The State of Britain

The North East economy sluggish out of 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 NE’s growth was -9.5% compared with -22.1% the previous quarter. This placed the NE eleventh (previous ranking eighth) 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 NE post growth of 15.7% compared with -17.3% in April to June 2020.

This placed the NE ninth (previous ranking fourth) 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 NE’s best sector was accommodation at 280% compared with finance at -2%. Production, Construction and Services were 18%, 28% and 14%.


Data from the ONS showed the Job Retention Scheme continued to mitigate unemployment across the UK. Unemployment in the region was down 13,000 at 70,000 between January and March; the drop of 1% took the rate to 5.4%. At 6.8% London was the highest; the South East had the lowest rate of 3.4%, 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 and 72.2% in the NE where 1.2m are employed; the UK rate was 75.2%.

Public sector employment in the NE increased by 1.4% to 239,000, which was 20.4% 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 NE grew to £584 per week. London had the highest average earnings of £871 and the lowest average earnings 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.


The NE’s average property price increased by 3% in March 2021 to £145,893. The uplift took the annual increase to 13.7%. In comparison, UK prices grew by 1.8% to £256,405 during March, an annual growth rate of 10.2%.

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