by 5.8% following lockdown and data for an earlier pre-pandemic period also shows a Brexit contraction with a big decline in services

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A nowcast for the SE for the 12 months ended June 2020 on a rolling 4 quarter basis, published by the Economic Statistic Centre of Excellence (‘ESCoE’), has estimated that the SE economy contracted by 5.8%.

This ranked the SE fifth in the UK and suggests the regional economy has so far coped ‘better’ with the pandemic relative to the other eleven UK ‘regions’. Over the same period the East Midlands was ‘best’ with a fall of 4.5%, with London’s 7.4% contraction the ‘worst’; the UK decline according to the Office for National Statistics (‘ONS’) figures was 5.3%.

ESCoE is a partnership of research institutions and the ONS and has highlighted that during these unprecedented times, there is no historical data that their model can use to fully understand how the pandemic will impact regional economies. Consequently the partnership emphasises the uncertainties that exist with their nowcast at this time.

ONS GDP to December 2019

Official ONS figures for an earlier period which reflects Brexit uncertainty rather than Covid 19 turmoil, show the region dropping a few places relative to other parts of the UK. Following its first publication of quarterly GDP estimates for the regions in September 2019, the ONS has now published its fifth estimate for the SE, the other eight English regions, and Wales. GDP figures have been available for the UK since the 1940s, for Scotland since 2002 and Northern Ireland since 2013.

These stats are for the period six months before ESCoE’s estimates shown above and compare GDP in the quarter ended December 2019 with the same quarter a year earlier. These showed the SE contracted by 1.2%, a deterioration on 0.8% the previous quarter. This placed the SE eleventh (previous ranking fifth) out of the twelve UK ‘regions’.

London topped the table with growth of 5% whilst UK growth over the same period was 0.9%. The West Midlands was again the worst performer and contracted by 2.7%. The North East, Wales, East Midlands and the North West were the other ‘regions’ in the UK to suffer a decline.

In the same report, the ONS’s figures highlighted that the standalone quarter to December 2019 also showed a worsening picture in the SE with the data poorer than the previous quarter. The SE economy fell by 0.6% in October to December 2019, following -0.4% in July to September 2019.

This placed the SE eighth (previous ranking ninth) out of the twelve UK ‘regions. The SE was one of seven regions of the UK that saw their economies contract but overall UK growth was flat.

The SW was top with quarterly growth of 0.8% whilst the North East was bottom, posting a drop of 1.3%.

In this period, the SE’s best sector was water supply with growth of 8.4% but administrative and support service activities fell by 4.4%. Overall production was flat and construction grew by 0.9%, but services fell by 0.9% and agriculture was down by 0.4%.

Labour

Data from the ONS showed the Job Retention Scheme continued to depress unemployment across the UK. Unemployment in the region was 15,000 higher at 157,000 between April and June; the uplift of 0.3% took the rate to 3.3%. At 5.2% the North East was the highest; Northern Ireland had the lowest rate of 2.5%, with the UK rate at 3.9%.

The South East had the highest employment rate at 79.7% where 4.7m are employed; this compared with 71.7% in Northern Ireland, with the UK rate at 76.4%.

Housing

The SE’s average property price increased by 0.2% in April 2020 to £327,413. The uplift took the annual increase to 2.7%. In comparison, UK prices dropped by 0.2% to £234,612 during April, an annual growth rate of 2.6%.

The ONS data is based on completed housing transactions. Typically, a house purchase can take 6 to 8 weeks to reach completion so the price data in the April figures will therefore reflect those completions that occurred before lockdown.

This is the first publication of the UK HPI since it was suspended in May 2020. The UK Property Transactions Statistics for April 2020 showed that that between March 2020 and April 2020, transactions decreased by 55.5%.

Jobs at Gatwick under threat, a big disparity between incomes in West Surrey and Portsmouth and poor growth in Medway highlighted

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The pandemic’s impact on the aviation industry has continued with c600 ground staff at Gatwick Airport at risk under proposals put forward by Gatwick Ground Services. The firm will take on 412 BA employees in July who will join 511 current GGS staff.

