County areas should be given freedoms currently available to urban areas through City Deal arrangements, a report by Essex CC argues.

According to the study, City Limits, issued 6 September, devolved powers over economic growth should be made available in non-metropolitan areas, since analysis suggests they cannot be distinguished from the eight core cities which have already struck deals with Government.

In exchange for taking control of economic levers over investment and infrastructure, skills and training, eight first wave ‘core cities’ - Birmingham, Bristol, Leeds, Liverpool, Manchester Newcastle, Nottingham and Sheffield - have agreed to establish accountable local leadership and make efficient use of additional resources.

But while the core-city areas are home to 28% of the population, they are responsible for 24% of the Gross Value Added (GVA) productivity measure in England.

City Limits’ authors say these figures indicate economic performance and enhanced productivity is primarily driven by London and non-metropolitan areas – which contributed 25% and 51% of GVA respectively.

Each additional job in county areas such as Berkshire, Surrey and Buckinghamshire delivers around 40% more output than each additional job in City Deal areas such as Newcastle, Sheffield and Liverpool, the report notes.

A main reason for this productivity gap, the study infers, is that major cities specialise in declining industries, while county areas are home to more high-value, knowledge intensive manufacturing and service industries.

Cllr Peter Martin, leader of Essex CC said: ‘We agree with the coalition’s policy that local leaders, rather than Whitehall departments, are best placed to understand and address their own local economic issues and challenges.

‘However, we are missing a major trick if we simply concentrate our efforts to boost the economy on our cities and ignore the major part our county and non-metropolitan areas play in supporting the economy.’