The Centre for Cities think-tank found that the average annual wage in London is nearly PS20,000 more than the lowest-paid areas of the UK.
The report Cities Outlook 2025 has revealed the wide pay gaps across the UK. The average annual salary in London is nearly PS20,000 more than the places with the lowest salaries such as Burnley and Huddersfield.
By August, the average Londoner will have earned more than a Burnley worker will earn in a single year.
Researchers said that due to a lack “cutting edge” jobs outside London, and the South East of England, only seven places have salaries higher than the average.
Centre for Cities believes that 2025 should be the year when government takes action to increase economic growth and reduce regional disparities.
Andrew Carter, CEO of Centre for Cities said: “The Government is right in identifying boosting economic development for all parts of the country as its top priority. This is the only way to increase wages in a sustainable manner. The starkness of Cities Outlook’s results shows that an incremental approach will not be sufficient.
The importance of boldness, urgency and size is crucial. “2025 must be the year of delivery, especially on the Government’s Industrial Strategy and framework for English devolution, as well as its reforms to Planning.”
Pay disparities are primarily due to the fact that some cities have more “cutting-edge” businesses and jobs than others. London and Cambridge, for example, have three times more cutting-edge companies and twice as many jobs in biotech and AI than low-paying towns and cities like Burnley and Huddersfield.
Reading and Milton Keynes are two of the South East’s largest cities, and nearly all have salaries above the UK average. Leeds, Warrington Derby, Swindon Bristol Aberdeen and Edinburgh are the only places outside the UK that have salaries higher than the UK average.
The authors of the report said that cities where wages at work are low must address barriers to growth for cutting-edge areas of their economies.
It will be necessary to conduct evidence-based analyses of the local economy’s weaknesses, prioritize high-skilled work over high street activity, and invest in fundamentals such as skills and transport, and in workspaces.
Cities Perspective 2025 highlights the importance of implementing proposed changes to national planning systems to make housing deliveries easier and faster.
Housing costs are a major challenge in cities and towns with high salaries, such as London and the majority of places in South East. The study found that half of the places with the highest wages are also among the least affordable housing markets.
Carter added: “Bold planning changes can provide more housing for the poorest areas and our largest cities where they are most needed.
“The Industrial Strategy should focus on growing the leading edge of the economy and not call for action in all sectors or industries. The English devolution process needs to be accelerated so that more areas, especially the large cities, can have the resources and powers to provide the much-needed pay raises.
This government has promised to put more money in the pockets of people. If the people of Canada are to earn more money by the end a parliamentary term then we must see progress and action in 2025 on the government’s ambitious growth plan.”
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