New polling reveals that people are markedly pessimistic about the long-term economic prospects of their local area. Across the UK, 59% of people expect local economic conditions to worsen over the next five years. In Yorkshire and Humber this rises to 70%. The North of England overall is more pessimistic than average, with 65% of people in this region expecting things to get worse.

By comparison, around a quarter (26%) of people in both the South East and London expect their local economy to improve, compared to just a fifth (20%) in the UK as a whole.

The Centre for Progressive Policy commissioned Ipsos to explore people’s views on the level of economic opportunity in their local area as well as how evenly spread opportunity is where they live. While sentiment on the economy is closely monitored, few trackers to date have sought to tap into one of the most important ways people experience the economy – the economic conditions and opportunities where people live.

Backsliding on levelling up

People living in areas classed by ONS as post-industrial, including parts of northern England, south Wales and the central belt in Scotland, are also more likely to be pessimistic, with 68% of people living in such areas saying they expect local economic conditions to worsen over the next five years. Previous CPP research has shown these areas are at increased risk of the impact of rising prices, through a combination of a highly vulnerable population and a high share of local jobs in energy-intensive sectors.

While current economic forecasts mean it is perhaps unsurprising that 67% of people across the UK expect local economic conditions to worsen over the next 12 months, it is striking that such large proportions of people expect things to worsen over the long term.

The fiscal statement contained just one real mention of levelling up, and while the Chancellor delivered some immediate support for households during the cost-of-living crisis, there was no transformative economic plan to tackle long-standing regional inequalities. The Centre for Progressive Policy believes the findings will worry Conservatives, as the parts of the country that the government explicitly targeted in its 2019 manifesto are now the most pessimistic over the long term.

Growing inequality a concern for many

People also expect their areas to become increasingly unequal. Around half (49%) of those surveyed think that access to economic opportunity will become less equal in their local areas in 12 months or over the next five years.

In inner London, this rises to around seven in ten people who think their area will become more unequal. This sentiment holds for both the immediate future, with 69% thinking inequality in their area will increase over the next 12 months, and longer-term, with 67% thinking this will happen over the next five years.

Wages, transport and housing are priorities

When asked which changes would make the biggest improvement to the local economy over the next five years, there were significant differences between places.

Those in the North of England and the Midlands say better wages for workers are their top priority (29% and 31% respectively) by comparison to 20% of people in the South and 25% of people in the UK overall.

Transport was a greater priority for people in Yorkshire and Humber (23%), the South West (24%) and East of England (23%), compared with 17% across the UK. Those in the South are more likely to prioritise affordable housing (30%), rising to 45% in inner London, compared to 26% across the UK as a whole.

The Chancellor announced a significant increase in the National Living Wage and re-announced existing plans to invest in northern rail. The Autumn Statement also included a cap of 7% on social rents, less than the current 11% inflation, but this does nothing to ease pressure on households in the private rental sector.

Ben Franklin, Director of Research & Policy at CPP said:

“These findings are a serious reality check for the levelling up agenda, which should worry the Conservative party following a fiscal statement devoid of any serious plan to tackle regional inequalities. People feel most pessimistic about their local area’s economic prospects in precisely the northern and post-industrial places where many placed their faith in the Tories for the first time in 2019 on the promise of levelling up.

“While there were some welcome moves in the fiscal statement on wages and support with the cost of living for people on low incomes, there was no core economic vision or plan to deliver the investment in transport, skills and housing that people want to see in their local areas.

“Meanwhile there is a widespread expectation that local areas will become more unequal, particularly in London. The Chancellor was right to identify growth as a key route out of our economic malaise, but we cannot repeat the same mistakes of the past by managing the economy in a way that drives inequality; this will only hold back growth.”