Leeds: A northern economic powerhouse with ‘a wealth of unique strengths’ - Business Leader News

Leeds: A northern economic powerhouse with ‘a wealth of unique strengths’

The Leeds City Region is a UK leader in financial and professional services, digital technologies, manufacturing, healthcare and innovation – so why doesn’t the city ‘shout loudly enough about how great it is’?

In the latest in a new series of city spotlight features, Business Leader spoke to a trio of the city’s leading authorities to learn more about the area’s strengths, challenges and future ambitions.

What are the strengths and weaknesses of the region from a business perspective?

Professor Julia Bennell, Executive Dean of Leeds University Business School, said: “Leeds is a great place to work, study or run a business. The standard of living is fantastic – there’s a vibrant social and cultural life, property is affordable, the city is surrounded by beautiful countryside and the economy is strong and diverse.

“Leeds is the largest centre for financial and legal services in the UK outside London and has one of the largest concentrations of higher education institutions in Europe.”

City regeneration specialist Richard Bickers, Integrated Planning Lead – North of England, Arup, said: “The Leeds City Region has a wealth of unique strengths. With its large population, great career opportunities, good transport links, vibrant city centres and fantastic countryside surrounding it, the region offers fantastic opportunities rarely found elsewhere in the UK. These assets make Leeds a desirable place to live and work, as the region equips its people to live a brilliant quality of life while excelling both professionally and personally.”

Mark Goldstone, Head Of Policy at West & North Yorkshire Chamber of Commerce, said: “We’ve got a very diverse economy. People know us for financial and legal services, and we are the largest centre of certainly legal, and probably financial as well, outside of London. The reason a lot of that is here, is because there are so many other organisations and companies; we have a very strong manufacturing base, for example. Admittedly it’s not as strong as it was in the 1960s in terms of the number of people employed, but it’s still very strong.

“We have a large and growing cluster of digital businesses. We have some heavyweights here like Sky, Sky Bet, Trans Union, who employ many hundreds of people, and of course we have Channel 4 as well. We also have a massive swathe of often very small businesses, but fast-growing in specialist areas. There are two other emerging sectors. fintech – it has been recognised internationally that Leeds is a place where that is happening. There’s a lot of that, and more coming.

“The other is health tech; we’ve got the HQ of the NHS here, which sometimes goes unnoticed. NHS Digital has a very large presence here, and that’s been a fast-growing area for the NHS. 98% of patient records are managed by software developed by two companies in Leeds. They are significant employers who are acting as a magnet and bringing digital talent to the area.

Mark Goldstone, Head Of Policy at West & North Yorkshire Chamber of Commerce

Mark Goldstone, Head Of Policy at West & North Yorkshire Chamber of Commerce.

“Leeds is also part of a much bigger city region, with pockets of expertise, particularly in technology, right across our region from York and Bradford, so there’s a big catchment area to draw people in.”

Bennell: “The city is very international. The University of Leeds has more than 9,000 international students who make a huge contribution to life here.

“Thousands of talented students graduate from the city’s universities each year, boosting the region’s skills base.”

Goldstone: “We have five universities in Leeds. People will have heard of the University of Leeds, but also Leeds Becket, but also smaller ones focusing on specialist areas including digital, but we have the Institute of Robotics in Leeds and the Institute of Data Analytics. That drives companies that want to be around that – they are real big assets in our universities that are increasingly engaging with the wider business community.”

And what about weaknesses?

Bennell: “One weakness is that we don’t shout loudly enough about how great Leeds is, although I think this is changing over time.

“And while Leeds is the nexus of north-south and east-west transportation lines, the efficiency of the transportation network could be improved, both within the city and getting to and from Leeds.”

Goldstone: “Our biggest weakness is transport and public infrastructure. We are the largest city in Europe without a mass transit system, and that is a barrier in some cases. There is work afoot to try to develop one, and that has been going on for decades, but there is a new push. Boris Johnson’s government has said it needs to do more for infrastructure in the north, and this can certainly help.

“We are big advocates for HS2 and the proposed East-West Northern Powerhouse Rail, and if what we’ve asked for – and if what the local council is pushing for – happens, it puts about ten million people of working age within an hour’s commute of the city centre.

“We have close to £1bn of investment either going through planning or on the ground now, so although the transport system is poor, there are plans afoot to make it better. However, it’s still not up to par compared to other cities and that’s the one big gripe.”

