Burnley shows why you can’t rebalance the British economy through manufacturing

Hammerton Street, Burnley. Image: Tim Green/Flickr/creative commons.

Manufacturing plays a larger role in Burnley than in any other British city, taking up 22.6 per cent of its total jobs share. And yet despite this, it has one of the weakest economies of any UK city. So how does this square with calls for a manufacturing renaissance to create a brighter future for struggling places?

This isn’t something that is unique to Burnley. As the chart from our data tool below shows, those cities that had a higher share of jobs in manufacturing tended to have lower productivity in 2017. And no British city with over 10 per cent of its jobs in manufacturing met the national average in GVA per worker. On the other hand, the top ten performers in terms of productivity had much lower shares of jobs in the manufacturing sector. (Of these, Swindon had the highest share at 8.4 per cent.)

Burnley’s lagging performance in terms of productivity is reflected in how well it does on other measures too. Cities Outlook 2019 shows that it:

  • Had some of the highest levels of young people claiming unemployment benefit (60th out of 63);
  • Ranked in the bottom ten in its business start-up rate, with only 36.2 businesses per 10,000 population (the national average was 57.8);
  • Has seen the third slowest growth in population of any city in the last decade;
  • Had the lowest average house price at £107,900, and is the most affordable city, with a housing affordability ratio of 4.3.

This sits somewhat uncomfortably with the notions of both Labour and the Conservatives of rebalancing the economy towards manufacturing. The line goes that Britain doesn’t make anything anymore and, in a world of black and white and no shades in between, is over-reliant on finance and doesn’t make enough goods. But if anything, the data suggests that what Burnley needs is a rebalancing away from manufacturing if its fortunes are to improve, not more of the same.

It also challenges the notion of looking at an area’s ‘strengths’ when assessing its performance, something that many strategies and independent reviews are very fond of doing. But this is the wrong way of looking at the problem. The question for weaker cities like Burnley should not be “What do we have?” Rather, it should be “what have we not got enough of?”


In Burnley’s instance, it is a lack of higher-skilled, higher-paid jobs in both manufacturing and services. In manufacturing, data from the Census shows us that for every high skilled job in manufacturing in the city, there are five lower skilled jobs. This compares to a ratio of one to one in Cambridge and Crawley. And at 6 per cent of all jobs in 2017, it had the lowest share of knowledge-based jobs of any British city.

While national politicians may miss the point on this, it is something that is well understood by Burnley Borough Council. As a result, it has been focussing efforts on expanding the University of Lancashire’s presence in the city, has set out a masterplan for its city centre which goes beyond retail, and where it has been supporting manufacturing firms it has been to help them raise their productivity and the skills of their workforce. All with the aim of helping its economy to adapt in the face of ongoing changes to the global economy.

Assisting cities to adapt to the constant changes in the global economy should be the goal of government. Sadly too much national policy – the Regional Growth Fund and Enterprise Zones to name but two – looks to the past, ignores the situation that cities find themselves in, and doesn’t help cities to adapt to the ongoing changes in the world of work.  In many instances, national politicians are more nostalgic than local politicians.

Recent decades have not been kind to Burnley. If it, and other cities like it, are to fire again, they can’t be constrained by nostalgia. They need help to make themselves attractive to tomorrow’s businesses and workers, whatever industry they’re in.

Paul Swinney is head of policy & research at the Centre for Cities, on whose blog this article first appeared.

You can see more data for all UK cities on the Centre for Cities’ data tool.

 
 
 
 

The Tory manifesto promises to both increase AND decrease the rate of housebuilding

Housing secretary Robert Jenrick. Image: Getty.

In his 2014 Mansion House speech, the then-chancellor George Osborne expressed with uncharacteristic honesty the motives at the heart of how the Conservatives see British housing politics: “The British people want our homes to go up in value, but also remain affordable; and we want more homes built, just not next to us.”

Five years later these contradictions remain unreconciled and present in their manifesto, which contains two different and contradictory – but clearly extensively targeted and focus-grouped – sets of policies.

