What the geography of jobs in England and Wales tells us about the modern economy

Economic trends are concentrating jobs in cities. Policy should foster the benefits of 'agglomeration', and address the costs.

Over the past few months we have been busy mapping all the jobs that are located in our cities, and you can now view the results on the city pages of our website. Alongside these individual city maps, we thought it might be interesting to map the distribution and concentration of jobs across the whole of England and Wales. This is what that looks like:

England and Wales-01

The map shows the size of the workplace population in England and Wales in 2011, and clearly demonstrates that the economic geography of jobs is ‘spiky’ rather than ‘flat’.

Looking at the map, the following trends are worth highlighting:

  • The national economy is concentrated in very specific places: In 2011, 59 per cent of all jobs in England and Wales were located in cities despite accounting for just 12 per cent of landmass of England and Wales. And this was even more pronounced in city centres, which were home to 13 per cent of all jobs despite covering just 0.2 per cent of all land.
  • This concentration is most evident when looking at the high skilled, knowledge-based jobs: 69 per cent of all high skilled, knowledge-based jobs in England and Wales were located in cities. And these jobs favoured city centre locations in particular: 28 per cent were located there.
  • Big cities have big ‘spikes’: In 2011 there were more than 1 million jobs in each of Manchester and Birmingham, and more than 300,000 in each of Leeds, Newcastle, Bristol and Sheffield.
  • But the biggest ‘spike’ by far is London: In 2011, more than 5 million jobs were located in London. This meant that nearly one in five of all jobs in England and Wales were in London.
  • Cities play an important role in the Northern Powerhouse: With 4.7 million jobs, the cities and the wider areas of the Northern Powerhouse (Hull, Liverpool, Manchester, Sheffield, North East, West Yorkshire) accounted for 18 per cent of all jobs in England and Wales.

These patterns in the geography of jobs – with a visibly ‘spiky’ core and a ‘flatter’ periphery – arise because of the benefits of agglomeration, something that we have written a lot about in the past. These benefits that firms and people obtain from locating close to each other include linkages to suppliers and consumers, easier access to jobs and workers, and enhanced opportunities to exchange ideas and information.

But there are costs of agglomeration too, such as high prices, congestion and crime. These have a negative impact on the attractiveness of a location and generate forces that disperse economic activity.

As our previous work – such as Beyond the High Street – has shown, the geography of jobs has become increasingly concentrated in cities, and city centres in particular. Although mobile phone, email, video-conferencing and the Internet were expected to free businesses and people to live and work wherever they wanted, the benefits of agglomeration still produce a geography of jobs that is ‘spiky’. Rather than dispersing, people and firms increasingly congregate in cities.

Because where jobs are located can affect how well a city’s economy performs in the future, these push and pull forces suggest an important role for policymakers, who in order to make cities more productive should actively seek to foster the benefits of agglomeration and minimise the costs (or diseconomies) of agglomeration.

The measures that policymakers could take include permitting the development of office space to meet the future demands of businesses, improving the skills of residents to allow them to access the jobs created in cities, and improving transport infrastructure to better link workers to jobs, and businesses to other businesses.

You can view maps for each individual city we look at on the city by city pages.

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Comments

Mark
10 March 2016 13:03

When you say 1 million jobs in Manchester and Birmingham and 300,000 in places like Sheffield, do you mean in those cities metropolitan areas (ie the proper city area), or in your own definition of their PUAs? That obviously makes a big difference as to how many jobs there are actually on offer in each of those cities.

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Ilona Serwicka
14 March 2016 12:02

Hello Mark. The statistics quoted refer to the number of jobs in the whole of Birmingham/Manchester/etc. PUA, which is our unit of analysis and a definition of a city. Thank you for reading the blog and making further enquiries about the stats. Best wishes, Ilona Serwicka

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