LONDON’S economy will continue to outperform Yorkshire’s cities for the next decade despite George Osborne’s ‘northern powerhouse’ plan to close the north-south divide, according to a new report.
A forecast for the economic performance of Yorkshire cities shows that they will continue to struggle to match the capital over the next 10 years.
The report’s authors argue the figures show there is “still much to be done” to tackle the north-south divide.
However, the analysis by the Centre for Economic and Business Research for law firm Irwin Mitchell does at least suggest that the economic recovery will continue to gather strength across most of the region.
Among Yorkshire’s major cities, Leeds is set to enjoy growth in output of two per cent in the 12 months to September to compared to 1.9 per cent in the previous year.
In Sheffield, growth in the value of goods and services is also expected to increase from 1.6 per cent to 1.8 per cent, a pattern matched in Hull where output will increase from 1.4 per cent to 1.6 per cent.
The notable disappointment is Bradford, where the report forecasts a slow down in growth from 1.6 per cent to 1.4 per cent despite notable developments including the new shopping centre.
Growth in London is expected to fall from 3.1 per cent to 2.7 per cent but that remains well ahead of any Yorkshire city.
Over the longer term, London’s economy is expected to grow by close to 27 per cent in the 10 years to 2025 compared to 18 per cent for Leeds and 15 per cent for Sheffield.
That equates to the economic gap between London and the North growing from £62 billion to £115.3 billion over the next decade.
Paul Firth, regional managing Partner of Irwin Mitchell’s Sheffield office, said: “The information provided by our latest tracker also shows that there is still much to be done to tackle the North-South divide and it’s vital that more is done now before it is too late.
“The recent devolution deals unlock considerable funds to help boost investment and long-term growth in a number of these cities, however, much of the impact won’t be fully realised in 2016.”
The report found that Milton Keynes was the fastest growing city in 2015.