Fears expressed over North-South divide as unemployment widens

CONCERNS have been expressed over the state of the region’s economy as new data shows the productivity gap between the North and South is widening, with unemployment figures in Greater Manchester also reporting a sharp increase.

A report published by New Economy, the economic research body for Greater Manchester, showed that although Gross Value Added (GVA) grew over a ten-year period from 1998-2008 by 61.4% in the North, the South experienced a faster growth rate of 85.5%. This  meant the contribution of the North to national GVA actually fell from 42.6% in 1997 to 39.2% in 2008. 

However, Greater Manchester performed better than other parts of the North.

In 2008, Greater Manchester’s total GVA was £47.7 billion – higher than England’s entire North East region, which contributed a GVA of £40.1 billion.

Of Greater Manchester’s total economic output, £32.2 billion of GVA was contributed by the south of the region, which is on a par with South East England, while just £15.5 billion came from the northern part of the conurbation. 

Baron Frankal, director of economic strategy at New Economy, said:  “Though it is simplistic to talk about the “North-South” divide, the differences outlined highlight a need for Manchester to maintain and strengthen its position as an economic hub for the North.”

However, unemployment figures published yesterday showed that the number of people claiming jobseeker’s allowance (JSA) in Greater Manchester grew by 1,170 in September to 82,310 – a monthly rise of 1.4%.

All districts in Greater Manchester saw a monthly increase in JSA claimants except Wigan where there was a 0.8% fall. The district with the largest proportional increase was Salford, with an increase of 2.8%, with Bury and Tameside also seeing large monthly rises of 2.3% in each.

Year-on-year, there has been a 10.5% increase in claimants in Greater Manchester, and some 4.8% of the population now claims jobseeker’s allowance.

Frankal said: “Greater Manchester has experienced a particularly dramatic rise in its unemployment figures this month.  

“What is particularly worrying is that youth unemployment caused all of this increase in the region, whilst female unemployment is continuing to rise as well.”