Skills and infrastructure ‘biggest barriers to Northern Powerhouse prosperity’
The Northern Powerhouse can accelerate its investment potential by building on existing strengths if key issues around skills and infrastructure are addressed.
According to design consultancy giant Arcadis, Northern Powerhouse cities rank among the most attractive in the UK for investment, with key locations including Manchester, Liverpool and Newcastle boasting a more balanced housing market, attractive business environment, lower cost of living and therefore often a better quality of life when compared with competitors including London and Birmingham.
The results are published in the latest Arcadis report “Investing in Britain: Cities Built for the Future”. The study ranks 24 of the UK’s key cities based on their performance across six key pillars deemed crucial for future inward investment and growth potential.
These are business environment; workforce and skills; infrastructure performance; housing; place; and city brand.
The report identifies three distinct groupings of cities, representing different economic profiles and subsequently a city’s relative attractiveness to future investment. These are established economic centres; future growth hubs; and smaller regional cities.
Established economic centres like London and Edinburgh require huge levels of investment just to accommodate continuing growth.
In contrast, the Northern Powerhouse benefits from a cluster of future growth hubs, including Liverpool and Manchester, which do not face the same pressure on housing and infrastructure that has resulted from the concentration of too much growth elsewhere.
In these cities, the agglomeration effect of industries such as aerospace and media has created a thriving environment for investment.
While some of the UK’s most attractive cities risk falling back down the rankings if fundamental issues around infrastructure and housing capacity are not addressed – as evidenced by London – the biggest barrier preventing Manchester and other Northern Powerhouse cities from moving further up is skills.
This will need to be urgently addressed through education, training and inward migration if the North is to maximise its future attractiveness to investors and citizens.
Evidence from around the world indicates that city agglomeration is most successful when supported by well-connected infrastructure.
This means that the realisation of infrastructure plans for the Northern Powerhouse are at the heart of future growth opportunities, and the success of the region in attracting future investment will create a further boost to sustainable growth.
Smaller regional cities need to consider different levers for attracting investment, building on their specific strengths and opportunities – including better access to schools and hospitals, cheaper housing and a better quality of life.
Arcadis city executive for Manchester Jonathan Moore said: “The Northern Powerhouse is home to immense investment potential and could become one of the leading agglomeration hubs in Europe.
“Cities like Manchester provide a springboard for leveraging existing strengths in the economy and quality of life, but the most important thing is to recognise which levers need to be pulled to ensure that all Northern Powerhouse cities continue to attract the type of investment they need.
“As with many parts of the UK, long term improvements around educational standards will prove crucial, as will ensuring our skilled workforce has sufficient access to jobs and homes. Boosting public transportation and cutting congestion must also remain a focus.
“Ultimately, as we’ve seen through the continuing positive impact of the Northern Powerhouse Partnership, the governance of a region needs to be structured in a way that encourages and facilitates inward investment.
“This will ensure that future opportunities are focused on the right locations, helping to accelerate balanced growth across the region and ultimately realising new sources of competitive advantage for the North.”
