living standards in greater manchester

We do things differently here

Living standards in Greater ManchesterStephen Clarke

November 2016

@stephenlclarke/@resfoundation

2

Britain’s major cities underperform

Notes: All cities shown have populations between 1 and 2 millionSource: OECD, Metropolitan database

3

DON’T LOOK BACK IN ANGER

Strong economic performance has been followed by

disappointment

4

Strong pre-crisis economic growth has unfortunately been followed by poor performance since

Source: RF analysis of ONS, Regional Gross Value Added

Greater Manchester’s

economy performed

strongly before the crisis, but

remains around 3.5 percentage

points below its pre-crisis

peak

5

Similarly good employment performance pre-crisis, but the region has fallen behind

Source: RF analysis of ONS, Labour Market Survey

6

And earnings were keeping pace with UK before crisis, growing divergence afterwards

Source: RF analysis of ONS, Annual Survey of Hours and Earnings

7

As a result living standards are broadly in line with other cities, but below average overall

Source: RF analysis of ONS, Small area income estimates 2011/12

Weekly household

incomes are £76 or 15%

lower in Greater

Manchester than in the

rest of Great Britain

8

ISOLATIONFalling inequality between people Rising inequality

between places

9

Between 1997 and 2016 pay growth was broadly progressive

Source: RF analysis of ONS, ASHE

… but mainly because it fell faster for those at the top since the crisis

10 20 30 40 50 60 70 80 90-2.0%

-1.5%

-1.0%

-0.5%

0.0%

0.5%

1.0%

1.5%

2.0%

1997 - 2016

1997 - 2009

2009 - 2016

Average annual change in gross hourly pay (RPIJ-adjusted)

(Poorest) (Richest)

Pay rose by 21% for the lowest-paid

between 1997 and

2007

10

Employment rose most for those most likely to be out of work…

Sources: RF analysis of ONS, Labour Force Survey

The employment

rate for ethnic

minorities rose from

44% to 54%

And from 53% to 61%

for people with low level qualifications

11

… most of the improvement came before the crisis

Sources: RF analysis of ONS, Labour Force Survey

12

Geography matters a lot for understanding how much different groups have benefitted

Sources: RF analysis of ONS, Labour Force SurveyNotes: Each diamond represents a local authority in Greater Manchester

Employment rate:

13



Employment rate:

Low qualified 43% in

Manchester69% in Stockport

14



Employment rate:

Low qualified 43% in

Manchester69% in Stockport

Younger people53% in Rochdale72% in Stockport

15

Despite inequalities between people falling, they were rising in one respect - housing

Source: RF analysis of ONS, Labour Force Survey

Greater Manchester

has seen the biggest fall in

homeownership of any city

region - down 15

percentage points since

2003

This has most affected younger

people

16

Some areas saw strong enough growth in the 200os to outweigh hit from crisis

Source: RF analysis of ONS, Small area income estimates 2004/05 & 2011/12

Between 2004/05

and 2011/12

Overall incomes fell

by 3% across Greater

Manchester

though income

growth ranged from 5% to

35% in parts of the regional

centre.

17

Strong population growth has taken place in fast growing areas

Source: Transport for Greater Manchester

There was significant

population growth in the regional

centre between 2001 – 2011…

18

Strong population growth has taken place in fast growing areas

Source: Transport for Greater Manchester

There was significant

population growth in the regional

centre between 2001 –

2011…

And in the regional centre

this corresponded broadly with

income growth

19

PLEASE PLEASE PLEASE LET ME

GET WHAT I WANTProductivity, geographic inequality and housing

20

Three key challenges

Productivity: • Output per hour worked in GM is

£26.60 compared to £30 in the rest of the country.

• 1 in 5 workers will be paid the minimum wage in 2020.

• Raising productivity in high-employment low paying sectors is vital, as is providing opportunities for high-skilled workers.

21


Geographic inequality: • Household incomes in the richest

neighbourhoods in GM are 1.8 times those in the poorest, and this is up from 1.6 in 2007.

• GM is the most unequal region in terms of employment rates.

• Devolution of transport, employment and skills powers provide opportunities to help people as well as places.

22


Housing: • Housing costs rose 26% in GM

between 2004 and 2012 while incomes fell by 5%.

• Homeownership has fallen by 15 percentage points since 2003.

• The Greater Manchester Spatial Framework provides an opportunity to set clear goals around housebuilding.

living standards in greater manchester

News & Politics