The rise of the ‘super city’ as North-South divide narrows

Toscafund, which has been betting on a revival in the UK economy since last year, sees immigration, carmaking and UK universities as key drivers of economic growth.

In a new report – Growth of Britain’s Primary Cities – the firm challenges the notion that Britain’s growth will be centred around London and the South East.

It champions the idea that a number of towns and cities, including Leeds, Sheffield and Rotherham, will grow at a rate not recorded in many generations and become compelling alternatives to London for location choice for businesses, people and capital.

Savvas Savouri, chief economist and author of the report, said: “Everyone agrees there is ongoing recovery but received wisdom is it will be entirely based in the South.

“We are challenging the idea that London can contain the recovery without spreading out.”

He added: “The most important thing is that car-making is flourishing. There are no car factories in the South East.”

Mr Savvouri believes these so-called super or primary cities will be formed as the edges of existing conurbations practically come into touch.

Central to his conviction is the inward migration of a considerable number of people arriving to work, invest, study, and for leisure.

He believes Manchester and Liverpool will eventually join together to form a single primary city, known as Man-Pool.

Mr Savvouri said: “It won’t happen next year but I have every confidence that in 15-20 years a very large city in the North West will be growing and beginning to rival London in a great many sectors.”

Leeds and Birmingham will continue the process of integrating their neighbouring towns and districts into larger metropolitan areas, he added. Other places highlighted as future primary cities include Sheffield-Rotherham, Newcastle, Nottingham, Bristol, Portsmouth-Southampton, Leicester and Brighton.

Mr Savvouri said: “London has grown by incorporating surrounding districts and that’s what I believe will happen elsewhere.

“The pace at which this happens will be far quicker than anything that has happened before.

“This country’s population is progressing at such a rate that by 2050 there will be more people than any other country in Europe. They can’t all live in the South East.”

The report notes that the Leeds city region covers an area larger than that of London, but with a population a quarter of the size.

“There is considerable capacity for new arrivals,” it says. “If Greater Leeds were to match the density recorded in London, it would have a population of close to nine million.

“One factor that has affected the area’s development is inadequate suburban transport, caused by lack of unity in planning; this said, the 2012 ‘City Deal’ is addressing this through a unified transport system.”

Mr Savvouri believes the area’s strength in business and professional services sectors will be the catalyst for continued growth, particularly through economic migrants.

But he believes migration will rise after the completion of HS2’s first phase, as work extending the railway to Leeds begins in earnest, and both businesses and workers look to capitalise on lower property values and rents.

Meanwhile, the outlook for Sheffield and Rotherham’s population suggests that growth excluding migration will increase faster due to a younger population and the concentration of high-skilled industries, according to the report.

A feature unique to this area, it says, is the development of custom neighbourhoods, such as Waverley, to cater for those employed in the city’s science and research parks and manufacturing facilities.

Across the UK, the report believes the number of landlords and renters will increase in the housing market in the future due to an increasingly mobile workforce.

Speaking about the report’s bold forecasts, Mr Savvouri said: “I have every confidence the report will be proven right. We believe this so much we have made significant property purchases around Britain and are putting our money where our mouth is.”

Earlier this year, Toscafund predicted that the resurgent British economy is set for faster growth than the United States for much of the rest of the decade.