The Conservatives have two housing targets. The first is to make significant progress to hitting “our target of 300,000 houses built a year by the mid-2020s”. The second is their aim to build “at least a million new homes” during the next parliament, which implies a target of 200,000 homes a year. This is not only 100,000 lower than their initial target but also lower than the current rate of housebuilding: 213,660 new homes a year. They have therefore implied at separate points in the same manifesto that they intend to simultaneously increase and decrease the rate of housebuilding.  

There are similar conflicts in their approach to planning. They intend to make the “planning system simpler” while simultaneously aiming to introduce community-led design standards for development and planning obligations to provide infrastructure for the local community.

None of this is unsurprising, The Tories don’t seem to know if they want to build more houses or not – so of course they don’t know whether they wish to make it easier or harder to do so.  

Politicians like obfuscation on housing policy to placate NIMBY voters. Take for example prospective Conservative MP and ‘environmentalist’ Zac Goldsmith’s crusade to save treasured local car parks. The manifesto can equally be accused of pandering to NIMBY instincts, protecting their shire voters from all housing, including ones they might actually need or want, by promising to protect the greenbelt.  

Instead, Conservatives intend to foist development on Labour-leaning inner-city communities and prioritising brownfield development and “urban regeneration”. This requires massive, infeasible increases in proposed density on brownfield sites – and research by Shelter has shown there are simply not enough brownfield sites in cities like London. Consequently, it is not clear how such a policy can co-exist with giving these inner-city communities rights on local design. Perhaps they intend to square that circle through wholesale adoption of YIMBY proposals to let residents on each street opt to pick a design code and the right to turn their two-storey semi-detached suburban houses into a more walkable, prettier street of five-storey terraces or mansion blocks. If so, they have not spelt that out. 

Many complain of NIMBYism at a local level and its toxic effects on housing affordability. But NIMBYism at the national level – central government desire to restrict housebuilding to make house prices rise – is the unspoken elephant in the room. After all, 63 per cent of UK voters are homeowners and price rises caused by a housing shortage are hardly unpopular with them. 


There is anecdotal evidence that protecting or inflating the value of homeowners’ assets is central to Conservative strategy. When George Osborne was criticised for the inflation his help to buy policy caused within the housing market, he allegedly told the Cabinet: “Hopefully we will get a little housing boom, and everyone will be happy as property values go up”. More recently Luke Barratt of Inside Housing noted that most Conservatives he spoke to at the 2018 party conference were scared “they’d be punished by their traditional voters if the values of their homes were to fall”. He was told by a Conservative activist at the conference that, “If you build too many houses, you get a Labour government”.

But the senior figures in the Conservative Party are painfully aware that the continuing housing shortage presents major long-term problems for the Party. As the manifesto itself acknowledges: “For the UK to unleash its potential, young people need the security of knowing that homeownership is within their reach.” Perpetual increases in house prices are incompatible with this goal. The problem has greatly contributed to the Conservatives’ severe unpopularity with a younger generation priced out of decent accommodation. 

Equally, there is increasing evidence that ‘gains’ from rising house prices are disproportionately concentrated in the south of England.  The differences in housing costs between regions greatly reduce labour mobility, suppressing wage growth in the north and midlands, which in turn leads to greater regional inequality. The policy of coddling southern homeowners at the expense of the economic well-being of other regions is a major long-term stumbling block to Conservative desires to make inroads into the ‘red wall’ of Leave-voting labour seats outside the south.

Before dealing with the issue of where housing should go, you must decide whether you want to build enough housing to reduce the housing crisis. On this issue, the Conservative response is, “Perhaps”. In contrast, even though they may not know where to put the necessary housing, the Labour Party at least has a desire in the abstract to deal with the crisis, even if the will to fix it, in reality, remains to be seen. 

Ultimately the Conservative Party seems to want to pay lip service to the housing crisis without stopping the ever-upward march of prices, underpinned by a needless shortage. Osborne’s dilemma – that the will of much of his party’s voter base clashes with the need to provide adequate housing – remains at the heart of Conservative housing policy. The Conservatives continue to hesitate, which is of little comfort to those who suffer because of a needless and immoral housing shortage.

Sam Watling is the director of Brighton Yimby, a group which aims to solve Brighton’s housing crisis while maintaining the character of the Sussex countryside.