Parties need to consider more carefully the geography of foreign investment and jobs in the UK.
Debate over the UK’s membership of the European Union (EU) is at the top of the national political agenda in the run-up to the General Election.
Voters and political parties are divided on the issue of whether the EU should be seen as a friend or foe, and all the parties have set out their own unique promises on how they will address the UK’s membership if successful in May:
As with many national issues, there is an interesting cities perspective to the debate that is not often heard – but must be counted.
The UK’s membership of the EU means many non-European foreign firms choose to base themselves here in order to access the EU Single Market, which, comprising 500 million people, is almost 10 times the size of the UK’s internal market. And many of these firms choose to locate in one of the country’s cities.
According to research from TBR, European firms have created more jobs in the UK than any other of the UK’s trading partner countries. While one in five jobs of these are in London, they also provide a relatively large number of jobs in cities right across the UK. In booming Milton Keynes, almost one in eight jobs is based in European firms. That number is similar in Sunderland.
Cities matter to foreign firms because they offer access to skills, suppliers and markets. And foreign firms matter to cities because they bring new technologies and new knowledge to the host economy that local domestic firms can embrace to become more productive. These technology diffusions and productivity spillovers can then in turn improve the international competitiveness of domestic firms.
Businesses need market and regulatory certainty in order to plan for their future. But in the capital – home to the UK’s financial hub – and in many other cities throughout the UK, this national-level debate is creating unwelcome apprehension and uncertainty among the wealth and job creators that the country’s future economic success is reliant upon.
Whether the UK ultimately stays or leaves, in the run-up to the Election and beyond, national politicians need to consider more carefully the geography of foreign investment and jobs in the UK, and be aware of the potentially disproportionate impacts that their decisions about the nation’s place in the world will have on cities up and down the country.
Leave a comment
I am disappointed to see that this comment says the Lib Dems are the most pro-Europe party, ignoring the Green Party, whose membership exceeds both Lib Dems and UKIP considerably. The Greens had an MP long before UKIP, elected at the main not by-elections. The Greens work hard in Europe and are well aware that many crucial decisions are best taken at that level.