Birmingham has retained its position as the 21st best business city in Europe, according to property consultants Cushman & Wakefield.
But north-western rival Manchester has opened up a clear lead – moving up four places to be named the 14th most business-friendly European city.
It is the second survey in a month to suggest Manchester is pulling ahead of Birmingham.
Cushman & Wakefield’s UK Cities Monitor, reflecting the views of 200 of the country’s chief executives, recently saw Birmingham remain in third position as the best place in which to locate a business after Manchester and London.
But Birmingham’s reputation as a shopping and leisure destination and the quality of life enjoyed by residents fell.
Out of the 14 main categories used to produce the UK monitor, Birmingham slipped back in six, stayed the same in five and advanced in three. London and Paris are the most business-friendly cities in the European monitor, while Moscow can expect the biggest influx of companies over the next five years.
The study named Barcelona as the city with the highest quality of life with Brussels, Zurich, Dusseldorf and Manchester all rising significantly. The annual report is based on interviews with senior managers and board directors in charge of location for 500 of Europe’s largest companies.
Cities are ranked against a number of criteria such as transport links, telecommunications, access to markets, availability and quality of staff, cost of office space and quality of life.
Despite moving up the table this year, Manchester is yet to regain the position it held in 1990 when it was ranked it the 13th best business city in Europe. Elaine Rossall, head of business space research at Cushman & Wakefield, said: “London, Paris and Frankfurt form a top tier of business cities which are unlikely to be seriously challenged in the near future.
“The rise of regional cities has been driven by advances in telecommunications and more sophisticated Government promotional strategies aimed at attracting inward investment.
“It is amongst the lower rankings where these smaller regional cities are really jostling for the attention of major corporates. They are benefiting from a more cost-conscious business climate where flexibility of location and an appreciation of softer factors such as quality of life are becoming increasingly important.”
The European Cities Monitor asked companies which were the key factors when deciding where to relocate their business. The availability of qualified staff came ahead of easy access to markets, customers or clients as the single most important factor with telecommunications marginally ahead of national and international transport links.