Economic futures in the UK

The UK's economy in 2024 looks very different from 1970. Heavy industry has shrunk; services dominate; new tech and creative clusters have grown. AQA expects you to explain why and to evaluate the regional impacts.

Causes of economic change

• De-industrialisation — closure of coal mines, steelworks, shipyards from the 1970s. Causes: cheaper imports (Chinese steel), exhausted resources (UK coal seams), falling demand, unprofitable post-privatisation. Steel: from 24 m tonnes/year in the 1960s to ~6 m today.
• Globalisation — TNCs locate where costs are lowest. Manufacturing offshored to Asia; UK retains design and headquarters but not assembly.
• Government policy — privatisation under Thatcher (1980s) closed unprofitable nationalised industries; later EU/single-market access (1973–2020) helped financial services; Brexit (2020) created new frictions.

The post-industrial economy

• Services ~80 % of UK GDP — finance, healthcare, retail, education, public sector.
• Information economy — software, data analytics, AI. UK is Europe's leading tech market (~$1.1 trn valuation, 2024).
• Service-sector growth — Canary Wharf transformed from disused docks (1980s) to financial centre with 130 000 jobs.
• Research-driven — UK universities attract overseas talent and spin out tech companies (DeepMind from UCL, sold to Google 2014).

Science and business parks

• Cambridge Science Park — UK's first (1970), founded by Trinity College. 130+ companies, 7 000 staff. Hosts AstraZeneca, ARM Holdings (chip designs in 95 % of smartphones).
• MediaCityUK Salford — relocation of BBC departments (2011) and ITV; over 8 000 jobs in TV, radio, digital. Built on former docks.

These cluster firms with universities and other businesses (positive externalities), incubate start-ups, and use ex-industrial land.

Rural change

Two contrasting pictures:

• South Cambridgeshire — population grew 25 % in 20 years; commuter villages, high house prices, diversified farming (vineyards, B&Bs).
• Outer Hebrides — population fell 13 % since 2001; ageing demographic; school closures; reliant on fishing, crofting and tourism.

The pattern: near prosperous cities → growth; far from cities → decline.

Transport improvements

• HS2 — high-speed rail (Phase 1 London–Birmingham, 2026 due, £100 bn). Aim: cut journey times, rebalance growth.
• Crossrail / Elizabeth Line — opened 2022; 200 m journeys in first year.
• Heathrow — proposed 3rd runway (still political).
• Smart motorways — controversial after deaths M1M62; some converted back.
• Northern Powerhouse Rail — proposed Liverpool–Manchester–Leeds upgrade.

North–South divide

• South: higher GDP per capita, lower unemployment, higher house prices.
• North: lower wages, higher unemployment, hosts most ex-industrial cities.
• 2014 Northern Powerhouse and 2019 Levelling Up policies aim to reduce the gap. Mixed evidence so far: Manchester has thrived, but Stoke and Blackpool still struggle.

UK in the wider world

• Commonwealth — 56 nations, trade and aid links.
• EU exit — Brexit complicated trade, especially fishing and agriculture; financial services lost some EU passporting.
• Trade deals — UK signed deals with Japan (2020), Australia (2021), CPTPP (2023).
• G7 / G20 — UK still 6th-largest economy by GDP.

Examiner tips

• Use named examples for every sector — Cambridge Science Park (tech), MediaCityUK (creative), Canary Wharf (finance).
• Always tie de-industrialisation to a specific industry (steel, coal, shipbuilding) and date.
• For 9-mark "evaluate" questions, contrast successful regions (London, Cambridge) with struggling ones (Outer Hebrides, parts of north-east) and finish with a balanced judgement on whether levelling-up has worked.