Sunderland ‘on precipice’ due to reliance on Nissan and needs to broaden industrial base, says business expert

Nissan plant
Nissan plant
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Reliance on firms such as Nissan leaves Sunderland ‘on a precipice,’ says a city-born expert.

Speaking on an English language news programme on French TV channel France 24, Centre for Cities’s Paul Swinney said broadening the city’s industrial base was the challenge for both local and national government.

Paul Swinney

Paul Swinney

“The city needs to add another engine to its economy,” he said.

“Nissan has been a huge success story, although they have been fairly low-paid jobs, and that is a challenge for Sunderland.

“Yes, it has seen jobs growth over the last 20 or 30 years since its traditional industries closed down, but these jobs have tended to be fairly routinised and tended to be low-skilled, which means the city is constantly on this precipice of a new round of automation or a new round of globalisation, which does threaten jobs like the jobs in Nissan.

“It needs to be adding these extra engines, jobs growth in new areas, new industries that are going to create these higher paid type activities and put more money in people’s pockets

In or out of Europe, or in or out of the EU, a place like Sunderland has to be able to reinvent its economy, attracting new industries that are going to create new jobs, rather than being on the precipice of another closure.

Paul Swinney

This week’s news that Nissan had scrapped plans to build a new X-Trail at Sunderland ‘was not a huge surprise,’ he said: “It’s clear that one of the advantages of Nissan being based in the UK and being based in Sunderland is having access to the European market.

“I know that’s not the reason why they decided to change their decision, but, of course, as the UK changes the relationship with Europe, that is going to have an impact on how attractive UK cities are to this type of investment and it will alter investment decisions in the future.

“There is now a challenge here for Sunderland and perhaps other places in the north of England that attract this sort of investment.

“These places need to move on from companies where they have to keep offering sweeteners, and have to keep offering deals every couple of years and that’s a big challenge.

Nissan has scapped plans to build the new X-Trail in Sunderland

Nissan has scapped plans to build the new X-Trail in Sunderland

“In or out of Europe, or in or out of the EU, a place like Sunderland has to be able to reinvent its economy, attracting new industries that are going to create new jobs, rather than being on the precipice of another closure.

“I think for Sunderland’s economy, it certainly would be a bad thing if Nissan were to start to wind down its activities in the city, given that it is such a large employer and the city is so dependent on it currently.”

He condemned the failure of both Leave and Remain supporting MPs to address the UK’s future outside the EU.

“The big irony of the Brexit vote was that a lot of places, in England certainly, sounded a large alarm bell to say ‘we’re not satisfied with how life is at the moment’ but over the last two-and-a-half years all we’ve seen, was just infighting between politicians jostling for position rather than setting out any clear domestic policy and any clear domestic strategy about how we are actually going to improve the economy of these places.

“The Government needs to set out a very clear plan about how they can change the attractiveness of these places - but there has not really been any of that, nothing of any substance, which means Sunderland’s ability to attract investment today is no better than it was two years ago.

“What you would hope is that, as the situation progresses and new developments come about, that people would change their views, take on that information, update their view of the world and say ‘Right, this is the way forward.’

“Unfortunately, I don’t think we’ve really seen that over the last year or two within Westminster. I think, instead, we’ve seen two camps in very entrenched positions.

“They are not really looking at the picture on terms of how it is developing, they perhaps not thinking about the implications this has in terms of the economy.”