1. Economics
July 15, 2016

Is Sheffield falling behind?

By Jonn Elledge

The latest instalment of our weekly series, in which we use the Centre for Cities’ data tools to crunch some of the numbers on Britain’s cities. 

Yesterday, I was in Sheffield, to attend a Centre for Cities (CfC) debate on what the priorities should be for the new metro mayor that the region is – the fall of George Osborne notwithstanding – expected to elect next year.

It was my first time in the city, and what struck me about the place was that it does not feel like a boom town. Visit Manchester or Birmingham or Liverpool these days, and there’s an intangible big city energy in the air: some mixture of glossy property development and artisan cafes that tells you that this is a place where Things Are Happening. Sheffield, despite its abundant charms – not least the beauty of the surrounding landscape – seemed to lack that energy.

This is entirely subjective, of course, and I was in town for all of 10 hours. I probably wouldn’t written it down at all, were it not for the fact that, at the CfC event, speaker after speaker talked about their fear that the city was falling behind.

And the rival whose performance they looked longingly on at wasn’t London, but Leeds.

So is all this just paranoia? Or is Sheffield really struggling compared to its northern neighbour? Let’s look at some graphs. (They’ll all expand if you click.)

On the most basic measure – population – that certainly isn’t true. The CfC dataset uses Primary Urban Areas – collections of councils that make up a city’s economic footprint. As a result, Bradford is a separate city to Leeds, which obviously skews the results.

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Nonetheless, on these definitions, at least, Sheffield is bigger than Leeds, and becoming more so:

And yet – this is not a good sign – it has significantly fewer jobs:

Sheffield is also underperforming on the total labour taxes generated per job…

…and the total economy taxes (a broader measure, which includes capital, consumption and property taxes, too).

It’s behind on earnings, too. While Leeds has shown some increase, Sheffield is all but flat-lining:

It’s GVA, a total measure of the size of the city’s economy, is way behind that of Leeds:

All these figures are connected, of course: Sheffield has a weaker economy than Leeds, which means fewer jobs relative to its population. That gives employees less bargaining power, which means lower earnings and lower taxes, too.

Expand the graph to include all five of the big northern cities, and the pattern broadly seems to hold. On the tax measure, Sheffield has gone from being fourth in a relatively tightly bunched group, to lagging way behind:

That probably reflects what’s going on in earnings:

That said, on GVA, it’s doing better than Liverpool:

On total jobs, too. (I’ve excluded Manchester from this one, just because it’s so much bigger than the other four that it renders the graph unreadable.)

“Left behind” is a phrase we’re hearing a lot, in the wake of Brexit, and it’s not always as meaningful as one might like. It’s also worth remembering that Sheffield’s economy is a great deal stronger than many of the smaller towns and cities that dot the M62 corridor.

But it seems clear, at least, that Sheffield is struggling compared to Leeds. It remains to be seen whether electing a metro mayor – a figure Leeds is not currently set to have – will change that.

Jonn Elledge is the editor of CityMetric. He is on Twitter, far too much, as @jonnelledge.

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