Government warned not to ‘overestimate’ benefit of shifting jobs outside London

10 Aug 2017 By Hayley Kirton

Report reveals BBC move to Salford created a fraction of the jobs hoped for

The government is being urged not to overestimate the benefit of moving jobs outside London, after research revealed that the BBC’s Salford move six years ago had created less than a third of the jobs predicted.

The study by Centre for Cities, which was published today, found that the move had created 4,600 jobs within MediaCityUK – a property development in the Salford region designed to house media organisations – compared with the 15,000 it was thought the relocation would produce.

The think tank also warned that many of the new jobs had been created by businesses being displaced from other parts of Greater Manchester as opposed to new companies setting up within the region, and that the impact of the BBC’s move on employment across Greater Manchester as a whole had been negligible. The number of jobs attributed to other organisations following in the BBC’s footsteps and moving to Salford was just 145, it said.

“The impact of the BBC’s relocation shows that the government and city leaders should not overestimate the economic benefits of moving public sector jobs from London to other parts of the country,” said Paul Swinney, principal economist at Centre for Cities. “While the BBC’s move has been positive for Greater Manchester in other ways, it has done little to create new jobs across the city region, or to encourage new businesses to set up in the area.”

The report’s findings may have implications for the government’s proposed relocation of Channel 4 out of London. Cities that have so far expressed an interest in becoming the media giant’s new home include Manchester, Brighton and Birmingham.

The Conservative pre-general election manifesto had pledged to shift a “significant number” of civil servants away from London and the South East.

But the Centre for Cities report noted that many of the government job moves away from the capital to date seemed to be at a lower level. The study found that, while only a quarter (23 per cent) of all England’s civil service jobs were located in London in 2016, the capital also housed half (53 per cent) of those at grade 6 and above.

“If the government is determined to relocate more public sector jobs across the country, it should move them to major cities that are already home to a large share of high-skilled workers and firms in related industries,” said Swinney. “For example, if the BBC had moved to a smaller city than Manchester, with fewer high-skilled workers and a less diverse economy, it’s likely that the limited economic benefits it brought would have been less significant.”

A BBC spokesperson said they were “surprised” by the report, and added: “The BBC was crucial to the development of MediaCityUK, bringing thousands of jobs and millions of pounds of investment, and supporting the wider creative industries. To suggest our investment only benefits Salford, and not the rest of the region, seems very strange given the scale and size of our operation today.”

Sean Anstee, Greater Manchester Combined Authority’s lead for employment and skills, and leader of Trafford Council, said: "The BBC’s move to Salford has benefited not just Salford, but Greater Manchester as a whole and indeed the entire North West. As well as the direct benefits of the thousands of people who are now employed across Greater Manchester as a result of the BBC’s relocation, the move north has been instrumental in sparking a creative and digital revolution in the city region."

And a Department for Digital, Culture, Media & Sport spokesperson said: "The government wants Channel 4 to do more to drive economic growth outside London, stimulate regional creative industries, and better serve audiences around the UK. The government has consulted on how best Channel 4 can do this, and we will set out next steps in due course."

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