More positively, Oxfordshire County Council has secured £218m from the Housing Infrastructure Fund to support building new roads and bridges around Didcot. In 2015, Didcot was awarded garden town status, which gives it access to the Fund as part of a 20-year plan to build 15,000 new homes. The cost of the project is predicted to be £234m, with the balance being covered by contributions from housing developers.

Also in the county, government agency, Homes England, has submitted plans for a new market town of 3,000 homes at Chalgrove Airfield.

The Stats

This month the ONS published regional household disposal income figures for 2018. Total gross disposable household income (GDHI) in the UK in 2018 was £1.4bn. Of that, 86.3% was in England, 7.6% was in Scotland, 3.8% was in Wales and 2.3% was in Northern Ireland.

The average UK income per head after direct and indirect taxes were taken off was £21,109.  England was the only country above the UK average at £21,609 but growth in incomes was best in Scotland and Northern Ireland at 5.1% and 4.7%. England’s growth was the same as the UK at 4.6%; Wales grew by 4.4%.

At a regional level, London had the highest GDHI per head where, on average, each person had £29,362 available to spend or save; the North East had the lowest at £16,995 which compares with a UK average of £21,109. The SE was £24,318.

At a local level, Kensington and Chelsea and Hammersmith and Fulham district had the highest GDHI per head at £63,286 with Nottingham the lowest at £13,138. All the top 10 local areas were in London or the South East with the bottom 10 within the North West, Yorkshire and The Humber, East Midlands, West Midlands, and Northern Ireland regions.

The wealthiest part of the SE was West Surrey with incomes of £30,748. This ranked the area 7th out of 179 districts of the UK.

The poorest areas of the region were Portsmouth at £16,297, beating Southampton at £16,994. Portsmouth was ranked 154th in the UK, Nottingham and Leicester were bottom.

In terms of regional growth, the largest increase was in London at 5.2% with the smallest in the East Midlands at 3.6%. The SE was 4.1%.

At the local level, Kensington & Chelsea and Hammersmith & Fulham was again best in the UK with growth of 7.6% whereas Luton was the worst and only grew by 0.9%.

In the SE, income growth in Buckinghamshire was the sixth highest in the UK at 6.5% with North Hampshire a regional second at 6.1%. Medway was the worst regional performer with growth of 2.4%, a ranking of 170th.

Labour

More data from the ONS showed unemployment in the region was 10,000 lower at 146,000 between February and April; the drop of 0.2% took the rate to 3.0%. Despite narrowing the gap with the West Midlands (4.8%), at 5.2% the North East was still the highest; Northern Ireland had the lowest rate of 2.3%, with the UK rate at 3.9%.

The South East had the highest employment rate again at 79.5% where 4.7m are employed; the UK rate was 76.4%.

Public sector employment in the SE increased by 2.1% in March to 644.000, which was 14.5% of the workforce. At 25.2% Northern Ireland had the highest level of public sector employment which compared to 13.9% in London which was the lowest.

In March, average earnings in the SE fell by £27 to £702 per week. London had the highest average earnings of £847 and the lowest average earnings of £537 were recorded in Northern Ireland.

Earnings in the NE increased the most in the UK by £60 per week whereas the biggest drop in wages was £37 in Scotland.

In the UK overall, average earnings grew by 1.7% or by 0.4% after inflation. If bonuses are included real pay fell by 0.4%.

The public sector saw the highest estimated growth, at 3.2% for regular pay, while negative growth was seen in the construction sector, estimated at negative 1.8%. Both the wholesaling, retailing, hotels and restaurants sector and the manufacturing sector saw very weak growth at 0.1% for regular pay.

Housing

Estimates of private sector rents for the year to March 2020 were published by the ONS this month.

The median monthly rent was an all time high of £700 in England between 1 April 2019 and 31 March 2020. London had the highest median monthly rent at £1,425 with the North East the lowest at £495. Within local authorities the difference in monthly rental price between the most and least expensive was nearly £2,100.

In the SE rental prices ranged from £745 to £1,150 with £900 the median.

Data for the 12 months to May 2020 showed private rental prices paid by tenants in the UK rose by 1.5%, unchanged from the previous month. Rental prices grew by 1.5% in England, 1.2% in Wales and 0.6% in Scotland.

