West Midlands outperforms other UK regions for growth

THE West Midlands is expected to have outperformed other UK regions in terms of its economic performance in 2016, according to a new report.

The economic growth forecast by EY suggests that with GVA growth of 2.0% and employment growth of 0.9%, the West Midlands is leading the way in terms of expansion.

Neighbouring East Midlands has predicted GVA growth of 1.0% and employment growth of 0.3% during the year.

However, EY’s UK Region and City economic forecast says none of the UK’s regions or cities will be immune to slower economic growth over the next three years, with the West Midlands expected to slow to 1.2% in the period 2017-2019.
 
In Birmingham, GVA is set to grow by 1.2% annually over the next three years, with the fastest employment growth in the city coming from business services (0.8%) and information and communications (0.7%) sectors.

However, the West Midlands’ traditional heavy reliance on manufacturing will hamper its overall employment outlook, which is expected to fall by 0.2% annually until 2019.
 
Sara Fowler (left), EY’s senior partner in the Midlands, said: “This is our first region and city forecast since the EU referendum and the West Midlands has fared well with strong economic performance up until now.

“Looking ahead, no area of the UK will be immune to the economic downgrades we expect to see leading up to 2019 and the West Midlands will begin to see the impact of this with lower GVA and employment growth.
 
“This report shows just how much the outlook has changed across the UK’s regions and cities since this time last year, but Brexit isn’t the only factor at play. The combination of low inflation, rising employment and growth in average earnings that made 2015 a bumper year for UK consumer spending is fading fast and next year is set to be much tougher for consumers.”