Has the North-South economic divide in the UK worsened?

Has the North-South economic divide in the UK worsened

According to a survey by Nucleus Commercial Finance, 56% of SME leaders see the divide between the North and South as a growing problem since they are not experiencing the same economic growth and are unequal in terms of wealth. Many people in the UK are hoping for the government to make the changes that are necessary to fix the divide.

Comments by PM and plans moving forwardChirag Shah, chief executive of Nucleus Commercial Finance, said: “Despite years of promise from the government to address the North-South divide, it’s clear SMEs are still feeling its impact and many don’t ever see it being resolved. Looking ahead, the government must do more to level up and unite the country, and the Prime Minister’s recent speech will be crucial in demonstrating its commitment to boosting local businesses.”

Covid has made divide more apparent

Sadly, Covid has exacerbated the problem and made existing inequalities worse. Smaller towns may the effected the worst.

“People living in the south-east typically have a longer life expectancy, higher income and better standard of living than those living in the north. House prices in the south-east are higher due to high demand. Rates of unemployment are higher in the north as regions continue to adjust to de-industrialisation”, Internet Geography writes.

Productivity is especially low in some of the larger cities outside of London and people in Newcastle, Birmingham, Manchester and Liverpool have a lower life expectancy than the European average.

The financial difficulties that Covid-19 caused made it harder for people in areas that are already suffering due to high unemployment. Towns with low growth rates, such as in the north-east and Yorkshire, are in danger of falling behind even more and don’t have the same possibilities to withstand the effects of a pandemic.

Covid has made divide more apparent

There is still optimism despite a clear split

While businesses in London and the South feel more confident about an economic recovery than towns in the North of England and Scotland, many SMEs in the UK expect to see significant improvements within the next year and even plan to hire more staff. Many businesses began trading online as a result of the pandemic, making it easier to serve their customers.

Comments by PM and plans moving forward

In his speech on “levelling up”, Prime Minister Boris Johnson spoke about the rising inequalities in parts of the country. “COVID has entrenched problems and deepened inequalities – we need now work double hard to overturn those inequalities so that as far as possible that everyone everywhere feels the benefits of that recovery and we build back better across the whole of the UK”. Johnson says the government is investing £640 billion in new roads and railways and spoke of private sector investments to create more equality between London and other cities in the UK. He also invited those who are interested in making an impact on a local level to ask the government for the tools to “back business, attract more goods and improve your local services”.