Rental prices increased the most in the South West, up by 2.5%, with the lowest price growth in the North East at 0.8%, the SE recorded 1.2%.

According to the ONS the South West is also projected to have the highest regional rate of growth in households over the next ten years, at 9%. This compares with 6.9% in the SE and 4.3% in the NE (the lowest).

Overall the number of households in England is projected to increase by 1.6m (7.1%) from 23.2m in 2018 to 24.8m in 2028. The SE is forecast to have 4.0m households by 2028.

Given the closure of the housing market following lockdown the ONS has suspended its property price index until further notice.

The South East economy shrinks by 1.9% following lockdown and pre-pandemic data shows an earlier Brexit contraction

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A quarterly nowcast for the SE for the 3 months ended March 2020 which captures the start of lockdown, published by the Economic Statistic Centre of Excellence (‘ESCoE’), has estimated that the SE economy contracted by 1.9%. ESCoE is a partnership of research institutions and the Office for National Statistics (‘ONS’).

This ranked the SE eighth and suggests the regional economy has so far coped averagely with the pandemic relative to the other eleven ‘regions’ of the UK. Over the same period the East Midlands was ‘best’ with a fall of 1% with Northern Ireland’s 3.9% contraction the ‘worst’; the UK decline was 2%.

For the 12 months ended March 2020 on a rolling 4 quarter basis, ESCoE has estimated that SE growth has dropped from 1.8% to 1%.

This ranked the SE fifth (previous ranking fourth) and suggests the region has largely held its position relative to the other eleven parts of the UK. Over the same period UK growth was 0.5%; growth in London (ranked first) was 1.8%; and growth in the East Midlands (ranked twelfth) was -0.6%.

ONS GDP to September 2019

Official ONS figures for an earlier period which reflects Brexit uncertainty rather than Covid 19 turmoil, show the region dropping a few places relative to other parts of the UK. Following its first publication of quarterly GDP estimates for the regions in September 2019, the ONS has now published its fourth estimate for the SE, the other eight English regions, and Wales.  GDP figures have been available for the UK since the 1940s, for Scotland since 2002 and Northern Ireland since 2013.

These stats are for the period six months before ESCoE’s estimates shown above and compare GDP in the quarter ended September 2019 with the same quarter a year earlier. These showed the SE grew by 0.8%, a deterioration on 2.1% the previous quarter. This placed the SE fifth (previous ranking second) out of the twelve UK ‘regions’.

London topped the table with growth of 5% whilst UK growth over the same period was 1.2%. The West Midlands was the worst performer and contracted by 1.5%. The East of England and the North West were the other two ‘regions’ in the UK to suffer a decline.

In the same report, the ONS’s figures also highlighted that the standalone quarter to September 2019 showed an improving picture in the SE with the data better than the previous quarter. The SE economy fell by 0.2% in July to September 2019, following -0.7% in April to June 2019.

This placed the SE ninth (previous ranking also ninth) out of the twelve UK ‘regions. The SE was one of four regions of the UK that saw their economies contract but overall the UK grew by 0.5%.

Again London was top with quarterly growth of 1.4% whilst the North West and Northern Ireland contracted by 0.2%, with the East Midlands posting a drop of 0.3%.

In this period, the SE’s best sector was mining with growth of 4.4% but accommodation/food services fell by 2.4%. Overall production grew by 0.3% but construction fell by 1.5%, services by 0.2% and agriculture by 0.1%.

Labour

More largely pre-pandemic data from the ONS showed unemployment in the region was 9,000 lower at 142,000 between January and March; the drop of 0.2% took the rate to 2.9%. At 5.4% the North East was the highest; Northern Ireland had the lowest rate of 2.4%, with the UK rate at 3.9%.

The South East had the highest employment rate at 80.2% where 4.7m are employed; this compared with 72.4% in Northern Ireland, with the UK rate at 76.6%.

Housing

The SE’s average property price increased by 0.6% over the month to £323,353. The uplift took the annual increase to 1.6%. In comparison, UK prices dropped by 0.2% to £231,855 during March, an annual growth rate of 2.1%.

The ONS data is based on completed housing transactions. Typically, a house purchase can take 6 to 8 weeks to reach completion so the price data in the March figures will therefore reflect those completions that occurred before lockdown.

