Let’s make one thing clear from the start: we’re not talking glamour, we’re talking business.
London is without doubt Britain’s sexiest city. It’s got the best restaurants, culture and nightlife. It’s also the hub of Britain’s political, economic and media activity and has easily the highest profile – with or without the 2012 Olympic Games. However, London is also incredibly expensive to live in, rent premises in and hire staff in. It’s almost impossible to drive into, around or out of and is a nonsensical location from which to distribute goods to the rest of Britain. With this in mind, and without excluding London, we set about finding where the best place to run a business in Britain really is.
Methodology
The evaluation process began by identifying what you, the entrepreneur, would consider if you were looking to relocate, expand, buy or start a new business in any area of Britain. We settled on seven factors, broken down into the following sub-categories:
• Location (population; region)
• Workforce (availability; quality; skills; labour costs; universities)
• Premises (office stock; local authority business rates)
• Quality of life (house prices; schools; crime)
• Grants and funding (available grants; business angel networks; regional venture capital)
• Transport (average road speeds; motorways and airports)
• Business activity (business population; growth rate; corporate insolvencies)
We devised a unique scoring system approached from a practical, no-nonsense standpoint, consistent with the magazine’s editorial bent and applied it to the largest 20 centres in Britain, and therefore the likely focus for the majority of you. The group is also the same as that surveyed by OMIS Research for Cable & Wireless in July 2004, which provided statistical data for a number of the report’s categories. Finally, the total scores were converted to a percentage and ranked from one to 20. To view the full methodology, visit: www.growingbusiness.co.uk/bestplace
The findings
Location
There’s no getting away from geography. The basics are obvious but unavoidable and, for some businesses, where the selection process starts and finishes. The Midlands is the logical choice for companies that distribute goods to the rest of Britain. The North East, North West, South West, Scotland, Wales and Northern Ireland don’t share that luxury and are also a long way from London. And, of course, London’s superior transport facilities don’t make it any closer to the rest of Britain.
Unsurprisingly then, cities in the Midlands scored high for ‘location’ while those on the coasts and north and south extremes scored low. Cities not based centrally but near to other large cities, such as Manchester, also scored well – as did London for its location at the centre of the vibrant South East and its access to the continent.
Workforce
Geography is closely tied in with social-economics and our findings did little to dispel notions that a north/south divide still exists. It came as no shock that London had by far the highest paid workforce with an average annual salary of £33,118, or that the lowest wages were paid in northern cities traditionally associated with high unemployment and social deprivation, such as Sheffield and Newcastle.
Factoring in workforce skills and qualifications only widened the gap. London, Bristol and Southampton scored significantly higher than former industrial hotbeds Newcastle, Sunderland, Hull and Birmingham. However, strong performances by the three Scottish cities suggests Scotland’s educational and vocational systems are doing a better job than the rest of Britain at repositioning its formerly industrial labour market.
Cities were also scored on availability of workforce within a 30-minute catchment area with data sourced by OMIS Research. London, being so densely populated, scored highly but other cities showed their access to workforce is far larger than population figures suggest. For instance, while Birmingham has a population of 970,892 it has 1.08m workers at its disposal, whereas Manchester, with a population of almost 600,000 fewer, has 1.18m workers in surrounding areas. Likewise, Nottingham, Bradford, Sunderland and Newcastle can reach more than twice their immediate population.
Overall though, from an employer’s perspective, our findings conform with the accepted theory that large post-industrial towns have plentiful resources of lowskilled workers with low salary expectations, and that there are more skilled and better educated workers in the South – but they cost more. Scottish cities, particularly Glasgow and Edinburgh, proved the exceptions to the rule; offering a skilled, educated and moderately waged workforce.
Education and skills cannot be changed overnight and it would have been unfair of us not to consider the effort some cities are clearly making, so we also examined the higher and further educational institutions available. London, again, got maximum marks for variety and number. However, Manchester, Birmingham, Cardiff, Leeds, Sheffield, Liverpool, Leicester and Bradford all made up for the poor performance of existing workforces.
Premises
While businesses often decide or are offered incentives to move to an area for the attributes of its workforce – whether skilled or low-cost – the availability and cost of premises is also a major consideration. For instance, London may be comfortably the most expensive place (based on business rates) to hire an office, but it’s virtually without rivals on stock. London has more than 28m square feet of office space with Manchester practically out of sight in second place with 2.15m. Hull, Bradford, Liverpool, Leicester and Belfast were the cheapest but, except for Liverpool, had limited availability. The mass regeneration of Manchester, Birmingham and Liverpool undertaken in recent years ensured all three cities scored well for availability and value.