Although the UK government’s ‘levelling up’ agenda (termed ‘rebalancing’ by the previous government) has triggered renewed interest in regional disparities, the need for better subnational statistics predates any recent shifts in the policy landscape. For several years, there has been a growing consensus that better subnational statistics are required to support policymaking and analysis (see, for example, Allsopp, 2004 and Bean 2016).
This need for subnational statistics means that the Office for National Statistics (ONS) and devolved administrations now collect and produce more subnational data than ever before. However, a number of challenges remain. Different subnational statistics tend to be developed and published as part of different releases reflecting their categorisation (for example, health, housing etc.), making it difficult to quickly gain a holistic overview of the complex dynamics in a given region. There are also challenges which occur when attempting to measure regional indicators across the four nations or compare regions in different parts of the UK. Without taking stock of the vast array of subnational data available, it can also be difficult to identify important data gaps.
This report seeks to address these issues, discussing the opportunities, challenges and trade-offs when building a suite of subnational socioeconomic indicators for the UK. Such a suite would facilitate the development of local area profiles across the four nations. This report also complements and builds on the Subnational Data Strategy published by the Government Statistical Service and the Levelling Up White Paper’s Technical Annex on Missions and Metrics published by the Department for Levelling Up, Housing and Communities.
We begin by reviewing current international practice, focusing on Canada where the provinces and territories regularly release publications using data on subnational economic indicators. We then discuss the UK policy landscape with a focus on levelling up. We then turn to data issues, discussing different UK geographies used in the production of statistics and the differing goals of different producers of subnational data. We next consider key challenges in terms of collecting regional data, considering the interdepartmental business register, different surveys and issues which can arise when comparing data from across the four nations. Subsequent sections consider a wide range of socioeconomic indicators which could be included or developed for inclusion in a subnational suite.
In our report, we outline a number of key recommendations:
- First, we recommend that a small number of key economic indicators are included in the suite together with other socioeconomic indicators capturing subnational labour markets; skills, education and social mobility; income and poverty; housing; health; and demography and rurality.
- Second, given the suite’s focus on socioeconomic outcomes, we recommend that the baseline frequency of suite should be annual with a subset of indicators on the cost of living and labour market at a higher frequency.
- Third, we recommend that the baseline geographical granularity of the suite is at the local authority level for Great Britain and at the local government district (LGD) level for Northern Ireland. Nonetheless, we stress that this level of granularity may mask considerable variation in large local authorities so we also recommend that data on all indicators are included at lower level geographies. These should be meaningful in a devolved context. It may be the case that a “building block” approach may provide a way forward.
- Fourth, we recommend that a subset of indicators should be comparable across the four nations with other indicators equivalent (i.e. capturing the same characteristic but not necessarily comparable). Where an indicator is included for England, an equivalent indicator should be included for the devolved nations. Omission of indicators for the devolved nations should only occur in exceptional circumstances. Some caution should also be used when referring to comparable indicators as “headline” and noncomparable indicators as “supporting” since, in this case, “headline” indicators may not be the “best” or most representative of a specific characteristic.
- Fifth, we have a number of recommendations relating to measurement and comparability issues and data gaps. Specifically, we recommend that issues around apportionment and disaggregation are carefully considered with a focus on how Great Britain Reporting Units report on regional activity.
We also recommend that the ONS and devolved administrations collaboratively identify areas in which surveys can be boosted or harmonised. With all four nations deploying health surveys, there may be an opportunity to develop comparable health indicators across the four nations. Importantly, though, survey boosts and harmonisation will require the ONS and devolved administrations to collectively discuss and consider resource implications across producers. Additionally, where different definitions of concepts are used across the four nations, indicators should seek to capture constituent parts. For example, rather than developing indicators on rurality, data on population density and transport connectivity could be obtained.
We also identify a number of key regional data gaps. Currently, statistics are not produced on regional consumer prices. Nor is there data available on working-age adults or pensioners in poverty for small geographical areas. Data on labour markets would benefit from complementary indicators on skills shortages and mismatch and business demography by industry – data on these indicators already exists but requires standardisation. While there is an opportunity to develop a set of indicators on education across the devolved nations using individual school data, this will require significant collaboration between the ONS and devolved administrations. Data on transport connectivity across the devolved nations also warrants further investigation. We also recommend that data sources used by the four nations to capture different dimensions of indices of multiple deprivation should also be explored since they are selected on the basis that they can capture outcomes in small areas. Again, while there is a need to address these data gaps, on a practical level prioritisation and resourcing will need to carefully considered by all producers.
Last, we provide some reflections on how a suite of subnational indicators could be disseminated. Nomis, in particular, illustrates the usefulness of local area profiles and these services could be extended to consider the LGDs of Northern Ireland and devolved constituencies. Ultimately, Nomis (or a different service) could provide area profiles on a wide range of indicators. Such a service should also carefully consider how to guide users so that comparisons across areas are only made where appropriate.
This ESCoE paper was first published in May 2022.
Sharada Nia Davidson
Sharada supports the Institute’s projects which develop new economic indicators and statistics or require time series data analysis. She has undertaken work for the Economic Statistics Centre of Excellence. Previously, Sharada worked as a Consultant and PhD Trainee for the European Central Bank, modelling the impact of macroprudential policies.
Kevin is a Chancellor's Fellow in the Department of Economic with a focus on the use of regional economic models for policy analysis. Areas of interest include; energy and climate change, poverty and tourism.
Niccolò contributed to this report as part of a work placement with the FAI while completing an MSc in Applied Economics at the University of Strathclyde.
Mairi is the Director of the Fraser of Allander Institute. Previously, she was the Deputy Chief Executive of the Scottish Fiscal Commission and the Head of National Accounts at the Scottish Government and has over a decade of experience working in different areas of statistics and analysis.