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Economy / Jobs

Where are the UK’s most productive cities?

As you may have seen, the Centre for Cities, the UK’s leading urban think tank, recently signed up as CityMetric’s new data partner. This is the first of a new series of articles, in which we’ll be using the Centre’s data tools to crunch some of the numbers on Britain’s cities.

There’s a simple narrative that lazy politicians and journalists turn to when discussing Britain’s economy: that of the north/south divide.

In this telling of events, there’s a fault line cutting England in two, somewhere around the Watford gap. On one side is the rich south; on the other a struggling north.

Stock media narratives are often misleading, though. (We should know.) So how accurate is this one?

Obviously there is some validity to the idea that the south of England is richer than the north: clichés become clichés for a reason. Nonetheless, drill down to city level, and it’s clear that the idea of a rich south and a struggling north is an oversimplification.

The map below shows “GVA per worker” – a measure of the economic output produced by everyone working in each city. It is, in other words, a measure of productivity.

We should stick in some caveats here. For starters, the fact it’s per worker, not per head, means that the figures are higher than the GDP per capita that you most often hear cited: a significant chunk of the population are too old, too young or too ill to work.

Others are simply unemployed, which potentially leads to some odd distortions. An area with high unemployment may, paradoxically, look better on this measure than one where everyone is in work, because you’re cutting the cake into fewer slices.

With that in mind, though, here’s the map. It shows GVA per worker as it stood in 2013:

The first thing that leaps out at you is that it is not as simple as a north/south divide. For one thing there’s Scotland, whose cities are, on this measure, not noticeably less productive than those in the south east. (London, as with so much else, is a world unto itself.)

For another, “the south” is a misleading term. Anyone who has given the matter much thought probably imagines London to be at the heart of a rich zone spreading across the south east of England. That’s not quite right, though. Rather, it’s at the eastern edge of one that spreads across south central England. 

The cities to the east of London are noticeably weaker. All of them are producing in the region of £40,000-£50,000 per worker: that’s not at the bottom of the league table, but it’s lower than relatively far-flung places like Portsmouth or Gloucester.

To take just one example, in 2013 the Essex town of Southend, which is just 40 miles from London and well within the commuter belt, had a GVA per worker of £47,000. That’s not much higher than Cardiff (£46,400), a city in a region of the country generally thought of as economically weaker. It may or may not be a coincidence that the counties east of London were where the surge of enthusiasm for the right wing party UKIP happened.

There’s another story worth thinking about happening further north. Most of the cities that look weakest on this measure are in or near to the trans-pennine belt which makes up chancellor George Osborne’s “northern powerhouse”. In 2013, Blackpool’s GVA per worker was £39,500;in Barnsley and Doncaster it was £39,800 a piece.

Weakest of all is Burnley, in Lancashire, where the figure is just £37,500. The cities of the north east – which you might expect to be weaker – actually have significantly higher productivity. (It’s possible that this is one of those weird distortions brought on by higher unemployment that we talked about above.)

One last thing: those unproductive cities are very close to some much productive ones. Leeds, Manchester, Warrington – all of them are hovering around the £48,000 mark, making them more productive than Southend. Even Liverpool, rarely thought of as an economic powerhouse, isn’t much below (£46,900); it’s outperforming York (£45,500), which is generally seen as stronger.

Suddenly George Osborne’s enthusiasm for improving transport links in the M62 corridor makes a lot more sense. To significantly boost the British economy, you don’t need to make the north as productive as London: just making Barnsley as productive as Manchester could have a significant effect.

 
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