Do Britain’s secondary cities perform better if judged on GVA per head, rather than GVA per worker?

Hamburg: unexpectedly productive. Image: Getty.

The latest instalment of our series, in which we use the Centre for Cities’ data tools to crunch some of the numbers on Britain’s cities.

For the last few weeks, I’ve been trawling Centre for Cities’ data to first demonstrate, and then explain, a worrying piece of British exceptionalism. With the exception of London, our big cities are economically much weaker than their peers in France or Germany, Italy or Spain. Birmingham, Manchester, Glasgow and Leeds all have significantly lower productivity, expressed as GVA per worker, than similarly sized cities like Hamburg, Barcelona or Marseille.

Digging through the numbers, I found that they have smaller service sectors; lower numbers of businesses; don’t produce many patents; and have a lot of workers with low skills. I have another theory about what’s gone wrong in Britain – one which, if you’ve ever been to CityMetric before, you can probably guess. But before getting into that I want to address a question a couple of people have asked about the data.

In short, it’s this: is GVA per worker a misleading measure? Since the financial crisis, unemployment in Britain – in contrast to many European nations – has stayed low. GVA per worker is a measure that might flatter cities with higher unemployment, because they have fewer workers relative to their size. Perhaps GVA per head would be a fairer measure – on one which, the implication goes, British cities a more likely to punch their weight.

When someone first threw this argument at me, I was slightly torn, if I’m honest. The measure is clearly limited in its usefulness: taken to extremes, a city with one worker and 999,999 people on the dole could in theory have an enormous GVA per worker, but that doesn’t mean it’s a healthy economy.  

And yet, the thing we’re interested in here is productivity – the rate at which value is produced. To know that, you need to have at least some idea of the amount of work being done – so the number of workers seems a more useful measure than raw population.

That, though, is angels-on-the-head-of-a-pin stuff. We can go beyond that, to actually compare how to two measures work out in practice.

Here’s a scatter graph plotting GVA against population size. You’d expect these to be roughly correlated – more people generate more wealth. But that correlation is obviously not perfect, as some places are richer than others; and generally speaking cities that are further left than you’d expect are underperforming, while those to the right are over-performing:

Click to expand.

You can see that both Milan and Naples are outliers: northern Italy is surprisingly rich, southern Italy surprisingly poor. You can also see that German cities (in black) are generally also more productive than the norm.

But from a British perspective, it’s the position of Birmingham and Manchester that’s most concerning: two big cities that look way less affluent than you’d expect. Indeed, both Hamburg and Munich are significantly smaller – yet also significantly wealthier.

The key question, though, is what does switching from GVA per head do to the rankings? Here are our 19 cities, ordered by GVA per worker:

Click to expand.

And here they are ordered by GVA per head:

Click to expand.

Switching measure does change the rankings, a little. On the per head measure, Seville looks significantly better, going from worst to best performing of the three Spanish cities: that suggests a lower employment rate than in Valencia or Barcelona. And Naples goes from a little way behind the pack to way, way behind which I think suggests a much higher one, although my head is starting to hurt.

At any rate, that suggests that judging cities on GVA per head, rather than GVA per worker, can make a difference.


But it doesn’t change the fact that the British cities are clustered near the bottom. Okay, Glasgow and especially Leeds do rather better on the per head measure than they do on the per worker one. But Birmingham and Manchester still look terrible. Britain's secondary cities are still, as a group, performing worse than those of the other four countries.

To put it bluntly: whichever measure you use, something has clearly gone wrong in Britain's big cities. The only question is what.

Next time, in the final instalment of this mini-series, I’m going to put forward a theory as to what that might be. Until then, why not have a play with the Centre for Cities “Competing with the Continent” database?

Jonn Elledge is the editor of CityMetric. He is on Twitter as @jonnelledge and also has a Facebook page now for some reason. 

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Here are eight thoughts on TfL’s proposed cuts to London’s bus network

A number 12 bus crosses Westminster Bridge. Image: Getty.

In 2016, the urbanism blog City Observatory had a modest proposal for how American cities could sort out their transport systems: “Londonize”.

Its theory, the name of which referenced another popular urbanism blog, Copenhagenize, was that the key plank of Transport for London’s success was something that even transport nerds did not consider very sexy: its buses.

Though the Tube might get more glamorous press, London’s bus service really is impressively massive: It carries roughly 2.3bn passengers per year—much more than the Tube (1.3bn), close to the New York City subway (2.8bn), and nearly half as much as every bus service in America combined (5.1bn), while serving a population roughly 1/35 as large.

How has TfL done this? By making its bus network high frequency, reliable, relatively easy to understand and comprehensive. We rarely talk about this, because the tube map is far more fun – but the reason it’s so difficult to fall off the transport network in Greater London is because you’re never that far from a bus.

Given all that, we should probably talk about TfL’s plans to rethink – and in most cases, cut – as many as 36 different central London bus services over the next few months.

I’m not going to rehash details of the changes on which TfL is consulting from next month: there are just too many of them, and anyway it’s someone else’s scoop. The story was originally broken by Darryl Chamberlain over on 853 London; there’s also some fascinating analysis on Diamond Geezer’s blog. You should read both of those stories, though preferably not before you’ve finished reading this one.

