Cambridge, Oxford and Milton Keynes set to boost output by £1.8bn over next 12 months
The UK Powerhouse study, which has been produced by the Centre for Economics & Business Research (Cebr), analyses 50 of the largest local economies by employment and GVA* growth.
In the latest report, Cambridge is predicted to see employment levels grow the third fastest over the next 12 months, increasing year-on-year by 2.5% and adding almost 3,700 new filled positions.
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Employment growth (year-on-year year) Q4, 2022 (Source: UK Powerhouse)
The report says that Cambridge’s economy is boosted by its university and surrounding array of services and research-based firms.
It predicts that these factors will provide Cambridge, together with Oxford and Milton Keynes, with a year-on-year GVA growth of 3.3% by the end of 2022. This will result in a total of £1.8bn being added to their combined economic output.
Hannah Clipston, partner at Irwin Mitchell, said: “The UK’s economy has undergone significant change over the last two years and this report highlights that the post pandemic recovery is unlikely to be linear or even uniform.”
Irwin Mitchell’s report also examines to what extent disruption in the economy leads to innovation.
Here the study reveals that the South West and the South East have the largest share of businesses engaged in innovative activity. According to the study, 41% of businesses in the South West are defined as innovative compared to 34% in Northern Ireland.
The most popular driver for innovation is improving the quality of good and services. Interestingly, only a quarter of firms in the South East were innovating in response to environmental concerns and a desire to reduce their carbon footprint. The proportion was even lower in London and the South West where the figure was just 20%.
Hannah added: “Businesses have been incredibly resilient over the last couple of years and have faced many disruptors including Covid, labour shortages, supply chain issues and high fuel costs.
“Our latest study recommends that irrespective of the sector they’re in, organisations should be adopting technology more quickly and adapting to the UK’s new status after Brexit.
“All of this will require a shift in approach and for innovation to be celebrated and nurtured more than it is currently. It’s vital that businesses are encouraged to follow this path and receive the right level of support in order to help them succeed.”
About the report
Official economic data sources for the UK’s cities are often dated and fail to provide a reliable snapshot of the UK’s localised economies. The last set of regional economic accounts corresponds to 2019.
To more accurately estimate current economic activity, Cebr has used a range of timely indicators to create a nowcast of gross value added (GVA) and employment indicators for the 50 locations in the UK with the largest GVA. Cebr also models the economies of these cities in order to produce a forecast of their performance a year ahead.
The analysis of this data gives us a picture of how the UK’s regional economies performed in Q4 2021 and how they’re expected to perform in Q4 2022.