Heart of the South West LEP (Economic Profile)

Coverage

• East Devon, Exeter, Mendip, Mid Devon, North Devon, Plymouth, Sedgemoor, South Hams, South Somerset, Taunton Deane, Teignbridge, Torbay, Torridge, West Devon, West Somerset

Quick Statistics

• The LEP covers an area with a workforce of 767,500, representing 3.1% of the national total. The area supports 61,855 businesses. 

Visions & Aims

• To secure growth in key urban centres and facilitate job creation across the Heart of the South West, ensuring that market towns and rural areas are closely linked to urban growth and also economically successful in their own right.
  
• To provide support to strong sectors across the area, such as tourism, food and drink, and land-based industries to grow employment opportunities through improving business profitability and productivity.
  
• To encourage investment in potential growth sectors such as marine technologies and low carbon energy generation (notably nuclear power and renewables) that can create and sustain new private sector jobs, rebalancing the local economy away from an over-reliance on the public sector.
  
• To create the conditions for high levels of business start-ups and increase the numbers of jobs in expanding SMEs.
  

An Economic Snapshot

• According to the latest data, in 2009 the Gross Value Added of the Devon (encapsulating Plymouth and Torbay) and Somerset was £26.4bn, approximately 28% of the regional economy. GVA fell by 2.4% from 2008, highlighting the effects of the early part of the recession (comparing to a decline of 1.9% in the wider South West).

• The GVA per head at current basic prices in 2009 of Somerset was £15,988 and £15,848 in Devon.  However, there are significant differences in Devon – the GVA per head in Torbay was £12,777.  The relative position of Torbay markedly deteriorated between 2008 & 2009; GVA per head falling 3.5% and is now 63.9% of the UK average.  The relative performance of other areas in the LEP area are stronger – Devon County (81.4%), Plymouth (81%) and Somerset (79.9%).

• In terms of output, by far the largest sector in Plymouth and Torbay is the public sector (approximately 31.5%). In rural Devon, it is smaller (25%) with distribution, transport & accommodation also being a significant sector (21%). Somerset has a notably larger production (inc. manufacturing) sector (21.5%), with an output of £1.8bn.

• Earnings are relatively low in the LEP area, particularly in Torbay. In Torbay, the average (median) gross annual earnings for residents were £17,110.  Earnings are higher in Plymouth (£19,851), although it suffered the greatest decline in average earnings in the region (falling 6.3%).  For all areas, gross earnings for females are lower, although it is notable that in Torbay the differential is the smallest – female earnings are 70% of average male earnings (compared to 57% in Somerset).  Male earnings in Torbay relatively lower than in other areas .

• The latest (Dec 11) claimant count for the area stands at 2.7% of the working age population, whilst the ILO defined unemployment rate is higher at 6%.  The claimant count increased marginally during the latter part of 2011 as a sign of sustained economic weakness. There is a relatively wide difference in performance within the LEP area on the claimant count measure – ranging from 2.3% in Somerset to 4.5% in Torbay.  In all areas in the LEP, there is a greater tendency for males to claim Jobseekers Allowance.

• In 2010, there were 4,835 business births in the LEP area, a fall of 6.7% from the number of births in 2009. There were 6,745 business deaths in the same year, an annual fall of 1.6% - showing that, actually, business churn decreased in the difficult economic climate.

• There were 61,460 active enterprises in the LEP area at the end of 2010, a fall of 3.2% from the previous year. The fall in number of enterprises tended to be larger in urban areas (Plymouth & Torbay declining by 4.7% & 4.3% respectively).

• Just under half of all enterprises that started activity in 2005, were still trading in 2010. 5-year survival rates in Plymouth, Torbay and Somerset were marginally lower (approx. 46%) than in Devon (48%) – although within the realms of data confidence intervals. Approximately 1 in 4 firms started in 2008 had ceased trading by 2010.

* It should be noted that confidence intervals for earnings data at a sub-regional level are typically wide, so caution needs to applied in any analysis.