Cities Outlook 2014, the annual health check of UK cities, warns that economic recovery is widening the gap between London and other cities in the UK. London continues to be critical to the UK economy, creating almost 10 times more private sector jobs than the second fastest growing city, Edinburgh.

The report by the leading urban economic Think Tank, Centre for Cities, shows that London accounted for 80% of national private sector jobs growth between 2010 and 2012*. It also flags that, while most other cities are cutting public sector jobs, London has seen strong growth in the public sector too.  For every one public sector job created in London, two have been lost in other cities across the country**.

London’s success reflects and is supported by a booming population. One in three 22-30 year olds who move city move to London and when people start families in their early 30s, 60% of Londoners move out to the Greater South East, often staying in the London labour market.

In contrast to London, cities such as Bradford, Blackpool and Glasgow have seen job losses in both private and public sectors.  So while there is talk of an economic recovery at a national level, people living in these cities are unlikely to be feeling the effects of national growth.

While London is leading the recovery, there are welcome signs of growth from some other cities. Edinburgh, Birmingham and Liverpool have all created significant numbers of private sector jobs which have helped to offset the impact of public sector job cuts. In total, five of the eight Core Cities feature in this top ten list.

The following table shows one indicator of how cities have fared during recovery - the cities which have created the highest absolute numbers of private sector jobs since the 2010, and those which have lost the most jobs in the private sector.  It also shows the number of public sector jobs gained or lost in these cities from 2010 to 2012.

These figures show that London remains the UK’s economic power house and that the capital is pivotal to the UK’s future success.  As a hotbed for jobs, skills and productivity it is critical for the national economy, the Government can benefit from giving London additional freedom and powers to increase the amount of income it produces, with some of the additional money raised going to support investment elsewhere in the UK.

Outlook also shows that many of our other cities are improving their economic performance, but could do better if they respond to their distinctive strengths and weaknesses, which Outlook highlights. City Deals have been a very significant step; the next stage needs to be further devolution of the kinds of powers and freedoms currently afforded to London.

The UK is one of the most centralised countries in the developed world.  In the year that will see a referendum on devolution for Scotland, Cities Outlook 2014 urges all political parties to support the case for radical devolution that delivers the political powers and financial freedoms needed to enable cities to respond to their particular local economic circumstances and drive local economic growth.  

Alexandra Jones, Chief Executive of Centre for Cities said:

Cities Outlook 2014 shows that that the gap between London and other UK cities is widening, but that other cities are making progress. To enable cities to respond to their particular strengths and weaknesses the Government should build on City Deals and devolve more funding and powers to UK cities – London and others - so they can generate more of their own income and play to their different strengths. This will help ensure this is a sustainable, job-rich recovery across the country.”

ENDS

Cities Outlook 2014 can be downloaded from 00.01 on Monday 27 January at www.centreforcities.org/outlook14

For further information, to see an advance copy of the report or to request an interview please contact Rachel Morrisroe, Senior External Affairs Manager at Centre for Cities on 0207 803 4316 / 07748 183 026 / r.morrisroe@centreforcities.org

Notes to Editors

*2010 has been used as the starting point as it marks the beginning of the economic recovery.

**London’s public sector jobs growth was driven by increases in education and health, which largely respond to increased demand, and offset the nevertheless significant losses seen in public administration (e.g. local government and civil service jobs).

*** In our analysis, the public sector is defined as the Standard Industrial Classification (SIC) codes:

84: Public administration and defence

85. Education

86: Human Health activities

87: Residential care activities

88: Social work activities without accommodation

This differs to the definition of the public sector by the Office of National Statistics as we include further education, sixth form colleges and universities throughout the 2010 to 2012 period.

****It is important to note that private sector jobs, while important, are only one indicator of the success of city economies (and one that can be affected by movements in business headquarters, without this impact being felt as strongly in the local economy).

Cities such as Bristol, which continues to be the most successful large English city outside London on a range of factors including GVA, with all the fundamentals in place to grow, or Northampton, which is in the top ten cities for business starts, demonstrate the importance of considering urban success across a range of measures.

For a fuller picture of city economies across a range of indicators, download the full report at: www.centreforcities.org/outlook14

The Centre for Cities uses the Department for Communities and Local Government Primary Urban Area (PUA) definition of a city for the English urban areas included in Cities Outlook 2013.  Primary Urban Areas are an aggregate of local authorities that make up the ‘built-up’ area of a city, defined as having a population of 125,000 or more.

PUA data only exists for English cities. For Welsh and Scottish cities, we have used the corresponding local authority area, with the exception of tightly-bounded Glasgow, where we have defined the city as an aggregate of five local authorities: West Dunbartonshire, East Dunbartonshire, East Renfrewshire, Renfrewshire and Glasgow City. Belfast has been defined as the aggregate of Belfast City, Carrickfergus, Castlereagh, Lisburn, Newtownabbey and North Down.  The full breakdown is available at www.centreforcites.org/puas

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Rachel Morrisroe

Senior External Affairs Manager (maternity leave)
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