03City Monitor

There is considerable variation in the economic performance of cities and towns across the UK. The purpose of this chapter is to show the scale and nature of this variation by highlighting the performance of the 63 largest urban areas* on 17 indicators covering:

	Population		Employment
	Productivity		Skills
	Business dynamics		Housing
	Innovation		Digital connectivity
	Wages		Environment

 

For all indicators, the 10 strongest and 10 weakest performing places are presented.

Tables of the full list of cities can be found at https://www.centreforcities.org/data/data-tool/

The national picture

The national economy clusters in cities and large towns. Figure 13 shows that they account for 9 per cent of land but 63 per cent of output and 72 per cent of knowledge-based jobs in the private sector – the sorts of jobs that the UK will need more of if it is going to see productivity growth throughout the rest of this decade.

Population

Productivity

• There is a clear split in productivity across the county. All of the 15 cities with higher productivity than the national average are in the South, with the exception of Edinburgh.
• GVA per hour in the Greater South East was £42.50 in 2021. It is the only region that is more productive than the national average. GVA per hour in the rest of Great Britain was £32.10.
• The Greater South East’s strong performance is led by its cities, where the average GVA per hour was 29 per cent higher than non-urban areas in the region. This results from the advantages that urban settings provide to high-knowledge businesses in particular.
• However, cities in the rest of Britain were only 0.1 per cent more productive than non-urban areas in the rest of the country.
• Most notable is that with the exception of Bristol, all large cities lag behind the national average. Their size should mean that they instead lead the national economy, as happens in other western European countries.¹⁸ It is this underperformance that is the main cause of the wider underperformance of the economy outside of the Greater South East.

Business dynamics

Business starts and closures

Business stock

Public and private sector jobs

Innovation

• The ‘new economy’ encompasses emerging knowledge-intensive sectors like FinTech and advanced manufacturing that are at the forefront of new technologies and innovations. Their performance is important for the UK’s productivity and prosperity because they are at the frontier of the economy and the number of new economy firms in a city serves as a proxy for measuring levels of innovation across the UK.
• The new economy tends to cluster in cities, and city centres in particular. Cities accounted for only 9 per cent of land in the UK, but were home to 62 per cent of new economy firms in 2022. City centres are even more concentrated centres of the new economy: they accounted for 0.1 per cent of land in the UK, but were home to 18 per cent of the new economy.
• However, the distribution of new economy firms is uneven – 51 per cent of these firms were located in cities in the Greater South East, and 7 of the 10 cities with the largest numbers of new economy firms per population are in the Greater South East.

Wages

• The average weekly workplace wage in cities was £709 in 2023 – higher than the UK average of £666. However, this was the result of a strong performance of a small number of cities – just 17 cities had an average weekly wage that was above the UK average.
• There is also a clear divide between the Greater South East and the rest of the country: the average weekly wage for jobs in the South East was 23 per cent higher than in the rest of the country.
• That said, while many cities lag the national average, a number of them lead their regional averages. Cities such as Belfast, Manchester, York and Newcastle are examples of this. This underscores the importance of cities in their regional contexts even if they underperform in the national context.

Employment

Employment rate

Unemployment benefit claimant count

Skills

No formal qualifications

High-level qualifications

Housing

House prices

Housing affordability

Housing stock growth

Digital connectivity

Environment

Greenhouse gas emissions

• Cities are on average greener than the rest of the country. They accounted for 54 per cent of the total population but only 40 per cent of the UK’s greenhouse gas emissions¹⁹ in 2021. Average UK emissions per capita in 2021 totalled 6 tonnes while the city average was lower at 4.4 tonnes.
• This in part is because cities account for low shares, relative to their share of population, of the two principal contributors to the UK’s greenhouse gas emissions – transport emissions and industry emissions. They were the source of 40 per cent of transport emissions and 39 per cent of industry emissions.
• Swansea has much higher per capita emissions than any other city because of its industrial emissions – likely linked to the steel plant at Port Talbot. On a per capita basis, its industrial emissions were 17.6 tonnes per head in 2021, compared to the UK average of 1.2 tonnes.
• Emissions increased in almost every city between 2020 and 2021, likely reflecting the reopening of economy. Despite this, they were still lower than 2019 levels in every city bar Derby, Ipswich, Mansfield and Plymouth.

Air quality