Is London’s economic growth threatening the recovery of the rest of the UK? If you watch the news you’d certainly think so. Last week saw another programme bemoaning the death of local economies and in particular the economy of Manchester.
In a two part series shown on the BBC over the last couple of weeks, called ‘Mind The Gap: London Vs The Rest’, journalist Evan Davis ascertained that while parts of the UK are still struggling after the financial crash, London is thriving. The programme highlights that London is generating a fifth of Britain’s income, is attracting both the best talent and the lion share of foreign investment – at the cost of growth elsewhere.
I would consider this a little unbalanced. Contrary to popular belief other local economies aren’t on their knees just yet. Take Skout’s home city for example, according to the Chamber’s Quarterly Economic Survey (QES), Manchester has seen 2% growth over the past 12 months (the strongest growth figures since the QES began) and is expected to continue this trajectory.
The city is also forging ahead with the development of its media friendly identity and is naturing both startups including many new B2B PR and consumer agencies and more mature media businesses (including the BBC!) to grow and thrive here.
It seems to me that it’s pretty normal for London to attract the best talent – initially at least. It’s the capital city after all and graduates are blinded by the bright lights. The issue for the capital is the retention of those graduates once the shine has rubbed off. With living expenses in the capital continuing to rise and with house prices out of the reach to most, that exciting new pool of talent tends to look elsewhere for opportunities to develop their careers.
Many of those (now qualified and experienced) graduates often head back to home towns or other parts of the UK to put down roots and live and work. This means that the other regional economies are actually likely to benefit from the talent AND the experience gained from being trained in the nation’s capital.
So while the BBC and Evan both feel that the gap between London and the rest of the UK is widening, I’d argue that there are benefits to be had.