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Birmingham & Solihull Economic Review 2002

This is the first ever joint Economic Review to be prepared for the Birmingham and Solihull Sub- regional economy by Birmingham City Council, Solihull MBC, Birmingham & Solihull LSC and Birmingham Chamber of Commerce & Industry.

The Review identifies key headline trends and a range of policy responses designed to accelerate the significant achievements of the last 15 years and drive forward the renaissance of the sub-region.

Key Trends

• The Service sector is the main driver of employment growth and now accounts for 76% of employment and around two-thirds of this is in marketable services.
• Employment growth in Financial Services and Professional Services, (15% and 11% respectively) actually outstripped national growth (6% and 10%) since 1993, creating over 43,000 jobs.
• The Manufacturing sector remains of strategic importance to the Sub-region's economy despite now only employing 20% of Birmingham & Solihull's workforce.

Prospects

• Output growth between 2001 and 2005 is estimated at 3.3% pa in the Sub-region, which is above the national average in this period and above the long-term UK growth rate of around 2.25% pa.
• Over the longer term, there could be up to 50,000 additional jobs in the Sub-region by 2010. Many of these jobs will be in Professional Services, Computer Services, Retailing, Tourism and Hospitality. Manufacturing will continue to shed employment.
• These sectoral developments will be paralleled by a marked increase in the number of managerial, professional and technical staff required, and a significant increase in the demand for 'customer facing' service occupations.
• The ethnic composition of the local population will continue to change over the next 10 to 15 years.

Policy Responses

The partners, working with new agencies – particularly Advantage West Midlands (AWM) – are developing a clear framework for future action:

Developing a Stronger Economic Base

Key cluster developments include:

• The A38 High Technology Corridor which will provide an opportunity to develop a new high value added Manufacturing presence in Birmingham;
• The further development of the Coventry – Solihull – Warwickshire technology corridor to capitalise on the recent growth in computer and hi-tech industries;
• The regeneration of Eastside in Birmingham, which will include the Technology Innovation Centre at Millennium Point, alongside major office developments and complimentary leisure and retail activities;
• Developing new and expanding key employment locations in and around Solihull – e.g. Blythe Valley Business Park in Solihull; and
• Developing a substantial new commercial office capacity – especially in Birmingham City Centre.

Other policies to support economic diversification include:

• Business Link operations to ensure the creation and survival of business;
• Developing and encouraging close links between Higher Education (HE) and business; and
• Development of the Tourism sector.

Developing Human Resources and Skills

The Strategic Plan of the Birmingham and Solihull LSC identifies a number of key frameworks:

• A skills strategy, to maximise the contribution of education and training to economic performance;
• A participation strategy, to promote equality through an Equal Opportunities Action Plan; and
• A learning strategy to work closely with schools, colleges and training providers to improve participation.

West Midlands Objective 3 Programme – will make assistance available to projects throughout the Birmingham & Solihull sub-region.

Addressing Community Regeneration and Social Inclusion

• Regeneration Zones - There are two regeneration zones, which have been identified as areas of need and opportunity by Advantage West Midlands, in the sub-region. Indicative levels of expenditure by AWM in these zones are £14.4 million for 2002/03, £30.4 million for 2003/04 and £44.8 million for 2004/05.
• Single Regeneration Budget Projects - have been funded in Birmingham by the last three rounds of the SRB. By 2006 these projects are expected to have created a total of 725 jobs, increased the number of business start-ups, and helped to equip community organisations.
• New Deal for Communities - There are two New Deal for Communities programmes in Birmingham:
  King's Norton (Round 1) - This area is to receive £50 million between 2000 and 2010 to tackle social exclusion.
  Aston (Round 2) - this area is to receive a total of £54 million between 2001 and 2010 to tackle unemployment, community safety, health, educational attainment, housing and environmental improvements.
• Neighbourhood Renewal Fund - The aim of the Neighbourhood Renewal Fund is to improve housing, raise school standards, reduce crime and improve health in the most deprived neighbourhoods in the country. Birmingham had been allocated a total of £49.6 million.