A report was released earlier today to widespread commentary about the state of the UK’s cities, and the effect that London has on the UK economy.

Like all such reports, it says exactly what you think, and disagrees with everything that the opposition says — and visa-versa.

There was however a table there, which was highlighted on Twitter and looked very interesting as it seems to suggest a correlation exists, which has been supported by anecdotal comments I have been told by some railway firms.

What was striking was the list of cities in the UK ranked by the percentage of their population employed by a company that was also headquartered in London.

So, these can be considered to be the regional outposts of the London HQ.

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What seemed to be showing up was that those locations with a high level of local  employment by a London based firm also had good transport links to London.

It is easy and reliable for staff at the London head-office and at the regional outposts to meet up. Cheap, probably not! But fast and reliable yes.

When you look at the less well performing cities, even those which are geographically not much worse in terms of physical location seem to do poorly because of the lack of decent rail links.

As was also noted in the twitter debate, the rail links might exist, but they might be indifferently operated with too few trains per hour to make it an attractive option to businesses who often prize reliability more highly than simply shaving a few pennies off the travel budget.

Now, this seems to fit in with some conversations I have had over the past few years during my site visits to see the redevelopment of the King’s Cross station, and the surrounding area.

The cleaning up of the railway station, and the improvements to the railway service were absolutely critical to the regeneration of the space behind. Although there’s no explicit evidence that companies such as Google chose King’s Cross over another location because of the railway, everyone at Network Rail and the rail operators I spoke to suggested that it was a very big factor in the discussions.

Managers don’t want to start their trips by hanging around dirty unloved buildings and travel on run down train lines. Managers also don’t want their staff doing the same. It affects staff morale, which affects work productivity.

So substantial improvements in railways in London encourages companies to locate close to the railways, and gives them the confidence that they can quickly and reliably nip “up north” to regional centers for meetings.

It is the railway improvements in London that seem — anecdotally — to be helping preserve job creation outside London by otherwise London-centric employers.

These railway improvements need to spread to the regions as well. It’s all very well a Google exec having a nice railway station in London, but if the destination station isn’t, well, frankly “a destination building”, then a lot of that effort can be wasted.

We are humans, and subject to human frailties, and if you travel from the bright lights of London and arrive in a shabby tired station in the regions, it will colour your opinion of the area.

As much of the debate is about how the regions can improve their job creation and stop the great sucking sound coming from the big city, then what is needed is to improve the transport links to the big city.

Some, many indeed, argue that improved transport links to London encourages people to move to the city, but the chart above seems to show the opposite — good transport links encourages London firms to diversify and create local jobs.

Make it possible to work in the regions by making occasional travel to London a viable alternative to having to live there.

After all, it can be quicker to get from King’s Cross to Milton Keynes than it can to some parts of South London!

Obviously, that is part of the appeal of HS2 — to boost the capacity and reliability of the railway network so that the regions can compete more effectively against London, by, being less of a hassle to get to when travelling from London.

Making it High-Speed as well adds little to the cost, so might as well do that at the same time.

It could be that a great rail renewal in the UK will be itself a far bigger driver of regional employment growth than any host of government initiatives could ever come up with.

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11 comments
  1. As an anecdote I argue sometimes that Birmingham airport is the best airport from NW1 – pop down to Euston, get on a fast train and a nice compact airport awaits. Unlike the alternatives which are a pain to get to

    Also, HS2 somehow, *please*. Euston needs nuking as a terminus.

    • Daniel Tonks says:

      I have been advocating over on SkyScraper City that the whole Airport Capacity problem can be much easier solved by expanding Birmingham, rather than building a new Airport in the Estuary or expanding Heathrow. It will be 25 minutes from Central London by the time any Thames Estuary airport would open, and it will boost jobs in Birmingham, where the jobs are most needed.

      It has been met from some “But it isn’t London” snobbery, however.

  2. Greg Tingey says:

    What seemed to be showing up was that those locations with a high level of local employment by a London based firm also had good transport links to London.
    In that case, why are Stoke & Hull doing at/near the bottom of the list?
    Stoke: Two trains an hour 146 miles, 85-87 minutes.
    Hul: OK not so good, about 8 trains a day, 206 miles 140 mins approx
    Incidentally, the display of train time to/from Hull is abysmal – I wonder of that is relevant?

    • IanVisits says:

      You’ve answered your own question – two trains per hour, or worse is not a decent service.

  3. Nigel says:

    Some problems with your analysis….
    It disregards all other possible reasons beyond rail links as a creator of employment. This was the fundamental flaw in KPMG’s report for HS2 which Robert Peston pointed out about half an hour after it was published.
    It assumes all jobs are of equal value as a measure of economic value, when in reality, many regional offices of national businesses are back office support at the lower income range, requiring a lower skills pool. Skill levels are the most significant economic drag on regional cities and it’s getting worse.
    If there was some powerful correlation of private enterprise and job creation, you’d see more than one city that is served by either the WCML or ECML in the top 10.

    • IanVisits says:

      No problem with my analysis, as I never made any claims that jobs in a region would be comparable to jobs in London.

      It’s common sense that jobs done in secondary offices will never be as comparable as those done in the headoffice — they are after all very different functions.

      My point is that a London based headoffice, given good transport links would have the flexibity to stage those other jobs outside London as well.

  4. Nigel says:

    Correction to above, I missed off Milton Keynes on the WCML. So two out of top 10.

  5. Nigel says:

    >>No problem with my analysis, as I never made any claims that jobs in a region would be comparable to jobs in London.<>It’s common sense that jobs done in secondary offices will never be as comparable as those done in the headoffice — they are after all very different functions.<>My point is that a London based headoffice, given good transport links would have the flexibity to stage those other jobs outside London as well.<< But this is undermined as a theory by the absence of cities like Mcr, Leeds, B/ham, Bristol from the top 10, which are both very well served by rail and have a diverse skills pool.

    • Nigel says:

      The formatting of replies seems all over the place.

      My point was that you’ve ignored my chief criticism of your argument, which is that you assume that rail connectivity is the only factor at play. This was one of the many flaws in KPMG’s report for HS2. Robert Peston and Henry Overman have written good articles on this wonky thinking which are worth looking at.

    • IanVisits says:

      I didn’t say it was the only factor — indeed I noted explicitly that it “seems to suggest a correlation exists”.

      Again, it should be too obvious to state it, but for clarity, quite obviously building a decent rail link is not the only factor in how a regional economy prospers, or declines.

  6. Matt says:

    Ian, its an interesting analysis and ‘feels’ right, but my gut feeling is that that those stats are of limited value as they reflect concentrations of financial services back-offices, for whom you say quite rightly that fast links to London are important and cost is relatively unimportant. I suspect that you could also find this pattern with outposts of central Government – e.g. Sheffield, Cheltenham.

    It goes without saying that not all the world is London-centric, and as you move further down the ‘food chain’, a link to a local hub like Leeds or Manchester is more important than a link to London, or proximity to airports. Also, price is important to smaller companies and a big deal for those of us in Bristol and a deterrent to spending more time with London clients.

    What I would suspect that you could find is a direct correlation between the quality of rail service (frequency/%overcrowding/reliability) from a station and the unemployment rate and the average income of residents in the immediate area of the station (lets say a 15 minute walk/drive/ bus journey). I’m not sure that you could prove causality, but it might be enough to get more railway stations built and service frequencies improved.

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