As a new Prime Minister prepares to take office, attention will quickly turn to how Andy Burnham intends to restart economic growth and raise living standards across the country. With Manchester’s strong growth record often labelled “Manchesterism”, few challenges will be more pressing.
Burnham has set out an optimistic vision for Britain’s future, promising to deliver “good growth in every postcode” and identifies three priorities to help “rewire” the country: reindustrialisation, reforming public utilities and regenerating places. The challenge is turning those ambitions into reality against a backdrop of national economic stagnation and falling productivity in London – the global city that generates a substantial fiscal surplus for the country.
Greater Manchester’s economic outperformance over the past 15 years offers valuable lessons for any government seeking to deliver on those priorities. Each depends on growth: reindustrialisation needs places where businesses can innovate and scale; regeneration relies on investment; and better public services require the stronger economic activity that generates tax revenue. In each case, development has been a critical enabler of growth, not merely a by-product. Looking at Manchester’s transformation over the past two decades, it is difficult to ignore the relationship between city-centre development and economic growth. New workplaces, homes, transport infrastructure and public realm have created the conditions for businesses to invest, jobs to grow and private capital to flow into the city. Strong local governance and consistent policy have created a stable investment environment which, according to Oxford Economics, has helped growth spread across much of the wider city region, even if the strongest gains remain concentrated in the urban core.
London has its own success stories, of course. But too often development is framed as a problem rather than an opportunity. Height, density, disruption, carbon and private gain tend to dominate the debate long before the homes, jobs, tax revenues, skills, public spaces and long-term stewardship that good development can deliver are recognised. If we are serious about national prosperity, development must be treated not as a constraint on growth, but as one of its most powerful drivers of economic and social value.
If government at every level wants to change that perception, we need to make a clearer and more confident case for development’s benefits, especially locally, where its impact is felt most directly.
A good place to start is with one of the UK’s most overlooked forms of economic infrastructure: offices. To deliver “good growth”, we must recognise offices as essential to growth, productivity and regeneration. Modern workplaces support reindustrialisation in knowledge-intensive sectors, generate business activity and tax revenues that fund better public services, and anchor the regeneration of town and city centres. The real estate sector contributes more than £100 billion to the UK economy each year and supports one in 13 jobs. In central London alone, every 100 office jobs create a further 40 roles through supply chains and 18 on the high street. Development is not a planning inconvenience; it is a foundation of national growth and prosperity.
Despite this, the link between development and public benefit remains poorly understood. Residents need to see that change will improve their lives, not simply create value for others. As a sector, we have not always made that connection clear enough.
New research commissioned by the Westminster Property Association helps close that gap. It shows that Westminster’s private real estate sector supports around 335,000 jobs, nearly 40% of local employment; generates £42 billion in economic activity each year; contributes up to £17 billion in annual tax revenues; and sustains around £1 billion of worker spending in local shops and cafés. That is equivalent to keeping roughly 4,300 cafés in business.
Making that impact visible matters, and it is encouraging that Westminster City Council and other local authorities increasingly recognise it.
National government can help. By some measures, between £4 billion and £8 billion generated through development is sitting in council bank accounts across the country. Giving councils greater flexibility over how they spend this income, while improving transparency around the sector’s role in supporting local communities, would help restore the link between development and its positive impact.
Recognising city-centre offices as critical economic infrastructure and giving greater weight to economic growth in planning decisions, would help the industry deliver the spaces the economy needs and the public benefits development can bring more quickly.
Manchester’s experience shows what is possible when good growth is embraced, investment is welcomed and policy is aligned behind long-term objectives.
