Leeds named most improved city in major PwC report

Leeds has been ranked as the number one most improved city in an annual report which measures the performance of 42 of the UK’s largest cities.

PwC’s Good Growth for Cities 2017 index uses ten categories defined by the public and business as key to economic success, as well as personal and family well-being.

These include employment, health, income and skills; the most important factors as judged by the public. Housing affordability, commuting times, environmental factors and income inequality are also included, as well as the number of new business starts.

While the highest ranked cities are still mostly in the South of England, except for Edinburgh, the top 10 improvers in the 2017 index include Leeds, Newcastle, Liverpool, Birmingham and Derby. The report suggests that the North of England and the Midlands are steadily narrowing the gap. Only London and Southampton from the South are among the top 10 improvers relative to last year’s index.

Nearly 70% of all UK digital technology investment in 2016 was into regional clusters outside London, where tech businesses raised more than £4.6bn. Leeds is now home to 23,734 digital jobs, 314 start-up births and has a tech sector growth potential of 92%.

The analysis also shows that most of the Government’s 12 ‘opportunity areas’ do not score well against the measures of ‘skills’ and ‘new business starts’. Ten of the areas performed below the average of all cities in the index against both of these measures.

However, Doncaster has performed better recently on new business starts and Norwich is slightly above the UK city average for skills.

The 12 opportunity areas selected are: Oldham, Blackpool, Bradford, Doncaster, Scarborough, West Somerset, Norwich, Derby, Fenland & East Cambridgeshire, Hastings, Ipswich and Stoke-on-Trent.

John Hawksworth, chief economist at PwC, said: “The UK has been a great job-creating machine in recent years and this has driven improvement in our good growth index this year across all major UK cities. On average across the UK, the index is now at its highest level since it began in 2006 and all regions have benefited from this upturn.

“But there has also been a price to pay for this in terms of worsening housing affordability, increased average commuting times and more people having to work long hours. The cities that are highest ranked on the index also tend to suffer the highest price of success.”

Index scores for all 38 Local Enterprise Partnership (LEP) areas in England were also revealed.

A total of 88% of LEP areas now have index scores above the 2011-2013 average, with Oxfordshire remaining the top performer. As with the overall index for cities, higher scores for more affluent areas are seen, particularly in and around the Home Counties.

For LEPs, not every area experienced an improvement in score between the two periods, although this was the case for the great majority of areas. Some of the biggest improvements have been measured in LEP areas in the North and Midlands, with Liverpool City Region and Leicester and Leicestershire showing the strongest performance, closely followed by Black Country and the Humber.

York, North Yorkshire and East Riding were among the highest performing areas. Improvement in LEP scores since the 2016 report has reduced the number of areas with scores materially below the 2011-13 average.

Paul Terrington, PwC head of regions, said: “We’ve seen broad-based improvements in our good growth index across the UK, driven in particularly by falling unemployment rates. Some areas that had lagged behind in the recovery from the financial crisis are now showing clear improvements, so it’s clear that the recovery is now spreading across the entire UK.

“However, we are also seeing the price of prosperity in terms of growing pressures on scarce resources of housing, transport and skills. If the regional cities are to sustain the strong recovery and performance of recent years, it will be critical to address these challenges as part of cities’ growth strategies, rather than trying to fix the problems when they become constraints on growth.”