The West Midlands
History, geography and political context
The population of the three LEPs which make up the West Midlands Combined Authority is just over 4 million peopleii, and its central location means 90% of country’s population is within 4 hours’ drive.iii There are 1.7 million homes in the area, and over 2 million jobs across 145,000 businesses, with a business ‘birth’ rate of over 20,000 new businesses a year (around twice the UK average).
The West Midlands is the largest regional economy outside London. The areas covered by the Black Country, Coventry and Warwickshire, and Greater Birmingham and Solihull LEPs have a combined GVA of around £90 billion per year. This is larger than those of Greater Manchester, the Leeds City Region and the South East. The West Midlands LEPs have grown their GVA faster than those regions from 2010 to 2015 (see Figure 4 below).
This density of population and industry reflects the region’s history and identity, which were largely forged in the eighteenth and nineteenth centuries on the back of abundant local energy resources (particularly in the Black Country) and innovation, driven by the then prohibitive cost of skilled labourv. Strong sub-regional identities and economies persist to this day, with an emphasis on transport and mobility in the East (where Coventry’s heritage in transport and automotive grew out of over 250 companies manufacturing bicycles from 1870 onwardsvi) and metal processing in the West, where there are still over 240 medium-sized businesses within the LEP area focused on traditional metal forming and component production, largely for the high-technology and demanding aerospace and automotive supply chains.
The region has the highest concentration of manufacturers of any regionvii, and accounts for 9% of all manufacturing employment in Britain.viii It is home to world-class companies including Jaguar Land Rover (JLR) Aston Martin, UTC Aerospace, and Mondelez as well as much of their supply chains.
The West Midlands is Britain’s largest exporter after the South East and London.ix In 2016, the West Midlands exported goods worth £3.3 billion to China, more than three quarters of which were road vehicles. This represented 26% of all UK exports to that country, twice that of the next largest region. With imports from China of £3.5 billion, the West Midlands is the only region to achieve anything close to trade balance with what is predicted to become the world’s largest economy by 2030.x The West Midlands has secured more inward investment from China than any other region bar London - 52 projects in the past 20 years, and 30 in the past six – creating 2,500 jobs and safeguarding a further 1,500.
Area |
GVA in 2015 (£bn) |
GVA growth 2010 - 2015 |
| London | 378.4 | 27% |
| 3 LEP WM SIA Geography | 87.5 | 20% |
| South East | 85.8 | 18% |
| Leeds City Region | 64.6 | 14% |
| Greater Manchester | 59.6 | 16% |
Birmingham is Britain’s second city, and its population of just over 1 million makes up around a quarter of the total West Midlands populationxiii. It is a dense and thriving modern city, with many of the challenges common to cities worldwide in energy poverty, legacy infrastructure, and a need for new housing which puts pressure on the surrounding rural hinterland.
There are two further cities within the region which share similar challenges (Coventry (320,000 people) and Wolverhampton (260,000 people)) and seven metropolitan local authorities, as well as districts of Warwickshire, Staffordshire and Worcestershire which fall within the three LEP geography and have more rural economies. However, the region has a natural economic geography and political coherence because its existing transport systems and employment patterns mean a large part of the population of the WMCA area commute to and from work in the city centres.
key local stakeholders
The political geography of the West Midlands is evolving rapidly and is currently working reasonably well (evidenced for example by the GVA growth illustrated in Figure 4). The three LEPs and WMCA focus largely on specific agendas where working together at regional scale makes sense, for example around economic development, including transport, inward investment and skills; while the local authorities run public services and maintain the integrity of their respective geographical places.
All these bodies are properly democratically accountable, and the LEP Boards (which are supervised by elected representatives) have effectively engaged committed local business interests and academic institutions, including all the region’s eight universities.
Major energy-related corporates located in or close to the region include E.ON, National Grid, Calor, Cadent, JLR, Severn Trent, and UTC Aerospace. These represent a significant part of the GVA attributable to energy across the region (see Section 3) but a tiny fraction of the 10,000 businesses active in the energy sector across the regionxiv. Smaller businesses are represented on LEP Boards and sub-boards through organisations such as the EEF (formerly the Engineering Employers’ Federation) and Chambers of Commerce.
The West Midlands hosts substantial national research and innovation assets in the Energy Systems Catapult and the universities of Aston, Birmingham and Warwick, which are part of the Energy Research Accelerator. These universities have highly complementary research expertise in energy and all have contributed to this strategy in distinctive ways2. Wolverhampton, Coventry and Birmingham City University further enhance regional energy capabilities, particularly around energy in buildings, smart systems, local skills development, and industry engagement.