Irwin Mitchell Publishes Latest UK Powerhouse Report

A new economic study has placed Birmingham in the top 10 of UK cities for job creation and claimed that over the last three years it outperformed London in terms of output growth.

The UK Powerhouse report by Irwin Mitchell and the Centre for Business & Economic research (Cebr) provides an estimate of GVA* and job creation within 45 of the UK’s largest cities 12 months ahead of the Government’s official figures.

Analysing Birmingham's performance, the report revealed that headcount within the city stood at 547,759 - 1.4% higher in Q1 2017 than it was in the same period of 2016. Coventry was one place ahead with annual growth of 1.5%, but Wolverhampton was at only 1.1%.

Although Birmingham was said to have a relatively low exposure to international markets, something which had boosted many other city economies during Q1, UK Powerhouse attributed the Birmingham’s steady GVA growth of 2.1% to strong output within retail, professional services, construction and manufacturing.

The report also revealed over the last three years that the economy in Birmingham had grown at 8.8% - faster than London at 7.1% and Greater Manchester at 7.4%.

Highlighting the challenge ahead for the new Metro Mayor, Andy Street, the latest quarterly study predicts GVA across the city will grow by 14.7% over the next 10 years. Some cities in the South during the next decade, however, are expected to grow much faster with Milton Keynes and Cambridge seeing the size of their economies grow by 22% and 24.1% respectively.

Chris Rawstron, partner in the Birmingham office of Irwin Mitchell, said:

“The latest results paint a mixed picture for Birmingham because although it has performed relatively well in the last three years and had a steady start to the year in terms of employment growth, our report predicts that growth  over the next decade will be slower compared to a lot of other cities, particularly those in the South of England.

“We are of course only at the start of the devolution journey in Birmingham and it is now vital that the new mayor draws on the expertise and strength that exits within the city, whilst also tackling issues relating to skills and congestion which have such a big impact on our productivity.”

UK Powerhouse also examined the impact of the Financial Services sector on city economies. Birmingham performed strongly in terms of employment in the ‘Financial Powerhouse’ league table, with the report stating that the city had added 5,500 new jobs in the last three years, taking the total number employed in the sector to 97,000.

It added that the city’s influence within the sector will be boosted by HSBC’s decision to locate the headquarters of HSBC UK, the high street lender which recently separated from other parts of the bank, in Birmingham rather than London.

*GVA – Gross Value Added (the total value of goods and services produced)