Bickers: “We can do more to continue accelerating the region’s growth as, without a Mayor, we are missing out on some government funding. With a new government seeking to invest in the North, we would benefit from another political voice strongly promoting our city region, helping to seek out new – and maximise on existing – opportunities.”

Goldstone: “Salaries are probably not as high as you might expect given the types of jobs here, but that’s changing. It’s certainly moving in the right direction.

“Leeds has an issue, like a lot of cities, with the loss of graduates to London, but we also attract a lot of graduates from other locations, so we lose a few but we gain more. For all sorts of reasons, with quality of life being one of them.”

How does the Leeds City Region compare to Manchester City region?

Bennell: “Manchester is known due to its rich political history and football teams, while Leeds is more of a well-kept secret. The Leeds City Region – Barnsley, Bradford, Calderdale, Craven, Harrogate, Kirklees, Leeds, Selby, Wakefield and York – is the UK’s largest regional economy, with around 109,000 businesses and a GVA of more than £69bn. In pure financial terms, this places it above the Manchester Combined Authority – Bolton, Bury, Manchester, Oldham, Rochdale, Salford, Stockport, Tameside, Trafford and Wigan – which has a GVA of £66.4bn.

Professor Julia Bennell, Executive Dean of Leeds University Business School

Professor Julia Bennell, Executive Dean of Leeds University Business School.

“In terms of living in these cities, Leeds has lower consumer prices and higher average wages, giving an overall purchasing power advantage of 17.9% relative to Manchester. Leeds and Manchester are two great city regions which should be working more closely together to mutual benefit. Improved transport links between the two would help a lot and help increase economic activity in the regions around Leeds.”

Goldstone: “It’s not about Leeds versus Manchester, it’s about Leeds and Manchester working with London to balance the economy. Leeds to Manchester is about 40 miles, which in a southern perspective is Reading to Paddington.

“I think we’re missing a massive opportunity by not having Leeds, Bradford, Manchester connectivity. There’s some great job opportunities being created in all of those cities, and not everyone who should have access to them will have, because they’re not on a decent transport connection.”

What impact has Channel 4 moving to the region had?

Goldstone: “Channel 4 has been a massive coup for the region. It’s been absolutely phenomenal.

“They’re bringing 300 jobs here, but that’s not the big thing for me – the big thing is the all the companies that are moving here because they want to be in the orbit of Channel 4’s commissioning body.

“Our Local Enterprise Partnership has been working with businesses, and has set up a scheme of grants to help new start-ups or businesses relocate here. This is where the real benefit will come; those companies which come here, start-up, scale-up, create new opportunities, and we’re seeing that happening already, and Channel 4 is not even fully moved in yet.”

Bickers: “Channel 4’s decision to come to Leeds is a fantastic vote of confidence for our region. It signals confidence in our creative and digital industries which are growing rapidly. Already, the region is seeing spin-off development projects in new film studios and TV editing facilities which bodes well for the future.”

Bennell: “Channel 4’s decision to base its national HQ in Leeds is a big deal for the city and a huge boost for Yorkshire’s media and creative industries.

“You could feel the sense of pride and optimism in the city when Channel 4 announced that it was moving to Leeds. The broadcaster’s new offices in the city centre are set to open in 2020 – this should help to galvanise the region’s existing media and creative industries, and serve as a base for collaboration with media and creative talent in Bradford, Hull, Liverpool, Manchester, Newcastle, Nottingham and Sheffield.

“Leeds City Council leader Judith Blake, has said that the move could bring 1,000 new jobs and £1bn in regional income within the next decade.”

Bickers: “I am particularly excited about Channel 4’s decision to move into the Majestic development. Not only has this brought new life to one of the city’s landmark buildings, but its location immediately outside the train station positively affirms Channel 4’s role in the future of the city, along with reinforcing Leeds as a place to be.”

Goldstone: “One of the things that attracted Channel 4 here wasn’t shiny buildings, it was access to a diverse talent base. You get that in our region. There’s a lot of cultural diversity, real people who aren’t in the Westminster bubble.”

What are the main challenges and opportunities when it comes to evolving Leeds from an economic perspective?

Bickers: “In ever-changing times, and with a government saying they want to invest more in the North and devolve decision-making, now is the time to create opportunities and demonstrate that we, as a region, can deliver excellence.

City regeneration specialist Richard Bicker, Integrated Planning Lead – North of England, Arup

City regeneration specialist Richard Bicker, Integrated Planning Lead – North of England, Arup.

