The Corus steel works in Redcar announced 1,600 job losses earlier this year Middlesbrough is the area of England least resilient to economic shocks, according to BBC-commissioned research.
The study, carried out by Experian, looks at the ability of each local authority area to withstand and respond to sudden changes in the economy.
With further public sector cuts on the cards, it suggests how England’s regions may cope.
Each area is ranked in order of resilience, and a clear north-south divide is evident.
Middlesbrough on Teesside is followed by Mansfield in Nottinghamshire, which is the second least resilient area according to the research, and then Stoke-on-Trent which is the third.
Elmbridge in Surrey is the most resilient area in England, followed by St Albans in Hertfordshire and then Waverley in Surrey, the information suggests.
The research looks at four key themes; business, community, people and place.
Within these categories, a number of factors have been analysed, including the amount of vulnerable and resilient industry within an area, the life expectancy of residents, earnings of workers, unemployment and crime rates.
Today’s research reveals a clear north-south divide. It is a divide which is a legacy of government policy over decades.
The Tees Valley in general and Middlesbrough in particular are places which became rich on heavy industry.
William Gladstone famously went to the original town hall in Middlesbrough and proclaimed it an “infant Hercules”.
Go to the same spot now, as I did, and you find a sad, boarded-up building surrounded by wasteland and a few abandoned, crumbling houses.
The area found it increasingly hard to compete in global markets and, over time, government felt obliged to pump in state support to prop up and regenerate the declining economy.
The result is that a town like Middlesbrough has become state-dependent.
The BBC commissioned the research as part of The Spending Review: Making it Clear season, which looks at the government’s plans to make deep public sector savings.
The results of the coalition government’s spending review will be announced in October, when it will be revealed which departments will see their budgets cut and by how much.
The Experian research suggests Middlesbrough will be the least resilient to such public sector cuts.
It is ranked at number 324 out of 324 council areas. The Teesside town also appears as the least resilient in the business section.
Alastair Thomson, dean of Teesside University’s business school, said Middlesbrough had a high number of workers employed in the public sector, particularly in the NHS and education.
The three largest employers in the town were public sector, he said.
Public sector employment, along with other industries like construction, engineering and metals, is classified as vulnerable in the Experian research.
Mr Thomson said there was very little of the traditional heavy industry associated with Teesside and the North East left, but new industries were emerging.
“We are seeing a lot of growth in the digital sector,” he said. “It is an area we see as having a lot of potential for the future.
“Renewable energy is big business in this part of the world.
“We are a significant player in terms of bioethanol production.”
The North East as a whole does not fair well in the Experian study.
A special BBC News season examining the approaching cuts to public sector spending
Redcar and Cleveland, Hartlepool, South Tyneside and Sunderland are all in the bottom 20 of the overall resilience table.
One of the area’s large industrial employers, Corus steel works in Redcar, announced the partial mothballing of the plant and loss of 1,600 jobs in February.
John Crook lost his job at the plant in March after working there for 25 years.
He and his wife Jan decided to start their own catering business and obtained funding from their local council and from the government’s Business Link scheme.
Mr Crook said if such funding was cut by the government in the future, many people in Teesside would be unable to start their own business.
“I can only hope that the new government is sympathetic to the area, that there’s no north-south divide,” he said.
“We have relied very heavily on steel and heavy industry and most of that has gone now.”
He said the mood among former Corus workers who have been made redundant was very “downbeat”.
“There does not seem to be work out there,” he said. “What new skills can they bring to steel workers? That’s the worry.”
At the top of Experian’s resilience table is Elmbridge in Surrey, followed by St Albans in Hertfordshire.
St Albans also topped the business resilience section, which looked at a range of variables including the amount of vulnerable sectors, key high-growth areas, new business start-ups and the percentage of working-age population that is self-employed.
John Crook and set up his own business after being made redundant Mel Hilbrown, director of St Albans and District Chamber of Commerce, said the main industry in the city was knowledge-based, working in areas such as finance and consultancy, which had proved resilient in the recession.
“It’s always been quite entrepreneurial as an area,” said Mr Hilbrown, who is also executive director of the St Albans Enterprise Agency.
“In the last five to 10 years, it’s had a high number of business start-ups.”
He said the recession had provided opportunities for such businesses in the area, and the city’s proximity to London helped them.
“Even in the financial recession, things that the larger companies were not so interested in, there were businesses in St Albans starting to develop that niche.
“Small businesses can often be more resilient in a recession.”
The Spending Review: Politicians come face to face with the public across England to talk about the cuts. BBC One at 2235 BST on Thursday, and on local BBC radio at 0900 BST on Friday.
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