Why investment in rural towns should focus on skills, health and social infrastructure.
While our previous research focused on towns located in the hinterland of cities, the following analysis takes a closer look at rural towns that lie far from the economic benefits cities can bring.
Figure 1 shows that two thirds of the 46 rural towns – those that are over 45 minutes commute to their nearest city – are classed as weak.
Source: Census, 2011
One of the most likely explanations for their poor performance is the distance to their closest city. Cities provide jobs – particularly those with higher salaries – to people living within a commutable distance in their hinterlands. These high-paying jobs are something rural towns are largely unable to benefit from.
However, there are 16 rural towns that perform considerably well despite the lack of a city nearby. Is there anything we can learn from them to help level up other rural towns?
Given these towns miss out on the economic benefits of being close to a city, this leaves two main ways for them to succeed. Either they can have a strong economy in their own right, or they can attract a wealthy population who move there for non-economic reasons – be that because they earn income from investments or because they work remotely.
Figure 2 looks at these two factors, with the strength of the local economy on the x-axis, and the ability to attract people for non-economic reasons on the y-axis. A stronger business base seems to be the main driver of the success of a rural town. Every strong rural town has at least 10 per cent of their workforce employed in high-skilled exporting industries.
In addition, stronger towns seem to be more able to attract wealthy inhabitants who are not bound to a specific location, such as well-off retirees and people who are able to work from home which are often in high-skilled professions. To a certain extent it’s this effect that is likely to help rural towns like Salisbury, Kendal, Truro and Falmouth make up for their comparatively weaker business base.
Source: Census 2011
Note: Data available for England and Wales only.
While some rural towns do have noticeably stronger economies than others, it is worth noting that this is in the context of other rural towns. Only a few towns such as Andover, Great Malvern or Yeovil have shares above the general town average, which itself trails the city average.
The reasons why this occurs doesn’t appear to be particularly informative for policy. The first is that history appears to matter. Some of the stronger rural towns we see today were centres of knowledge jobs more than a century ago (see Figure 3). Towns like Worcester, Tunbridge Wells and Yeovil are likely to have played the role of a centre of commerce for the wider area historically, and a legacy has persisted. This legacy isn’t a given though – a number of rural towns such as Eastbourne, Bridgwater or Colwyn Bay have weak economies despite being relatively strong a century ago.
The second is that some of them have benefited from direct state intervention. Previous governments have placed defence jobs in Great Malvern and Andover (The Royal Radar Establishment and British Army Land Forces Headquarters), while Yeovil’s helicopter industry has benefited from defence spending.
Source: Census 2011; Census 1911
Note: Data available for England and Wales only.
The state could make such interventions again, and the current Government has done just this with its intention to move Treasury jobs to Darlington. But this can only be done in a handful of places.
As with towns closer to cities, the attractiveness of rural towns appears to be the quality of life they offer. This is one explanation why the number of people who can locate where they want, as shown with the bubble size in Figure 4, is higher in places with a higher quality of housing stock (y-axis) and lower crime levels (x-axis). It also shows that there is a variation between strong and weak rural towns. Strong rural towns appear more often in the top left meaning that overall, they have a higher quality of life while weak rural towns are found more frequently in the bottom right.
There have been a number of arguments made recently that the so-called work from home revolution will be a boon for weak towns as people will be freed from living in cities. If this comes to pass, the data suggests that those towns that struggle are unlikely to be the first choice of those who decide to relocate.
Source: Census, 2011; VOA, 2018; MHCLG, 2019
Note: Bubble size: High-skilled that are 65 years and older and people that work from home as share of the population (%), 2011
Note: Data available for England only.
To level up rural towns the Government must focus on improving living conditions everywhere. There is no reason why a person living in Grimsby should be dealing with higher crime levels and worse housing than a person living in Chelmsford. And unlike trying to influence where businesses are located, it is in the provision of public services that the state can really make a difference.
Increasing employability and skills of those living in weaker rural towns will also play an important role in improving their quality of life. Figure 5 shows that people in weak rural towns are more likely to suffer from health deprivation and lower skills compared to strong rural towns. This makes them less likely to work in higher-skilled jobs with a good salary and in addition limits their mobility to move to places with a better job offer.
Source: Census, 2011; MHCLG, 2019
Note: Data available for England only.
Weak rural towns differ from strong rural towns on a range of indicators. And while the weaker business base is one important factor, there is little the Government can do to change that. Instead, the focus must be in areas where the Government can have more influence. Levelling up weak rural towns must therefore mean raising the living standards of their inhabitants to the same level as that of strong rural towns, with a specific focus on investing in skills, health and social infrastructure.
Ignoring the relationship between cities and towns makes it harder to bring greater prosperity to struggling towns.
Critics who attack city policy as ‘trickle out economics’ are hurting the people they are trying to help.
Why levelling up towns must mean increasing investment in skills, housing stock and the attractiveness of a place – in conjunction with improving the performance of cities.
Why transport policy shouldn’t be at the core of the levelling up agenda.
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