“We need to pitch and persuade for more investment, particularly in transport, housing and infrastructure, as these are vital to underpinning economic performance and help improve productivity. We also need to be quicker at allocating funding and delivering projects on the ground.”

Bennell: “Leeds is ideally placed, from a geographical perspective, to continue to grow. But to capitalise on its advantage, Leeds – and the North in general – needs better transport infrastructure.

“This will require significant investment. The government needs to spend the money, not just talk about it.”

Bickers: “We also need to focus on enhancing our city centre as this is the lifeblood of our region. Our city centre is changing, with reorganisation of retail, growing leisure markets, businesses moving back into the city and city centre living continuing to grow. Therefore, we must continue to improve the quality, safety, diversity and vitality of the city centre.”

Goldstone: “HS2 and rail; putting in that transport hub. We’re talking to companies that are investing heavily in Leeds city centre, a regeneration area about the size of Edinburgh new town, and we’re seeing those schemes coming forward now. That’s driven by rail mostly, and if we’re attracting all these companies to Leeds, they need to go somewhere.

“For example, the government has rationalised its property in Yorkshire, they have purchased what is going to be called the Government Hub, and there’s going to be about 5,000 people in that building. I think it was the single biggest property investment in Leeds ever. There’s more of this coming. NHS Digital is rationalising into one. Sky is expanding in Leeds and looking for more space. So there’s quite a lot of big opportunities.

“However, you also need to create spaces for smaller businesses to set up and thrive, and there are plans for an innovation district in the north of the city centre, anchored by the universities and council.”

Bennell: “A real area of opportunity is collaboration between higher education and business. The University of Leeds has a strong track record in commercialising the amazing research being carried out on campus, but we want to do much more. The Nexus building is integral to this. Nexus is a state-of-the-art building on campus which acts as a hub for connecting business with our research and expertise. 

“The University has created over 110 companies in the last 20 years, six of which are AIM market-listed with a combined value in excess of £500m. Anyone interested in working more closely with the University should come and look around Nexus – it’s a stunning building.

“Leeds University Business School is working with Leeds City Council, West Yorkshire Combined Authority, and the Leeds City Region Enterprise Partnership (LEP) to use our expertise in economics and business analysis through work on the new local industrial strategy. We are also collaborating with these partners on the MIT Regional Entrepreneurship Acceleration Programme (REAP), and Leeds City Council’s Our Spaces programme for Leeds city centre development.”

What does the future hold for the city? What developments are planned and how will they impact the area?

Bennell: “The Leeds economy, and that of the wider region, is well positioned for the future. Leeds has traditionally been strong in areas such as manufacturing, chemicals, education, engineering, finance and law and we are now also sector-leading in the digital and creative industries, medical technology and business services. Looking ahead, fintech, data analytics and digital industries will be key areas of growth for the city.”

“The diversity of the economy is one of Leeds’s biggest strengths and that should be consolidated as new businesses emerge and grow.

“Cambridge Economic Associates’ forecast of growth for the Leeds city region sees a rate that is 69% higher in the 2015-30 timeframe compared with the 2000-15 timeframe, and projects this as a low-end estimate, due in part to the strength of the city’s growing financial sector.”

Bickers: “Cities will continue to grow and become more important, and Leeds is in a great place to capitalise on this evolution, as it has such a positive future.

“New transport links such as Northern Powerhouse Rail will help underpin this growth and will help to transform Southbank. Projects such as The Tetley, Tower Works and Granary Wharf have really made a difference, however we have not yet achieved a critical mass.

“The completion of Mustard Wharf and new projects by Vastint and CEG this year should help to move this area forward.”

Goldstone: “I’m hoping we’ll see improvements to the train station, bus services and infrastructure, a lot more focus on public realm in the city centre, and driving footfall into there. We’ve had quite a lot of investment in the retail quarter, and retail is probably more successful in Leeds than in other places.”

Bennell: “We need skilled people in good jobs with access to training and we need to support businesses to meet the challenges of the future economy. Leeds’s future has health at the heart of the region, and growth through technology and innovation. Leeds, and the UK, needs to remain open to doing business globally and we must continue to welcome talented people from around the world.”

Goldstone: “In five years? We’ll have more purpose-built high-quality residential. We’ll have the beginnings of the Southbank encroachment as more companies look to move south of the river. We’ll have a lot more of the sites in the city centre filled in, and I’m hoping the world will know that we are a place to do fintech, and that Channel 4 will be fully embedded into the city, with a lot of good activity happening as a result. It’s exciting times.”