The counties and unitary authorities of the South East include Bracknell Forest, Brighton and Hove, Isle of Wight, Medway, Milton Keynes, Portsmouth, Reading, Slough, Southmpton, West Berkshire, Windsor and Maidenhead, Wokingham, Buckinghamshire, East Sussex, Hampshire, Kent, Oxfordshire, Surrey and West Sussex.

The South East is one of the most prosperous regions in the UK, with unemployment figures lower and per capita GDP higher than the respective national averages. However, these figures disguise the fact that there is considerable variation within the region. For example, in a report published by the Office for National Statistics in 2002, the claimant count rate in the Isle of Wight was 5 per cent, while in West Berkshire it was only 1 per cent. Furthermore, areas such as Brighton and Hove, East Sussex, the Isle of Wight, Kent and Medway have per capita GDPs consistently below the average for the UK.

Economy:
Whilst there is variation within the region, in general the economy of the South East is strong and has the second highest GDP of any region in the UK after London. Unemployment has been steadily falling and in 2001 the ILO unemployment rate and claimant count rate stood at 3.1 per cent and 3.2 per cent respectively. This compares to figures of 6.2 per cent and 7.3 per cent in 1996.

Service sector industries dominate the economy, although the manufacturing sector is still important to the region. The South East England Development Agency (SEEDA) states that the South East has the largest manufacturing economy of the UK regions, with in excess of 20,000 manufacturing SMEs employing approximately 12 per cent of the area's workforce. Since early 2002 work has been underway to set up a Regional Centre for Manufacturing Excellence based at Hook in Hampshire. The centre is part of a £15 million initiative to boost manufacturing in England and Wales and provide support to manufacturers in the South East. However, according to the TUC, figures published by the government show that the number of manufacturing jobs in the region fell by 13,000 between 1999 and 2002. In contrast, some 196,000 jobs were created in the service sector during the same period. Some of the most prominent companies located in the region include American Express, Ericsson, IBM, Microsoft, Nokia, Pfizer, Sony, Sun Microsystems and Vodafone.

Despite the large rural areas of the South East, the traditional industries of agriculture, fishing, forestry and hunting make up only a relatively small part of the regional GDP, contributing in the region of £900 million a year. However, certain parts of the region, such as areas along the south coast and on the Isle of Wight remain largely dependent on agriculture.

Local Infrastructure:
The South East benefits from a well developed transport infrastructure, with good national and international connections. However, congestion is becoming increasingly problematic. In response to this, and with the aim of delivering a more sustainable pattern of development, the Regional Assembly formally launched a transport strategy for consultation at the end of June 2002. The Strategy identifies several priorities for the regions transport system including better links with London and other regions and to move away from the present domination of cars and lorries. Perhaps the most far-reaching priority is to reduce the rate of traffic growth over time by uncoupling traffic growth and economic growth.

According to a report published by the Department for Transport in 2001, the South East handles approximately a quarter of all aircraft traffic in Great Britain. The region's two main airports, Southampton International Airport and Gatwick Airport in West Sussex, provide excellent connections to numerous national and international destinations. Gatwick, the world's busiest single runway airport, provides both scheduled and cargo services to all parts of the globe, while Southampton has scheduled services to approximately 20 UK and European destinations. Both airports have good local transport connections, which include their own designated railway stations. The world's busiest international passenger airport, Heathrow, also lies within easy reach of much of the South East in the adjacent region of Greater London.

The South East is home to 11 ports spread throughout the region. Two of these, Sheerness and Southampton, are Free Trade Zones allowing goods and services to be processed or transacted without being subjected to taxes, duties or certain government regulations. The Port of Sheerness is one of the main importation points for wood products, fresh produce and cars, while Southampton is the country's principal cruise and vehicle-handling port. It also deals with nearly half of the UK's Far East container trade.

Portsmouth is one of the country's most successful municipal ports and is famous as a Royal Navy port and maintenance base. In 2001, the port handled in the region of 560,000 tonnes of imports and almost 693,000 tonnes of exports.

Dover is the UK's largest passenger-ferry port and is also one of the country's top four cargo handling locations by tonnage. Thamesport (Isle of Grain) in Kent is one of Europe's busiest container ports, covering a total area of 214 acres and offering nearly 17,500 metres of dry warehousing. Other ports in the region include Chatham, Folkestone, Newhaven, Ramsgate New Port, Shoreham and Thames Europort Dartford.

The Channel Tunnel provides the region with direct access to mainland Europe. Many of the Eurostar passenger trains, which depart from London Waterloo, stop at Ashford International in Kent. The new Ebbsfleet 'parkway' station in north Kent, due to open in 2007, will also be served by Eurostar international trains in addition to providing domestic connections with London St Pancras, Stratford, Gravesend, the Medway towns and east Kent. The 'Le Shuttle' service operates approximately 72 crossings each day carrying passengers and their vehicles, as well as driver-accompanied lorries, from Folkestone to Calais.

Local Workforce:
The South East has a labour force in excess of 4.1 million people. About 53 per cent of the working population are educated to at least A level standard, while just 9 per cent have no qualifications at all. Furthermore, according to the Government Office for the South East, the region is above the UK average in all but one of the National Learning Targets. However, the South East suffers from skills shortages in areas such as IT, management and languages. As part of an effort to rectify this the South East England Development Agency (SEEDA) spent £5.5 million on learning and skills issues during 2001, including £2.8 million on projects, initiatives and studies related to management skills and links with business. SEEDA has also set up a Workforce and Social Dialogue Committee to advise on the development of the regional workforce. The committee brings together a variety of bodies such as the regional Trade Union Congress and Confederation of British Industry as well as a number of public and private sector employees.

Business Costs:
The cost of office space in the South East varies throughout the region. In a survey conducted by City University Business School and Actium Consult in 2001, Reading and Guildford had a combined office rental and rate cost of £434.44 and £412.77 per metre squared per annum respectively. In Southampton the figure was £263.59, while in Basingstoke the figure was £293.28. In the same survey, the cost in the city of London was £858.99, while in Edinburgh it was £439.92 and in Cardiff it was £257.06.

In the New Earnings Survey 2001 published by the Office for National Statistics, wage costs in the South East were just under 6.5 per cent greater than the average for Great Britain.