Partner Article

Prosperity rising in North East despite economic uncertainty

By Andrew Miller, Regional Director in the North East, Barclays Wealth and Investment Management

The past 12 months have been marked by uncertain economic conditions and volatile stock markets. However, in spite of this, the UK is more prosperous today than a year ago, including in the North East, although there are still stark regional disparities.

Recently we published the second annual Barclays Prosperity Index which uses a unique ‘Prosperity Index Score’ for each UK region taking into account factors including number of millionaires, household wealth, entrepreneurial activity and exam scores.

Unsurprisingly, London continues to be the most prosperous UK city, but it is encouraging to see that signs of prosperity are slowly emerging in other areas of the country, including here in the North East. Newcastle, in particular, is a key hot spot in the North East which is driving up prosperity levels. For example, it has one of the largest increases in the number of people earning above the national average, growing 5% on 2014 only just behind Leeds (6% growth).

Prosperous entrepreneurship

According to the Federation of Small Business (FSB) there were 5.4 million registered private sector businesses last year, a massive 1.9 million more than in 2000[1]. With this surge in entrepreneurial activity, some of the greatest success stories are to be found beyond the traditional economic strongholds of London and the South East. Newcastle, for example, has had 1,210 business births showing a 1.3% increase since last year’s data was released.

With entrepreneurship being an important driver of personal wealth, it is no surprise that it is also on the rise in the North East, with our research revealing a 5% increase in overall household wealth since we did the study last year. This is particularly positive given the broader national picture which saw household wealth drop in Yorkshire and Humber (-6%), the East Midlands (-4%) and the West Midlands (-4%). The North East’s GDP per capita also rose by 8%, in line with that of London. .

Looking to the future

Based on our findings, it is very encouraging that prosperity in the North East is on an upwards trajectory, with earnings and productivity rising in the city of Newcastle. The North East’s workforce is showing signs that it is beginning to play a vital part in supporting this growth.

We can feel confident that these signs of development show that not only is the North East ‘open for business’, but that we have an important role to play in the prosperity of the UK as a whole.

[1] http://www.fsb.org.uk/media-centre/small-business-statistics

This was posted in Bdaily's Members' News section by Rachel Finlay .