Sunderland needs more small businesses says report

Sunderland does well for jobs with large employers such as Nissan but trails behind its European competitors in the number of small businesses, says Centre for Cities.

Sunderland does well for jobs with large employers such as Nissan but trails behind its European competitors in the number of small businesses, says Centre for Cities.

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Wearside needs more entrepreneurs ready to set up their own businesses, says a new report.

Economic thinktank Centre for Cities says Sunderland is holding its own against rival European cities in the number of people in work.

Paul Swinney, of Centre for Cities.

Paul Swinney, of Centre for Cities.

But the city lags behind in terms of small businesses and business start-ups.

A new report published today, ‘Competing with the Continent’, presents an in-depth picture of how UK city economies compare to European counterparts, covering 330 cities across 17 countries.

The organisation says most UK cities urgently need to address challenges with low levels of skills, productivity and innovation to have the best chance of competing with European counterparts after Brexit.

Sunderland has less than half as many businesses per head of population than French cities Mulhouse and Tours.

If you get fewer people starting up businesses, that is going to lower the number of new jobs being created.

Paul Swinney

And while city has a higher employment rate than its French counterparts, a greater proportion of people are in comparatively low-skilled jobs.

Sunderland-born Centre for Cities economist Paul Swinney said Sunderland was typical of cites in former coalfield areas.

“It is interesting that we tend to see business start-ups are low, the number of businesses is low,” he said.

It was possible the pattern was a hang-over from the days of large scale businesses such as shipyards and coal mines.

Alexandra Jones, chief executive of Centre for Cities.

Alexandra Jones, chief executive of Centre for Cities.

“I don’t know whether that is because there is a mindset that ‘somebody else will create the opportunity,’ rather than ‘I will’,” said Paul.

“If you get fewer people starting up businesses, that is going to lower the number of new jobs being created.”

Today’s report shows cities contribute 60% of the UK’s national economic output (compared to just 36% in Germany and 32% in Italy) but fall below the European urban average for skills, productivity and innovation.

Nine out of ten UK cities perform below the European average in terms of productivity, and more than half are among the 25% least productive cities in the continent.

More than three out of four UK cities (48) have a lower proportion of high-skilled residents than the European average.

UK cities are also home to the third highest concentration of low-skilled residents in the continent, behind only Spanish and Polish cities.

Centre for Cities chief executive Alexandra Jones said: “No other economy in Europe is so dependent on the performance of its cities, yet too many of the UK’s urban areas are failing to realise their potential.

“For the country to thrive in the years to come, it’s vital the Government works with cities to address the skills and productivity gaps holding most places back.

“In particular, the Government should ensure that any new funding commitments in the Autumn Statement focus on boosting the key drivers of growth in cities, such as skills, transport and housing.

“Over the long-term, it should also build on its devolution agenda by giving places the powers they need – and which European counterparts already enjoy – to grow their local economies.”