Belfast amongst top devolved cities – but English cities recovering faster

  • Belfast is fifth amongst 11 UK devolved cities, but 30th in PwC’s ‘all-cities’ rankings
  • Oxford, Reading top the index for second year running
  • Birmingham most improved and cities in Midlands and North are amongst fastest improvers
  • Northern Ireland overall, has not seen the same level of recovery as England, Scotland and Wales


Belfast remains amongst the best cities in the UK’s three devolved administrations in which to live and work, according to the latest Demos-PwC Good Growth for Cities 2017 index that ranks cities on a combination of economic performance and quality of life.


However, when compared to the index’s evaluation of 42 leading cities across the UK, Belfast has now slipped to the number 30 spot, down from last year’s 25th position and from the city’s stellar 5th position in the 2015 index. The report says that while Belfast has enjoyed strong job-creation, English cities, particularly in the Midlands and North of England, have enjoyed faster recovery in key economic and social areas including new business formation, employment growth and improved incomes.

Oxford and Reading and Southampton are the three top performing cities in the UK as the South-East continues to lead the top-10 cities league. However, cities in the Midlands and North are catching up on the historic top performers in the South of England.

Published today [8 November 2017], the sixth annual Good Growth for Cities 2017 index sets out to show that there’s more to life, work and general well-being than just measuring GDP. The index measures the performance of 42 of the UK’s largest cities, England’s Local Enterprise Partnerships (LEPs) and the nine Combined Authorities, against a basket of ten indicators based on the views of the public as to what is key to economic success and wellbeing.

These include employment, health, income and skills - the most important factors, as judged by the public - while housing affordability, commuting times, environmental factors and income inequality are also included, as is the number of new business starts. The report says that all 42 of the UK cities are now outperforming their pre-financial crisis peak and, while Belfast scores well in job-creation, work-life balance and commuting times, it has not matched other UK cities in terms of improvements in new business formation, skills and health.


Comparing the UK regions

The index shows that overall, England and Scotland have outperformed Wales and, to a lesser extent, Northern Ireland throughout almost the entire period since 2005-07. Scotland took the top spot for most of the pre-crisis period but England has taken its place since 2008-10, largely driven by jobs and incomes.

The financial crisis of 2008/09 affected all four UK regions, however, Scotland and Wales experienced a steeper decline in their index scores between 2007-09 and 2009-11 than in England and Northern Ireland. This reflects the more severe impact of the crisis on unemployment in Wales and a more severe impact on Scottish incomes. The report says that Northern Ireland has not seen the same pattern of strong recovery in the Good Growth index since 2011-13 as has been experienced in the rest of the UK.


Average index score for each country of the UK since 2005-07

PwC chief economist John Hawksworth, said the UK has been a great job-creating machine in recent years and this has driven improvement in this year’s index across all major UK cities.


“On average across the UK, the index is now at its highest level since it began in 2005 and all regions have benefited from this upturn.


“But there has also been a price to pay for this in terms of worsening housing affordability, increased average commuting times and more people having to work long hours. The cities that are highest ranked on our index also tend to suffer the highest price of success.”


Performance of cities in the devolved administrations

In the battle for the devolved administrations’ title, Scotland takes the honours with Edinburgh, Inverness Aberdeen and Dundee, ahead of Belfast, with Perth in sixth position. Measured against all 42 cities Edinburgh and Aberdeen were fourth and 11th respectively – each one place lower than in last year’s index. The fall in Belfast’s performance in both the devolved nations and the overall UK rankings reflected Belfast’s slower than average employment recovery, the UK’s highest economic inactivity and the lack of real growth in regional wages.

For the fourth year, Londonderry/Derry was also included amongst smaller UK cities with populations of less than 250,000 people. Amongst the devolved regions, Derry is the lowest scoring devolved city, relative to all 42, scoring below average in the majority of the variables although the city’s score for job creation was slightly ahead of generally higher performing devolved cities like Cardiff, Sterling, Perth and even Belfast. Overall, the results for Derry are more positive than in 2013-2015, largely due to improvements in jobs and income. However, Derry’s position on the border with the Republic of Ireland means a significant number of the city’s ‘working population’ commute into the region from RoI.

And, as one of the few City Regions within Europe that will potentially now see an EU/ non-EU international frontier cut across it - Derry faces particular challenges, including peripherally. These challenges will likely be compounded by the changes that Brexit will bring, no matter in which form it is implemented.


Devolved Administration scores, 2013 – 15 and 2014 – 16

Growth in digital industries contributes to jobs and wealth

The turnover of the UK digital tech industries was estimated at £170 billion in 2015, a growth rate of 22% (or £30 billion) in five years. Over the same period, the total number of UK digital tech businesses grew by 28% - more than twice as fast as non-digital businesses.

According to the latest report, Belfast has around 9,000 digital jobs, in a sector with GVA of £531m and where average wages in digital industries are £37,780 – well above the region’s average wage and demonstrating the impact the digital technology sector has on wealth creation, However, when compared with the index’s top performing cities, even this performance is relatively low. Oxford and Reading score highly on the UK’s tech top-10 rankings, boasting above-average digital sector salaries of £47,800 and £53,250 respectively. Oxford currently has around 25,350 jobs in the digital sector, with Reading having around £45,290.


Commenting on the overall theme of this year’s index results, Paul Terrington, PwC Northern Ireland regional chairman and PwC’s head of regions, said:


“We’ve seen broad-based improvements in our Good Growth index across the UK, driven in particularly by falling unemployment rates. However, the Good Growth index also sends a clear message to government and city leaders that there’s more to prosperity and growth than GDP.


“Some areas in the North and Midlands where recovery from the financial crisis had seemingly lagged are now showing clear improvements in their index scores and the relatively recent combined authorities and ‘city-deal’ areas are catching up fast.


“In Northern Ireland, the challenge is to learn the lessons of these fast-improving English regions and get the balance right between investment and reform and maintain a clear focus on driving improved productivity and economic growth while delivering public services efficiently.


“It’s also clear that Brexit will have a profound impact on Northern Ireland and the challenges facing Derry and the North-West are particularly acute. The lack of an Executive for the better part of this year has not helped that situation.


“It’s also worth noting the price of prosperity in terms of growing pressures on scarce resources of housing, transport and skills. If UK cities are to sustain the relatively strong performance of recent years as we move through Brexit and beyond, it will be critical to address these challenges as part of cities’ growth strategies, rather than trying to fix the problems later when they become serious constraints on growth.”




Notes to editors:

About the Good Growth for Cities report

1. A copy of the Demos-PwC Good Growth for Cities index 2017 can be downloaded below.

2. The Demos-PwC Good Growth for Cities index 2017 measures the current performance of 42 of the largest UK cities against a basket of 10 indicators that - based on the views of the public – are seen as critical to economic success and wellbeing. Employment, health, income and skills are the most important of these factors, as judged by the public, but housing affordability, commuting times, environmental factors, business startups, work-life balance and income inequality are also included in the index.

3. The latest index is based on data that was averaged over the period 2014-2016. We use rolling three year averages in order to minimise the impact of the volatility from year to year that is often a feature of local area data.

We have included cities with a travel-to-work area (TTWA) of at least 250,000 people. The top 10 highest ranked cities, and the most improved since last year were:

4. Further methodological details, including definitions of all of the variables in the index and data sources, can be found in Appendix 1 of the report.

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