State of the Region

IRS Framework Objectives 11 - 13 (Economic)

Introduction

The economic theme assesses the performance of the region in terms of employment, skills, economic growth and productivity. Much of this section draws on the evidence base produced for the Regional Economic Strategy review process and is available on the Intelligence East Midlands website.

Because of the introduction of the Annual Population Survey comparison with past data needs to be treated with some care as different methodologies are used to collect and present data compared to the Labour Force Survey.

Employment rates in the East Midlands have remained stable since 1996, and have consistently exceeded the national average. According to the Annual Population Survey, the successor to the Labour Force Survey, in 2005, 75.8 of the working age population in the East Midlands was in employment, compared to 74.6% in the UK. However, there are substantial sub-regional variations. Employment tends to be lower in the cities and higher in rural areas and in the south of the region.

The percentage of working age adults with only NVQ level 3 qualifications (A levels or equivalent) is below the national average (42.2% vs. 43.9%) but has been increasing. 37.3% of East Midlands’ employees in 2005 were in knowledge intensive sectors, as defined by Eurostat, compared with the national average of 42.4%.

Gross Value Added per head has continued to increase in the East Midlands but still lags behind the average for England as a whole. Productivity as measured by GVA per hour worked in the East Midlands has improved relative to England as a whole even if it remains slightly below the national average. While this is to be welcomed it is still the case that the UK as a whole lags behind a number of other countries such as France, Germany and the USA in terms of productivity.

There has been an increase in business start ups in the East Midlands but the rate of registrations still lags behind that of the nation as a whole. The growth in the registration of firms is in part a response to the changing industrial structure and policies to support business start ups.

Business Enterprise Research & Development (BERD) is the total cost of Research & Development carried out in the business sector. Expenditure on Research and Development was 1.5% of Gross Value Added in the East Midlands in 2003 compared to 1.8% of Gross Value Added in 2002 and is below the national figure of 1.6% of GVA.

The proportion of businesses trading online has been increasing in the East Midlands. By the end of 2005 99.9% of the East Midlands had access to broadband up from 94% in 2004 and effectively meets the regional target of full regional coverage by 2006.

Overview 

Compared with national figures the East Midlands is below average on several indicators, although there have been improvements in the economic indicators in the East Midlands over the past few years.

IRS Objective 11>>