Financial wellbeing in South West England

England’s largest region by area is defined by stark contrasts between high incomes in some places and low incomes in others; with COVID–19 and the UK’s EU exit, the South West faces some big changes. 

Take a peek at England’s regional rankings in different categories, and you’ll notice a pattern: the South West sits at the top in quite a few of them. To name only a few, the South West region:

• Includes more than a quarter of the land within National Parks or Areas of Outstanding Natural Beauty in England.
  
• Has the highest proportion of people of state pension age and above.
• Includes more second homes than any other English region.
• Has the largest hotels and restaurants sector in the UK, in terms of percentage of both employment and gross value added to the economy, and receives more domestic tourists than any other UK region or country. (ONS, 2020).

A few things emerge from these statistics: the region harbours diverse beauty, drawing many retirees and tourists. It’s home to a booming tourism and hospitality sector, ranging from Bristol’s world-class restaurant scene to the many outstanding holiday spots in Devon and Cornwall.

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The South West is heavily exposed to COVID–19 and the UK’s EU exit.

Since COVID–19 emerged in the UK, much of the region’s economy has been shut down due to high levels of dependence on shutdown sectors like hospitality, food and drink, leisure, travel and non-essential retail.

A 2020 report by the Resolution Foundation showed that the region had the highest rates of furloughed workers and of job losses across the UK since the pandemic began .

Footfall in towns is down by an average of 85% and even buoyant areas like Exeter have been affected with the loss of 15% of its population this spring, due to students returning home.

Simultaneously, the UK’s EU exit will also offer unique challenges for the South West. Statistics from the Office of National Statistics (pre-COVID) show 8% of jobs in the region – that’s around 250,000 people – are dependent on EU exports.

This includes some of the largest engineering companies in the UK, such as Rolls Royce and British Aerospace, major automotive business with Honda in Swindon, key financial and business services, food and drink production, creative industries and the critical tourism sector.

Of these jobs, 65,000 are in distribution, transport, hotels and restaurants, 39,000 in the professional and support service sector, 23,000 in production, 8,000 in finance and insurance, and 7,000 in information and communication.

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The South West is increasingly a blend between more affluent parts – like some parts of Bristol and Swindon – and increasingly left behind areas.

The region has, for example, the highest and second-highest life expectancy for women and men respectively. Its workforce is also highly educated: the South West has a smaller proportion of working-age people without qualifications than any other region.

And yet, wages in the South West lag behind the rest of the country with average weekly pay at £410 compared to £442 for England. Regional statistics, however, mask massive differences, from Torbay at £303 to Swindon at £490.

Concentrations of urban, rural and coastal deprivation contribute to a widening opportunity gap. According to the most recent social mobility index, the South West region has only one constituency – South West Devon – among the highest-ranked 20% of all constituencies.

The most economically productive areas within the region are Bristol, the M4 corridor and south-east Dorset, which are the areas with the best links to London. Bristol alone accounts for 25% of the region’s GDP, with  Gloucestershire, Somerset and Wiltshire accounting for a further 25%.

MaPS was established by the government to improve financial education in every region and nation of the UK. We offer a wide array of free support to organisations, specifically tailored to each unique location’s needs – so don’t hesitate to get in touch with me for bespoke support.