Leeds city centre second worst hit in country by shift to working from home with £35m drop in spending

Leeds city centre will be the second worst hit in the country after London by the shift to working from home, with the local economy losing £35m, according to researchers in Yorkshire.

A Sheffield University study suggests that in 2022 the average worker will work an extra day at home (20 per cent more) compared to pre-Covid, with city centres losing £3bn in revenue as a result of people spending less at coffee shops, on lunches, or shopping after work.

Across the country 77,000 hospitality and retail workers could be forced to relocate or lose their jobs completely, including 2,000 in Leeds, which could see a citywide fall in annual spending of £68m.

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The dramatic changes to the way people work will also have a major impact in Sheffield, researchers say, with a £38.5 million decrease in annual spending and 1,100 jobs at stake. The Cathedral neighbourhood is expected to see the biggest fall in spending of £8.7m.

Leeds city centre  Credit: Google MapsLeeds city centre  Credit: Google Maps
Leeds city centre Credit: Google Maps

Lead author Dr Jesse Matheson, from Sheffield University’s Department of Economics, said some of the spending would shift to residential neighbourhoods, however it wasn’t clear how much that offset would be.

The latest restrictions as a result of the Omicron variant would compound the problem and could push the figures up even higher.

Dr Matheson, who worked with researchers from the universities of Nottingham and Birmingham, said the shift in working patterns was one of “the biggest changes in 100 years”.

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He said: “Leeds city centre comes up as the most impacted area outside of London above Birmingham and Manchester.

“I would certainly expect in the short term we are going to see some empty shops around.

“While some businesses will be able to relocate, others won’t find it profitable to do so.”

“There could also be a problem getting staff if demand shifts to place where commuting is too difficult.”

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The latest data from thinktank Centre for Cities shows for the first week of December, Barnsley and Wakefield were the only two places in Yorkshire to exceed pre-Covid footfall levels.

Leeds and Bradford were worst hit at 80 per cent of pre-Covid levels.

Centre for Cities’ Chief Executive Andrew Carter said: “At the beginning of last month weekday footfall in Leeds was just three quarters of pre-Covid levels and the new variant may push these levels down further.

“Clearly the pandemic casts doubt over the future viability of many city centre services that previously catered to office workers now working from home.”

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Cities where there were less workers concentrated in the centre may not be as badly affected.

In Hull, there is expected to be a £13m decrease in annual spending, with 380 jobs at stake. The largest decrease - £6.5m - is in the city centre.

The British Retail Consortium said footfall in November had slipped back slightly with harsh weather deterring shoppers from going out.

Kyle Monk, Head of Retail Insights and Analytics at the BRC, agreed that the trend for home working could have significant impacts.

He added: "However, as consumer habits change, the retail industry has a strong track record of adapting and innovating to these new behaviours accordingly."

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