According to the latest Vibrant Economy Index from leading business and financial adviser Grant Thornton UK LLP published today (19 April 2018), the West Midlands region’s performance is polarised, with over half of the region’s local authority areas ranking in the bottom 40% of the 324 analysed for overall vibrancy. At the other end of the spectrum, eight areas rank in the top 40%. Of these, Warwick and Stratford-upon-Avon both rank in the top 20% nationally.
Grant Thornton’s Vibrant Economy Index ranks 324 English local authority areas against six broad socio-economic objectives for sustainable and inclusive growth. These six baskets are based on 52 indicators of performance and track factors that enable businesses, communities and individuals to thrive. Places were measured by key factors in each performance indicator and awarded an overall ‘vibrancy’ score, with 100 being the national average.
The most vibrant local authority areas in the West Midlands are:
4. East Staffordshire
In addition to taking top slot in the West Midlands’ index for the second year running, Warwick ranks 21st nationally and has a very balanced scorecard. All of its baskets rank above the national average, with four ranking in the top 20% nationally (prosperity; health, wellbeing and happiness; resilience and sustainability and community, trust and belonging).
It performs particularly well in the health, wellbeing and happiness and resilience and sustainability baskets, ranking 23rd and 21st respectively. A closer look at the health measures shows that Warwick records high levels of sports participation and low levels of both adult and child obesity. In terms of resilience and sustainability, Warwick has high a high number of dwelling completions and ranks in the top 20% for recycling rates.
In the prosperity basket the region’s cities and towns dominate, with Birmingham, Coventry, Solihull and Warwick all ranking in the top 20% nationally. However, half of the local authority areas in the region rank in the bottom 40% nationally for prosperity. In the dynamism and opportunity basket, Coventry is the only area ranking in the top 20% nationally, with half of the areas in the region performing below the national average.
The Index finds that traditional indicators of economic prosperity – which include Gross Value Added (GVA), average earnings and business turnover – do not correlate in any significant way with other measurements of performance, such as inclusion and equality. In city areas in particular, where there are high levels of economic prosperity, not everyone benefits.
Looking at social measures across the West Midlands, the picture is polarised. In terms of health, wellbeing and happiness, seven areas rank in the top 20% nationally, with Stratford-upon-Avon ranking 12th nationally and first in the region. But there are also 10 areas in the bottom 20%, which is the highest number of worst performing areas in any basket.
A similar picture emerges in terms of inclusion and equality – which considers how well economic wealth is being shared – with almost a third of places in the region in the top 40% nationally, a third in the bottom 40% and the remainder ranking around the national average.
David Hillan, practice leader at Grant Thornton in Birmingham, said: “Traditionally, Gross Domestic Product (GDP) has been the measure for judging whether or not government interventions have delivered success for our economy.
“Used in isolation this measure works under the assumption that GDP growth benefits everyone – but the Vibrant Economy Index clearly demonstrates that this is not the case.Using only GDP as measure of progress is a considerable oversimplification, masking regional differences and hiding issues that if tackled with direct action could make a significant difference to the quality and equality of our society.
“Our data highlights a region of ‘haves’ and ‘have nots’, where the wealth of certain boroughs sits uncomfortably with the experience of most city dwellers. How the region tackles deprivation is an essential element of creating an economy where everyone can thrive.
“The big question remains as to how we can work together to improve the skills of our people alongside growing our industrial base to create a sustainable regional economy that is fit for the future.”