Vince Cable recently accused London of acting like a giant machine that sucks in all of the talent from the rest of the country. Our new report, Cities Outlook 2014, shows that London is indeed a magnet for young people from across the country. But the big question is: why does this happen, and what does it mean for policy?
First, let’s look at the key stats. Somewhat counterintuitively, overall London loses population to the rest of the country. But this is overwhelmingly to the Greater South East, whereas between 2009 and 2012, almost every city outside this region lost population to the Capital. London also sees large gains in people aged 22-30 – all but five cities (all of which are in the Greater South East) saw people within this age group leave to the capital.
This data highlights that London is indeed attracting young workers from across the country, but that upon starting families, these people begin to exit the capital. Critically however, they tend not to return home, and a number of them are likely to continue to work in London.
The biggest losers from London’s pull on young workers are our other large cities. Between 2009 and 2012, there was a net flow of 48,000 22-30 years olds to the capital from large cities. This was enough people to sell out Manchester City’s Etihad Stadium.
Migration patterns in large cities look very different to the capital – they see a huge inflow of 18 to 21 year olds, largely reflecting the arrival of university students, but they see a significant loss of 22 to 30 year olds. In other words, once students graduate, they take their degree to pastures new.
So the universities of large cities attract a large number of young people. But cities then struggle to retain them once they graduate.
But what factors are driving these trends, and can anything be done to address them?
First, it’s important to note that London attracts young people because of the amenities that only a big city can provide. Yet while the ‘bright lights’ of the capital are likely to play a role, England’s large cities should also benefit from an in-migration of people from smaller cities and non-city areas.
Second, London simply boasts an unrivalled number of available jobs and career progression opportunities. There are more graduate level jobs in London than in the large cities – on average between 2009 and 2012, 35% of all jobs in London were graduate jobs, while this figure was 26% for the large cities.
The challenge for cities outside of London, therefore, is for them to offer sufficient economic opportunities for young people to stay beyond university. If this is to happen, we need to see far greater levels of devolution to UK cities. Currently they have very little control over the money that they are given, and that means that they have little flexibility to divert funds to help create jobs and boost their local economies.
Bristol and Birmingham are very different places, with different strengths and challenges. And yet in general national policy does not recognise this. Until we place power in the hands of local politicians our cities outside of London will struggle to fulfil their potential. And this is not just bad for their local economies, but for UK plc as a whole.
* Alexandra Jones has been Chief Executive of the Centre for Cities since summer 2010.