Addressing longstanding productivity and equality gaps remains a top priority for government but requires targeted action. Disparities in economic performance are large across and within English regions, but the picture is not as clear cut as north vs. south. Areas that are considered ‘left behind’ can be found across all regions in England. These include former industrial towns across the North and Midlands, but also coastal towns across the South and East of England.
Tackling these gaps and spreading opportunity throughout the regions is not easy. It requires targeted interventions over multiple dimensions to be sustained over years. It requires investment in the drivers of productivity, particularly skills but also infrastructure, innovation and exporting, and business practices. But if it is to be successful, interventions also need to address social challenges such as health and education deprivation. It also requires examining the role of cities in driving growth, which has dramatically changed this year in response to COVID-19.
Reviving regions: empowering places to revive and thrive
A new CBI report, Reviving regions: empowering places to revive and thrive, sets out a number of complications that make closing productivity gaps more challenging. However, addressing these longstanding productivity and equality gaps is likely to be complicated in the coming years. COVID-19 is set to have significant and lasting impact on our economy and uncertainty over Brexit and the future of AI and automation adds further complications for businesses. On all three, the impacts on different regions is likely to vary.
What does the report recommend?
Tackling these challenges requires a new approach. This must empower places to deliver strong labour markets, vibrant towns and cities and attractive business ecosystems. If regions are to revive and thrive, it must be driven from Local Authorities, Local Enterprise Partnerships and Growth Hubs, and Combined Authorities, in collaboration with national government.
The report sets out 10 recommendations to ensure regions can revive and thrive in the future. This includes:
- Building vibrant local labour markets: including increasing local capacity to deliver back to work programmes alongside a long-term focus on the devolution of adult skills to meet our growing upskilling and retraining gap
- Transforming local infrastructure to facilitate new ways of working: including a focus on the future of towns and cities, and a wholesale reform of regional funding to ensure a strategic approach to future investment
- Inspiring world-class, innovative businesses to invest in the regions: including short term interventions to help businesses grow, locally designed and delivered business support with a focus on access to exporting opportunities, and interventions to close the gap in regional R&D funding.