If you’d been reading a 1983 European Communities Commission report on Britain during its first 10 years as a member, and turned to its pages about the North East, it wouldn’t have exactly cheered you up. The region was suffering badly: it was witnessing strong growth when the UK joined the EC, but this had changed dramatically with the shocks of the oil crisis. The commission noted how the gross domestic product of the North East was falling fast – between 1975 and 1979 only one other UK region, the West Midlands, was showing lower growth. A regional director of the CBI went as far as saying the North East had a “flimsy” economy which had been going downhill since the 1930s.
Reliant on the traditional industries of coal, shipbuilding, steel and heavy engineering, with a large chunk of semi-skilled manufacturing and factory jobs, the North East was not doing well. There was growth in the service sector but nowhere near enough to offset spiralling job losses. In the five years to 1981, the North East’s shipbuilding industry alone shed 43,000 jobs, compared to only 3,000 between 1966 and 1976, and unemployment in the region was more than 220,000, about 16 per cent. Remember, too, that the commission was looking at the region before the bitter coal strike of 1984 to 1985.
It also noted that in Sunderland – once the world’s greatest shipbuilding centre – closures along the River Wear itself or in the inter-linked economy of the Durham coalfields had pushed unemployment to 25 per cent. In some areas of what is now the city of Sunderland, every other working-age man was unemployed.
Surveying the scene in 2005, chief executive of the North East Chamber of Commerce George Cowcher believes Sunderland and the North East have been utterly transformed in the last 30 years. Cowcher, who represents more than 5,000 businesses in the chamber, said: “A complete re-shaping of the North East economy has been achieved which has seen us move from one dependent on old 20th century industry into a 21st century economy with a mixture of sectors from services to manufacturing. We are much broader-based now which puts us in a stronger position.” Inward investment has played a key role, coming from national and local government, Europe and from business itself. Government-guided agencies and local authorities have helped reclaim old industrial sites and, while much of the work could be “lost” to the eye of the casual visitor or newcomer, those improvements have not only benefited the people who live in the region but served to make it more attractive for new business.
It was only announced at the beginning of this year that the last deep coal mine in the North East, Ellington, in south east Northumberland, was going to close, but elsewhere in the region the pit heads have become business parks, the spoil heaps levelled or grassed over, and the once-black beaches of East Durham transformed. Sunderland, the largest city and local authority between Leeds and Edinburgh, serves as a prime example of the turn-around.
The city now boasts Europe’s most efficient car plant at Nissan, where 4,100 people are employed, and the company has just announced that a sixth-model, a 4x4 people-carrier called the Qashqai, will be made at the plant from late next year. In the last 20 years, Nissan has invested £2.2 billion into the UK and Colin Dodge, Nissan’s managing director, has said that without the support of government, Sunderland Council and regional development staff, the company would never have been so successful. The government chipped in £5 million towards Nissan’s £23 million for the new Qashqai, and Dodge has said that officials at the Department of Trade and Industry were certainly no “pushovers”.
Alan Clarke, chief executive of regional development agency OneNorthEast, said: “The success of Sunderland in attracting and retaining inward investors to the region of the magnitude of Nissan, is mirrored right across the North East. Around 100,000 people are employed by foreign-owned firms in the North East and our region is continuing to punch its weight nationally in attracting new investors and retaining overseas companies.”
In contrast to the experience of both the North East and Great Britain as a whole, manufacturing employment in Sunderland has reversed the downward trend, which started in the 1970s and continued through the 1980s. Sunderland is currently the fastest-growing car centre in the UK with 12,000 people working in the industry. On the service side, the city has attracted household names such as Barclays and Nike into its new business parks. It’s just been estimated that around 10,000 people in the city work in what are still too commonly known as “call centres,” when they are in fact key administrative centres.
Sunderland’s track record for pulling in jobs has been unparalleled and more work has been created in the city through inward investment than the rest of the region put together over the last four years. A recent KPMG study placed Sunderland as one of the top five most competitive places in the UK to do business in, and an international survey has named it as one of the world’s seven most intelligent cities for the digital age.
As Sunderland, along with the rest of the North East, has picked itself up, it is also having to look ahead. Unemployment is still above the national average, but far from what it was, at just under four per cent. A key component is the city’s own development corporation, the Sunderland arc (area regeneration company). The arc aims to develop Sunderland’s labour supply advantages with a range of commercial and development opportunities to attract more investment and generate real step change.
An arc predecessor and a forerunner of ONE, the Tyne and Wear Development Corporation, helped clear Sunderland’s last pit site 10 years ago, and that went on to become the prestigious and breathtaking Stadium of Light – the new home of Sunderland AFC. The arc has ambitious plans for a range of Sunderland’s former industrial sites that could draw in £1 billion of investment and create a further 10,000 jobs over the next 10 years. As arc chief executive Tom Macartney said: “In Sunderland we are on the cusp of a real step forward to create a much more sustainable community.”