Given the closure of the housing market following lockdown the ONS has suspended its index until further notice.

The SE remains the largest UK exporter, the region’s construction sector and labour market perform the best

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HMRC has published the latest regional trade figures which show exports and imports for 2019. Given the time period this data reflects Brexit uncertainty rather than Covid 19 turmoil. 

In the year to December 2019, the overall value of UK trade in goods exports increased by 2.1% to £346bn compared with the same period in 2018. The overall value of imports increased by 0.3% to £483bn.

There was a decrease in the annual export value in the SE along with five of the 12 UK ‘regions’. The SE’s exports decreased by 1.1% or £503m to £46.5bn which was 13% of the UK total.  

The biggest regional exporter remained the SE with Northern Ireland the smallest at £9bn. The best performer in percentage terms was London which added 17% with Yorkshire & The Humber falling by 6.3%.

There was an increase in the annual import value in the SE along with five of the 12 UK ‘regions’. The SE’s imports increased by 3.1% or 3bn to £98bn which was 20% of the UK total.

The leading regional importer was the SE at £98bn and Northern Ireland was the smallest at £8bn. In percentage terms London added 12% compared with Scotland which reduced imports by 7%.

The USA was the SE’s largest export market with machinery & transport equipment the best export. Most of the SE’s imported goods came from Germany with machinery and transport equipment the biggest import.

Services

This month the ONS published data on regional services imports for 2017. The biggest component of services imported into the UK was £51bn of travel. This was 28% of the £181bn UK total imports of services.

The SE imported £26bn of services value in 2017 of which £7bn was travel. The largest importer of services was London at £60bn with Northern Ireland importing £1.6bn.

At a local level, the biggest importer of non-travel services into the UK was Camden and City of London at £14.5bn, almost double the next largest importer which was Westminster at £7.9bn. Of the 167 local areas, the Western Isles of Scotland imported the least amount, £21m, with Anglesey next at £31m.

In the SE, Berkshire imported £3.9bn of non-travel services compared with £92m on the Isle of Wight.

The data on services exports was released by the ONS last year which showed the SE exporting £45bn of services which compared with London at £117bn and Northern Ireland at £2.9bn.

Other data

The ONS has also published the latest regional construction sector data to December 2019 which again reflects Brexit uncertainty rather than Covid 19 turmoil. Compared with the previous quarter all parts of the UK recorded a decline with the SE posting a 0.9% drop to £6.3bn.

The biggest decrease in the UK was 4.6% in the West Midlands; the SE was best with the 0.9% fall. Within construction though 9880 new houses were completed in the SE, an increase of 26% on the previous quarter.

More pre-pandemic data from the ONS showed unemployment in the region was 13,000 lower at 91,000 between December and February; the drop of 0.3% took the rate to 3.0%. Northern Ireland had the lowest rate of 2.5%, the NE the highest at 5.6%, with the UK rate at 4%.

The South East had the highest employment rate at 80.1% where 4.7m are employed; the UK rate was 76.6%.

The SE’s average property price decreased over the month by 0.4% to £321,329. The fall took the annual increase to 0.4%. In comparison, UK prices dropped by 0.6% to £230,332 during February, an annual growth rate of 1.1%.

Abingdon in Oxfordshire and Portsea in Portsmouth are the wealthiest and poorest areas of the region, Thames Valley Berkshire LEP had the best productivity in the UK and the SE’s employment rate now top

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The ONS has published average household disposal income estimates for England and Wales in 2018. The incomes shown are after tax and housing costs are taken off.  The analysis has shown that 87% of local areas had an average household income of between £22,500 and £39,200; within this over a third were between £28,000 and £33,600.

Of the 50 areas with the highest total incomes, 41 were in London with the lowest incomes more widely spread geographically across England and Wales. The North East, East England, London, and the South East had no local areas in the bottom 50.

The wealthiest area in England and Wales was Mickleover in Derby, with incomes of £52,200 and the poorest was Highfield North in Leicester with £12,500. The two areas are 30 miles from each other and ranked 7200 places apart.

