Manchester – A look at economic growth

By Robert Hawley

Last month’s Autumn Statement included the promise of a continuing commitment to investment in the North; particularly vis-a-vis Manchester, the Northern Powerhouse.  However, there has been much speculation that even though Manchester has been tipped as the fastest growing city outside the South of England, the Government’s measures with regard to the North in general will have very little impact upon the region until the next decade.

Ernst & Young published a report in December 2015 stating that whilst Manchester is due to record growth in GVA of 2.5% per year between 2015 and 2018,  the North West as a whole will only grow 2% per year (with Liverpool predicted to increase by a more modest 1.9%), making it the UK’s sixth fastest growing region.  London is forecasted to grow by 3% per year, the South East by 2.5%, the East by 2.4%, the South West by 2.2% and the East Midlands by 2.1%.  All of which points to a continuing disparity between the North and South; at least for a few more years.

It is not all doom and gloom, however, with EY predicting that Manchester will see a growth in employment, with 4,300 new jobs created in 2015 alone; fuelled by some 1,300 new positions in the professional, scientific and technical services sectors.  The rest of the North will begin to experience real growth after 2020, when the impact of the Northern Powerhouse and infrastructure projects are expected to take effect.  The re-balancing of the UK economy will have limited impact in the short term, but from 2020 onwards we can expect to see some dramatic changes for the North of England; particularly towards the end of the next decade, when the benefits of HS2 begin to be felt.