West Midland enterprises have consistently underperformed on the stock market since 1999, a study has revealed.
The UK Competitiveness Index 2005 also suggests that the Government's commitment to the UK enterprise economy is failing with national business start-up rates between 1997 and 2003 remaining stagnant.
The study, which tracks the changing competitiveness of the UK, includes a UK Regional Share Index that charts the progress of London Stock Exchange listed companies between 1997 and 2005.
With a base-point of 100 in 1997, the West Midlands had declined 32.9 index points to 67.1 in 2005 - the lowest regional performer. The list's top three were the South-west, Wales and the South-east.
Business start-ups between 1997 and 2003 have remained unchanged nationally at 3.2 businesses per 1000 people. The West Midlands, although under the national average, showed a slight increase from 2.8 business start-ups per 1,000 people in 1997, to 2.9 in 2003.
However, the author of the research, Dr Robert Huggins from the University of Sheffield, said that the West Midlands had underperformed generally.
He said: "The region has been particularly hit in recent years by the decline in manufacturing and we are yet seen a vibrancy in enterprise sector."
Dr Huggins also said the real winner had been the South-east with the rapid expansion of knowledge-based industries along the M4 corridor.
"Almost all of the successful regions have a hotspot of development. In the Southeast it is Oxford and in the east it is Cambridge.
"The West Midlands hasn't yet got this and research in the region needs to engage with business in the same way. There has been some development in this area, but perhaps it is more embryonic than people realise."
Dr Huggins sentiments were echoed by Jeremy Blackett, policy director of Birmingham Chamber of Commerce.
He said: "I think the competitiveness index has exposed a number of issues which are only just starting to be addressed in the West Midlands.
"Due to our manufacturing legacy our skills are is not as high as we might think and it has been difficult implementing strategies to freshen up workforce training.
"Whilst the physical regeneration of the region is well under way, human regeneration is far less developed."