Local Economic Assessment (LEA) Wigan January 2011

1. Local Economic Assessment (LEA) Wigan January 2011

2. The LEA: What’s New? • The LEA endorses and reinforces key findings of the MIER … but nearly 2-years on, the LEA also tells us about: • The current & forecast future impact of the recession • The composition & risk profile of the public sector across GM • The spatial dimensions of growth down to local level

3. LEA Timetable • GM LEA incl. Local Authority chapters: • Presentation based on draft final reports • Final version early 2011 – taking into account feedback • Additional Studies: • Advanced Manufacturing – Feb • Manchester Airport – Feb • Worklessness (Uni. of Oxford analysis of DWP data) – May/June

4. GM S ummary • Strong growth in GM over the last decade (GVA and employment), coincided with: • Structural change – shift to services • GM South main driver of growth • Inequalities of growth across the conurbation

5. GM Employment Growth 2003–08

6. GM Employment Growth 2003–08

7. Impact of the recession • GM forecast to suffer less than UK • But, given growth uneven across GM, impact of the recession and forecast recovery is also uneven • Wigan not forecast to return to pre-recession peak employment (2006) until 2028

8. Impact of the Recession • Wigan suffered more than GM average in employment terms

9. Challenges and Key Priorities for GM • Early years • Housing • Quality of life • Skills • Transport

10. A key issue for Wigan is its relatively poor connectivity with the rest of GM • Map shows public transport travel times to central Manchester

11. Wigan: Travel-to-Work

12. Business Base KEY (1998–2008) (Source: ABI) High Growth Growth Decline High Decline EDUCATION: 6.5% HOSPITALITY & TOURISM: 5.9% PUBLIC ADMIN: 4.1% LOGISTICS: 4.5% CONSTRUCTION: 9.2% FINANCIAL & PROFESSIONAL SERVICES: 9.7% HEALTH: 13.0% MANUFACTURING: 13.9% LIFE SCIENCES: 0.7% RETAIL: 13.5% FOOD & DRINK: 4.8% ENGINEERING: 4.1%

13. Public and Private Sector employment growth

14. Public Sector employment levels across GM – workplace and residents

15. Public Sector by type in Wigan – where above GB average

16. High-growth businesses across GM

17. People - highest skill levels are below the GM and UK averages

18. People & Place – large areas of ‘hard-pressed’ with small pockets of affluence Standish Aspell New Springs Whelley Astley Moss Lowton East

19. Although deprivation is a serious issue the borough is less polarised than some others

20. Areas in the most deprived 5% tend to be concentrated in the centre

21. Impact of the Recession – increasing part time work

22. Public sector cuts … but employment forecasts are more favourable than many GM boroughs New Economy scenario 2010 to 2015 shows a net increase Source: ODBR, GMFM, New Economy analysis. Note: may not sum due to rounding

23. Strengths • Good outward connectivity – West Coast Mainline / M6 • Key employment sites, including Westwood Park and “Wigan South Central” • Recently strengthened Town Centre offer, to provide a competitive retail offer within a wide catchment area • Competitive areas of private sector business base e.g. Food & Drink (Heinz and Pataks), Sport and Hospitality & Tourism • Less inequality than many other GM districts

24. Weaknesses • Poor internal transport (large / dispersed district) and connectivity to rest of GM • Too reliant on Manufacturing and Construction, despite having strengths in these sectors • Highest skills too low – benefit claimant levels too high = significant productivity gap • The impact of recession has been worse than GM as a whole (as a result of skills deficit and high concentration of Manufacturing and Construction)

25. Opportunities • Better exploit transport links / improve connectivity within Wigan and with rest of GM • Improving the image of Wigan (leveraging the wider ‘Manchester’ brand) • Environmental Technology sector – Wigan's is one of the fastest growing in GM (+166% employment growth between 1998 and 2008) • Potential to exploit quality of life offer, including attractive housing markets and access to high quality green spaces

26. Threats • Forecast to be long recovery from recession. Manufacturing will not be source of employment growth, even if output rises • Potential for increased inequalities in growth between Wigan and GM, when growth returns, unless better connectivity to opportunities (transport and skills) • OMEGA provides a potential threat for certain jobs in Wigan, although also opportunities for Wigan residents potentially • Reduced ‘framework funds’ from the EU?

27. The GM LEA including the Wigan chapter are available at: www.neweconomymanchester.com Dr Alexander Roy Head of Economic Analysis alex.roy@neweconomymanchester.com

28. Building Economic Resilience across Greater Manchester and Wigan The Emerging Strategic Context Baron Frankal Director of Economic Strategy baron.frankal@neweconomymanchester.com

29. The Coalition has introduced a series of significant changes to the economic development landscape… Comprehensive Spending Review Local authority funding settlement Local Growth White Paper LEPs Transport innovation Skills White Paper SKILLS RDAs Regeneration inequality worklessness Localism Bill RGF Enterprise This presentation describes whatthese changes to policy entail, and how we seek to deliver economic development in GM in the future…

