Lunar Society Lecture: Adonis on Birmingham’s ‘crisis’

In this extended excerpt from Lord Adonis’s Lunar Society Annual Lecture, the Labour peer outlines the challenges faced by Birmingham:

I care passionately about the future of our cities.  Nearly half of Britain’s population live in conurbations.  Birmingham dominates the second largest. There was hardly a month as a minister when I was not in Birmingham on some business or other, and I am convinced that there is no bright future for Britain unless there is a bright future for Birmingham.  You have imposed on me the obligation to consider how the city’s future can be secured, so here goes.

In my view, Birmingham faces something of a crisis. 

The city has great strengths.  Natural strengths of location in the heart of England.  Strength and pride in ethnic diversity and an instinctive internationalism.  Great cultural institutions.  It has built on these strengths in recent years. 

The city centre is rejuvenated. Symphony Hall, the canal district, the International Convention Centre, the National Indoor Arena.  New Street Station, the worst railway eyesore in Britain, is being rebuilt, thanks to creative leadership by Mike Whitby – just as Dick Knowles and Albert Bore before him deserve great credit for the ICC and NIA.  There are three popular universities, and the city’s schools have improved in recent years. Your health sector is strong and growing. 

But while all this and more is positive, the big picture for Birmingham looks to me to be bleak unless there is big change. Not more incremental change, but radical transformation under strong, purposeful civic leadership.

Birmingham’s population is still 100,000 down on its peak fifty years ago.  Despite this – or partly because of it, urban economists tell me – the city’s unemployment rate is more than twice the national average, now at over 11 per cent, whereas London and Leeds are only marginally above the national average.  Birmingham also has one of the lowest employment rates in the country, 61 pc against 70 pc nationally.  London and Leeds, again, are at about the national average.

This relates to two further stark facts: Birmingham has very low productivity and it is excessively dependent on public sector jobs.  In Birmingham’s shift from manufacturing to services over the last 35 years, it is public services that have predominated.  One in three jobs in the city are now in public services, compared to one in five in financial and business services.  Only one in ten jobs are now in manufacturing.
According to economic projections prepared for the city council, Birmingham’s employment is forecast to be 4 pc lower in 2020 than in 2008, compared a static national position by 2020.  
In the five years to 2008 the city gained 10,000 public sector jobs but lost 3,000 private sector jobs.  Now the losses in the public sector are starting too.  A month ago the city council announced 2,000 job cuts, with many more to come.  Stephen Hughes, the council’s chief executive, was quoted as saying: “The scale of cuts is likely to be of a magnitude that no one has seen. My life in local government goes back to 1979 and there has never been anything as bad as this.”  I’m not sure this will console the city’s army of future unemployed.   
Underpinning all this is perhaps the most worrying statistic of all.  Birmingham almost tops the league of Britain’s low skill cities.  More than two in ten of the city’s residents have low skills, compared to 12 per cent nationally.  Greater London is, remarkably, better than the national average on skills. Of our major cities, only Leicester is worse placed than Birmingham in skills – and Birmingham only fractionally beats Liverpool, which, again, isn’t I suspect much consolation. Liverpool has lost nearly half its population in the last 50 years.  

Given Birmingham’s poor employment and skills base, the deep deprivation which afflicts so much of the city is not hard to explain.  Nearly two-thirds of children in the city live in households with low income.  Infant mortality – incredibly – is almost twice the national average, worse than in Cuba and on a par with Bulgaria and Chile. 

Using international income per head data for cities worldwide, London ranks 44th, Birmingham 89th, below seven German cities: Munich, Frankfurt, Nuremberg, Hannover, Hamburg, Cologne and Stuttgart.