Why business clusters are an increasingly urban affair

Silicon Valley: the cluster effect in action. Image: Getty.

Below a kebab shop in Shoreditch, at the end of a corridor covered with old Czech newspapers, an appointment-only establishment serves cocktails with a theatrical twist. Holy Smoke is essentially cognac, but comes hidden in a bible accompanied by smouldering frankincense and myrrh; Old Castro is rum poured over dissolving candy floss. Reviews of Lounge Bohemia on social media range from hip to hype.

Sustained by the well-paid workers of the East London tech scene, such bars are increasingly en vogue. They might not seem like an obvious magnet for productivity, yet some firms have located in or re-located to the area to recruit or retain the talented people who drink in them. A technology hub has emerged, which the government has branded “Tech City”.

The attraction of city living for the workers of the digital economy helps explain a shift in the innovation landscape. Rather than building on green-field sites, as the Silicon Valley pioneers did in the 1940s, a rising number of high-growth companies are choosing to locate and congregate in the core of cities, which offer advantages such as access to skilled labour and knowledge sharing.

“We are seeing the biggest rural urban migration in history,” said Peter Madden, chief executive of the Future Cities Catapult, a government-funded program to stimulate innovation. “Fashions have ebbed and flowed, but the last 150 years has been very urban.”

Competition for talent pits cities against each other: from Berlin, New York and Paris, to Beijing, Tel Aviv and even new upstart tech scenes such as Beirut. Investment brochures boast about a creative scene with art galleries, bars, restaurants and temporary “pop-up” installations. Eased visa restrictions, investment programs and direct incentives complete the offer.

This has led to a revived interest in business clusters – geographic concentrations of interlinked businesses – as a means of attracting mobile investment to stimulate growth. But building expensive out-of-town facilities would be unsuitable for footloose digital economy firms, many of whom require little more than a good internet connection. The new tools of economic development are downtown co-working spaces, and start-up incubators and accelerator programs.

Research by the Centre for Cities think tank and McKinsey, a consultancy, identifies 31 “economically significant clusters” in the UK: from financial services in London to Scottish whisky. Accounting for 8 percent of UK business but 20 percent of output, they are a “major contributor to growth”, and offer high salaries.

Centre for Cities Analyst Edward Clarke says it’s not possible to classify all of the 31 clusters as either urban or rural: many, such as Motorsports Valley in the Midlands, straddle large areas which include both. But he insists the most productive clusters “benefit from the fact that they are in cities”.

While fast-growing digital economy firms hog media attention, however, research-oriented firms in other industries – bioscience, for example, or motorsports – still require access to purpose-built facilities. “It depends where the focal point or the node is,” says Nigel Walker, head of access to finance at the Innovate UK agency. “Shoreditch is a village with artistic flair, and that wouldn’t work on a campus. But something that needs access to experimentation facilities, then maybe a campus is necessary.”

Governments continue to invest in them, from Russia’s Skolkovo Innovation Centre on the outskirts of Moscow to the Paris-Saclay research facility. Successful sites bring researchers, or people with ideas, together with entrepreneurs to turn those ideas into businesses, and access to finance. They also have good connection links to other centres.

In 2011, the government awarded the British Bioscience Research Council £44m to invest in its Babraham Research Campus, on the outskirts of Cambridge. Dr Celia Caulcott, its executive director for innovation & skills, explains that the campus is designed to attract small bioscience companies through access to world-leading researchers and facilities.

“It’s about proximity to discovery,” she explained, during the Innovate UK conference in London earlier this month. “We have invested to make sure that great research facilities are available to small companies that couldn’t possibly afford access to those things on their own.”

The flexibility of accommodation on the site appears to have given it the “stickiness” that economists crave. Will Spooner, chief science officer at Eagle Genomics, says the company has occupied seven different offices in six years on the campus as it expanded from 3 to 22 people: as the company grew, the space it occupied could grow with it, without the upheaval of moving to a completely new site.

Innovation, of course, doesn’t stop at city borders. Two “growth areas of national importance” attached to London – the Thames Gateway and the London-Stansted- Cambridge- Peterborough areas – extend far beyond the M25. Both schemes bring together policy makers across institutional boundaries, in an attempt to create joined-up thinking on issues such as transport, housing, and skills.

Public policy “should not only be one answer centric,” says Michael Joroff, a senior lecturer at the MIT Dept. of Urban Studies and Planning. Or, to put it another way: “A lot of growth will happen where growth happens.”

 

 
 
 
 

12 things we learned by reading every single National Rail timetable

Some departure boards, yesterday. Image: flickr.com/photos/joshtechfission/ CC-BY-SA

A couple of weeks ago, someone on Twitter asked CityMetric’s editor about the longest possible UK train journey where the stations are all in progressive alphabetical order. Various people made suggestions, but I was intrigued as to what that definitive answer was. Helpfully, National Rail provides a 3,717 page document containing every single timetable in the country, so I got reading!

(Well, actually I let my computer read the raw data in a file provided by ATOC, the Association of Train Operating Companies. Apparently this ‘requires a good level of computer skills’, so I guess I can put that on my CV now.)