Before offering my own analysis of the proposed changes, though, I should offer a few examples. More than a dozen routes are facing a trim: the 59 from King’s Cross back to Euston, the 113 from Oxford Circle to Marble Arch, the 171 from Holborn all the way down to Elephant & Castle and so on. A couple – the 10, the 48, the C2, and at most times the special routemaster version of the 15 – are being withdrawn altogether.

On, and one new route is planned – the 311, from Fulham Broadway to Oxford Circus. This will help plug some of the cuts to the 11, 19 and 22.

So, what does all this mean? Some thoughts:

1) This might not quite be as awful as it initially sounds

TfL says that demand for buses has fallen by around 10 per cent in London in recent years. It predicts it’ll fall further when Crossrail opens, as passengers switch to the new line, or to the tube routes relieved by the new line. So: the idea of taking some unwanted capacity out of the system is not, in itself, terrible.

Striping out unnecessary buses should also improve air quality in some of London’s worst pollution hot spots, and improve traffic flow, hopefully speeding up journeys on those buses that remain. 

A map from the presentation in which TfL explained its plans, showing the reduction in bus numbers on key arteries. Hilariously, notes Darryl Chamberlain, “It no longer produces its own maps, so has had to use one prepared by a bus enthusiast”.

The plans might even free up buses and staff to increase frequencies in outer London where demand hasn’t fallen – though these plans won’t be unveiled until next year and, for reasons I’ll come to below, I’ll believe it when we see it.

2) For many bus users, a lot of these changes will pass almost unnoticed

By my count, I use nine of the affected routes with any regularity – but only three of the changes are things that I’m likely to be at all inconvenienced by. Most of the changes either affect a part of the route I don’t take, or one where there are easy, and pain free, alternatives.

This is anecdotal, obviously – perhaps I’m just lucky. But my suspicion is that a lot of these changes will go unnoticed by most passengers. It’s only the sheer number of them happening at once that makes this look like a big deal.

3) The Hopper fare makes this easier...

Once upon a time, if you had to switch buses, you had to pay a second fare. This isn’t true of journeys on the tube or railways – and since bus passengers have, on average, less money than tube passengers, it amounted to a pretty unfair tax on poorer Londoners.

But in January, in what is probably his most notable policy achievement of his two years in office so far, London’s mayor Sadiq Khan changed the rules. Now you can take as many buses as you want within an hour, for a single fare: that means you can switch buses without paying a penalty.

That will have made it easier for TfL to cut routes back: replacing a direct bus journey with one that requires a change no longer means imposing a financial penalty on passengers.


4) ...but not that easy

That’s about where the good news stops, though – because there are reasons other than cost why people prefer direct bus routes. Needing to change buses will be difficult for anyone with any form of mobility impairment, for example. Even for those of us lucky enough not to fall into that category, it’ll be annoying: it’s just easier to stay in one seat for 40 minutes than to get turfed off and have to fight for a new one halfway through.

More than that, from the passengers’ point of view, excess capacity feels quite good a lot of the time: it means your bus may well be nice and empty. Reducing the number of buses along those key corridors will also make those that remain more crowded.

5) The motive is almost certainly financial

Another of Sadiq Khan’s big policy promises was to freeze fares. He made this promise at a time when central government is massively reducing the financial support it gives TfL (the work, Chamberlain notes, of Evening Standard editor George Osborne, back when he was chancellor). And the Hopper fare, while a great idea in many ways, means a further reduction in income.

So: TfL is scrambling for cash: this is why I remain cynical about those new outer London bus routes. I would be amazed if money wasn’t a motivation here, not least because...

6) TfL thinks no one will notice

Any attempt to reduce tube frequencies, let alone close a station, would result in uproar. Hashtag campaigners! Angry people pointing at things in local newspapers! Damning reports on the front of the Evening Standard from the bloke who made it happen!

Buses, though? Their routes change, slightly, all the time. And do you really notice whether your local route comes every 10 minutes or every 12? That’s not to mention the fact that bus passengers, as previously noted, tend to be poorer – and so, less vocal – than tube passengers.

So cuts, and the savings they bring, are much easier to sneak through. TfL probably would have gotten away with it, too, if it hadn’t been for those meddling bloggers.

Although...

7) Scrapping the C2 might be a mistake

The C2 runs from Parliament Hill, through Kentish Town and Camden to Oxford Circus. In other words, it links north London, where a lot of journalists live, to the offices of the BBC and Buzzfeed.

As occasional New Statesman writer James Ball notes, this is probably not the easiest route to quietly shelve.

8) None of this is set in stone

The consultation doesn’t even begin until next month and then will run for six weeks – so all these plans may yet be forgotten. We shall see.

Anyway – here’s Darryl Chamberlain’s original scoop, and here’s some detailed analysis on Diamond Geezer. Please support your local bloggers by reading them.

Jonn Elledge is the editor of CityMetric. He is on Twitter as @jonnelledge and on Facebook as JonnElledgeWrites.

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