William Eichler 25 January 2016

Jobs boom in cities accompanied by low urban wages, report reveals

Nearly a million new jobs have been created in British cities since 2010, but the average salary has decreased, according to a new report from Centre for Cities.

Cities Outlook 2016 reveals that more than 980,000 new jobs were created in cities between 2010-14, but that urban wages fell by 5% in the same period – a decrease in average annual salary of £1,300 per city dweller in real terms.

Cities were responsible for three quarters of the jobs boom between 2010 and 2014, but nearly half (29) of UK cities are currently classified as having ‘low-wage, high-welfare’ economies, the report’s authors found.

Centre for Cities did, however, also find that 14 UK cities are already delivering ‘high-wage, low-welfare’ economies, but these were concentrated mostly in the Greater South East, suggesting a geographical divide across the country.

The report’s findings also suggest a close correlation between high wages and fast jobs growth. The number of jobs in high-wage places has risen by 10% since 2010, compared to 3% in low-wage cities.

But welfare spending has also grown at a much faster rate in high-wage cities, with housing benefit payments more than 50% higher than in other places. This is due to a high demand for housing leading to an increase in housing benefit payments.

Commenting on the findings of Cities Outlook 2016, Alexandra Jones, Chief Executive of Centre for Cities, said:

Cities Outlook 2016 highlights the size of the challenge facing the Government in building a high-wage, low-welfare economy, and the importance of supporting and empowering UK cities in order to make that vision a reality.

‘One of the most pressing issues is the need to tackle skills-gaps and improve schools attainment, especially in low-wage cities, to help those places attract businesses and jobs, and support more people to move into work, particularly in high-skill sectors.’

Ms Jones also stressed the importance of tackling housing issues.

'For cities which have seen strong growth in wages and jobs, the focus should be on addressing housing shortages, to ensure that their success isn’t derailed by a lack of affordable homes.’

Emphasising the need for more devolution, Ms Jones continued:

‘Cities also need more powers and incentives to boost jobs and wages. Giving places control over skills and welfare budgets, and allowing them to keep any savings made by reducing the welfare bill, would incentivise local leaders to invest in employment programmes that, if successful, would reduce people’s need for benefits payments.’

‘Further devolution would also enable local leaders to make spending decisions which better meet the needs of their communities and give them more incentives to drive economic growth,’ she added.

Skills Pipelines: What local government needs to know image

Skills Pipelines: What local government needs to know

Councils and mayors are to be handed a central role in developing skills pipelines for local industries, as the Government unveils what it calls a ‘fundamental change’ to the education system aimed at tackling youth unemployment. Here's what council leaders and officers need to know.
SIGN UP
For your free daily news bulletin
Highways jobs

Highways Supervisor

London Borough of Richmond upon Thames and London Borough of Wandsworth
£44982 - £54500
Job Title Highways Supervisor... Richmond
Recuriter: London Borough of Richmond upon Thames and London Borough of Wandsworth

Communication Support Worker

Durham County Council
£33,673 - £37,563 pro rata
Required – Temporary, grade 8, term time only plus 2 weeks.  8 hours per week until 31 August 2027. Are you looking or a role in school supporting th Durham
Recuriter: Durham County Council

Outreach Workers

Durham County Council
Grade 6 £29,071 - £32,046
We are looking for enthusiastic and committed practitioners to join our Family Hub Teams supporting children and Families to deliver services in comm Peterlee
Recuriter: Durham County Council

School Admin Officer

Durham County Council
£26,403 - £28,598 pro rata (pay award pending)
Required to work term time only plus 2 weeks during summer holidays. 8am-4pm. Wingate Nursery School is looking for an exceptionally organised, warm, Wingate
Recuriter: Durham County Council

Cleaner

Durham County Council
£24,796 pro rata (pay award pending)
Required to work 12 hours per week, 05.30-08.00 or 15.30-18.00 Monday-Friday, Term Time plus 3 weeks to be worked during school holidays. We are seek Durham
Recuriter: Durham County Council
Linkedin Banner