Analysis by North East Bylines of new official statistics* reveals where the region’s wealthiest and most impoverished localities are to be found. We also show where the region fits into the national household prosperity picture.
The poorest places in the region are in or very close to the centre of Middlesbrough; and the richest are in Northumberland, close to the north-western outskirts of Newcastle.
The locality with the lowest total annual household incomes in the region is in the Central ward of Middlesbrough, with £24,900 on average’ and that with the lowest average net household annual income after housing costs (disposable income) is in neighbouring Ayresome, with an average of £16,800.
At the top of the North East tables for both total incomes and disposable incomes after housing costs is a locality within the Darras Hall, Stamfordham and Heddon area of Northumberland.. Households there enjoy total incomes averaging £60,100 and disposable incomes of £39,700 even after meeting their usually considerable housing costs.
Total incomes
While the income figure of £60,100 a year for the Darras Hall, Stamfordham and Heddon area makes it top dog in the North East, it is only enough to place it in 815th position out of 6,791 local areas (known as Medium Level Super Output Areas – MSOAs) in England. Every other region in England has at least one area with higher average household incomes.
According to the ONS’s own analysis, only 0.29% of MSOAs in the North East are in the richest 10% before housing costs, which is the lowest in England. In London it is more than 34%, and the capital is home to 47 of the 50 richest MSOAs in the country, including 13 in Westminster, 11 in Kensington & Chelsea and four each in Wandsworth and Camden.
In Yorkshire & Humber and the North East, respectively, 30% and 27% of all local areas are among the lowest 10% of areas before housing costs – higher proportions than any other part of the country. London has no areas in the bottom 10%.
The mean average total household income for all MSOAs in the North East is £37,338, the lowest in England; London households enjoy the highest incomes overall, with £58,709, while households in the richest MSOA in the capital, in Wandsworth, enjoy average incomes of £108,100 – 79% more than the North East equivalent – and those in the poorest area of the capital, in Croydon, have £38,600.
Disposable incomes
London, even with its high housing costs, still has 26% of its MSOAs in the top 10% for disposable income, but the North East, with its comparatively low housing costs, does not fare quite as badly by this measure. The region still has only a miniscule 1.17%, of MSOAs in the richest 10%, but that is still above the East Midlands, with 0.52%.(as well as Wales, with 0.48%) and the misery is spread more widely.
The £16,800 household income after housing costs in Ayresome, Middlesbrough, the poorest in the region, as mentioned above, is higher than the equivalents in the North West and West Midlands (both £15,700) and Yorkshire & Humber and the East Midlands (both £14,400). This is presumably because housing conditions in Ayresome are so appalling, and therefore relatively cheap.
While two of the 50 local areas with the lowest mean household disposable income nationally are in the North East (both in Middlesbrough), 29 are in Yorkshire & Humber region, including 11 in Bradford, six in Leeds, five in Sheffield, and two each in Calderdale and Kirklees. The East Midlands has a further 13 local areas in Leicester (8), Derby (3) and Nottingham (2). There are also six in the North West.
A quarter of the North East’s MSOAs are among the 10% lowest-income areas in England and Wales, which is more even than Yorkshire & Humber, with 22%.
Methodology
The figures, published this month by the Office for National Statistics (ONS), are estimates based on the 2021 Census and the Family Resources Survey and are subject to confidence (give-or-take) limits. They relate to 2020. Local area names used in this analysis refer to MSOAs, which have an average population of 7,200.. The statistics can be explored in detail on the ONS website. A list of MSOAs can be found on the House of Commons library website
Disposable net income means the sum of the income of every member of the household, from wages and salaries, self-employment, pensions, investments and benefits, minus income tax, national insurance, rates or council tax, maintenance or child payments deducted through pay and contributions to occupational pensions.
Household disposable incomes are equivalised, a process of accounting for the fact that households with many members are likely to need a higher income to achieve the same standard of living as households with fewer members. On the other hand, two people do not need double the income of one person to have the same living standards.
Comment
According to the ONS: “Focusing on the areas with the highest and lowest mean household disposable income offers insight into how income is distributed across England and Wales.”
No one with any knowledge of the North East will be surprised that the poorest localities in the region are in central Middlesbrough or that the richest are in and around Darras Hall. That is partly what makes the statistics so depressing; governments, local authorities and we, the general population as citizens and voters have known about it for decades, but nothing has changed.
The statistics, though only just published, are three years out of date. But no one will believe that there has been any significant improvement in Middlesbrough or other impoverished areas of the North East during the intervening period.
It is now four years since the government was elected on a manifesto pledge to level up left-behind areas. Ministers may say that billions is being poured through levelling up funds under a variety of names into mayoral combined authorities like Tees Valley and local areas across the country, and so it is. But there is a long way to go before people in places like Ayresome approach anywhere near the household prosperity of those in Darras Hall and other prosperous parts of the region, never mind Wandsworth.
*Income estimates for small areas, England and Wales: financial year ending 2020. Office for National Statistics. 11 October 2023. Available here.
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