30. A new economic development landscape is starting to emerge … designed to reduce costs and increase private sector involvement Mix of national, sub-regional and local activity Regional tier (RDAs) Public sector support for private sector Private sector contribute to public sector contracts Return on investment and private sector investment Grant and gap funding for projects

31. The emerging landscape in skills & employment shifts primary responsibility to the private sector • EMPLOYMENT: The DWP Single Work Programme incentivises private sector contractors to move people into jobs • Loss of funding and powers for authorities (Working Neighbourhoods Fund) • Public sector role becomes more one of influencing contractors and ensuring integration with other local services and activities • SKILLS: Primary responsibility for skills provision placed in the hands of the market – to colleges and other providers • In GM discussions are underway to form a three way relationship between providers, businesses and the public sector to ensure skills provision meets the long term needs of businesses and the economy. • The LEP will be pivotal in this arrangement

32. Key responsibilities around business support, inward investment and trade have been centralised • Most RDA responsibilities have been centralised nationally, however much of the delivery of activity will be sub-contracted locally • The LEPs will provide strategic input and leadership but the LEP is not a business support delivery body … the onus is on businesses to use networks and associations to formulate ideas and influence policy • GM partners are seeking to develop a business support proposition - low-cost, high value-added, private sector-led initiative to ensure GM's businesses have access to the best possible business support services • MIDAS and Marketing Manchester will promote GM internationally, fostering international links and attracting inward investments • Science and innovation is a key priority and GM are seeking to attract a Technology & Innovation Centre focussing on low carbon

33. The funding environment has changed significantly, requiring an adapted approach • RDA funding will cease to exist - European funding through ERDF will continue without RDA involvement • The Regional Growth Fund provides funding for projects delivering economic growth outcomes • The Evergreen fund requires a strong return on investment - and aims to attract public sector pension fund investments as well as private sector investment. This could create a fund of over £300m • An increased emphasis will be placed on projects delivering a return on investment as well as quantifiable and evidenced economic growth outcomes • A single investment framework is being developed to provide a transparent and consistent means of assessing GM projects

34. In this new policy environment the organisational landscape is changing significantly Mix of national, sub-regional and local activity Regional tier (RDAs) GM Combined Authority & LEP + increased collaborative working Ten local authorities + AGMA & BLC Identified GM Strategic Priorities & produced Delivery Plan Integrating GM organisations to drive delivery of GM Priorities

35. The Greater Manchester Local Enterprise Partnership (LEP) is being established • The GM Local Enterprise Partnership proposal has been approved by government and a Shadow LEP is already in place • The LEP will drive strategy, set direction and identify growth opportunities • Recruitment of the full LEP Board is starting, with national advertisements, in order to be in place from April • The Board will have a private sector Chair and majority private sector membership, alongside AGMA representatives • Private sector members will be selected through an open process, based on skills and experience rather than representation of particular interest groups • The GM LEP proposal outlines areas of focus for the LEP - however the LEP will have scope to shape and define its own agenda

36. The Greater Manchester Combined Authority (CA) will work in concert with the GM LEP to drive the GM agenda • The GM Combined Authority legislation is currently being finalised, and will be in place from April • The CAwill be the primary accountable body with the potential to take on responsibility for coordinating economic development and regeneration and transport provision across Greater Manchester • While the LEP defines strategy and sets direction the CA can mobilise local authority resources to deliver the GM agenda

37. The GMS continues as the focus of Greater Manchester’s economic priorities • Based on MIER, and other evidence, the GMS identifies the 11 priorities to improve Greater Manchester’s long term economic performance • Agreed by AGMA and with central government … and now endorsed by the Shadow LEP • Individual authorities have a key role to play in achieving the GMS in order to benefit from improved GM economic performance

38. GM economic development organisations need to be aligned and adapted to drive delivery • The GMS provides the focal point and drives the activity of all GM’s economic development organisations • The LEP will become the principal body driving this strategy • An integrated business plan across GM organisations will ensure delivery activity is aligned and resources are used effectively and efficiently • The Combined Authority will offer a similar platform for integration and alignment of local authority activity • It is crucial that these organisations work in concert on these key priorities for Greater Manchester • … as well as offering support to authorities in identifying and addressing specific issues of local relevance and importance

39. Sub-regions in the north west are collaborating to ensure regional priorities and assets are retained • A number of regional transition work streams are underway – with sub-regions and NWDA working closely to ensure critical activity is not ‘lost’ • These groups are accountable to the north west Regional Leaders Board • The groups are focusing on … • Regional ‘case-making’ and lobbying • Identifying and supporting key sectors in the region • Identifying and retaining key assets – people / data / systems • Cost efficiencies in research, analysis economic forecasting

40. In conclusion … • The GMS remains at the core of Greater Manchester economic strategy • The LEP and Combined Authority provide Greater Manchester with new levers to drive forward this strategy • However the policy and funding environment has changed significantly and this presents many challenges … as well as opportunities • Engaging with business becomes ever more important – as does the need for commercial returns on investments • Ensuring that GM level organisations work effectively and collaboratively with local authorities is crucial to achieving our aims