Young professionals resist London’s lure and head north for work

Migration of workers to and from cities such as Manchester and Leeds evens out.

Financial Times - 11 May 2017

For decades, young professionals in England’s provincial cities had only one destination in mind: London. These days, the traffic is going both ways.

Rick Lamb moved from London to Manchester for personal reasons but once he started looking for job, the range and quality of work astonished him.

After a journalism course in London, he had carved out a career in digital marketing and he and his wife Louise did the “classic commuter-belt thing”, moving from Hackney to St Albans outside London as they prepared for a family.

But after their first baby’s birth they wanted to return closer to parents in north-west England. “I realised I could do my job there. Next morning I had five recruiters contacting me,” he said.

Though England’s big cities struggle to resist the economic pull of London, improvements in transport links and office space, the seemingly relentless upward march of house prices in the capital and, as Mr Lamb testifies, better job opportunities, are slowly drawing business away.

As a result, the migration of workers to and from cities such as Manchester, Birmingham and Leeds is evening out. Only last week, Burberry announced it would move 300 staff to Leeds from London; on Wednesday, a Swiss electronics distributor, Distrelec, said it had chosen Manchester for its European headquarters, creating more than 100 jobs; SportPesa, a betting company, said recently it would create up to 100 jobs when it opened its main European office in Liverpool; and on May 5, HSBC finished the first stage of its new headquarters for retail operations in Birmingham — 1,000 staff will move there from London.

Leaving London would create “significant savings”, Burberry said, and enable teams to work better together. Finance, IT and other service jobs will move and the office should open in October.

Roger Marsh, who chairs the regional development group for Leeds, said it was “fantastic to see Burberry . . . recognise the strength of our professional services offer and our heritage within the textiles industry”. Burberry has also said it will move manufacturing and design jobs to Leeds but has not given a date for doing so.

Mr Marsh also reports “increased levels of interest from FTSE 100 companies who see benefits such as increased productivity as a result of relocating here”.

In the case of Distrelec, it is consolidating offices from across Europe and has picked the new 2 St Peter’s Square building by Manchester Town Hall, one of many office blocks going up in regional cities. Most match the standards of London but at about a third of the price.

In Birmingham and Leeds, new offices are going up at rates not seen for a decade and billions have been spent on new shopping and leisure centres. Moving offices away from London can bring big cost savings. Moving people can be more challenging. When the BBC transferred 2,300 jobs to Salford, only 46 per cent of eligible staff came along and a hiring spree ensued. It now employs more than 3,000 in Salford and is advertising for software developers against fierce competition.

HSBC says it has filled more than half the 1,000 jobs it is moving to Birmingham from January 2019; more than 2,000 staff in London have registered an interest in transferring, according to Antonio Simoes, chief executive.

One challenge is that so many graduates head for London, although universities say more are remaining in their cities because of the cost of living in the capital. Sky Bet, a gaming company headquartered in Leeds that employs 1,000 people, has set up its own training academy to bridge the gap. It has also opened a Sheffield office to attract skilled staff who would not commute 30 miles to Leeds.

Although there are still only six FTSE 100 businesses based between Birmingham and the Scottish border, compared with 10 in 1984 when the index was first compiled, Mr Lamb has no complaints.

The north of England has some significant marketing, retail and technology companies and Mr Lamb found a job as head of operations at a digital marketing company based in Warrington, between Liverpool and Manchester.

“It is exciting here and there is a decent amount of confidence,” he said. He and his wife have bought a bigger house in Hale — the “St Albans of Manchester”, as he called it — 20 minutes by tram from the city centre.

“I have not taken a step backward even though my main motive was personal,” he said. “For a growing number of . . . digital jobs, you need to be in the north-west.”

 

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Key Facts

  • In Birmingham and Leeds, new offices are going up at rates not seen for a decade and billions have been spent on new shopping and leisure centres.