PwC index shows NI capital leads way for devolved regions, with renewed focus on how to maximise potential, writes Alyson Magee
Published today, PwC’s annual Good Growth for Cities Index ranks Belfast as its leading city among the devolved regions and in the top 10 UK-wide.
Belfast is ranked ninth among 50 of the UK’s largest cities, down from eighth in last year’s index, but coming out top of cities in Northern Ireland, Scotland and Wales.
Cat McCusker, regional market leader for PwC Northern Ireland, said: “Our analysis shows people here are prioritising work-life balance more than in previous years as post-pandemic changes to working patterns allow people greater flexibility, greater control over working location and support better work-life balance.
“As a result, this is helping to unlock good growth.
“Belfast is also set to break away from the sluggish economic growth expected to be seen in most cities, along with London and Liverpool, as it is buoyed by relatively high-growth sectors. This strong growth is likely to drive growth across Northern Ireland as a whole.”
Belfast is performing above or in line with the UK average across two thirds of the index measures, said PwC.
It scores above the UK average for work-life balance, jobs, health, youth skills, house price to earnings, transport, income distribution and safety, and on par for owner-occupation rates.
However, the city performs below the UK average for income, new businesses, adult skills, the environment and high streets.
While work-life balance improved significantly more than the UK average for Belfast, it also saw the biggest decrease in terms of the health metric.
Belfast is expected to experience the highest rate of economic growth for all cities located in devolved nations, forecast at 0.23% in 2023 and 1% in 2024. Average UK growth is forecast at 0.05% is in 2023 and 0.99% in 2024.
Driving the positive projection for Belfast is its overperformance in sectors that are expected to be more buoyant over the next few years, including human health and social work which are projected to grow by 1% in 2023 and 1.8% in 2024.
The city also has a below-average share in some sectors forecast to perform poorly including real estate activities, expected to shrink by 0.52% in 2023.
“We must continue to focus on how we can maximise Belfast’s growth potential,” said Ms McCusker.
“A key part of our purpose at PwC is leading on some of the big issues and promoting the role of business in doing so, for example, addressing regional inequality and social mobility, achieving net zero, and investing in upskilling the workforce of the future.
“We are a strong supporter of economic growth in NI and are keen to see the region become a destination for skills, innovation, technology and tourism excellence.
“It is crucial that the narrative of NI’s economy is reframed in a way that leverages its unique trading position and does more to promote a positive story about NI to the rest of the world.”
A new addition to the index this year is a regional breakdown of public priorities, highlighting issues important to people at a local level.
As households struggle with the cost-of-living crisis, particular priorities identified by people in Northern Ireland include financial issues including income, jobs and fair distribution of income.
Concern over inflation and disposable income is outweighing other public priorities, most likely impacted by cost-of-living pressures dampening consumer appetite for spending such as the strength of the high street and housing.
Safety is also seen as less of a priority by people in Belfast compared to elsewhere in the UK.
Produced by the Big Four accountancy firm in partnership with educational charity Demos, the ranking was created in 2011 and is based on the public’s assessment of 12 economic measures.
Included are jobs, health, income, safety, skills, work-life balance, housing, travel-to-work times, income equality, high street shops, environment and business start-ups.
The top five cities UK-wide are, respectively, Oxford, Swindon, Exeter, Bristol and Southampton, while English cities also fill the lower performing end of the index including London, Bradford, Middlesbrough and Stockton, Birmingham and Manchester.
PwC said while the gap between the highest and lowest performing cities is narrowing, economic progress to level-up the UK is still too slow. The firm has called for more radical and ambitious devolution of governance and powers to a regional, local and hyper-local level, including greater fiscal flexibility and innovation to help cities respond to their specific challenges.
It recommends greater fiscal flexibility and innovation at a city level, such as those included in Greater Manchester’s trailblazing devolution deal allowing for 100% retention of business rates.
Jason Calvert, economist and place and purpose co-leader for PwC Northern Ireland, said: “Fully unlocking the potential for growth in Belfast and across Northern Ireland will require creativity and collaboration across all levels of government, public and private sectors and with citizens to deliver the best results for places and people.
“There needs to be a continued focus on longer-term levers for economic growth in Northern Ireland, including stimulating investment, getting more people into work, and underpinning all of this with support for skills and education.
“The issues and opportunities are complex, and no one organisation or type of organisation can tackle them successfully on their own.
“Rather, the business community needs to work alongside government and other stakeholders to drive sustainable change through meaningful collaboration on policy, strategy, and business planning.
“The Belfast Region City Deal is an example of our existing excellence and can-do attitude which makes us so unique.
“The City Deal is a catalyst for business growth through research and development, with critical investment in five university-led innovation and research centres already in the pipeline.”