The UK is by some measures the most geographically unequal developed economy in the world. While cities and large towns in the Greater South East of England are among the most productive and prosperous places in Europe, most in the North and Midlands lag far behind.
The Government has set out its intention to address this inequality and ‘level up’ underperforming and left-behind parts of the UK through a programme of infrastructure development, investing in education, skills and scientific R&D.
Because the vast majority of UK economic activity takes place in the largest 63 cities and towns, they are crucial to the levelling up agenda.
This briefing presents two new indexes to summarise and compare the performance of the UK's largest cities and towns. The findings have implications for policy, particularly the Government’s ‘levelling up’ agenda.
Achieving levelling up is about more than just 'fixing the Green Book'
Skills are a key determinant of the success of people and places. Levelling up must address the root causes that are holding cities and large towns back.
The widely held, but wrongly assumed, belief that cities are rich and towns are poor will make levelling up even more difficult if it shapes policy.
Unlike many other developed economies, the UK’s largest cities and towns do not become more productive as they get bigger. In Germany, France, and the United States, there is a positive relationship between city size and productivity, as measured by GDP per worker.
This relationship does not hold in the UK. A number of small cities, such as Slough and Swindon, are more productive than expected and, with the clear exception of London, most large cities are less productive.
Even after adjusting the size of cities to take into account people who commute into them for work, most of the UK’s large cities still underperform. Their underperformance affects many more people than the underperformance of small- and medium-sized places, and has much larger implications for the national economy.
Among those underperforming cities, if the eight largest closed their output gap, the UK economy would be £47.4 billion larger in total — equivalent to adding two extra economies the size of Newcastle to national output. Manchester, Birmingham and Glasgow account for 70 per cent of this gap. For comparison, if all of the underperforming small- and medium-sized cities closed their output gaps, the UK economy would be £22.5 billion larger in total.
What needs to change
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Achieving levelling up is about more than just 'fixing the Green Book'
Skills are a key determinant of the success of people and places. Levelling up must address the root causes that are holding cities and large towns back.
The widely held, but wrongly assumed, belief that cities are rich and towns are poor will make levelling up even more difficult if it shapes policy.
What the Chancellor needs to focus on in the Spending Review 2020 to put local economies in the best position to bounce back, level up and decarbonise.
Despite claimant count remaining unchanged or declining in almost every city and large town over the past month, places are entering this second lockdown in a much weaker position than in March.
As the COVID-19 pandemic sends shockwaves through the labour market, Centre for Cities tracks the latest unemployment claim statistics across the UK's cities and largest towns.
London finds itself in the unfamiliar position of being amongst the UK’s worst performing cities. Are we seeing a levelling down?
If metro mayors are defunded, sidelined or even scrapped then the Prime Minister’s levelling-up agenda will fail, and ultimately so, too, will his government argues Andrew Carter.
While over the summer many social distancing restrictions were lifted almost everywhere, this was not reflected in the same way in local labour markets.
Chair of the National Infrastructure Commission Sir John Armitt on the future of UK infrastructure.
