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A shrinking national economy does not mean that every place will become poorer at the same rate. Nor does it mean that prosperity will disappear everywhere. It may become more local, more varied and less visible in national statistics.

The United Kingdom could evolve into a patchwork of economic postcodes. Some localities would continue to contract. Others would discover new forms of prosperity, not measurable in industrial terms, based on their land, skills, water, buildings or position.

This would not be growth as understood from the top down. It would not necessarily produce rising GDP, expanding financial markets or growing consumer spending. It would be prosperity measured through sufficiency, security and the quality of everyday life. Maybe not called “prosperity”.

The end of the uniform national economy

The industrial economy encouraged places to become specialised. One area made steel. Another mined coal. A third manufactured cars. Food, energy, materials and manufactured goods were transported across the country.

Cheap energy made this possible. Rising energy and infrastructure costs will gradually weaken it.

As the national economy shrinks, places will become more dependent on what can be produced, repaired and maintained nearby. Their fortunes will increasingly diverge.

One locality might possess fertile soil, reliable water, orchards, market gardens and food-processing workshops. Another might have poor soil, few practical skills and a population dependent on distant employers. Their experiences of economic shrinkage would be very different.

The national economy might be shrinking while particular economic postcodes remain busy, productive and reasonably prosperous.

Food-prosperous localities

Imagine a locality with good agricultural land, several villages and a small market town. It has dairy farms, orchards, vegetable growers, a flour mill, a bakery, a slaughterhouse and workshops able to repair agricultural equipment.

As national supply chains weaken, this locality becomes increasingly valuable.

Its prosperity would not necessarily appear as economic growth. Local food might replace food previously transported from hundreds or thousands of miles away. A local workshop might repair machinery that would once have been replaced. Families might preserve fruit, share tools and grow vegetables.

These activities could reduce measured spending. Nevertheless, people would have food, useful employment and a functioning community.

The locality would be prosperous in the things that mattered, even though its contribution to the quantified industrial economy might appear small.

Land that had been used for horse paddocks, lawns or speculative development might return to food production. Empty shops might become bakeries, stores, workshops and food-processing premises. Young people could find work in horticulture, forestry, food preservation, building maintenance and care.

This would be an economy of provision rather than consumption.

Energy-prosperous localities

Other localities might prosper because of energy.

A wooded district could develop a wood economy based on coppicing, timber, charcoal, firewood and woodland crafts. An upland locality might use small hydroelectric schemes. A coastal settlement could combine fishing, wind power and boat repair. A farming area might produce modest amounts of biogas from agricultural waste.

These places would not become entirely self-sufficient. They would still need national electricity networks, telecommunications, medicines and specialist machinery. But local energy would provide a degree of protection against rising national costs and unreliable supply.

Energy prosperity would attract activities that needed dependable power. Small food processors, cold stores, sawmills and repair workshops might gather around such places.

The economic map would begin to change. People might move towards localities with food, energy and useful work rather than towards the places offering the highest salaries.

The return of economic migration

This would not be entirely new.

When work disappeared from one industry, workers historically moved to another. Slate quarry workers from the Corris area, for example, migrated to the South Wales coalfield. Their skills, strength and experience of dangerous manual work could be used in a different industry.

Similar movements could occur in a shrinking economy.

A town dependent upon warehouses, commuting, tourism or discretionary retail might lose employment. Some of its working population could move towards localities where food, forestry, maintenance and essential production were expanding.

The movement might be gradual. A family could retain its original home while one member worked seasonally elsewhere. Young people might move first. Empty houses in productive rural towns could be occupied by workers, while housing in less viable commuter settlements declined in value.

Not every locality would survive in its present form. Some places exist because of economic arrangements that may no longer be affordable. Their decline could be unavoidable.

Government could not prevent all such change. Attempting to preserve every existing pattern of settlement and employment would consume resources needed elsewhere.

How government could enable natural evolution

Government would not create these new local economies. They would emerge because people responded to necessity and opportunity.

Government’s most useful role would be to stop obstructing them.

Planning rules could allow farm buildings, empty shops and redundant public buildings to become workshops, food stores and small processing premises. It could become easier to build modest homes for people working locally.

Regulations designed for large industrial businesses could be simplified for small producers. A village bakery, cheesemaker or slaughterhouse should not face the same administrative burden as a national corporation.

Public purchasing could favour nearby production where practical. Schools, hospitals, care homes and military establishments could buy more food from their surrounding localities.

The tax system could recognise very small businesses, cooperatives, household production and exchanges partly conducted through goods or services. Not every useful transaction needs to be forced into the structure of a conventional company.

Government could also preserve the national foundations upon which localism depends. These include telecommunications, the electricity grid, railways, defence, specialist hospitals, a functioning currency and the rule of law.

Its task would be to maintain the framework. The detailed economy would be created from below.

Unequal but different

These economic postcodes would not all be prosperous in the same way.

One might have abundant food but little cash. Another might possess hydroelectric power and engineering workshops. A third might specialise in timber, textiles or care. A market town could prosper as the centre where several surrounding localities exchanged their surpluses.

There would also be struggling areas. Large cities might find it difficult to secure affordable food, water and energy. Former commuter settlements could lose their economic purpose. Coastal resorts dependent on discretionary spending might contract sharply.

Government would face pressure to redistribute resources from successful localities to unsuccessful ones. Some redistribution would remain necessary. But excessive extraction could weaken the very places producing the essentials upon which everyone depended.

The objective could no longer be to make every area economically identical. It would be to help each locality discover what it could sustain.

Prosperity without growth

This future would confuse conventional economists.

A locality might produce more food, employ more people and become more resilient while showing little monetary growth. Households might consume fewer imported goods but enjoy better food and stronger communities. Repair, reuse and shared ownership might reduce retail sales. Lower incomes might coexist with greater security.

National GDP could continue to fall.

Yet within that shrinking total, some economic postcodes could become better places in which to live. They would possess the essentials of life. They would offer useful work. Their prosperity would come from producing what people needed rather than encouraging them to consume what they did not.

No government could design this pattern in advance. It would be too complicated, too local and too dependent upon human initiative.

It would evolve naturally.

Government’s challenge would be to recognise what was happening, protect the essential national framework and give localities enough freedom to find their own future.