Manchester’s economic recovery to lag Liverpool, says new City Tracker report
Liverpool’s economy will grow at a quicker rate than Manchester’s according to the latest Irwin Mitchell City Tracker report.
The stats, produced by the Centre for Economics and Business Research (Cebr), examine 50 locations across the UK and forecast future growth in terms of GVA and employment.
The report says Manchester’s economy will return to growth in the final three months of 2023, but at a slower rate than Liverpool and other large cities including Birmingham and Edinburgh.
It estimates the UK entered into a recession in the second half of 2022, and expects economic growth to resume in the second half of 2023.
Its analysis of Manchester’s economy reveals a contrast between its city centre’s economy and that of Greater Manchester. It estimates in the fourth quarter of 2022, GVA in Greater Manchester fell by 0.2%, while the centre was more resilient, seeing 0.7% year-on-year growth.
Several quarters of annual contractions are expected in 2023 as the effects of the recession hit. However, by Q4 2023, Greater Manchester is expected to see 0.1% annual GVA growth with employment rising by 0.6%.
Manchester’s city centre economy, on the other hand, is predicted to be 0.5% larger in Q4 2023 than it was in the final quarter of 2022. It is also expected to see a 0.9% increase in employment levels, taking headcount to 482,700. Key sectors that are expected to drive economic growth in Manchester include technology and advanced manufacturing.
Liverpool is expected to see its economy grow by 0.6% in Q4 2023. It is also estimated to build on its strong job creation position at the end of 2022 and grow headcount employment in Q4 2023 by 1.7%.
The report predicts Stockport’s GVA will grow year-on-year by 0.2% in Q4 2023, while Warrington, which was one of the fastest growing at the end of 2022, is expected to see the size of the economy stay the same at £8.2bn.
Josie Dent, managing economist at Cebr, said: ”2023 will be a difficult year for consumers and businesses in the North West, with the cost-of-living crisis expected to lead to falling economic activity. However, Cebr forecasts that economic growth will resume in the second half of 2023, with most cities expected to see an annual expansion in GVA by Q4 2023.”
Charlotte Rees-John, partner and head of Irwin Mitchell’s consumer sector, said: “Last year presented numerous challenges and the downward pressure on spending activity, which continues to be concentrated in the consumer sector, looks set to continue throughout the first half of 2023.
“The consumer sector has, however, been one of the most resilient, agile and innovative sectors in recent times and those businesses that succeed during 2023 will be in a very strong position to take advantage of a more stable economic environment in 2024.”
She added: “Considering longer term aspirations, such as the transition to carbon net zero, is something all businesses, irrespective of the sector they are in and the pressures that they are facing, need to do. ESG is fast becoming a priority for the majority, particularly at a time when there is huge pressure and scrutiny from consumers and investors who are increasingly making their decisions based on ethical as well as financial factors.”