Snapshot of the Yorkshire Economy
Yorkshire is special. It rivals major European countries in population size, such as Norway, and surpasses 20 others including Ireland and Croatia. It is also the largest county in the UK, at around three million acres. Encompassed within this area is a diverse range of geological and historical advantages that makes Yorkshire an exciting prospect for economic growth, in a position to be the next regional powerhouse of the UK economy as Britain navigates through these abnormal times.
The current size of the Yorkshire economy is not exactly known. In 2017 many outlets including The Times quoted it as being worth around £110bn. Growth statistics from the Office of National Statistic since this estimate was published show the Yorkshire economy has grown at an average of 0.25% over the last seven quarters, a strong result compared to the UK average outside of London.
Within the Yorkshire economy, its diversity and range of industry is what has made the recent economic uncertainty so far manageable.
The emerging metropolitan centres in cities such as Bradford, named as PwC’s most improved city in the Good Growth for Cities Index 2019, with Hull also on the list, show a strong future for Yorkshire cities outside of Leeds. The Leeds city area itself is worth over £64.6bn alone according to Leeds City Council, emerging as the largest financial centre in Britain outside of London in recent years and has the highest proportion of private to public sector workers than anywhere in the UK. Private investment is also high, contributing to the Council’s target to achieve over 20% GVA growth by 2030.
Beyond the stability of Yorkshire’s cities, the primary sector of the economy is also strong despite historic declines in such industries as mining. Being the largest county by area, Yorkshire is crucial to UK farming. A government report published in February showing Yorkshire contributes around 15% of England’s crops and a similar proportion of livestock with the exception of pigs where Yorkshire accounts for over a third. The average farm size in Yorkshire stands at 93 hectares, well above the English average of 86 hectares.
Yorkshire is also home to a significant manufacturing sector. From steel mills in Rotherham which maintain a sign of South Yorkshire’s industrial past to house building, with FTSE 100 listed Persimmon headquartered in York. There is a vast range in type of firms operating in the secondary sector of the economy. In the drinks industry for example, a plethora of independent breweries have found success in recent years, including Whitby and Northern Monk. Alongside this, multinationals also have an important presence in the county with Heineken operating a brewery in Tadcaster and Coca-Cola operating the largest soft drink plant in Europe from Wakefield.
Despite this current success, there are still some gaps in the Yorkshire economy. A European Commission study in 2017 charted the GDP per capita of Yorkshire at €24,700 which is below both the UK and EU average of over €30,000. As Yorkshire transitions from the historic reliance on industry to a modern service-based economy, there is a danger that the aforementioned success of Leeds may draw resources from the rest of the region. For instance, the Sheffield city region still relies heavily on a declining manufacturing industry and has struggled to grow at the same rates as Leeds.
Yorkshire also requires further public spending and an upgraded infrastructure. Yorkshire received £9,123 of spending per head between 2018-19, below the UK average and behind the North East and North West. The largest airport in the region, Leeds-Bradford, carries 4 million passengers a year, only enough to make it the 15th largest airport in the UK. When combined with Doncaster-Sheffield and Humberside airport, the only other international airports in the county, there is a combined annual handling of around 5.5 million passengers. Manchester airport by comparison carries nearly 30 million passengers a year. Antiquated rail networks have also been criticised in the region, with the proposed ‘HS3’ being delayed until 2040.
With the ongoing economic uncertainty caused by the Brexit saga and the ongoing Covid-19 pandemic, it is unclear how the Yorkshire economy will respond. Some reports suggest there will be a disparity in the impact, with the Leeds economy reportedly strong enough to manage the shock whereas there is worry about the economy of South Yorkshire. The true impact will naturally become clearer over time. One thing is clear; however, Yorkshire is a hotbed for economic potential and success and it was about time that potential was tapped.
written by Samuel Slater