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Paul Ormerod: Whatever happened to all those miners?  Shocks and economic resilience

Thursday, April 18, 2013
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Where have all the miners gone?  To judge by the rhetoric of the BBC and other Leftist media outlets, whole swathes of Britain lie devastated, plagued by rickets, unemployment and endemic poverty – nearly thirty years after the pit closures under Lady Thatcher!

The reality is different.  There is indeed a small number of local authority areas where employment has never really recovered from the closures in the 1980s.  But, equally, there are former mining areas which have prospered.  


Thirty years ago, in 1983, there were 29 local authority areas in the UK, out of a total of over 450, in which mining accounted for more than 10 per cent of total employment.  A mere handful of areas still remain scarred by the closures. Wansbeck, on the bleak Northumbrian coast, had 21 per cent of its jobs filled by mining in 1983.  Now, employment remains 25 per cent lower than it was then.  Elsewhere, reality is not as bad as the image.

The old mining areas at the heads of the South Wales valleys are meant to symbolise industrial decay.  But in Merthyr Tydfil, there are 8 per cent more jobs than there were in 1983.  Admittedly, in Blaenau Gwent, based on Ebbw Vale, employment is 12 per cent lower. This is hardly permanent devastation.  In Easington on the Durham coast, miners made up no less than 41 per cent of all local employment.  But even after this devastating blow, losing almost half the area’s jobs, employment now is only 9 per cent lower than it was in 1983.   

In contrast, there are real success stories.  North West Leicestershire and South Staffordshire used to have lots of miners.  But employment in both areas is now some 40 per cent – forty! – higher than it was in 1983.

The experience of the individual mining areas differs dramatically in terms of their resilience, their ability to recover economically.  Three years ago, I published a short article in Applied Economics Letters on the changes in employment in all the mining areas between 1983 and 2002.  Total UK employment grew by 23 per cent, and in the ex-mining areas as a whole by just 9 per cent.  But it was growth and not decline.

A key influence on this has been the attitude of the workers.  Statistical analysis shows that the more militant an area was in the bitter and controversial miners’ strike in the winter of 1984/85, the less well it has done subsequently.  In Leicestershire, one of the success stories, only 10 per cent ever supported the strike in the first place.  In Wansbeck, support was 95 per cent, and even when the strike was ending rapidly in March 1985, 60 per cent were still out.

Economies have the capacity to recover from even the most dramatic adverse shocks, both at national and local levels.  But to do this successfully, the workers must be willing to embrace the future rather than cling to the past.

Paul Ormerod is an economist at Volterra Partners LLP, a director of the think-tank Synthesis and author of Positive Linking: How Networks Can Revolutionise the World




 

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