New figures show that regional inequality may be enhanced rather than reduced by new technology.The phrase ‘north-south divide’ may well be superseded by ‘digital divide’ to denote those areas where business start-ups and e-commerce capability is booming, and those where it is not.
The new divide is not as easy to define geographically, with different areas of London for instance proving to have startlingly different levels of growth.
The Government’s new figures come partly from VAT registration figures for 1999, which are taken to reflect the level of new business start-ups, and which show serious disparities across the country.
Within the Greater London area Camden had a rate of 146 new start-ups per 10,000 residents, more than four times Greenwich’s rate of 32. No area of the North East reached the UK average of 38 start-ups, whilst Wellingborough and Mansfield, both in the East Midlands, had rates of 90 and 23 start-ups respectively.
The DTI’s International Benchmarking Study 2000 showed wide regional variations in the percentage of businesses trading on-line. It also showed that while 79 per cent of businesses in London have a marketing website, only 60 per cent in the North West do, and 58 per cent in the South West.
Stephen Byers says that the action to encourage those areas getting on-line more slowly should come at local level. He’s encouraging local councils to do more to encourage new businesses to grow and to help existing and traditional industries to adapt to the new global internet economy.