Birmingham has seen greater centralisation than almost any other UK city – with thousands of jobs being created in the centre while the rest of the city has struggled.
A total of 10.5 per cent of workers across the city are now based in the centre, up from eight per cent in 1998 – and a quarter of office jobs are based there.
While the outer city has struggled, both before and after the recession, according to a new report by Centre For Cities, economists say it is vital to the city that the centre grows.
Report author Paul Swinney, senior economist at Centre For Cities, says this centralisation is delivering more knowledge-intensive roles for the city, which is seen as key for future growth, amid wider issues like skills and unemployment.
The report, Beyond The High Street: Birmingham Analysis, shows that while private sector jobs in the city fell by 11 per cent between 1998 and 2011, that figure actually grew in the centre by 17 per cent.
Mr Swinney told the Birmingham Post the Big City Plan – to expand the city centre – was paying off in Birmingham, as in 38 of the 63 cities where research was carried out the city centres were lagging behind the wider city economy.
He said: “In 21 of the 63 we actually saw less private sector jobs in the city centre, despite rising across the city. It was something of a surprise.
“In Birmingham we actually see the opposite to that, and was unlike any other city in the UK. Between 1998 and 2008 in Birmingham as a whole there was a two per cent decline in private sector jobs, which is a bit disappointing, but you didn’t see that when you looked at the city centre – and it proved right, as the private sector grew by 27 per cent there.
“It is not something you really see elsewhere. In Manchester, the city has seen growth, but there has also been growth elsewhere.”
The report, which seeks to show the fortunes of the High Street are dependent on wider city centre strength, states: “The story of Birmingham’s economy between 1998 and 2011 was one of increasing economic concentration in the city centre.
As a whole the city performed poorly in terms of private sector job creation. But the performance of the city centre provided a stark contrast, creating many thousands of extra private sector jobs.
The number of knowledge-intensive roles based in the city centre rose by 35 per cent in the 13 years to 2011.
The report says it is vital that the public sector needs to “take steps to deal with industrial buildings outside of the city centre”, and warned about vacant buildings causing “urban blight”.
Mr Swinney pointed to the Highbury Initiative – the precursor to the Big City Plan – as a factor in boosting skilled jobs in the city.
The plan’s aim is to increase the size of the city core by 25 per cent, improving transport connectivity through five key areas of development potentially worth £10 billion.
Mr Swinney added: “Birmingham city centre’s performance is certainly one of the strongest that we looked at.
“When you go back to the Highbury Initiative even though you can’t directly link through, if the road plan was the same as in the early 1990s you wouldn’t have attracted this number of private sector businesses or created as many jobs.
“You can contrast that with Sheffield, which has spent money on its city centre but doesn’t appear to have gone as well.”