The wealthiest area of the SE was northern Abingdon in Oxfordshire with £44,900. This ranked the area 35th out of the 7,201 areas recorded. The poorest area of the region was the Portsea area of Portsmouth with £18,400. This area was ranked 6,337 out of the 7,201 areas recorded.

Unlike most regions of the UK, output per hour in the SE was above the UK average. Productivity in the SE was 9.1% above the norm which ranked the region second in the UK. The SE and London record high levels of hours worked and their high productivity pulls up the UK average so much that all other regions fall below it.

The ONS has now released data for a longer period and at a subregional level. This gives further insight into the SE’s performance.

Perhaps the most useful is the 2018 results for the 44 enterprise regions in the UK which comprise the 38 English local enterprise partnerships (LEPs) and six enterprise regions in Scotland, Wales and the border regions.

The region’s Thames Valley Berkshire LEP had the best productivity (in terms of hours and jobs) in 2018 at 35% above the UK average whereas the West Midland’s Black Country LEP at 24% below was the worst.

Eight of the 44 enterprise regions in the UK recorded productivity above the UK average; four of the SE’s seven LEPs were in this category. After Thames Valley Berkshire, the next best was Enterprise M3 ranked third at +20%, then Coast to Capital sixth at +5% followed by Solent eighth at +3%. Buckinghamshire Thames Valley LEP (-0.2%), Oxfordshire LEP (-4%) and the South East LEP (-7%) were ranked 9th, 14th and 18th.

In terms of productivity growth between 2010 and 2018 the Coventry and Warwickshire LEP was top with growth of 16%. Twelve economic regions recorded productivity levels lower in 2018 than 2010. The worst performer was the SE’s Buckinghamshire Thames Valley LEP which saw productivity drop by 11%.

More generally the SE’s results for productivity growth were mixed. With growth of 6%, Enterprise M3 was the eighth best in the UK, one place above Thames Valley Berkshire, and the Solent LEP was ranked 27th nationally with growth of 2%, Four of the region’s LEPs recorded productivity levels lower in 2018 than 2010; the South East at -0.2% was ranked 34th, four places above Coast to Capital LEP which recorded -1.5%. The -6% drop in productivity in Oxfordshire was only worse in Gloucestershire and, as mentioned above, in Buckinghamshire Thames Valley LEP.

Three of the SE’s four subregions recorded productivity above the UK average. Berkshire, Buckinghamshire and Oxfordshire +17%, Hampshire and Isle of Wight +12% and Surrey, East and West Sussex +6%. Kent was just below at -3%.

At county level, led by North Hampshire (+44%), eleven of the SE’s economic regions recorded productivity above the UK average. The other ten areas dropped below the UK average, with East Sussex recording the lowest productivity at -27%.

The growth in hours worked between 2010 and 2018 in Berkshire, Buckinghamshire and Oxfordshire was 18%, beating Kent which recorded 11% and Surrey, East and West Sussex on 8%. In UK terms this level of growth was in the top half of the country’s 40 subregions with Berkshire, Buckinghamshire and Oxfordshire ranked fifth. With growth of 6% Hampshire and Isle of Wight was ranked 34th.

If the increase in economic output is also factored in then the sub regional performances are mixed. Hampshire and Isle of Wight was ranked 20th in the UK with growth of 2%, one place above Surrey, East and West Sussex, with Kent placed 29th with 1% growth, one place above Berkshire, Buckinghamshire and Oxfordshire.

More data from the ONS showed unemployment in the region was 7,000 higher at 156,000 between November and January; the uplift of 0.1% took the overall rate to 3.2%. Northern Ireland had the lowest rate of 2.4%, the North East the highest with 6.2%, with the UK rate at 3.9%.

The South East finally overtook the South West and had the highest employment rate at 80% which compared with 79.9% in the SW; the UK rate was 76.5%. Over 4.7m are employed in the SE.

The SE’s average property price decreased by 1.2% to £320,700, which took the annual decrease to 0.5%. In comparison, UK prices decreased by 1.1% to £231,185 during January, an annual growth rate of 1.3%.

SE growth accelerates and moves the region up the rankings, highly productive London means only the SE beats the UK average, but the region outdoes the capital on productivity growth

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For the 12 months ended December 2019, a nowcast published by the Economic Statistic Centre of Excellence (‘ESCoE’) on a rolling 4 quarter basis, has estimated that the SE’s growth has increased from 0.9% to 1.8%. ESCoE is a partnership of research institutions and the Office for National Statistics (‘ONS’).