Here’s what I learned:

1) The record for stops in progressive alphabetical order within a single journey is: 10

The winner is the weekday 7.42am Arriva Trains Wales service from Bridgend to Aberdare, which stops at the following stations in sequence:

  • Barry, Barry Docks, Cadoxton, Cardiff Central, Cardiff Queen Street, Cathays, Llandaf, Radyr, Taffs Well, Trefforest

The second longest sequence possible – 8 – overlaps with this. It’s the 22:46pm from Cardiff Central to Treherbert, although at present it’s only scheduled to run from 9-12 April, so you’d better book now to avoid the rush. 

  • Cardiff Central, Cardiff Queen Street, Cathays, Llandaf, Radyr, Taffs Well, Trefforest, Trehafod

Not quite sure what you’ll actually be able to do when you get to Trehafod at half eleven. Maybe the Welsh Mining Experience at Rhondda Heritage Park could arrange a special late night event to celebrate.

Just one of the things that you probably won't be able to see in Trehafod. Image: Wikimedia/FruitMonkey.

There are 15 possible runs of 7 stations. They include:

  • Berwick Upon Tweed, Dunbar, Edinburgh, Haymarket, Inverkeithing, Kirkcaldy, Leuchars
  • Bidston, Birkenhead North, Birkenhead Park, Conway Park, Hamilton Square, James Street, Moorfields
  • Bedford, Flitwick, Harlington, Leagrave, Luton, St Albans City, St Pancras International

There is a chance for a bit of CONTROVERSY with the last one, as you could argue that the final station is actually called London St Pancras. But St Pancras International the ATOC data calls it, so if you disagree you should ring them up and shout very loudly about it, I bet they love it when stuff like that happens.

Alphabetical train journeys not exciting enough for you?

2) The longest sequence of stations with alliterative names: 5

There are two ways to do this:

  • Ladywell, Lewisham, London Bridge, London Waterloo (East), London Charing Cross – a sequence which is the end/beginning of a couple of routes in South East London.
  • Mills Hill, Moston, Manchester Victoria, Manchester Oxford Road, Manchester Piccadilly – from the middle of the Leeds-Manchester Airport route.

There are 20 ways to get a sequence of 4, and 117 for a sequence of 3, but there are no train stations in the UK beginning with Z so shut up you at the back there.

3) The longest sequence of stations with names of increasing length: 7

Two of these:

  • York, Leeds, Batley, Dewsbury, Huddersfield, Manchester Victoria, Manchester Oxford Road
  • Lewes, Glynde, Berwick, Polegate, Eastbourne, Hampden Park, Pevensey & Westham

4) The greatest number of stations you can stop at without changing trains: 50

On a veeeeery slow service that calls at every stop between Crewe and Cardiff Central over the course of 6hr20. Faster, albeit less comprehensive, trains are available.

But if you’re looking for a really long journey, that’s got nothing on:

5) The longest journey you can take on a single National Rail service: 13 hours and 58 minutes.

A sleeper service that leaves Inverness at 7.17pm, and arrives at London Euston at 9.15am the next morning. Curiously, the ATOC data appears to claim that it stops at Wembley European Freight Operations Centre, though sadly the National Rail website makes no mention of this once in a lifetime opportunity.

6) The shortest journey you can take on a National Rail service without getting off en route: 2 minutes.

Starting at Wrexham Central, and taking you all the way to Wrexham General, this service is in place for a few days in the last week of March.

7) The shortest complete journey as the crow flies: 0 miles

Because the origin station is the same as the terminating station, i.e. the journey is on a loop.

8) The longest unbroken journey as the crow flies: 505 miles

Taking you all the way from Aberdeen to Penzance – although opportunities to make it have become rarer. The only direct service in the current timetable departs at 8.20am on Saturday 24 March. It stops at 46 stations and takes 13 hours 20 minutes. Thankfully, a trolley service is available.

9) The shortest station names on the network have just 3 letters

Ash, Ayr, Ely, Lee, Lye, Ore, Par, Rye, Wem, and Wye.

There’s also I.B.M., serving an industrial site formerly owned by the tech firm, but the ATOC data includes those full stops so it's not quite as short. Compute that, Deep Blue, you chess twat.

10) The longest station name has 33 letters excluding spaces

Okay, I cheated on this and Googled it – the ATOC data only has space for 26 characters. But for completeness’ sake: it’s Rhoose Cardiff International Airport, with 33 letters.

No, I’m not counting that other, more infamous Welsh one, because it’s listed in the database as Llanfairpwll, which is what it is actually called.

 

This sign is a lie. Image: Cyberinsekt.

11) The highest platform number on the National Rail network is 22

Well, the highest platform number at which anything is currently scheduled to stop at, at least.

12) if yoU gAze lOng into an abYss the abySs alSo gazEs into yOu

Image: author's own.

“For I have seen God face to face, and my life is preserved”, said Thomas.

Ed Jefferson works for the internet and tweets as @edjeff.

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