By Jonathan Davies
Businesses located in Enterprise Zones have created nearly 20,000 jobs since the scheme started in 2012, according to government figures.
The UK's 24 Enterprise Zones say they have now attracted £2.2 billion of private investment and more than 500 new businesses across a range of key industries including the automotive, aerospace, pharmaceutical and renewable energy industry sectors.
Local Growth and the Northern Powerhouse Minister James Wharton said:
We are seeing enterprise zones across the country create thousands of jobs and billions of pounds of investment, boosting the local and national economy. This is testament to the hard work of local people making the most of opportunities the zones bring for attracting firms.
Having 19,000 new jobs on zones is a significant milestone and one which we will continue to build as part of the government’s long-term economic plan to rebalance the economy.
Britain is a great place to do business and there is much untapped potential local areas can build on, to make the most of their unique benefits, which is why more areas and businesses will be able to benefit from the support in a new wave of zones.
The government launched enterprise zones in April 2012 as part of its 'long-term economic plan' to re-balance the economy.
Businesses housed within Enterprise Zones benefit from tax incentives, simplified planning and superfast broadband for firms.
But do they work?
A report by the Work Foundation in 2011 found, based on a similar scheme operated during the 1980s, "that Enterprise Zones — or any policy which offers tax breaks or
incentives to businesses in concentrated areas — are likely to be ineffective at stimulating
sustainable economic growth in depressed areas".
It went on to suggest that it would expect any 21st century attempt to be "equally ineffective"
The report claimed that 80% of jobs created by Enterprise Zones are displaced from elsewhere, do little to promote "lasting economic prosperity" and cost at least £23,000 per job created.
In 2013, a report by the Financial Times found mixed reaction to relaunch of Enterprise Zones. It claimed that the benefits can take longer to come to fruition that politicians expect. It cited a National Audit Office belief that the government low growth schemes, which includes Enterprise Zones, were slow to create jobs and were "yet to demonstrate they were capable of achieving value for money".
As is the case with most government schemes, the government will praise the near-20,000 jobs created. But critics will question the quality of those jobs, where they came from and the value for money.