Guest column: Talent heads North as opportunities open up

Victoria Jordan, managing partner and head of energy and infrastructure practice, Holmes Noble, Manchester, on how UK talent is migrating from the South

The concept of cutting costs by moving operations to a lower-cost economy is far from new. 

We have become accustomed to call centres located offshore and manufacturers who have relocated to Eastern Europe or China to reduce overhead costs and maintain or boost  margins. 

However, in the professional and service sectors, where issues such as language and communications are more critical, businesses are increasingly looking to ‘North-shoring’, rather than offshoring.
 
The region’s large talent pool – coupled with its attractive lifestyle and affordable living – are serving to attract investment which brings opportunities including attracting more talent.

Experts from Oxford Economics are quoted as saying that Manchester has performed ‘incredibly well’ over the last five years and the driver of its growth has been the professional services industry.  7,800 new jobs are predicted to be created in Manchester by 2020 which should make Manchester one of the top ten, fastest-growing places for jobs in law, finance, management consultancy and advertising outside London.
 
With house prices in London and the South-East making it increasingly difficult to attract and retain talent, a diagonal move to the North-West is proving to hold great appeal for many businesses – and the results can be seen in the economic growth of the Northern Powerhouse. 

Growth in employment opportunities in the region is evidenced by major investments, including £800m in Airport City and £235m for the Sir Henry Royce Institute for Advanced Materials. 
Across the North, significant infrastructure projects such as HS3 between Leeds and Manchester and the widening of the M62 plus upgrades to other major highways also appeal to businesses looking to ‘North-shore’.

The energy sector is an increasingly significant employer in the region. The £10bn investment in Sellafield is predicted to create up to 21,000 jobs while in the Cheshire and Warrington economies, the energy-related sector comprises around 900 companies, 19,000 jobs and £2.8 bn of sales per annum with significant growth potential.
 
The region is also regarded as a centre of excellence in other sectors. It has 23 universities, six of which are ranked in the top 20 for research, nationally. 

It also has the largest financial services sector in the UK regions outside London and the report ‘Beyond the City’ puts employment growth in Manchester at 3.8 per cent between 2015 and 2020 which will see it outperform cities such as Paris, Berlin and Tokyo.

Of businesses already located in Greater Manchester, the GM Business Survey 2016 states that 65% anticipate an increase in employment over the next year of up to 20% – with 15% looking to grow in terms of employment opportunities by over 50%. This, of course, is incremental growth from businesses already established in the area.  

What is really boosting job opportunities, outside of major ‘indigenous’ projects like Sellafield, is the region’s ability to attract inward investment. 

The large-scale and rapid expansion of the service sector, particularly financial and professional services which together account for a sixth of employment and a fifth of GVA and businesses – are driving this investment.
 
One of the greatest catalysts for change in the region was the BBC’s mass migration to Salford Quays in 2011. 

As of March 2015, there were more than 2,500 full-time equivalent employees based at the BBC’s Salford site.  While a third of those employees were already in the region, around a third moved from London.  With MediaCityUK forming a hub for digital firms, around 6,500 people are now employed at the site with forecasts suggesting continuing growth which will call for a ‘skills migration’ to the North-West.
 
A key factor in encouraging talent to move to the region is the cost of living when compared to the South.
 
A survey by WiredScore found that 63% of tech workers cited Manchester property prices as the reason they preferred it to London and there is a strong drive in the city to ensure that the provision of housing meets the aspirations of the growing workforce.
 
Manchester Place, a partnership between Manchester City Council and the government, has been set up to drive forward both the new home building needed to support the city’s economic growth and to rejuvenate the city’s leisure and cultural offering. 

Although demand inevitably pushes up the cost of accommodation, Manchester City Council is keen to avoid London’s inflated prices, recognising that when housing costs exceed a third of household income, they become unaffordable.

Another recent indicator for ‘North-shoring’ growth, is the announcement from one of the top five global law firms about plans to open a new office in Manchester to provide business services currently provided from a global services office in Los Angeles.  Latham & Watkins, which employs 300 people, chose Manchester for its “large and highly qualified talent pool”. 

What we are seeing now in the North, in the 21st century, is as significant in its impact as the industrial revolution of the 19th century in its transformative effects.  Manchester has become a hotbed for companies in the digital sector and a number of leading global companies have national and international offices in the region – and there is still scope for huge growth.  

The combination of energy and opportunity that abounds will inevitably see many more businesses reaping the benefits of ‘North-shoring’ and that, in turn, will make the region a number one destination for top talent.