Whether or not you believe the regional stereotypes that persist, there is something to be said about our differences. Variation in sub-regional GDP is greater in the UK than any other European country, meaning that the least productive regions are failing to make up ground on the most productive. New approaches are needed to tackle this persistent problem, in order to exploit untapped potential in the less productive regions and to improve equality and opportunities.

The North East has continually lagged behind the rest of the UK in terms of business creation, meaning economic opportunities are not being fulfilled. The North East continues to see fewer than half as many VAT registrations as most other regions.  Future prosperity in the North East depends upon the right advice and support being given to people with ideas, and it also depends on retaining or attracting people with relevant skills who may otherwise choose to work elsewhere.

Human capital is a major factor influencing regional economic growth, especially with the knowledge-intensive industries that exist today. In terms of qualifications and expertise of the workforce, there are large variations between regions. The North East is still relatively reliant on the public sector and manufacturing industries for employment, and while this remains the case, we will continue to see graduates leaving the region to work in other industries which are stronger in different geographical locations. A mix of different industries in the North East would provide more incentive for graduates and talented individuals to stay in the region, and this in turn would influence the growth of the region.

There are certainly encouraging factors in the North East – in recent years the region has become the most active region outside of London for hi-tech business start-ups, with several clusters of technology businesses emerging, where the benefits of agglomeration can be experienced, and around which lasting regional industries can be built.  Unemployment in the North East is falling, and has been since the turn of the century, and the region is also one of the strongest for exporting, with particular strengths in chemicals, building, IT, electronics, oil, gas and telecoms.

Fact File

• The North East had a GDP per capita nearly £7,000 or 40 per cent below that of London, the richest.
• London’s working-age population for example contains almost three times as many graduates as the North-East.
• The North East receives the lowest proportion of investment in early-stage firms outside of Wales and Northern Ireland.
• The Northern Way project has been set up in order to help bridge the £30bn output gap between the North and the UK average.
• 40% more graduates are employed in London than studied there, whereas 40% fewer graduates work in Yorkshire and the Humber, the North East, East Midlands and Wales than were educated there.
• The value of exports per employee in the North East is relatively strong at £8,263, which is £702 above the national average, putting the North East fourth in the UK.