ACCORDING to data from the North East Local Enterprise Partnership, labour productivity is growing at the fastest rate in the country and median wages are very competitive.

The North-East has the most equal distribution of salaries in the country. The data indicates the area is a great place to be both an employee and employer.

Age is an issue though, no where else in the country has a greater percentage of students achieving 5 A*’s to C; however the talent is not sticky and migrates to the south for employment. This being said, combined with our productivity and income advantages there are clear reasons to be living and doing business in the North East.

The North-East is well connected, by air, land and sea and noticeable improvements are evident in terms of the increased number of flights in and out of Newcastle International Airport, the road network offering some of the lowest average commuting times in the UK, world class freight links, the Tyne & Wear Metro improvements, East Coast mainline train links and Teesport – home of the second largest UK port along with Port of Tyne.

The region is home to the UK’s biggest reservoir at Keilder and largest integrated chemicals plant at Wilton, Teesside, with over 14,000 companies exporting £12bn of goods a year. Subsea engineering is a key sector and likely to benefit should Scottish Independence prevail.

The North-East has a long tradition of making things, much of which is exported. The region has the lowest number of imports and on a per capita basis, exports perform above national average. But the region is under threat from a growing skills gaps. Furthermore, shortages could get worse if the population does not upskill itself.

If the North-East is to remain a world class region for manufacturing, there is a need to recruit new talent. Around 30 per cent of the mainstream engineering companies in the region employ apprentices and it has been indicated that nearly all of the contractors in the oil & gas sector are looking to recruit over the next year. Confidence is high for the industry but growth is constrained by skills shortages in key areas.

Of the 8,500 skilled workers in the region, almost half are highly skilled and due to retire in the near future. Whilst apprenticeship starts in manufacturing and engineering have risen over 100 per cent in the North- East, higher than the national average, there is still much to do and apprenticeships remain key to bridging the skills gap.

The ‘Jeremie 2’ investment programme could add a further boost to the North-East economy, potentially ploughing £160m into the region’s businesses. This initiative follows on from ‘Jeremie’, the £125m Finance for Business North East fund launched in 2010, and aims to help the growth of business start ups, technology based companies and growing smaller businesses.

North-East numbers are encouraging, despite starting from a low base. With synergies across sectors and local initiatives aiming to boost the economy, together the North-East recovery should continue to gain ground on the rest of the UK.

Samantha.dolby@brewin.co.uk

Samantha Dolby is an Assistant Investment Manager at Brewin Dolphin and offers advice on a wide range of financial services to private clients, trusts, charities and pension funds.  

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