North East

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The North East has reinvented itself after years of prolonged decline in its traditional industrial and manufacturing sectors, and is now a diverse and dynamic economy.

Key insights

The historic strengths of the North East economy were based around the region’s rich natural resources, including iron and steel, manufacturing and shipbuilding. Mining, however, saw a drop of 13% in the number of businesses in the sector between 2010 and 2017.

Today, among other things, the North East is renowned as a centre for manufacturing. In fact, manufacturing businesses in the region have increased by 10%, compared to just 5% in the UK overall. An upsurge in the metal and mechanical equipment industries in particular has contributed to this growth.

The automotive manufacturing industry is also booming, after the local supply chain got a boost in 2017, when Nissan announced it would double the amount of parts that it sources from UK suppliers. This was a move to offset the higher cost of importing parts from Europe since Brexit.

Did you know?

Nissan’s flagship European car factory in Sunderland produces more than half a million cars every year and is at the forefront of the development of next-generation electric vehicles.

Another success story for the region is the Northeast of England Process Industry Cluster, a conglomeration of more than 1,400 firms in the supply chain of chemistry-related sectors including petrochemicals, pharmaceuticals and biotechnology, which is particularly strong in Teesside.


Firms in the cluster produce half of the UK's petrochemicals output and a third of its pharmaceuticals production.

The North East has also developed expertise in the offshore engineering industry, with more than 50 specialist firms serving the oil and gas and renewable energy sectors, while electricity and gas businesses have soared by 107%.

Plus, despite a 7% drop in the number of education businesses in the UK, the North East has remained more stable in this area, enjoying a 1% growth.

Hartlepool has seen the number of the town's overall businesses grow by 24% – this is mostly due to a 105% rise in professional scientific businesses

Tyneside – once one of the biggest centres of shipbuilding in the world – has since reinvented itself as a location for scientific research, especially in the healthcare and biotechnology sectors.

Newcastle University is now a leading institution in that field, providing a pipeline of young talent and high growth potential spinout businesses.

In Darlington, the transportation and storage sector has increased by 50%. This is thanks to businesses such as logistics firm Nicholson's Transport, which recently opened a new warehouse in the market town, in order to meet growing local demand.

Meanwhile, Hartlepool has seen the number of the town's overall businesses grow by 24% – this is mostly due to a 105% rise in professional scientific businesses, which includes architectural and engineering ventures, as well as technology and science parks.

The North East also has a thriving financial and professional services sector, and is home to more than 145 contact centres.

Business numbers have increased by 17% since 2010, slightly behind the national increase (22%), though the region has built up effective support networks to back new start-ups, particularly in the digital and tech industries, including gaming.

What does the future hold?

Looking forward, the Northern Powerhouse is proposed as a way to rebalance the UK economy away from London and the South East by creating stronger infrastructure links between Newcastle and cities including Manchester, Liverpool, Leeds and Sheffield, as well as investing in science, innovation and skills.

For further information on the sourced references for the Business Trends data, outside of the Business Population Estimates 2017 and Nomis official labour market statistics 2010 and 2017, please download the information here (PDF, 233MB)

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