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Recession hits SW population growth - a little less pressure on housing but not good for growth

24 June 2010

By Donald Barr, Economics and Evidence Manager.

Figures published today by the Office for National Statistics, estimate that the resident population in the South West region grew by 0.4% in the year to mid-2009, barely half of the pre-recession rate and well below the UK average.

According to these estimates, since the start of the recession annual net international migration has dropped below zero - more are leaving than arriving - and internal migration has fallen by a third from 29,000 a year to 19,000. These are understandable effects of the recession as the UK generally has become a less attractive destination for European workers, and conditions in the housing and investment markets have created very difficult conditions for many who would otherwise have been planning to retire to the region.

Although this slowing in the rate of population growth offers a slight amelioration for the imbalance between supply and demand in the housing market, this is almost certainly outweighed by drastic fall in new home building over the same period. For the SW economy more generally, there will clearly be less growth arising from the inflow of migrant workers and there will be a smaller benefit from the wealth brought by people retiring to the region.