00Executive summary

The Fast Growth Cities group, comprising Cambridge, Milton Keynes, Norwich, Oxford, Peterborough and Swindon encompasses some of the most successful and innovative places in the UK. This briefing – an update of the first Centre for Cities report on this topic in 2016 – investigates the development of the Fast Growth Cities as places to live and to work between 2015 and 2018.¹ It gives insights on the additional challenges posed by the pandemic, as well as exploring how an increase in investment can unlock further growth and future success for the cities in the group.

The report focuses on six key areas:

Labour markets, skills and education

In recent years, a majority of the Fast Growth Cities were able to further strengthen their already robust labour markets by adding more high-performing jobs as well as seeing strong employment growth. The focus on higher education and research in the group is reflected in the rise and development of higher education institutes. While Cambridge, Oxford and Norwich already have established universities, in recent years the other Fast Growth Cities have developed their higher education sectors with plans to open their own campus- based higher education facilities. It will also be crucial to further work on skills shortages and increase the basic skills of the workforce in some cities.

Businesses and growth

The majority of the Fast Growth Cities have strong economies with large shares of employment in highly productive companies, and the group together has a disproportionately large contribution to GDP. However, cities in the group differ when it comes to their industrial profile and innovative capacity and further efforts should focus on attracting high-skilled exporting businesses and building on existing strengths to increase the innovative capacity in some cities.

High streets and city centres

The city centres of most of the Fast Growth Cities are relatively weak as they are more reliant on retail than office space. For some of the cities, this is due to their historic city centres and attractiveness as tourist destinations. New, non- retail commercial space is difficult to develop, which is why economic activity in these places is often clustered in peripheral locations. But for other cities, further investment must support turning their city centres into more attractive places to do business.

Housing and planning

One consequence of a place generating more and better paid jobs is more people moving to the city to access them. The Fast Growth Cities’ economic and population growth in recent years has increased the strain on local housing markets, creating growing challenges of affordability. If unaffordability continues to rise at a pace similar to the past, most Fast Growth Cities will face problems to meet the needs of both their economies and their residents.

The increase in housing stock in recent years shows a commitment to growth by the majority of the Fast Growth Cities and it will be important to continue with this commitment in the future. For the most unaffordable cities in the group, although increasing the supply of houses will help prevent affordability from worsening further in the longer term, shorter-term solutions will also be needed, particularly around the building of affordable homes.

Transport

In 2016, the increased pressure on transport and infrastructure was identified as a key barrier to continued growth in the group and it remains a central topic for most Fast Growth Cities. This is particularly because of the role that the Fast Growth Cities play as employment hubs for their region – seeing daily influxes of thousands of workers. The group currently relies predominantly on cars for their commutes, which is in line with the wider national trends.

This dependence will likely rise as a result of the pandemic, which may cause challenges in the long term for congestion, pollution and city centre parking if left unchecked. It is therefore important to build upon existing strengths by further investing in alternative modes of transport to allow the group to grow quickly in a way that is sustainable.

Economic impact of the pandemic

The pandemic has left all Fast Growth Cities with a significant share of their labour forces either on furlough or claiming unemployment benefits. But most of them are less affected than other UK cities, likely reflective of their higher share of jobs in higher-skilled activities that can be done from home. The key challenge to recovery in some of the cities will therefore instead be the significant drop in footfall. As is the case elsewhere in the country, the Fast Growth Cities have seen sharp falls in footfall, with implications for jobs and profits of their high street businesses. A focus for recovery should be to encourage people out to spend again once it is safe to do so.

The Fast Growth Cities group contains some of the UK’s most successful cities, many of which have a significant impact beyond their administrative boundaries. It is important that policymakers support these cities to reach their potential and to ensure that they continue to function as regional employment hubs and innovation centres post-pandemic. The immediate focus for the group and of government support needs to be on economic recovery. In the long run, support must address more strategic challenges raised in the five policy areas.