Stronger centres pull ahead as West Midlands growth remains ‘uneven’ – report

Investment in housing, transport and regeneration must be better aligned to spread economic growth, the West Midlands Combined Authority says.

The WMCA’s “State of the Region 2026” report, presented to the authority’s local scrutiny committee today, says economic output has now recovered to pre‑pandemic levels – with High Streets adapting to declining retail activity by becoming more focussed on leisure and hospitality.

The West Midlands’ major growth corridors and clusters are becoming “clearer and more investable”, the WMCA says, with particular strengths in advanced manufacturing, electric vehicles and batteries, next‑generation services, and green energy systems.

But the report warns that economic development is becoming centralised in stronger centres, risking a widening economic divide opening up between parts of the West Midlands.

“Growth is increasingly spatially uneven,” the report says.

“Economic gains are concentrating in stronger centres, while parts of the Black Country and other communities have yet to see meaningful improvement in living standards.

“Growth will continue to concentrate unless transport, regeneration, skills and housing investment are aligned to improve access and connectivity across the region especially for places most disconnected from opportunity.”

The conclusions come despite improvement in public transport links across the region backed by billions of pounds in fresh investment, intended to bring thousands of people closer to work.

Major transport programmes currently under way include the expansion of rapid transit corridors, extension of the West Midlands Metro, and the switch to a franchised bus system from 2027.

Compared to data from three years ago, an extra 30,000 jobs in the region are now accessible in 45 minutes via public transport.

Meanwhile, other major issues identified include the “central economic challenge” of long term sickness in the region, alongside deepening poverty and housing insecurity problems.

Low pay remains an issue, with in-work Universal Credit claims remaining stubbornly high, indicating that job quality and progression are not keeping pace with rising living costs.

Figures produced in March show around 144,000 people in the West Midlands claim Universal Credit, or 7.5% of the working age population.

The report says addressing these inequalities will require a coordinated approach across the public and private sectors, rather than relying on local authorities to tackle the challenges alone.

“The scale and interconnection of challenges – from health to housing to skills – cannot be solved by single institutions. A strong, shared regional narrative and coordinated action across local, regional and national partners are essential,” the report adds.

“The West Midlands State of the Region 2026 shows a region that has stabilised after a turbulent period, is beginning to strengthen in key parts of the economy, but where deep inequalities are hardening and now pose the central risk to future growth.

“The evidence shows that the conditions for growth in the region are improving, but the benefits are not yet spreading widely or quickly enough.”

The full State of the Region 2026 report can be read via the West Midlands Combined Authority website.