This ranked the SE fourth (previous ranking tenth) and suggests the region has improved relative to the other eleven parts of the UK. Over the same period UK growth was 1.4%; growth in London (ranked first) was 3.3%; and growth in the East Midlands (ranked twelfth) was 0.1%.

The latest official ONS figures for an earlier period are more mixed. Following its first publication of quarterly GDP estimates for the regions in September 2019, the ONS has now published its third estimate for the SE the other eight English regions, and Wales. GDP figures have been available for the UK since the 1940s, for Scotland since 2002 and Northern Ireland since 2013.

These stats are for the period six months before the ESCoE estimates shown above and compare GDP in the quarter ended June 2019 with the same quarter a year earlier. These more volatile figures showed the SE grew by 1.4%, down from 2.7% growth the previous quarter. This placed the SE third (previous ranking second) out of the twelve UK ‘regions.’

London topped the table with growth of 4.5% whilst UK growth over the same period was 1.4%. The NW was the worst performer and contracted by 0.7%, one of three ‘regions’ in the UK to suffer a decline.

In the same report, the ONS’s figures highlighted that the standalone quarter to June 2019 was worse for the region than the previous quarter. The SE economy contracted by 0.7% in April to June 2019, following growth of 0.2% in January to March 2019.

This placed the SE eighth (previous ranking ninth) out of the twelve UK ‘regions’. Six regions of the UK saw their economies contract as did the UK overall by 0.2%.

In this period, SE information/communication and finance showed growth of 4.3% and 6.6% but education and construction fell by 8.0% and 3.6%. In general all of the SE’s sectors shrank, with construction, production, agriculture and services falling by 3.6%, 1.4%, 0.7% and 0.4% respectively.

Overall the region has seen growth in the agriculture and services sectors relative to 2017 but the production sector has fallen whilst construction fell after growth in 2018 and has continued to fall into Quarter 2 2019.

Productivity

Unlike most regions of the UK, output per hour in the SE was above the UK average. Productivity in the SE was 9.1% above the norm which ranked the region second in the UK.

The SE was one of two regions that had productivity above the UK average in 2018; the other was London +31.6%. These regions record high levels of hours worked and their high productivity pulls up the UK average so much that all other regions fall below it. Wales was furthest off the average at -17.2%.

The SE was also second in the rankings in terms of output per job. The region’s 6.1% higher than the UK average compared with London at 40.5% above.

In terms of growth in output per hour, six regions of the UK expanded. The SE was ranked third as output per hour grew by 1.7%. At 2.3% growth was fastest in Scotland and the biggest contraction was in Yorkshire and the Humber at 2.5%. UK growth was 0.5%.

Sectorally, productivity in non-manufacturing production and agriculture was better than expected but finance and insurance disappointed.

On average, in 2018 the UK economy produced about £35 of value for each hour worked, with finance and insurance top at c£69 per hour compared with accommodation and service activities productivity at c£17 per hour.

Labour

More data from the ONS showed unemployment in the region fell slightly by 1,000 to 151,000 between October and December; which left the rate unchanged at 3.1%. Northern Ireland had the lowest rate of 2.4%, with the UK rate at 3.8%. The highest rate was 6.1% which was recorded in the North East.

The South West still had the highest employment rate at 80.1% which pipped 80% or 4.7m in employment in the SE; the UK rate was 76.5%.

In December, average earnings in the SE increased by £18 to £728 per week. London had the highest average earnings of £805 and the lowest average earnings of £530 were recorded in the NE. The SE was ranked second (previous ranking also second).

In the UK overall, average earnings grew by 2.9% or by 1.4% after inflation. After adjusting for inflation, regular pay is now at its highest level since 2000, whereas total pay (which includes bonuses) is still 3.7% below its peak in February 2008.

Housing

The SE’s average property price fell by 0.3% over the month to £325,050; the drop took the annual increase to 1.2%. In comparison, UK prices increased by 0.3% to £234,742 during September, an annual growth rate of 2.2%.