Yorkshire’s cities expand but Manchester dominates
Yorkshire’s cities have seen their economies expand in 2016, but Manchester remains dominant in the Northern Powerhouse according to a new report.
Leeds’ economy grew by 2.4% in 12 months, with Bradford and Hull’s economies growing by 2.1% and Sheffield’s by 2.0% according to the report by Irwin Mitchell.
Though numerically the region’s cities dominated the list for the North, Manchester experienced the largest growth, at 2.8%.
Leeds saw employment levels increase by 1.1%, but was outstripped by Manchester’s performance which saw it increase employment levels by 1.7%.
Irwin Mitchell said Leeds ran the risk of falling behind other cities in its UK Powerhouse report, in conjunction with the Centre for Business & Economic research.
It provides an estimate of GVA and job creation within 38 of the UK’s largest cities 12 months ahead of the Government’s official figures.
Though Manchester enters the country’s top three as a result of its performance, the law firm insisted that the government’s new industrial strategy would not be a “gamechanger” when it came to rebalancing the North-South divide.
It did however highlight that Manchester may be the exception in the Northern Powerhouse region partly as a result of the high shares of government investment, and new powers for the incoming metro mayor.
Mayors can extend strategies at city level, and have preferential treatment when it comes to funding. The report states that Manchester will benefit from nearly twice the amount as Leeds despite having a “significantly” smaller population.
Comparison of annual GVA growth in Q4 2016 (UK Powerhouse)
Andrew Walker, partner and head of business legal services at Irwin Mitchell in Leeds, said: “Leeds has a longstanding reputation as a leading financial services sector and although this will no doubt continue, there is also a shift towards it becoming a centre of excellence for tech with the likes of Sky Bet choosing to set up base here in Leeds.
“The rise of Holbeck and the Southern Bank as a tech centre should also continue to contribute growth to the city and bring new innovative skills, helping further boost employment levels. 24,000 people are already employed in the city region’s digital sector and it is vital that this is supported in the future and allowed to flourish.”
Jack Coy, an economist at Cebr, said: “Looking at our 10 year forecasts of GVA, the best performing cities are set to still be those within current high growth regions of London, South East and East. The current rounds of investment are likely to have a positive effect in the North, but are not sufficiently higher than comparable investment in other regions.
“We expect impacts of the new industrial policies to be broadly equal upon most regions, rather than redistributive. A possible exception is Manchester, which is likely to benefit from network and clustering boosts, skills and institutions, high shares of government investment, and new powers for the incoming metro mayor.”
