The UK is set to be more geographically balanced over the next three years. However, this is due to slower growth in the services sector having a detrimental impact on the south of the UK rather than other regions 'catching up' through improved performance, finds EY'sRegional Economic Forecast.
Key findings include:
Brexit uncertainty for the UK capital: London will continue to outperform all other UK regions through to 2021, however the gap is expected to become smaller.
The South East is the only region expected to see an increase in employment growth: A slowing economy, expected lower EU immigration and technological change are all contributing to this anticipated shift in the labour market.
Regions with a large manufacturing base enjoyed a boost last year: This was due to weaker sterling making exports more competitive. The West Midlands benefitted from this. However, more subdued growth is expected for these regions in 2018-21.