Liverpool and Halton show the way

Sep 10 2008 by Alex Turner, Liverpool Daily Post

A new academic study has come as a welcome boost for Liverpool, says Alex Turner

LIVERPOOL and Halton have become increasingly attractive to business, according to a new report. But the UK Competitiveness Index also shows that the wider city region is falling further behind its big city neighbour, as Sefton, St Helens, Wirral and Knowsley have all failed to significantly increase their competitiveness since 2006.

The report is based on the idea that the competitiveness of places and their firms is inter-dependent. It compared 407 localities on a range of indices which included business density, start-ups, educational qualifications of its workforce, unemployment rates and weekly pay.

Liverpool, which rose 44 places to 300th position in the rankings, received special praise from the report’s authors, Prof Robert Huggins and Dr Hiro Izushi, of the University of Wales Institute. Its improvement was the fourth best of the UK cities.

Prof Huggins said: “Although Liverpool is still ranked relatively lowly, its rise up the rankings, based on growing economic activity, greater levels of entrepreneurship and workforce skills, is a clear signal of economic revival and growing prosperity.”

The report is more welcome reading for those tasked with attracting investment to the region than last month’s Policy Exchange report which said Liverpool was “struggling”, has lost its “raison d’etre” and people living in the city should migrate south, to cities such as Oxford and Cambridge, for better jobs and a higher standard of living.

And the authors of the UK Competitiveness Index specifically addressed the Policy Exchange report, Cities Unlimited.

Prof Huggins said: “Our findings seriously question the validity of stimulating migration from the North to the South of the UK as a realistic mechanism for achieving economic regeneration and development.”

Mark Basnett, director of investment at The Mersey Partnership, was pleased that the report described a city he recognised.

“This reflects the reality of the city region,” he said. “It’s what is happening, the ongoing regeneration. To be in the top four UK cities for increasing competitiveness is a great achievement. But there is still a lot to do.

“We are seeing increased levels of entrepreneurship and higher skills in the workforce.

“There’s a momentum here. We have to continue making this an outstanding place to invest and work in. We need to work with young people and our educational partners. The recent GCSE figures are a tremendous achievement and this is an important indicator to employers.”

And he believes that the city region can follow Liverpool’s lead and become more competitive, with some promising signs in all of the other local authorities, despite the largely stationary overall rankings.

“They have all shown improvement in a number of indices,” he said. “You have to look across the piece at what is happening in those boroughs. All the local authorities have shown a good improvement in the number of businesses.

“We have to remember we are starting from a low base and a low investment. We are looking at three decades of under-investment in the city region.

“You are seeing a phenomenal willingness to change. Liverpool is showing the way to what the whole city region is capable of achieving.”

It is a model that the report’s authors identified, and they pointed to the importance of large regional centres to show the way.

Prof Huggins said: “In the North West, it is clear that regional competitiveness improvements are being driven by urban development in Liverpool, Manchester, and Salford.”

The North West led the way as the region with the biggest growth in competitiveness. The UK’s three most competitive regions – London, the South East and the east of England – all suffered from a drop in their competitiveness score.

The report argues that the growth in competitiveness of places in the north of England “suggests the beginnings of the reversal of the North-South divide”.

However, the report’s authors warned that the poor performance of the North East “highlights that changes in economic competitiveness at the regional level are not positively or negatively associated with the North or South of the UK”.

One Liverpool city region authority that is beginning to set itself apart from its near-neighbours is Halton. It is successfully cultivating a mix of traditional industries, led by chemical giant Ineos Chlor, the expanding haulage industry that is seeing the development of the multi-modal gateway and the scientific hub at Daresbury.

But Dick Tregea, a strategic director at Halton Council, acknowledges the key role Liverpool has in the overall performance of the city region, although he believes the sub-region can benefit from complementing the city centre rather than competing against it.

“There’s a balance to be had,” he said. “Liverpool is a really important local centre – a significant number of people live in Halton and work in Liverpool. What we have to try and do is get the balance between the major city centre activities, which are crucial, and the other activities that are more suited to the periphery if we can get both thriving we will have the solution.”

The assessment of Halton in the Index shows they are moving in the right direction. Halton rose 16 places, to 243rd with a competitiveness score of 91.7. Although this is a long way from the UK base score of 100, it is significantly higher than its nearest city region locality, Liverpool, which scored 87.8 despite an increase of three points since 2006.

Mr Tregea said there was “still a long way to go”, but was pleased with how the borough’s economic position was developing.

He said: “I think we are doing well recently and may move forward in the knowledge based industries, particularly on the back of Daresbury development.”

“There is an awareness of the importance of Daresbury, the redevelopment of the ICI headquarters into The Heath Business Park and the spin-offs from 3MG, the multi-modal gateway.

“I am impressed by the transport haulage and distribution industry as to how modern it is, how technologically advanced it is, using computer-based systems to a high degree,” he said.

“It holds us in good stead for the future, especially as there is a current planning application which has 1,000 jobs associated with it.

“It’s giving us a real change of our economic base. Halton has had a strong focus on the heavy chemical business but that is changing. The development of the haulage distribution-based industries is a real boost.

“Ally that to what we are doing out in Daresbury at the high end of knowledge-based businesses, which gives us a broad offering and provides opportunities for locals to find good quality employment.”

Halton has also benefited from a marked 5% rise in its business density, from 18.4 businesses per 1,000 people to 19.3.

When Jan Bonello chose to launch her own chain of coffee shops, Be Offee, last October, after years working for an East Lancashire-based chain, she picked Widnes as the place to start her business.

The company already has a second store in Warrington and is currently looking at sites across the city region, in Birkenhead, Liverpool and St Helens, as it seeks to expand.

Ms Bonello said: “We found that the area has benefited from investment and places like the Golden Square Shopping Centre, in Warrington, and Liverpool One are really attractive for retailers.

“There is also great demand for jobs – when we opened in Widnes, we had 20 times more applications than positions available.

‘OTHER developments in the area, like the plans for Widnes Waterfront and improvements in St Helens town centre, are helping to make them attractive places to do business.”

And it is not just new companies that are choosing Liverpool City Region. Johnson Service Group, which had been based in Prescot, moved its head office to London only to return in July when it relocated to Preston Brook, near Runcorn.

Uneek Clothing, a UK clothing manufacturer and supplier, recently announced it is moving its distribution base from St Albans to Wirral Business Park, and last week household goods firm McBride chose St Helens as the site for its new factory, which will replace its current Coventry site and see production at its Warrington operation scaled back.

But, while there are signs across the city region of positive developments, there remains a lot to do to haul the areas away from the bottom of the competitiveness index when it is reassessed in 2010.

alex.turner