1. Economics
July 27, 2018

Some thoughts on why Sheffield’s economy has struggled

By Peter White

After reading how surprisingly good Liverpool’s economic growth has been over the last 20 years and then why Leeds was such a laggard, I feel we need to talk about Sheffield.

On the graphs of economic growth featured in those earlier articles, Sheffield was bottom of the 12 cities selected, despite having a faster growing population than Leeds, Liverpool and Newcastle at the last census. Accused of physical isolation, Sheffield is sat between Manchester, Leeds and Nottingham, in the largest cluster of the cities listed.The city was also recently reported to have the fastest growing house prices in the country. So why is it struggling?

Sheffield may be Britain’s least known or understood large city. To many it’s the epitome of industrial decline, with its derelict steel mills and defunct cutlery factories. More are familiar with this side of the city that faces the M1 motorway and hosts several regeneration projects like the Don Valley Stadium (RIP), the Sheffield Arena (which seats 1,000 less than Leeds’ newer arena) and the Meadowhall shopping centre (actually in the neighbouring borough of Rotherham).

Fewer are familiar with the more economically prosperous south and west of the city, which includes the Sheffield Hallam constituency. Over the last 20 years, the Hallam constituency hosted the greatest number of professionals and a greater proportion of graduates than Oxford and Cambridge. Walking amongst these leafy suburbs, lined by splendid stone Victorian villas, it is difficult to figure out why this idyllic city isn’t booming.

Here are a few suggestions.      

Steel, Cutlery and Coal. The decline in heavy industry and manufacturing has been felt in cities across the North. The more economically successful cities of the last 20 years tend to have a long history of a large commercial and service sector.

Sheffield was built on steel, cutlery and coal – a toxic combination for a 20th century city. Although much of the decline was decades ago, Sheffield continues to have a higher proportion of manufacturing jobs than its more economically successful rivals.

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Poor road infrastructure. If you didn’t already know, Sheffield is modelled on Rome and situated on seven hills. The narrow valleys between the hills, which were perfect for providing water power to kick start the Industrial Revolution, get quite easily choked up with traffic.

There is no outer ring road through the adjacent Peak District National Park, and the M1 only serves half the city to move North or South. The three most direct routes to Manchester are single carriage lanes and take hours, despite it being under 40 miles away.  

Poor access to aviation infrastructure. Doncaster Sheffield Airport is situated 18 miles from Sheffield and handles fewer flights than Jersey’s airport. Yorkshire’s largest airport is Leeds-Bradford, which is the wrong side of the West Yorkshire conurbation for Sheffielders: that handles fewer flights than many cities half the size of the West Yorkshire conurbation (Bristol, Edinburgh, Newcastle). Most Sheffielders opt for Manchester Airport, which isn’t particularly easy to get to via road, or rail.

Very poor rail infrastructure. Yes, more poor infrastructure! You would be hard pressed to find a city of similar size with such poor access to transport infrastructure. (Please do write in if you know of one.)

A century ago, Sheffield had two railway lines to Manchester and one was scheduled to have an electrified service, which it finally achieved in 1954. Today you can catch a tram from an out of town shopping centre to the north of the city to an out of town shopping centre to the south east of the city, but you can’t take an electrified train anywhere. The electrified line to Manchester was closed after the Beeching report. Sheffield remains the largest city without an electrified service to London, or indeed anywhere: if and when HS2 arrives if may be situated in Rotherham to cut costs.

The polycentric nature of the Yorkshire urban area. Reviving Owen Bell’s point regarding Leeds’ poor economic performance – where Bristol, Newcastle and Norwich benefit from being regional capitals, Sheffield is overshadowed by not just Leeds but also Manchester and even Nottingham.

Reliance on public sector jobs. Sheffield benefits from hosting some government departments such as the DoE, DWP and up until recently BIS. When austerity hit the Civil Service, it hit the Sheffield departments harder. Most spectacularly the Department leading on the Northern Powerhouse initiative (BIS) was relocated from Sheffield to London.

Poor Question Time coverage. Such poor Question Time coverage is indicative that Sheffield is often overlooked for regional offices and media coverage. Alongside Liverpool, it is one of the largest cities to not broadcast its own local BBC News service. 

The People’s Republic of South Yorkshire. Labour have dominated Sheffield for decades, but it was only since the last election that all constituencies in Sheffield turned completely red. Aside from the lack of competition for votes, when the Tories are in power in Westminster, there is nobody fighting Sheffield’s corner in the governing party – unlike, say, Birmingham.

The Wider South Yorkshire Hinterland. Many cities on the list of 12 are sat in a constellation of wealthier commuter towns. Birmingham has leafy Solihull and Kenilworth. Leeds’ economy is supported by York, Harrogate and Selby.

Sheffield has Rotherham, Barnsley, Worksop, the economies of which depended on coal, coal and coal. Sheffield’s hinterland is struggling more than most, which is bad news for all of South Yorkshire.  

However, there may be a light at the end of the tunnel. There are more cranes above the skyline than ever before. The University of Sheffield managed to coax Boeing to set up its first facility in Europe, in its Advanced Manufacturing Research Centre (in Rotherham). New tramline extensions are due to open imminently.

The implementation of HS2 has the opportunity to transform Sheffield’s economic prospects – and HS3 may play an even more pivotal for Sheffield’s future. 

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