Last week in this space, I finally managed to find the overlap in the Venn diagram between urban economics and clickbait, when I published an article headlined, “Since 1998, a major northern city has grown almost as fast as London – and it’s not the one you think”.
The identity of the city in question, which as a dedicated CityMetric reader you’ll already know, was Liverpool. According to the Centre for Cities’ database, between 1998 and 2016 its economy grew by a factor of 2.1 – more than any major British city except London, Edinburgh or Cardiff.
Click to expand, if you must.
Why this might be is not a matter on which I spent too much time speculating. But the correspondence I received about that article, both demanding and suggesting explanations – and, in one memorable case, accusing me of colluding in corruption, by propagating official government figures (don’t ask) – suggests that plenty of other people were hungry for answers on this one.
So: here are some of the more popular theories.
It started from a low base
“The 90s were really bad here, man,” writes one local. My chart used 1998 as its year zero: if Liverpool fell behind its peers in the ‘90s, higher growth in the decades that followed could go largely unnoticed, simply because it never entirely caught up.
That’s no doubt part of the picture. But if you look at wages, it’s clear that Liverpool (in green) really did have a good start to the 21st century, compared to other regional cities:
Click to expand.
So: a partial explanation, at best.
It’s the culture, stupid
In 2003, Liverpool was named the 2008 European Capital of Culture. The city didn’t just spend five years planning its programme of events: it also took pains to ensure the event left a legacy, not just reputational, but in terms of cultural infrastructure, tourism facilities and actual physical venues, notably the Echo Arena.
This was obviously not a factor in, say, Manchester over the same period: so perhaps you’d expect Liverpool to grow more.
It’s the great big shopping centre
Liverpool City Council agreed to redevelop the Paradise Street Area in 1999. Nearly a decade later, as the city was showing its cultural goodies off to the world, the Liverpool ONE development opened: at 42 acres, the largest open air shopping centre in the UK.
Not everyone loves Liverpool ONE, but it did comprehensively remake Liverpool as a retail centre: so again, you’d expect this to have had an impact on the size of the local economy.
It’s all the students
There are four universities in Liverpool. It’s difficult to find comprehensive figures, but there is a consensus that the student body has grown massively in recent decades: Edge Hill University, for example, has increased in size eightfold, from 2000 students in 1993 to around 15,000 now.
All this has a knock on effect – in terms of cafes, accommodation, nightlife. Perhaps this has helped drive Liverpool’s growth.
The land is cheap in Liverpool. So is living the good life. So is buying a house. “My four storey Victorian townhouse in a conservation area cost £135k,” writes one correspondent. “Soz.”
At any rate: starting a business or undertaking a risky creative venture is easier in Liverpool than in many British cities. Perhaps that’s paying dividends.
It’s because of boundary issues
Something I didn’t explain as fully in the last post as I should have is how we’re defining Liverpool. The Centre for Cities (CfC) data uses “primary urban areas”, or PUAs: collections of local authorities which roughly approximate the economic footprint of a city.
The Liverpool one is actually quite small: just the city council and the neighbouring borough of Knowsley, excluding the other four boroughs of the Liverpool City Region. So it’s possible that the city has benefited from the wider trend for economic activity to move from the suburbs to cities proper.
Demonstrating that is difficult, at least with the data we’ve got. But we can show that Liverpool has grown faster than at least one of its outer boroughs. Because of the width of the Mersey, the CfC data counts the Wirral separately as the city or Bikenhead. It’s clear that the economy there has grown a lot less rapidly than that of the big city across the river:
It’s also possible that drawing the boundaries in different places would produce different results. For example:
Are you using Liverpool the local authority or Liverpool the City Region? The latter suggests growth marginally slower than Manchester (though if you rebase per capita annually to UK = 100 the headline message may be that nothing much is changing in general). pic.twitter.com/mrIFqKgn8G
— John C (@johnjdc) May 10, 2018
So: maybe our figures were not wrong, exactly, but incomplete.
It’s the EU
In 1994, the EU allocated £700m to Liverpool under its Objective One regional development programme. Another £928m followed in 2000; aother £700m shared across the north west in 2007. Between 2014 and 2020, another £450m was allocated to Liverpool. (These figures from the Liverpool Echo.) That money helped fund a huge range of infrastructure across the city, including the Echo Arena.
All of these factors and more have probably contributed to Liverpool’s quiet boom. But it’s this last that I keep coming back to. European money has almost certainly been a big factor in Liverpool’s transformation – and it is very far from obvious that Westminster will be as keen to invest in the city as Brussels was. Little wonder that the city voted Remain.
Thanks to assorted correspondents including Laura Brown, Andrew Lutter, Kelly Scotney, Bren Birkett and Caroline Crampton.