The Value of the Bristol Economy January 2016
Summary



1
ONS 1 published new Gross Value Added (GVA) data late last
year. The new data show that the value (GVA) of the economy of
Great Britain grew at an average of £65.4b per year between
2012 and 2014, a rate that is higher than that (£46.8b per yr) for
the period 2009 to 2011 and also marginally higher than the prerecession trend (£63.9b per year) for 2002 to 2007.
Between 2011 and 2014 the value (GVA) of the Bristol economy
grew (£592m per yr) significantly faster than the pre-recession
trend (£484m per yr) growth of 2002 to 2007. None of the other
seven British Core Cities with NUTS3 boundaries 2 has done
anywhere near as well.
If the recent (2011-14) trend growth of the GVA for Bristol
continues, the ground lost because of the 2008 recession will be
recovered by 2020 or earlier. With their current (2011-14) trend
growth rates two (Manchester and Glasgow) of the other seven
Core Cities will eventually 3,4 recover ground lost during and
directly after the recession. For the other five Core Cities the gap
between the pre-recession and current growth trends is still
increasing4, they continue to lose ground.
Office of National Statistics
Birmingham, Glasgow, Leeds, Liverpool, Manchester, Nottingham and Sheffield
3
but not for many years
4
See Appendix 3
2
1
The Value of the Bristol Economy January 2016
The Picture for Great Britain.
In early December ONS released revised estimates of the value (Gross Value Added) of the British
economy for the period 2007 to 2013 and an initial 5 estimate of its value in 2014. The revisions for
Great Britain are small 6 and have had no significant effect on the growth of the GVA. The new
estimates still show two periods 7 of economic growth. In the five years (1997 to 2001) at the
beginning of the current time series, the GVA of the British economy grew from £773,369m to
£931,130m at a rate of £39,874838m per annum 8. In the following 6 years the British economy
grew at an average of £63,926m per annum, reaching £1,299,447m in 2007. With the recession
starting in late 2008 the GVA of GB fell by 1.5% (from £1,338,023m to £1,317,884m) between
2008 and 2009. Since 2009 the GVA of Great Britain has grown in two significantly different
stages. Between 2009 and 2011
the GVA grew at an average of
£46,799m per annum and
between 2012 and 2014 at
£65,435m per annum. The full
time series is shown opposite
with trend growth lines for the
periods 1999-01, 2002-07, 200911 and 2012 to 2014. Clearly
post-recession growth has fallen
well below the pre-recession
trend, but since 2011 the gap
has closed slightly. As of 2014
the GVA of Great Britain was
9.1% below the level that would
have been expected if the 2008 recession had not occurred 9 and the economy had continued
expanding at the trend rate for the period 2002 to 2007. In 2014 the British economy was 61.6%
larger than it was in 2002.
The Picture for Bristol.
The most recent estimates of GVA for Bristol have post-recession (2011 on) growth higher than
previously published data. The new data is shown in the chart below. The revised estimates
indicate that the GVA of the Bristol economy grew at average rates of £213m per annum and
£484m per annum in the periods 1997 to 2001 and 2002 to 2007 respectively. Despite the
recession, Bristol GVA continued to increase 10 until 2010 (8% between 2008 and 2010), decreased
by 2.9% between 2010 and 2011 and then rebounded strongly. Between 2011 and 2014 the GVA
5
the estimate will be revised when the initial estimates of Gross Value Added are released in December 2016
no more than 0.5% either way between 1997 and 2012; 0.66% in 2012 and 1.4% in 2013
7
A more detailed analysis shows that the growth rate increased steadily between 1997 and 2008 – see Appendix 1
8
The results of the data analysis are given in Appendix 3.
9
down from 10.1% in 2012
10
note in previously published (2014) data the GVA of Bristol decreased between 2009 and 2010
6
2
of Bristol grew at £592m per annum. As a result the gap between the reported numbers and those
that would have been above expected if
the 2008 recession had not occurred has
closed from 8.1% in 2012 to 4.4% in 2014.
If the 2011 to 2014 trend continues,
Bristol’s economy will regain the ground
lost due to the recession by 2021.
