This publications was covered in BBC news, ITV news, Daily Express, City AM, Metro and The Independent on 18 April 2016.
- three out of Top 5 areas for disposable income growth located in Wales
- London home to 5/10 worst performing areas
Wales over the last five years* as manufacturing in the region recovers.
Three out of the Top 5 areas for the growth in average household disposable income, the money a household has left to spend or save after taxes and mortgages or rent, were located in Wales. Our research found that:
- households in Powys have 15.4% more spending money than they did five years ago – £16,670 compared to £14,440;
- households in Flintshire and Wrexham have 14.9% more – £16,110 up from £14,030; and
- households in South West Wales 4% more – £15,610 compared to £13,640.
The figures show these areas of Wales substantially outperformed the rest of the country – which saw an average growth in disposable income of 9.2% over the last five years.
Substantial investment from large manufacturers based in Wales is partly responsible for driving the growth seen in areas such as Powys, Flintshire and Wrexham and South West Wales. The weakness of the pound over the last five years has helped keep the UK’s manufacturing exports competitive.
A recent report** shows that manufacturing companies in Wales saw output rise by 43% during Q4 2015 significantly outperforming the rest of the UK, which saw manufacturing output fall by 0.5%.
Wales has received significant investment from manufacturers in recent years with examples including:
- sports car manufacturer TVR has recently announced that it will be opening a factory in Ebbw Vale in South Wales, creating 150 new jobs;
- investment by Toyota for the development of next-generation hybrid engines at its Deeside site in Flintshire; and
- Airbus’ preparation for the fulfilment of 181 orders for its new A350-1000, the wings of which will be made at the aircraft manufacturer’s site in Broughton, also in Flintshire.
Elliott Buss, partner says: “The leap in disposable income across Wales over the last five years pays credit to the hugely important role played by manufacturing in the region.”
“The Welsh manufacturing sector has grown from strength to strength and the subsequent rise in disposable income this has provoked ensures those areas of Wales worst affected by the recession have received a much needed boost.”
“As confidence returns and demand increases, we are seeing areas such as Powys, Flintshire and Wrexham and South West Wales make extremely positive signs of recovery. Consumers are buying again and manufactures are meeting renewed demand with enthusiasm.”
“As well as a reflection of wider economic health, the manufacturing industry in Wales has also benefitted from the help and support of the Welsh government in getting it back up on its feet and moving again. These efforts are now clearly being rewarded.”
London home to half of Top 10 worst performing areas in disposable income growth
We highlight that formerly deprived areas across England and Wales are outperforming disposable income growth in London, which was found to be home to some of the worst performing areas for growth in disposable income.
While the London Boroughs of Barking, Dagenham and Havering, Bexley and Greenwich and Enfield all saw growth of just 4% or under, Wandsworth and Camden and City of London actually saw household income fall by 1.3% and 0.1%, respectively – the only areas in the research to have seen a drop (see below table).
Growth in disposable income in some areas of largely finance-based London are lagging behind the rest of England and Wales as the economy continues to recalibrate itself following the recession.
Elliott Buss says: “The decline in City bonuses in recent years and increases in housing costs are major drivers in the slow growth rate in disposable income across London.”
“While some areas of the capital have experienced slower than expected growth, disposable income has actually decreased in others over the last five years.”
“Households in London however continue to have a higher level of disposable income compared to most other areas of England and Wales. It is likely that as the economy continues to recover, that we will see this begin to rise again over the coming years.”
Top 20 fastest growing areas in disposable household income (£s) over the last five years
The 20 areas across England and Wales that have seen the slowest growth in disposable household income (£s) over the last five years
Years 2009-2013, the latest figures available.
**Manufacturing Outlook 2015 Quarter 4: Report compiled by The Manufacturers’ Organisation and DLA Piper