In a report published on July 25, the firm likened cities to magnets – they either attract or repel. It highlighted nine non-capital ‘magnet’ cities around the world, including Bilbao in Spain, Malmö in Sweden and Denver and Pittsburgh in the US, which had succeeded in attracting wealth creators. Average gross domestic product growth in these magnet cities was 2.8% against just 1% in the 10 largest UK cities outside London.
Common principles behind magnet cities’ success were continual physical renewal and the establishment of clear, sharp and competitive identities. They also found ways to fund their reinvention themselves and in partnership with the private sector.
Caroline Haynes, public sector director at KPMG and author of the report, said: ‘This research highlights the growing economic gulf between UK cities, and other non-capital cities in the developed world.
‘If the ten UK cities had grown at the same rate as the magnet cities, this would have equated to an additional £35bn in national GDP, and a net addition of 750,000 jobs, creating greater economic balance across the country.’
She added that the UK’s non-capital cities needed to engage in some ‘bold’ thinking to redress the balance of growth. ‘The magnet cities selected for the report reinvented themselves to attract a targeted group of ambitious and energetic young people. As soon as the cities started to attract young wealth creators, the investment and jobs followed,’ said Haynes.
Kru Desai, KPMG’s head of UK local & regional government, added: ‘While everyone is agreed that greater local devolution is the direction we should be travelling to, it is not the only answer.
‘The Magnet Cities research shows there is much UK cities have the power to do today – to up their game nationally and globally. The more UK cities can demonstrate they are learning to become self-sufficient today, the stronger the case for devolution tomorrow.’
