Manchester is set to grow faster than any city outside the south of England according a new report out today.
The study, Rebalancing the UK Economy, from Ernst and Young forecasts that the South of England will continue to outpace rest of UK to 2018 but with three-year GVA growth of 2.5% – equal to that of Cambridge – Manchester is the best of the rest and the standout Northern city, illustrating clearly the potential of the Northern Powerhouse.
Manchester’s strong performance reflects investments made over more than a decade in revitalising the city centre, the opportunities offered by the airport and surrounding infrastructure, its strong surface transport links, and a clear reputational effect says the study.
However The UK’s industrial heartlands of the East and West Midlands, the North West and Yorkshire will grow at a steady rate below the UK average between 2015 and 2018, but will still hold the middle ground compared with other areas of the country. However, interventionist measures to help these regions flourish and contribute to re-balancing the UK economy, such as the Government’s ‘Northern Powerhouse’ and ‘Midlands Engine’ visions, will have limited impact in the short-term.
Steve Wilkinson, EY’s Managing Partner, Markets, UK & Ireland, says:
“Our forecast predicts that the impact of the Northern Powerhouse and national infrastructure projects will really start to impact after 2020. HS2 will not open for another decade and the devolution of powers to cities such as Manchester and Liverpool will only become fully effective when budgets are aligned and funds are used efficiently. It will take time for the benefits to translate into real growth.”
He adds:
“We predict that Manchester will be the fastest growing city outside of the South over the coming years, which is testament to concerted investment in maximising the city’s strengths, including its infrastructure and research institutions. It’s no surprise that Manchester has so far been the poster child for devolution. While the Northern Powerhouse is clearly a long-term vision, Manchester highlights the potential for cities within the North to thrive when they’re given clear, continued economic focus – allowing them to find their own competitive position. It points to the opportunity for regions within the North of England.”
