Andrew Carter is the Chief Executive of Centre for Cities.
Coming into power in 2010 the Coalition government had two pressing problems affecting people across the country: a lack of jobs off the back of the global financial crisis, and a housing affordability challenge in the Greater South East in particular.
Fourteen years on, Cities Outlook 2024 asks how much better off are places across the country?
Let’s start with the good news. The UK has experienced a jobs bonanza. There were 4.6 million more jobs in the UK in 2022 than 2010. And this miracle has been seen across most cities and large towns, with jobs up and more people in employment in almost all of Britain’s cities and large towns.
That though is where the good news ends. Those of a nervous disposition may want to look away now.
Productivity – the long-term driver of prosperity – has flatlined over the same period; it has been anaemic in traditional strugglers like Burnley and innovation superstars like Cambridge alike. This has meant that while more people have been in work, there has been little growth in the wages they have been taking home.
Given the role that productivity plays in generating prosperity, it is no surprise that income growth has also been underwhelming. In half of the UK’s 63 largest cities and towns, since 2010 disposable income has grown at less than half the rate it did between 1998 and 2010.
The result is that people have missed out on many thousands of pounds that this trend growth would have delivered. At the national level the average person is £10,200 worse off than they otherwise would have been. In places like Burnley, Cambridge and Milton Keynes – not usually three places you’d find in the same sentence – people are over £20,000 less well off on average.
(In Aberdeen, it is an eye-watering £45,200 lower, but that is mainly due to the struggles of the oil and gas industry).
While this has happened that other problem, housing affordability, has got worse. Housing became more expensive relative to incomes in all but five of 63 cities. The largest increases were seen in the places that already had the largest affordability challenges, such as Cambridge, London, and Brighton.
The mix of poor income growth and ever-more expensive housing has squeezed those at the bottom of the income distribution particularly hard.
The share of children living in relative poverty has increased in all but two cities. Sx cities – Birmingham, Blackburn, Bradford, Burnley, Derby, and Leicester – now have more than a third of children living in relative poverty. In Birmingham that is an increase of 60,000 kids living in relative poverty.
It’s not as if policy has been inactive over this period. There have been a plethora of deals, funding pots, and white papers attempting to spur growth. Most have been short lived and haphazard in their approach.
But there are some encouraging policies that the Conservatives must take forward if they win the next election.
The first is the strategy in 2022’s Levelling Up White Paper. The plan itself is good, even if policy action has been lacking. Backing this plan with a programme of policies and funding – a scale of funding closer to the trillions Germany gave to reunification rather than the few billion that has been committed to levelling up so far – should play well with Red Wall voters.
The second is devolution. Impressive progress has been made under Conservative-led rule, and opened up the potential for cities to have the powers and funding to help support growth that do comparators elsewhere in the world.
Continuing with this agenda does two things: it helps the Conservatives be a party for everywhere, and also allows it to reinforce and own a policy success.
The third is planning reform. Positive, if limited, policy steps have been taken in recent years to help build the homes we so desperately need. But the next government has much work to do if housing affordability is to be lower at the end of its parliament than at its beginning.
This is particularly important for convincing increasing number of mostly young urban professionals who are renting a reason to vote Conservative. And whilst it will most definitely play badly with older Tories in the home counties, it will likely play well with their children.
As current and prospective MPs gear up to go door knocking across the country, they’ll find the following compared to those that did the same in 2010: the people opening the doors will more likely to be in work, but the home they are living in will be costing them more to inhabit, and they are more likely to be struggling to make ends meet.
Recent years have been dominated by arguments on Brexit and immigration. But if the Conservatives are to be successful at the election, being able to say to voters in Burnley and Milton Keynes how the next decade is going to be more prosperous than the last is going to be pretty important.
Andrew Carter is the Chief Executive of Centre for Cities.
Coming into power in 2010 the Coalition government had two pressing problems affecting people across the country: a lack of jobs off the back of the global financial crisis, and a housing affordability challenge in the Greater South East in particular.
Fourteen years on, Cities Outlook 2024 asks how much better off are places across the country?
Let’s start with the good news. The UK has experienced a jobs bonanza. There were 4.6 million more jobs in the UK in 2022 than 2010. And this miracle has been seen across most cities and large towns, with jobs up and more people in employment in almost all of Britain’s cities and large towns.
That though is where the good news ends. Those of a nervous disposition may want to look away now.
Productivity – the long-term driver of prosperity – has flatlined over the same period; it has been anaemic in traditional strugglers like Burnley and innovation superstars like Cambridge alike. This has meant that while more people have been in work, there has been little growth in the wages they have been taking home.
Given the role that productivity plays in generating prosperity, it is no surprise that income growth has also been underwhelming. In half of the UK’s 63 largest cities and towns, since 2010 disposable income has grown at less than half the rate it did between 1998 and 2010.
The result is that people have missed out on many thousands of pounds that this trend growth would have delivered. At the national level the average person is £10,200 worse off than they otherwise would have been. In places like Burnley, Cambridge and Milton Keynes – not usually three places you’d find in the same sentence – people are over £20,000 less well off on average.
(In Aberdeen, it is an eye-watering £45,200 lower, but that is mainly due to the struggles of the oil and gas industry).
While this has happened that other problem, housing affordability, has got worse. Housing became more expensive relative to incomes in all but five of 63 cities. The largest increases were seen in the places that already had the largest affordability challenges, such as Cambridge, London, and Brighton.
The mix of poor income growth and ever-more expensive housing has squeezed those at the bottom of the income distribution particularly hard.
The share of children living in relative poverty has increased in all but two cities. Sx cities – Birmingham, Blackburn, Bradford, Burnley, Derby, and Leicester – now have more than a third of children living in relative poverty. In Birmingham that is an increase of 60,000 kids living in relative poverty.
It’s not as if policy has been inactive over this period. There have been a plethora of deals, funding pots, and white papers attempting to spur growth. Most have been short lived and haphazard in their approach.
But there are some encouraging policies that the Conservatives must take forward if they win the next election.
The first is the strategy in 2022’s Levelling Up White Paper. The plan itself is good, even if policy action has been lacking. Backing this plan with a programme of policies and funding – a scale of funding closer to the trillions Germany gave to reunification rather than the few billion that has been committed to levelling up so far – should play well with Red Wall voters.
The second is devolution. Impressive progress has been made under Conservative-led rule, and opened up the potential for cities to have the powers and funding to help support growth that do comparators elsewhere in the world.
Continuing with this agenda does two things: it helps the Conservatives be a party for everywhere, and also allows it to reinforce and own a policy success.
The third is planning reform. Positive, if limited, policy steps have been taken in recent years to help build the homes we so desperately need. But the next government has much work to do if housing affordability is to be lower at the end of its parliament than at its beginning.
This is particularly important for convincing increasing number of mostly young urban professionals who are renting a reason to vote Conservative. And whilst it will most definitely play badly with older Tories in the home counties, it will likely play well with their children.
As current and prospective MPs gear up to go door knocking across the country, they’ll find the following compared to those that did the same in 2010: the people opening the doors will more likely to be in work, but the home they are living in will be costing them more to inhabit, and they are more likely to be struggling to make ends meet.
Recent years have been dominated by arguments on Brexit and immigration. But if the Conservatives are to be successful at the election, being able to say to voters in Burnley and Milton Keynes how the next decade is going to be more prosperous than the last is going to be pretty important.