A positive start to the New Year for Greater Manchester, but challenges remain

New Economy today released the latest edition of the Manchester Monitor providing an analytical snapshot of the economic wellbeing of Greater Manchester.

The report found that, against the backdrop of a downward revision to GDP nationally, Greater Manchester has performed relatively well. Despite rises in the number of jobseekers between December and January, the labour market is moving in a positive direction, with the number of claimants down 11.5% on the year – a faster rate than the 9.5% annual decrease nationally. Simultaneously, while the number of available jobs decreased by 5.2% in January – in line with seasonal changes in the job market – over the year the number of jobs has increased by nearly a quarter (24.7% ), far in excess of the rise in jobs nationally of 5.3% .

This shows increasing confidence and stability in the Greater Manchester economy. Further evidence shows that, as a result of this stability, there were fewer landlord and mortgage repossessions in Q4 of 2010 – falling by 8.4% and 13.3% respectively.

More positively, business indicators were on the rise – showing increasing business confidence in the local economy’s short-term future. Business deals have seen a rise of 77.8% on the year, whilst the number of high risk businesses has fallen 0.9% . Likewise, the number of companies winding up has fallen into Q4 of 2010, whilst bankruptcies – both of creditors and debtors – have also fallen over the last quarter.

In line with seasonal changes, hotel occupancy fell across Greater Manchester into January, though rose marginally on the year. This indicated more day visitors to the city centre, as data from CityCo suggests that footfall rose by 2.9% on the year in December – in contrast to an annual fall of 11.2% nationally – and retail sales also grew by 5.2% on the year.

John Holden, head of strategic research at New Economy, said:
"The further revision downward of GDP in Q4 2010 indicates that the economy has been performing poorly in comparison to expectations – with many observers expecting an upwards revision in GDP growth. Yet Manchester, despite some slippage, appears to have done well over the last quarter. The city centre has seen impressive retail growth, and suffered less as a result of the poor winter weather.

“Yet risks remain for the local economy. Greater Manchester’s Chamber’s Quarterly Economic Survey showed less optimism amongst businesses about employment expectations in the coming months. With inflation forecast to remain high for the foreseeable future, interest rates expected to rise during the course of the year, and public sector cuts to come in earnest from April, the big challenge are still ahead of us.”

Mike Emmerich, chief executive of New Economy, added:
"We all know that 2011 will be a difficult year for growth and recovery. But this relatively strong start to the year puts Greater Manchester on a good footing. Greater Manchester has long been a driver of the north west economy, and we need to use our resources wisely – ensuring our Local Enterprise Partnership is strong, effective and delivers the potential for growth of Greater Manchester’s businesses and people.”

ENDS

Notes to Editors

For further information please contact John Holden, Head of Strategic Research, New Economy on 0161 237 4179.

New Economy’s purpose is to create economic growth and prosperity for the people of Greater Manchester. We are committed to working with our partners to lead, influence and innovate; creating a better economy. From strategy to research, project management and consultancy, everything we do has one aim in mind. To make Greater Manchester a better place to live and work

New Economy makes a difference by:

• Developing economic intelligence
• Helping to create jobs and improve skills
• Saving money and increasing efficiencies
• Increasing investment and enterprise
• Playing our part in reducing carbon emissions

New Economy is one of the six Association of Greater Manchester Authorities Commissions, established in 2009. New Economy works with the ten local authorities across Greater Manchester and our key partners to: Develop economic intelligence; Help create jobs and improve skills; Save money and increase efficiencies; Increase investment and enterprise ; and Play our part in reducing carbon emissions.

For information on the work of New Economy please visit: www.neweconomymanchester.com

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