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Like the time of the industrial revolution 300 years ago today, Manchester, alongside other large UK cities, is becoming the driving force of the new economy.
In our recent report Beyond the High Street, we looked at the way city centres contribute to city economies. And our findings show that size matters. It is the UK’s large cities that generate greater density that drives business growth, particularly in knowledge intensive services which have been setting the pace in recent decades. However, scale itself is not a guarantee of success. While Manchester is a good example of a large urban economy that is driven by the strong performance of its city centre, Sheffield is an example of a major English city that is so far struggling to make the most of its size.
Between 1998 and 2008 Manchester city centre added jobs three times faster than the city as a whole. In contrast, Sheffield city centre actually lost jobs during the same period. These processes are reflected in the spatial structure of the two economies presented on the charts below.
As a result today Manchester’s city centre stands out as the main location of private sector jobs within the city. The difference between the centre and the rest is even more significant if we consider knowledge intensive business services (KIBS) jobs. Within half a mile of the city centre there are 30,000 KIBS jobs, which amount to 1 in 4 of all the KIBS jobs spread across the wider area.
Sheffield city centre has been lagging behind the rest of the city and has thus let it catch up. Today whilst it still represents the main employment location in the wider urban area, its dominance is far less striking than in the case of Manchester. Despite this weaker performance, it is noticeable that KIBS jobs still tend to concentrate in Sheffield’s core. Just like in Manchester it accounts for little over 1 in 4 KIBS jobs in the 10 mile radius. This supports the idea that KIBS businesses need density that is only offered by city centres to prosper, and that is true even for weaker performing urban cores.
In recent years both Manchester and Sheffield have invested heavily in their city centres and both are looking to expand these schemes. But the data and anecdotal evidence shows that the response from business and investors hasn’t been the same. Two years ago the Co-operative Group committed to a large scale project in central Manchester, in contrast Sheffield has seen Hammerson pull out of a major retail lead scheme.
The UK’s large cities are crucial to the success of the UK national economy. If we want the engines of the UK economy to be running at full steam again, we need to understand and address the constraints that limit the success of places like Sheffield, while continuing to make the most of Manchester and the UK’s other large cities.
Previous blog in the series: Push me, pull me – the contradiction of policy
Next blog in the series: Beyond the High Street: The economics of independent shops
See the full report: Beyond the High Street
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