However, the growth of the Bristol
economy has accelerated since 2012 in
both absolute and relative terms. Between
2013 and 2014 Bristol’s economy grew by
6.5%, the fastest it has grown since 200607 when it grew by 9.7%. Thus it seems
that the ground lost as a result of the
recession may well be regained earlier.
Comparison with the British Core Cities 11
Of the ten British Core Cities, eight 12 (including Bristol) have boundaries that are congruent to the
NUTS3 13 areas for which GVA is reported 14. The pattern of GVA growth in these eight Core Cities
mirrors, more or less closely, that for
Trend Growth Between Years (£m per annum)
Great Britain. Post-recession GVA trend NUTS3 Area
Name
2002-07 2011-14 Difference Quality of Difference
growth (2011-14) varies widely between
15
Bristol
484
592
-108
converging quickly
the eight. The table opposite shows pre
770
707
63
diverging slowly
and post-recession trend growth for the Birmingham
Glasgow
791
827
-37
converging slowly
eight core cities. As was mentioned
Leeds
1,018
447
571
diverging quickly
above, Bristol’s GVA may well recover
Liverpool
508
153
354
diverging quickly
the ground lost as a result of the Manchester
751
798
-48
converging slowly
recession in the next few years. In Nottingham
276
8
268
diverging quickly
contrast none of the other seven Core Sheffield
476
310
166
diverging
Cities will 16. For five of the other seven in
fact, GVA trend growth is still divergent and for the other two it is only slowly convergent. If the
2011-14 trends persist, the GVAs of Birmingham, Leeds, Liverpool, Nottingham and Sheffield will
continue to fall behind the levels that would have been expected if the pre-recession trend growth
(2002-07) had not been interrupted by the recession. The GVAs of Manchester and Glasgow will
eventually recover the ground lost during the recession but not for many years.
Questions about the contents of this briefing should be addressed to:
Stephen Usmar,
Economic Intelligence Officer,
Policy and Research Team,
Policy Research & Communications,
Bristol City Council.
email:
[email protected]
Phone:
11
0117 9222925
NUTS3 areas that are congruent with British Core Cites
previously 7, but NUTS3 boundaries have been revised and now include Manchester
13
3rd level “Nomenclature of Territorial Units for Statistics” geographies.
14
this means that comparisons with the GVA of Newcastle and Cardiff are not possible
15
More detailed data can be found in Appendix 2
16
See charts in Appendix 3
12
3
Appendix 1
The chart below shows GVA for Great Britain for the period 1997 to 2014 and growth rates for the
same data. Note that the
growth rate increases smoothly
from about £34,000m per
annum in 1998 to £67,546m in
2006. Between 2007 and 2011
growth rates fall and then
increase as a result of the
decrease in GVA between
2008 and 2009. Because of the
methodology used to calculate
growth rates, growth never falls
below zero. Post 2011 growth
rates once again increase.
Appendix 2
Table showing the details of post-recession GVA growth for eight of the British Core Cities and
Great Britain with comparisons to the pre-recession trend growth for 20020 to 2007.
NUTS3 Area
Name
Bristol
Birmingham
Glasgow
Leeds
Liverpool
Manchester
Nottingham
Sheffield
GB (£b)
GVA (£m)
2012
11,863
21,550
17,157
18,908
9,893
14,510
7,814
10,645
1,453
2014
13,277
23,231
19,349
20,188
10,451
16,107
8,003
11,251
1,584
2002-07 Trend % Diff Between Trend &
Trend Growth Between Years (£m per annum)
Reported GVA in Year
Values (£m)
2012
2014
2012
2014
2002-07 2011-14 Diff’ Quality of Diff’
12,914 13,882
-8.1
-4.4
484
592
-108 converging quickly
23,665 25,204
-8.9
-7.8
770
707
63 diverging slowly
20,182 21,764
-15.0
-11.1
791
827
-37 converging slowly
23,260 25,296
-18.7
-20.2
1,018
447
571 diverging quickly
11,920 12,936
-17.0
-19.2
508
153
354 diverging quickly
17,069 18,570
-15.0
-13.3
751
798
-48 converging slowly
8,380 8,932
-6.8
-10.4
276
8
268 diverging
12,034 12,986
-11.5
-13.4
476
310
166 diverging
1,615 1,743
-10.1
-9.1
63.9
57.8
-6.2 diverging
4
Appendix 3