What hope for the West Midlands?

The last Regional Economic Strategy for the West Midlands offered a vision of a more prosperous region, making more full use of skills and talents and correctly valuing the natural, historic and cultural assets of the area whilst seeking to minimise use of the planet’s resources and preparing for a low-carbon future.

Unfortunately, since this vision was published in 2006, the region now has a headline Gross Value Added (GVA) figure of £84,838 million (7.8% of UK total). This equates to a GVA per head of £15,812. (Source: ONS). In addition, approximately 240,000 people were unemployed between February and April 2010

The sections of society that have seen the greatest increases in unemployment are those aged 16-24, those with no qualifications, and males. Unemployment in the 16 - 24 age group was 18.6% in July to September 2008, twelve months later it was 26%. Whilst unemployment had been higher among ethnic minorities before the downturn and still remained high (unemployment among non-whites in July - September 2008 was 15.1% and twelve months later it was 19%) the most dramatic increase had been among young, white males, albeit from a lower base.

The local authority places most at risk were Bridgnorth, Cannock Chase, Newcastle-under-Lyme, North Warwickshire, Staffordshire Moorlands, Tamworth and Wyre Forest. While urban areas (e.g. Birmingham, Stoke-on-Trent) had seen the largest total increases in unemployment, rural areas (e.g. Wychavon) and some market towns (e.g. Uttoxeter, Whitchurch) had experienced larger proportionate increases in unemployment. Some of the more rural wards were seen as vulnerable because of a reliance on one employer, or because of a large proportion of residents commuted to other areas and worked in vulnerable sectors (Source: Hansard, 2009).

During this Parliament, David Cameron has indicated legislation will be introduced to establish an elected Mayor on Birmingham (and possibly Coventry and Wolverhampton). An already declared candidate for the Labour nomination is Sion Simon, the previous creative industries minister. Politically, Birmingham should be a comfortable win for the Labour party if results from a mayoral election replicated parliamentary performance. However, the council has been controlled by a Conservative/ Liberal Democrat coalition since 2003 and this should help to make any election more competitive, with an overall likelihood that Sion Simon should become the first elected mayor of Birmingham.

With an existing budget of £1.3bn and anticipated cuts over the next two years of £100m, including £12.6m from Be Birmingham, the council-led partnership responsible for coordinating the assault on unemployment, crime and social deprivation, the next two to three years will be problematic for any newly elected mayor.

The Labour Party must become far more proactive in combating these cuts. It will not be enough to hope the coalition collapses before the end of its full term, or that local councillors will be able to create a defensive line to prevent the pruning from taking place. We need to organise opposition within the broad left and trade union movement. Part of this should be to organise demonstrations, rallies, lobbying and petitions, as well as offering full support to trade unionists facing redundancy.

Today the government announced £2bn of cuts as a result of closing a variety of services (including extension of Young Person's Guarantee to 2011/12 - £450m and the two year Jobseeker's Guarantee - £515m). If we don’t start acting soon it will be too late and we will begin to see a return to Thatcherite Britain.