Reasons to be cheerful? Ever since 1979 when Ian Dury penned the song of that name inspired by a near-fatal accident to a roadie, it strikes me as better to live life seeing the glass as half full.
This came to me as I contemplated the opportunities Birmingham faces today, particularly now with the prospect of an elected mayor.
Should Birmingham vote “yes” in May’s referendum (and the Chamber is campaigning for a yes vote), whoever is elected in November will inherit the stubborn problem of unemployment.
Birmingham creates jobs but not enough of them are filled by residents. Of all the English core cities, we have the largest percentage of working age population with no qualifications.
When you add that, after Liverpool, Birmingham has the lowest percentage of people educated to degree level and the fact that household incomes are low, you can see why unemployment in the city is running at 12.5 per cent – far too high.
These challenges are city-wide. Employment in Birmingham is below the English average for all ethnicities, including White, Indian and Pakistani/ Bangladeshi.
So why should we be cheerful? I believe there are many reasons that we should be extremely optimistic about Birmingham’s prospects. Look at the city’s strengths.
We have the biggest percentage of people engaged in entrepreneurial activities, at least for the working age of 24-plus. The challenge here is to crack the 18-24 band, where unemployment is around 25 per cent.
And the challenge here is underlined when you consider that Birmingham has more under-25-year-olds that any other major city in Europe.
This entrepreneurial spirit means we can regard ourselves as the “plug and play” capital of the UK. In other words, we are Europe’s USA. Ninety per cent of California’s Silicone Valley population did not start out as American citizens.
They arrived with ideas and creativity which they plugged into a welcoming USA. Within five years, they had become American. It’s not possible to do this in too many places. For example, you can never become Japanese and it’s really hard for a Polish plumber to be accepted into a Russian way of life.
Google was started by two Russian university kids who arrived and were embraced for the quality of their idea, demonstrating that America is the world’s leading “plug and play” centre where you can arrive, plug in your ideas and play.
Birmingham can claim to be the UK’s plug and play capital – and it’s really easy to become a Brummie. We are a young city – around only 200 years old – with few third and fourth generation citizens. And most of us arrive as a result of employment or to start a business.
Birmingham’s business base is well spread and whilst we are having to shrink our public sector back from the 30 per cent share of Gross Value-Added that it has represented, the task is not as daunting as it is in the North-East or Wales, where the public sector accounts for in excess of 40 per cent of local GVA.
Our largest sector is still business and professional services, which accounts for about 30 per cent of the city’s GDP. Behind that comes distribution, hotels, catering, manufacturing and transport.
And we have the largest retail destination outside London’s West End.
Then look at our growth sectors. We are top in the UK for appeal to businesses looking to enter the green automotive sector.
The R&D investment from this sector is huge, with Jaguar Land Rover leading the field and featuring in the top ten for R&D spend in the UK.
Shanghai Automotive’s European R&D centre is based at Longbridge and we are now a more attractive destination in this sector compared with some of Europe’s centres, such as Stuttgart and Dusseldorf.
Other areas where Birmingham can claim to be leading are clinical trials, life sciences, advanced materials as well as the creative and digital sectors.
We should be especially proud of our creativity, with the ability to provide beautiful design to goods and services. Jaguar cars, Aga Rangemaster cookers and even angle poise lamps are all designs dreamt up in and around Birmingham.
Ethnic diversity is also a terrific asset for the city. Currently, our city is in a white British/Irish majority of around 64 per cent.
By 2016, we expect the white population to account for 48 per cent, citizens of Pakistani origin around 21 per cent, Indian six per cent (a total of 27 per cent while at the moment they number about 14 per cent), African Caribbean four per cent and Chinese one per cent.
This diversity will be a huge advantage, keeping Birmingham in step with shifts in the world’s population. By 2050, the working age population of Europe is set to reduce by 23 per cent, while it will rise by 32 per cent in Asia, by 41 per cent in China and 156 per cent in Africa.
This will leave Birmingham looking more like the rest of the world than any other UK city – young and diverse.
This will certainly increase our appeal to corporates like JLR owners Tata looking to establish investments into Europe.
Alongside this we have the shifting of the world’s GDP from west to east. In 2005 the UK was the world’s fourth largest economy. By last year it had slipped to seventh place and projections for 2015 have us sliding to 11th place.
However, as the sun figuratively and actually rises in the east, so these economies start to look more like ours. Just last year, China overtook the USA in consumption or luxury goods to become second to Japan.
The Chinese last year bought 18 million cars. Although China will increasingly grow its own production (they already make one million cars a month), their appetite for western standards of life is a great opportunity.
Land Rover’s exports to China represent their fastest-growing export market now. The continent’s appetite for great design, creativity and innovation is just one of the huge opportunities for Birmingham.
I don’t think developments in the Far East need mark a death knell for the west. The great companies of the west – Google, Apple, JLR and Kraft, to name a few – will adapt and prosper. The bedrock on which the UK is founded will also grow in appeal.
Take the rule of law. When a contract is signed in the UK it means something and maturing countries worldwide will develop to appreciate the importance and value of this.
A “How to run Cities” service will become another great British export. So I am optimistic about the long- and medium-term prospects for Birmingham. New infrastructure will start to be delivered.
Getting under way in the next couple of years will be an extended runway at Birmingham Airport (the Chamber was instrumental in winning £17.5 million from the government for the project), New Street Station, the library, an Enterprise Zone worth maybe £700 million and, of course, HS2.
The City’s leadership has done a great job for Birmingham over past decades. What a mayor could embrace is a commitment to do even more to make Birmingham the plug and play capital of Europe.
Let’s use regulation that encourages business whilst we ditch the unnecessary stuff; let’s use the tax system to encourage innovation and creativity; let’s finish the job on transport. Get things like this right, and more businesses will plug and play, creating the jobs Brummies need.
Reasons for be cheerful? You bet!
Jerry Blacket is chief executive of Birmingham Chamber of Commerce Group