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Leeds judged better off than Manchester and Liverpool

New report claims city will recover from cuts quicker than local rivals

Published on February 1st 2011.

Leeds judged better off than Manchester and Liverpool

Leeds has been identified as one of the most economically resilient cities in the UK in a new report by think-tank Centre for Cities.

Although the city has been ‘overshadowed’ by Manchester in terms of publicity, it has a better prospect of creating private sector jobs in the near future.

But Liverpool has been picked out as one of five ‘vulnerable’ cities that will struggle to see their economies recover.

The Centre for Cities annual index, Cities Outlook 2011, claims Leeds, Milton Keynes, Reading, Aberdeen and Bristol stand the best chance of recovery from the government spending cuts.

Liverpool, Sunderland, Birkenhead, Swansea and Newport are the least likely to recover quickly due to low skill levels and a lack of business investment.

Cuts to the welfare bill will have a major impact on Northern cities. The report says that Liverpool currently spends the most on welfare - £2.5m or 28 per cent of its total budget. Manchester spends £5.2m (22 per cent) and Leeds dishes out £1.9m (18 per cent).

The cuts proposed by the coalition government will see Liverpool the most affected major city, equivalent to £192 per resident. In Manchester, that figure will be £167 per resident and in Leeds, the least affected major city, it will be £125.

Alexandra Jones, chief executive of the Centre for Cities, said: "Buoyant cities like Leeds, which have been fast-growing and have lots of private-sector jobs, are best placed to lead the UK's recovery. It's time these places had new financial freedoms such as full control over the local business rate, and new powers to raise money. They could also benefit from having London-style mayors.

"During 2011, the UK cities most dependent on the public sector, and which have seen slower economic growth over the last decade, will find it more difficult to rebalance towards the private sector. These cities will need realistic plans of action to ride out the spending cuts and create jobs – but they will also need additional financial support from central government."

Claire Maugham, Centre for Cities' deputy chief executive, said: "Cities like Liverpool have one in five of the population with no formal qualifications. Whereas in Milton Keynes, one in three people have degrees, which is a spur to investment and people moving there."

“(Leeds) is in a region that has pockets of deprivation, such as Barnsley and Doncaster, and Leeds has largely been overshadowed by Manchester, which has done a better job of promoting itself. But Leeds is better placed in terms of creating private sector jobs in the future."

Manchester City Council is currently putting together a package to shed 2,000 jobs as it seeks to make savings of more than £100m in the next year.

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