Vibrant Economy Index

VE Index: driving change in our cities and regions

Paul Houghton Paul Houghton

We need to open our eyes to what’s going on in our cities and wider regions. Only then can we speak up and take a lead on what will drive change, argues Paul Houghton.

It's only natural that if you're ‘playing’ with an online satellite-view map you go to your own postcode first. 

It’s like checking in the mirror before greeting the world in the morning – we want to know how we are perceived. And when we’ve checked out our own house, we look at our neighbour’s house, because we want to see what’s going on over the hedge.

Likewise, with the Vibrant Economy Index.

As a private sector leader passionate about driving local growth, I want to understand the city and region around me: the place from which I need to draw skilled people for my team. 

I want to know if it’s a place which has a track record of innovation and entrepreneurship, and whether it’s a place with an attractive cultural offering and community spirit for a Generation Z workforce interested in more than just the day job.

And I also want to understand what’s going on next door: partly because I’m just nosey; and partly because the future of the economy of my place will depend heavily on the place down the road.

I live and work in Sheffield.  I lead Grant Thornton UK’s team locally, and as chair of the Sheffield City Region Local Enterprise Partnership’s Growth Board, I care passionately about the opportunities and challenges we face as a region as we look to grow. 

Using the Vibrant Economy Index to measure the Northern Powerhouse

But the future of Sheffield is now intrinsically tied to the future of a wider region – not only the Sheffield City Region, but also the whole north of England: the ‘Northern Powerhouse’. 

Whether we subscribe to George Osborne’s phrase, there is now growing unanimity across the north of England that we need a step change to drive improved productivity and to compete –  and not just with London, but globally. 

The Vibrant Economy Index is a tool to analyse and compare regional metrics.  It sheds light on the localities in which we operate – giving us an understanding of the skills needs, the deprivation challenges and a whole lot more, helping us make the decisions we need to drive growth.

The index highlights some shocking disparities across the UK.  Whereas virtually the whole landscape south of Watford Gap appears as a mass of vibrancy, look to the Midlands and the North and the picture changes.  Although the northern English core cities (Newcastle, Liverpool, Manchester, Leeds, Sheffield, Birmingham and Nottingham) stand out as vibrant beacons, substantially their hinterlands show up as vast swathes which are statistically struggling. 

Sheffield and the Vibrant Economy Index

Consider the Sheffield City Region.  Whilst Sheffield itself scores well overall and in a number of the individual index baskets (prosperity; dynamism & opportunity; and community, trust & belonging), much of the rest of the region languishes behind. 

Only in resilience & sustainability is there a level of consistency at a relatively strong level across the region – an indication that Sheffield City Region is a resilient environment where its residents want to live. 

The disparity within the region is concerning but clear.  In Doncaster, just 20 miles north east of Sheffield, average weekly earnings are £434 as opposed to £457 within the city boundary.  This is clearly linked to there being only 14% employed in Doncaster’s knowledge economy, as opposed to 20% in the city. 

Only 50% of Doncaster’s residents achieved five or more GCSEs at Grade C or above, versus 54% in Sheffield. This pattern of real differences in life chances just a few miles apart should cause policy makers and mayoral candidates to think very carefully.

But in 2016 this economic data shouldn’t just be the preserve of the public sector and politicians.  If we learn anything from the US elections and Brexit it’s that the future direction of national and regional policy will not be set in town halls and Westminster. 

As dynamic private sector business people we must engage.  In our own businesses, we spend time understanding the issues and then assessing potential investment decisions. 

In the same way we must open our eyes to what’s going on in our own place, and up the road, see how that fits into the wider UK picture, and then speak up and take a lead in our cities and regions on what will drive change.