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Levelling up of the UK economy demands significant additional investment according to the latest Competitiveness Index

The economic levelling of the UK economy over the coming years is unlikely and can only be addressed through significant additional investment in the local areas of the UK that ‘have been left behind’. This is the conclusion of the 2021 edition of the UK Competitiveness Index, which is compiled by researchers at Nottingham Business School, part of Nottingham Trent University, and Cardiff University.

Graphic of money and an arrow pointing upwards
The UK Competitiveness Index measures current economic competitiveness across local and regional areas of Britain

The Index, which has been published since 2000, assesses the competitiveness of local authority areas, Local Enterprise Partnerships, cities and city regions across England, Wales and Scotland, and forecasts have compiled data to predict how they will fare in the years to come.

The most competitive localities are situated in London and the South East, with the City of London remaining the most competitive locality in the UK followed by Westminster and Camden. The least competitive localities are a mix of old industrial towns and more rural areas. The old industrial area of Blaenau Gwent in Wales is the least competitive locality. Redcar and Cleveland in the North East and Mansfield in the East Midlands also display lower levels of competitiveness.

The study finds that Covid-19 restrictions are likely to have impacted on sectors that are dominant in older industrial areas, with Brexit causing problems with access to the cheap labour that agriculture, hospitality and tourism sectors are reliant on in the more rural areas.

The least competitive cities are the old industrial cities of Kingston on Hull, Stoke-on Trent and Sunderland. In contrast, Leicester and Nottingham have seen improvements in their rankings, and a number of city regions that received City Deal funding have seen increases in competitiveness, such as Liverpool City Region, Glasgow and Clyde Valley City Region and Leeds City Region. However, the findings suggest that these remain exceptions rather than a levelling up, with the likelihood that the competitiveness landscape of the UK will become more uneven, with the least competitive locations forecast to grow at the slowest rates, and negative growth rates predicted for some areas.

In the East Midlands there remain considerable differences in competitiveness between the individual localities. Although the larger cities of Derby, Leicester and Nottingham have not only retained their competitiveness, but improved it in recent years, other more peripheral areas of the East Midlands have seen the opposite occur. In many cases these areas with industrial heritages, such as North East Derbyshire and Bolsover, or a more rural nature, such as East Lindsey, already had lower levels of competitiveness compared to the larger cities of the East Midlands and those located close by. Further reductions in their UKCI will be likely to increase disparities in the employment and broader life opportunities available when comparing the most and least competitive parts of the region.

One of the report’s authors, Professor Piers Thompson, economist and competitiveness expert at Nottingham Business School, said: “Although the full long-run impacts of the twin shocks of the global Covid-19 pandemic and Brexit will only become apparent in years to come, it is clear that in all regions of the UK there are localities which have been hit harder than others. Changes in the way that people consume and work, along with rising costs associated supply chain constraints and access to appropriate staff, mean that the sectors responsible for the competitiveness of some areas is may recover to some degree, but without intervention it is unlikely to return to pre-shock levels.

“While existing policies to support the rejuvenation of a number of cities outside London and the South East appear to be bearing fruit, it is important that ‘levelling up’ is an endeavour that considers all parts of the UK. Efforts must be made to ensure that a reduction of inequalities between regions is not simply replaced with greater inequalities within regions. In particular, areas outside larger cities that have previously benefited from low-cost labour could be in danger of being ‘forgotten’ when plans for large scale infrastructure projects and other investments in skills and education are made.”

The UK Competitiveness Index measures current economic competitiveness across local and regional areas of Britain based on a basket of economic indicators*.

  • Notes for editors

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    Professor Piers Thompson, Nottingham Business School, Nottingham Trent University, on telephone +44 (0)1158 482143 or via email

    The authors of the report are: Professor Robert Huggins (School of Geography and Planning, Cardiff University), Professor Piers Thompson (Nottingham Business School, Nottingham Trent University) and Dr Daniel Prokop (School of Geography and Planning, Cardiff University).

    *The UK Competitiveness Index uses a composite measure based on the following: Economic activity rate; business start-up rates per 1,000 inhabitants; number of businesses per 1,000 inhabitants; proportion of working age population with NVQ level 4 or higher; proportion of knowledge-based businesses; Gross Value Added per capita; productivity; employment rates; gross weekly pay; and unemployment rates.

    About Nottingham Business School at Nottingham Trent University

    Nottingham Business School (NBS) at Nottingham Trent University (NTU) is a world leader in experiential learning and personalisation of business, management and economics education and research, combining academic excellence with positive impact on people, business and society.  NBS has an unrivalled level of engagement with business, public and voluntary organisations. With 7,000 students, NBS is also one of UK’s largest business schools.

    NBS is a Quadruple+ accredited by EQUIS, AACSB, SBC and EFMD Programme level Accrediation which are internationally recognised hallmarks of excellence and quality for business education and engagement with business. The School is one of leading global 35 business schools recognised as a PRME Champion and held up as an exemplar by the United Nations Principles of Responsible Management Education (PRME).

    Nottingham Trent University (NTU) was named University of the Year 2019 in the Guardian University Awards. The award was based on performance and improvement in the Guardian University Guide, retention of students from low-participation areas and attainment of BME students.

    NTU was also the Times Higher Education University of the Year 2017, and The Times and Sunday Times Modern University of the Year 2018. These awards recognise NTU for its high levels of student satisfaction, its quality of teaching, its engagement with employers, and its overall student experience.

    It is one of the largest UK universities. With nearly 32,000 students and more than 4,000 staff located across four campuses, the University contributes £900m to the UK economy every year. With an international student population of more than 3,000 from around 100 countries, the University prides itself on its global outlook.

    The university is passionate about creating opportunities and its extensive outreach programme is designed to enable NTU to be a vehicle for social mobility. NTU is among the UK’s top five recruiters of students from disadvantaged backgrounds and was awarded University of the Year in the UK Social Mobility Awards 2019.

Published on 19 November 2021
  • Category: Press office; Research; Nottingham Business School