Recovery sees London pull ahead of other UK cities

Published on Monday, 27 January 2014 09:39
Written by Daniel Mason

Cities Outlook 2014, the annual health check of UK cities, warns that economic recovery is widening the gap between London and other cities in the UK.

London continues to be critical to the UK economy, creating almost 10 times more private sector jobs than the second fastest growing city, Edinburgh.

The report by the leading urban economic think tank, Centre for Cities, shows that London accounted for 80 per cent of national private sector jobs growth between 2010 and 2012. It also flags that, while most other cities are cutting public sector jobs, London has seen strong growth in the public sector too. For every one public sector job created in London, two have been lost in other cities across the country.

London's success reflects and is supported by a booming population. One in three 22-30 year olds who move city move to London and when people start families in their early 30s, 60 per cent of Londoners move out to the Greater South East, often staying in the London labour market.

In contrast to London, cities such as Bradford, Blackpool and Glasgow have seen job losses in both private and public sectors. So while there is talk of an economic recovery at a national level, people living in these cities are unlikely to be feeling the effects of national growth.

While London is leading the recovery, there are welcome signs of growth from some other cities. Edinburgh, Birmingham and Liverpool have all created significant numbers of private sector jobs which have helped to offset the impact of public sector job cuts. In total, five of the eight Core Cities feature in this top ten list.

The figures show that London remains the UK's economic power house and that the capital is pivotal to the UK's future success. As a hotbed for jobs, skills and productivity it is critical for the national economy, the government can benefit from giving London additional freedom and powers to increase the amount of income it produces, with some of the additional money raised going to support investment elsewhere in the UK.

Outlook also shows that many of our other cities are improving their economic performance, but could do better if they respond to their distinctive strengths and weaknesses, which Outlook highlights. City Deals have been a very significant step; the next stage needs to be further devolution of the kinds of powers and freedoms currently afforded to London.

The UK is one of the most centralised countries in the developed world. In the year that will see a referendum on devolution for Scotland, Cities Outlook 2014 urges all political parties to support the case for radical devolution that delivers the political powers and financial freedoms needed to enable cities to respond to their particular local economic circumstances and drive local economic growth.

Alexandra Jones, chief executive of Centre for Cities said: "Cities Outlook 2014 shows that that the gap between London and other UK cities is widening, but that other cities are making progress. To enable cities to respond to their particular strengths and weaknesses the government should build on City Deals and devolve more funding and powers to UK cities – London and others – so they can generate more of their own income and play to their different strengths. This will help ensure this is a sustainable, job-rich recovery across the country."

Source: Centre for Cities

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