Labour must hold its nerve: Investing in big cities will help left behind towns

25 April 2025, 13:27

Economic disenfranchisement is one of the key reasons why people have turned away from Labour and the Tories.

But if Labour wants to improve the lives of people in “left behind” places, not only do key parts of its growth strategy need to stay, they need to be enhanced. This includes going further on already bold planning reforms and setting out an industrial strategy that has investment in the country's biggest cities, like Birmingham and Manchester, as a central component.

But would this widen political and economic divides? Centre for Cities’ latest briefing shows it would not.

Despite much of the political discourse framing it as such, voting for populism is not a railing against the success of large neighbouring cities. It is more likely a protest against not being able to access the prosperity they generate. In this sense, the rise of populism has been misdiagnosed. Prosperous cities do not create “left behind” places and political disenfranchisement. Underperforming cities do.

Commuting to and from these big cities creates beneficial economic relationships for the surrounding places. Average incomes tend to be higher in towns and villages where high shares of people are able to access the highest-paid jobs in the city.

For example, a high proportion of residents in Altrincham and Sale constituency commute into Manchester city centre. They have higher average wages and spend more on the local high street as a result. Non-mainstream populist parties tend to do less well in elections there, too. Fewer than one in ten there voted for Reform there in 2024.

But the economic underperformance in the UK’s big cities – they trail well behind their international counterparts – means too few residents of their surrounding areas can tap into the kind of prosperity they should be enjoying.

So, while Altrincham benefits from its connections to central Manchester, other places in Greater Manchester have weaker economic ties to the centre and are therefore locked out of opportunities.

They tend to have higher rates of unemployment, more crime, and more empty shops on the high street. The result of this is that they typically had higher shares of voters for Reform at the last election. In Stalybridge and Hyde, in the east of Greater Manchester, just six per cent of residents commute into the city centre. Reform polled over 20 per cent here in 2024.

The economic and political challenge for the country is that Britain's big cities, with the notable exception of London, don’t generate sufficient good quality job opportunities for their residents. Big cities like Manchester and Birmingham have to play the role that London plays for its residents and the South East.

These ‘second cities’ have untapped potential: combined, the country’s eight largest cities outside of London have a gap between their actual and potential productivity worth £47 billion per year.

Given that gap, the Government’s plans for a modern industrial strategy – which we’re due to hear more details on this summer – and planning reforms make economic sense.

The risk is that the fallout from next week's local and mayoral elections will mean the government waters down its focus on targeting more investment in big cities, on the basis that it will sharpen political divides with other places. This would be a mistake. It may even have the opposite effect.

________________

Andrew Carter is Chief Executive of Centre for Cities.

LBC Opinion provides a platform for diverse opinions on current affairs and matters of public interest.

The views expressed are those of the authors and do not necessarily reflect the official LBC position.

To contact us email views@lbc.co.uk