Latest Results From UK Powerhouse Report
The level of economic growth generated within cities in Yorkshire continues to fall behind that in the South East, according to a new report published by national law firm Irwin Mitchell.
The UK Powerhouse study is produced by Irwin Mitchell and the Centre for Economics and Business Research (Cebr). It provides an estimate of GVA* growth and job creation within 45 of the UK’s largest cities 12 months ahead of the Government’s official figures.
According to the report, Leeds’ economy grew by 1.7% in the 12 months to 2017 Q2. The slowdown in the rate of growth compares to GVA of 2.1% in the previous quarter and has resulted in the city falling five places in the report’s league table.
Sheffield’s economy grew at 1.5% during the period whilst Bradford and Hull’s GVA increased by just 1.4%.
In a period where locations in the South East and the East of England dominated, Milton Keynes came top with GVA growth of 2.6% in the year to the end of Q2 2017 on the back of its booming technology sector and its track record for encouraging start-ups.
The report does highlight the growth of Leeds’ technology sector, with the latest figures revealing that the value of goods and services produced within the sector stood at £299 million - the eighth highest in the UK. Leeds was also ranked fifth according to the number of people employed within technology related work.
"Our latest research confirms that the UK Powerhouse’s Northern generators are still not running anywhere close to full load, and that those in our region need firing up.
"The technology sector can certainly fuel that fire, with the digital and creative industries booming in the Leeds City Region and beyond, but it needs the right raw materials both now and in the future. Highly skilled workers are the raw materials we need to attract more investment from the technology sector, but Brexit threatens to decimate our reserves and cut off our pipeline, so we are going to need to produce our own. To do that, we need to invest now in educating and motivating the next generation of tech geniuses and entrepreneurs, before it is too late." Alex Newman - Partner
It is further predicted that the UK-wide number of jobs in the technology sector will increase by 24% in next 10 years. However, the report raises concerns that the true potential might not be realised.
To ensure all cities including those in Yorkshire benefit from the available opportunities in the tech sector, the report advises a holistic approach and makes a number of recommendations. These include:
- Tackling the shortage of highly skilled employees by encouraging more women to enter the industry
- Investing and opening more ‘code academies’ to increase the number of people with the necessary skills in programming languages
- Establishing a plan that allows the existing data flows between the UK and the rest of Europe to continue before the UK officially leaves the EU
- Expanding the Start Up Loans scheme for new business ideas by providing financing deals which offer higher amounts on lower interest rates
- Changing the current UK entrepreneur tax relief scheme as it encourages small firms to sell out early and inhibits the number of businesses reaching unicorn size
- Funding knowledge sharing and skill building platforms, including events for new businesses to network and discuss ideas with successful technology entrepreneurs