Insight on the current state of the economy and how it relates to Dorset by Nigel F Jump, Chief Economist of Strategic Economics Ltd (a Dorset Company) and Visiting Professor in Economics at the Universities of Bath and Plymouth.
See: www.strategiceconomics.co.uk
The Dorset Economy is effectively operating at full employment. In September 2014, the claimant count rates for Bournemouth, Dorset County and Poole were 1.6%, 0.8% and 1.1% respectively. These are very low compared with the averages for England as a whole (2.1%, September 2014) and their own rates a year earlier (2.5%, 1.3% and 1.7% in September 2013).
In wider terms, we can summarise the local labour market more structurally using the numbers in the table below. It reflects the range of experience across Dorset and compares these with the English average for the year July 2013 to June 2014.
|
July 2013- June 2014 |
Employment rate (%) |
Unemployment rate (%) |
Inactivity rate (%) |
Claimant count (%) |
Job density (%) |
|
Bournemouth |
70.0 |
7.3 |
25.5 |
2.4 |
0.70 |
|
Poole |
77.9 |
4.6 |
19.1 |
1.7 |
0.94 |
|
Christchurch |
71.7 |
5.0 |
25.0 |
1.5 |
0.84 |
|
East Dorset |
77.9 |
3.4 |
18.9 |
1.0 |
0.78 |
|
North Dorset |
85.2 |
3.8 |
12.5 |
0.9 |
0.75 |
|
Purbeck |
74.1 |
4.1 |
20.6 |
1.2 |
0.85 |
|
West Dorset |
77.0 |
3.1 |
19.2 |
0.9 |
1.01 |
|
Weymouth & Portland |
75.5 |
7.2 |
15.8 |
2.3 |
0.55 |
|
England |
72.2 |
6.8 |
22.4 |
2.9 |
0.79 |
In most areas, Dorset has employment rates above the average, indicating tight labour markets, particularly in North Dorset, East Dorset, and Poole. Only Bournemouth and Christchurch are below the national average: the former reflecting various urban and demographic issues and both reflecting the local age distribution. Similarly, inactivity rates also tend to follow the age distribution in the different areas – higher where there are a lot of retirees (e.g. Christchurch) and/or students (e.g. Bournemouth).
The other side of this coin is the very low unemployment rates observed across the county, especially in West, East and North Dorset. The exceptions are Bournemouth, and Weymouth and Portland, where a number of different social, economic and historical factors influence the pattern of joblessness in the local, urban community. Across the country, unemployment tends to be higher in urban than adjacent rural areas, although this is not as strongly the case for Poole.
Finally, job density, reflecting the number of jobs per working population, shows a stark contrast between, for example, the high rates of West Dorset and Poole compared with the low rates of Weymouth and Portland. This largely means a more dynamic labour market in the former than the latter.
The important message from this analysis is that in considering what’s going on in the local economy, some of the most important factors reflect structural community issues, such as age and social distribution, urban/rural splits and commuting, and some economic trends, such as recovery from the downturn, export performance, sector scale and activity concentration and demand/market influences. Accordingly, we see big contrasts between Bournemouth and Poole, between Weymouth and Portland and the rest of West Dorset, and between, say, North Dorset and Christchurch. It is not enough to know the numbers themselves, you also need to analyse the particular circumstances that explain them – both as they are now and how they have evolved over time.
Nevertheless, the key conclusion is that, as the economic recovery develops, Dorset has a strong, indeed, tight local labour market. In most areas, the issues are about labour quality, skills gaps and shortages and low earnings, rather than any surplus labour quantity. Will labour shortages restrict local growth if the economy builds a sustained upturn?
Professor Nigel Jump, 1st November 2014
