Vibrant Economy Index

Economically prosperous towns and cities are not the happiest and healthiest places to l.....

New index measures the social and economic performance of England’s towns and cities

Grant Thornton UK LLP today publishes the results of a new index which measures how towns and cities in England compare on a range of factors from prosperity to health, wellbeing and happiness, and inclusion and equality that measure not only economic but also social performance. According to the Vibrant Economy Index* –, which looks at 324 local authorities across England – Cambridge, Oxford, Richmond upon Thames, South Cambridgeshire and Guildford are the most vibrant places, where there is a good balance between economic growth, social equality, sustainability and healthy and happy people.

The index finds traditional indicators of economic prosperity – which include GVA, average earnings and business turnover – do not correlate in any significant way with other measurements of performance, such as health, equality and opportunity. This indicates that efforts that solely focus on improving the economic performance of a place do not always translate into creating a healthy, happy place to live, or one in which individuals feel part of their community.

Local authorities in places like London and the Leeds City Region score highly for prosperity, meaning they have higher Gross Added Value, higher pay levels, and attract more businesses. However, the affluence in these places does not necessarily translate into communities that are more inclusive or healthier. For example:

  • In places like Leeds, there are higher numbers of young people not in education, employment and training, a larger proportion of people claiming benefits, and lower average incomes, meaning that while its economy is relatively affluent, it is underperforming compared to some places in terms of inclusivity and equality.
  • In London, where local authorities see strong levels of prosperity, populations in these areas are significantly more likely to be anxious.
  • In London, where local authorities see strong levels of prosperity, populations in these areas are significantly more likely to be anxious.
  • In Birmingham, high levels of economic prosperity hide the fact that there are a number of notable public health challenges including above average levels of diabetes and child obesity with the result that life expectancy is low.

The Vibrant Economy Index, based on 52 indicators of performance, tracks factors that enable businesses, communities and individuals to thrive. These include economic measures such as GVA, educational attainment and average incomes, and combines them with data around fuel poverty, obesity levels, air quality and crime rates to give a picture of how a place is performing not just economically, but also socially. Places were measured by key factors in each performance indicator and awarded an overall ‘vibrancy’ score, with 100 being the national average.

The study also found:

Urban areas have unhealthier populations

  • Urban areas score worst for health, wellbeing and happiness, with parts of London, Birmingham, Manchester and Liverpool all performing badly
  • Rural areas tend to have healthier and happier communities, including parts of Devon and Somerset, the Derbyshire Dales, the Suffolk Coast and the Lake District
  • Commuter areas perform well, including parts of Hertfordshire and Surrey outside of London, Harrogate outside of Leeds, Rushcliffe outside of Nottingham and Stratford and Warwick outside of Birmingham and Cheshire East outside of Manchester

Cambridge is England’s most vibrant place

  • Cambridge tops the index, scoring highly on dynamism and opportunity (134.14), which measures innovation and entrepreneurship. It also scored highly (107.11) for resilience and sustainability and above the average of 100 for community, trust & belonging (110.04), which measures how safe and engaged people feel in their community.
  • With a world-class university and renowned tech cluster, the strength of Cambridge’s knowledge economy is evident: its high patent registration (491.66 per 100,000 residents) is more than 10 times the national average (46.6 per 100,000 residents); the proportion of employees working in research and development is almost 11 times the national average (4.93% compared to 0.45%)
  • While Cambridge performs well on prosperity (106.35), it’s score is lower than Leeds, Reading, Manchester and Oxford, demonstrating that social and economic performance relies on more than just high GVA and employment levels.    

Inclusive towns and cities have happier populations

  • The more inclusive and equal a place is, the healthier and happier its population seems to be. A place’s inclusion & equality score correlates strongly with its health, wellbeing & happiness score. 
  • Where 100 is the average, Hart in Hampshire scores above average for inclusion & equality (109.93) and health, wellbeing & happiness (106.90). Compared to Birmingham which scores 86.07 for inclusion & equality and 94.16 for health, wellbeing & happiness, and Newcastle upon Tyne (93.58 for inclusion & equality 94.86 for health, wellbeing & happiness).
  • For much of the south and midlands, levels of inclusion and equality are high with only a few isolated anomalies in parts of London (Tower Hamlets, Westminster, Barking and Dagenham), Essex (Tendering) and the Midlands (Nottingham, Birmingham), where it is some of the lowest nationally

Commenting on the findings, Sacha Romanovitch, CEO of Grant Thornton, said:

“If we want an economy that works, then it must provide opportunities for everyone. We’re hearing loud and clear the messages about what divides us in the UK. That means we need more than ever to build a vibrant economy where people are engaged in their local communities, where communities trust local businesses and local government, and where businesses can invest and grow. So how do we measure whether a place is living up to this? Our Vibrant Economy Index goes beyond traditional figures such as GDP, and combines measures of economic and social performance.

“The index demonstrates that if we want to create places that provide opportunity for all, we need to focus on more than headlines about economic prosperity. Higher employment levels or strong business growth need to translate into the creation of communities that are more inclusive and equal, where populations are healthy and happy. While economic performance is fundamentally important to the future of the UK, we need to ensure that this prosperity can also positively impact other factors including health outcomes, housing affordability, personal wellbeing and social inclusion.

“We need an economy that produces wealth and creates jobs, one where the trust and integrity of businesses and institutions enables entrepreneurial and innovative growth, and where everyone can benefit from that economic growth in a healthy and active environment, which must be sustainable for the long-term.

“The results of our index demonstrate the opportunities that can be opened up if we collaborate: for businesses to create growth that benefits them, the people they employ and the wider community; for local government leaders to rise to funding challenges by providing vital services in new ways; and for the third-sector to be a clear voice to ensure that no one is left behind on key issues like health, employment and housing.

“Grant Thornton’s Vibrant Economy Index provides a new way of looking at the success of a place in economic and social terms. We hope that it will help businesses, public sector leaders, the third sector and communities identify ways they can collaborate to create a truly vibrant economy that works for everyone.”