Media City

How to stop tech hubs in urban hotspots from intensifying geographic inequalities

Perhaps George Osborne’s most abiding legacy from his time as chancellor will be the creation of the concept of the Northern Powerhouse. Certainly Manchester, its principal focus, is booming.

The landscape of the centre is being altered dramatically by skyscrapers. Peel Holdings, the huge investment and property outfit, is planning to double the size of the development around Media City in the old docks, where the BBC was relocated. The airport, already the third busiest in the UK, is expanding.

All in all, it seems a triumph for modern capitalism. After decades of relative decline, a city is being transformed by private enterprise. But what is really going on?

In a piece this month in the MIT publication Technology Review, urban guru Richard Florida has picked up on a startling new trend in the location of new technology companies in the US.

In the 1980s, there were essentially no high tech companies in city locations. Instead, we had Intel and Apple in Silicon Valley, Microsoft in the Seattle suburbs, the Route 128 beltway outside Boston, and the corporate campuses of North Carolina’s Research Triangle.

Now, urban centres are rapidly becoming the places which attract technology companies. In 2016, the San Francisco metro area was top of the list for venture capital investment, attracting more than three times the amount of the iconic location of Silicon Valley. Google has taken over the old Port Authority building in Manhattan. Amazon’s headquarters are in downtown Seattle.

The impact of this new, high concentration of tech firms is to intensify geographic inequalities. As Florida puts it: “tech startups helped turn a handful of metro areas into megastars. Now, they’re tearing those cities apart.”

A relatively small number of urban areas in America, and within them a small number of neighbourhoods, are capturing all the benefits.

The same sort of thing seems to be going on in Greater Manchester. A few areas are soaring away and attracting wealth and talent. In 1981, fewer than 600 people lived in what the Council describes as “the heart of Manchester”. Now, over 50,000 do, almost all of them young graduates.

But the more traditional outlying boroughs of the city region, especially to the north and east, are struggling to capture any trickle down from this massive transformation. Indeed, they are at risk of losing out, as their young bright sparks are attracted by the life of the inner metropolis.

Richard Florida does not just identify the problem, he suggests some possible solutions. One of which is a programme of building lots of good housing in the outlying areas, supplemented by a top class public transport service. This would keep house prices down, and attract some of the people stuck in rabbit warrens in the urban centres.

Manchester already has a modern tram service. But the new Labour mayor, Andy Burnham, is resolutely opposed to building on the green belt just to the north and east of the city. Yet another example of the sanctimonious intentions of the Left serving to intensify, not reduce, inequality.

Paul Ormerod 

As published in City AM Thursday 29th June 2017

Image: Media City UK by Magnus D is licensed under CC by 2.0

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ALEX O’BYRNE

Associate

e: aobyrne@volterra.co.uk
t: +44 020 8878 6333

Alex O’Byrne, Associate at Volterra, is an experienced economic consultant specialising in economic, health and social impact, economic strategy, project appraisal and socio-economic planning matters.

Alex has led the socio-economic and health assessments of some of the most high profile developments across the UK, including Battersea Power Station, Olympia London, London Resort, MSG Sphere and Westfield. He has significant experience inputting to EIAs and s106 discussions as well as drafting economic statements, employment and skills strategies and affordable workspace strategies.

Alex is also experienced at economic appraisal for infrastructure. He was project manager of the economic appraisal for the City Centre to Mangere Light Rail in Auckland. He also led the economic and financial appraisals of the third tranche of the Transport Access Program for Transport for New South Wales, in which Alex developed and employed innovative methodological approaches to better capture benefits for individuals with reduced mobility.

He is interested in the limitations of current appraisal methodologies and ways of improving economic and health analysis to ensure it is accessible to as many people as possible. To this end, Alex recognises the importance of transparent and simple to understand analysis and ensuring all work is supported by a robust narrative.

Alex holds a BSc (Hons) in Economics from the University of Manchester and he was a member of the first cohort of the Mayor’s Infrastructure Young Professionals Panel.

ELLIE EVANS

Senior Partner

e: eevans@volterra.co.uk
t: +44 020 8878 6333

Ellie is a partner at Volterra, specialising in the economic impact of developments and proposals, and manages many of the company’s projects on economic impact, regeneration, transport and development.

With thirteen years experience at Volterra delivering high quality projects to clients across the public and private sector, Ellie has expertise in developing methods of estimating economic impact where complex issues exist with regards to deadweight, displacement and additionality.

Ellie has significant experience in estimating the economic impact across all types of property development including residential, leisure, office and mixed use schemes.

Project management of recent high profile schemes include the luxury hotel London Peninsula, Battersea Power Station and the Nova scheme at London Victoria. Ellie has also led studies across the country estimating the economic and regeneration impact of proposed transport investments, including studies on HS2 and Crossrail.

Ellie holds a degree in Mathematics and Economics from the University of Cambridge.