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Enterprise zone jobs growth ‘has been underwhelming’

The number of new jobs created by enterprise zones around the country ‘has fallen well short’ of original government predictions, according to a new study.

Research by the think tank Centre for Cities claims only 17,500 jobs had been created in the zones by 2017, compared to the original Treasury target of up to 54,000 more jobs by 2015.

The report adds that ‘even’ if all the new jobs can be attributed to the enterprise zones and their policies, this would still be ‘less than a third’ of what the Treasury initially predicted.

The 24 zones were created by the-then chancellor, George Osborne and became operational in 2012.

The zones offered a series of incentives, including business rates discount of up to 100% over a five-year period, simplified planning and superfast broadband.

According to the study, there has ‘much variation’ in the number of jobs created in the various zones.

Bristol and Bath topped the list with more than 5,000 jobs created between 2012 and 2017, with Mersey Waters coming second with just over 3,000 more jobs.

But Humber and Lancashire enterprise zones recorded fewer jobs over the same time period. In the case of Lancashire, there were 2,327 fewer jobs by 2017.

‘The nature of the jobs created has also been overwhelmingly low-skilled, meaning that the zones have done little to attract in higher-skilled economic activity that would help to change the economic make-up of the economics into which they have been placed,’ the report states.

The report also found that enterprise zones in city centres performed better than zones in other areas, and accounted for almost two thirds (63%) of all the jobs growth.

‘Even if the goal had been to redistribute jobs, rather than grow the total number of them, then the zones have struggled on this measure,’ the report adds.

‘The zones that were created in Lancashire and the Humber in response to large job losses have seen job losses. Meanwhile, the top-performing zones have been in the already successful city centres of Bristol, Birmingham and Liverpool.’

A spokesperson for Ministry of Housing, Communities and Local Government said: ‘Since 2012, enterprise zones have supported over 877 businesses, attracted £3.5 billion of private sector investment and created over 38,000 jobs.

‘Enterprise zones are just one part of our extensive package of support for communities – including the £12 billion Local Growth Fund – which is creating jobs, helping local businesses to grow and building an economy that works for everyone.’

Photo Credit – Tama66 (Pixabay)

Jamie Hailstone
Senior reporter - NewStart

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