Boom City Bristol – But Can It Last?

Aerospace giants Airbus and Rolls-Royce; Aardman Animations of Wallace and Gromit fame; the BBC Natural History Unit, home of many of David Attenborough’s wildlife blockbusters; and a cluster of finance professional services companies, including KPMG and stockbrokers Hargreaves Lansdown, point to the strength of the Bristol economy across multiple business sectors. Not forgetting leading tech businesses such as Oracle, Cray, fitness app specialist Strava and many more built on the back of early investment by Hewlett Packard and semiconductor pioneer Inmos.

Digging beneath the headlines, Bristol’s economy is strong across a whole range of measures. Unemployment is low, both the ‘official’ claimant count rate and also ‘hidden’ unemployment, including the long-term sick. The Centre for Cities’ Cities Data Tool (which defines the Bristol Urban Area as including the local authority areas of the City of Bristol and South Gloucestershire) shows that Bristol ranks 11th out of 63 towns and cities on productivity, the value of goods and services produced per hour worked. It ranks ninth nationally on its share of ‘new economy’ jobs in fintech and advanced manufacturing, ninth also for IT and high-value ‘knowledge-based’ employment. The picture overall has also been one of growth: Bristol’s population was up by over ten per cent in the decade to 2021. Numbers of jobs grew by ten per cent over the last five years, making Bristol the fourth fastest-growing urban area nationally. This is particularly significant given that Bristol is a big city – 760,000 people and 460,000 jobs, the fifth largest urban area outside of London on total jobs. The best-performing and fastest-growing places are typically smaller towns and cities, particularly former new towns closer to London, not the big conurbations like Bristol.

Bristol was ranked fourth nationally in PwC’s latest Good Growth for Cities Index, combining economic indicators like income, jobs and skills along with measures of health, environment, safety and work-life balance. It took first place in the Sunday Times’ 2017 Best Places to Live (and was termed ‘cool, classy and supremely creative’) and was voted Rough Guide’sTop City in the same year. It was also European Green Capital in 2015.

Why then has Bristol done so well? Historically, Bristol has been able to continuously reinvent itself. It suffered much less than other large urban areas from post-war decline in manufacturing and traditional industries, with less long-lasting scarring of the economy and skills as well as the urban landscape. Relocation from London of office-based professional services and early tech investment, including Hewlett Packard and Inmos, laid the foundations for a dynamic, ‘post-industrial’ economy. And aerospace, smaller overall in job terms, remains a major cluster of high-value advanced manufacturing.

Stand-out business sectors locally now include professional and legal services, aerospace and advanced manufacturing, creative and media and digital technologies. By no means unique to Bristol, they are, however, relatively large, dynamic and more concentrated locally, certainly in combination, than in much of the rest of the country. Collectively they help give Bristol the edge. Importantly as well, they represent well-developed ‘clusters’ of the sort seen by economist Michael Porter and a host of analysts and policymakers since as critical to productivity and economic dynamism. Clusters of often interconnected businesses draw on large pools of skills and labour, common supply chains, specialist supports and services and supportive governance structures. Developed over time, these attributes come to constitute a ‘deep ecology’ of knowledge, innovation, networks, relationships and opportunities which mutually reinforce the benefits to individual businesses.

Many studies have tried to unravel the key factors driving productivity and growth, pointing to a combination of workforce skills; local industry mix; the quality of place, infrastructure and environment; connectivity and location; and local governance and management. Proximity to London, motorway connectivity, high-speed rail (recently electrified) and strong business and cultural links have favoured Bristol both historically and more recently in terms of relocation, investment and expansion, talent acquisition and recruitment and – less tangibly – cultural fit, reputation and visibility. The attractiveness, liveability and lifestyle offered by the city and surrounding countryside has also been key in attracting and retaining people, business and investment. This has included the variety of urban environments and potential lifestyles on offer across the city and beyond, the style of inner suburbs or harbourside living, the ‘edginess’ of the inner city, proximity to outdoors activities, more conventional suburban areas and beyond to desirable and commutable rural towns and villages.

Ranked 11th nationally for the proportion of the workforce with high-level qualifications, Bristol also has a large pool of labour with the sort of skills and attributes that businesses need to draw on to drive growth and competitiveness. The attractiveness of Bristol in terms of lifestyle and location, combined with the salaries and opportunities on offer in a large, competitive labour market, help businesses recruit and retain staff from elsewhere – both early career and more experienced staff looking to relocate, including from London and internationally. This tends to be self-reinforcing, with high-skill individuals attracted to places which have already demonstrated their attractiveness. The city’s two universities, with over 50,000 students between them, are important contributors, providing a regular stream of graduates across a wide range of subjects, boosted by those coming to study from outside of Bristol who take up employment locally. The universities also contribute as major employers in their own right, through support for business innovation and growth and through the value of student spend locally.

Transformation of the fabric of the place has also played a key role. The historic city docks and warehouses transitioned into residential apartments, bars, restaurants and heritage, arts and cultural attractions. The centre of gravity of earlier office-based activity in the city centre has shifted eastwards, with a major cluster of new developments on underused sites towards the main Temple Meads rail station and beyond. Strong market demand has seen reinvestment in and the refurbishment of ‘left-behind’ buildings in the older urban core as apartments and student accommodation. Bristol’s ‘northern arc’, with outstanding motorway and rail connectivity and historically a more permissive planning regime, also saw strong growth in housing and employment, many thousands employed by the Ministry of Defence, Bristol Science Park, the University of the West of England and major employers at Severnside, including, most recently, Amazon.

Taking the city as a whole, Bristol has clear strengths from an economic perspective. But looking across different parts of the city it is clear that not all have benefited from economic success. Fifteen per cent of the total population of Bristol (over 70,000 people) live in the most deprived ten per cent of areas of England as a whole. There are stark differences in terms of hidden unemployment in particular, while life expectancy in parts of South Bristol is over ten years lower than affluent Clifton and Cotham just north of the city centre. Longstanding social exclusion means that many in the most deprived inner-city areas and outer estates are simply disconnected from the opportunities created by the overall success of the city.

Among other challenges, Bristol’s jobs growth and relatively high earnings of those in employment, coupled with limited supply of new housing, has also led to eye-wateringly high house prices and private sector rents. Average house prices have risen to nearly 12 times average incomes, making Bristol eighth worst nationally for affordability. Rents are also amongst the highest outside of London, affecting those for whom ownership is not an option, including those on lower incomes but also mobile early career graduates who might be priced out of the local labour market. The cost of housing is a potential threat to the continued ability of the city to attract and retain both more highly skilled labour and those working in lower-paid service roles. Commentators have suggested that outdated greenbelt provision and planning restraint have potentially had an impact on the growth rate of UK cities and, in the case of Bristol, constrained the supply of both housing and employment land. Difficult politically given ‘nimbyist’ opposition to new housing, this is, however, a clear threat to continued growth. Nor is it clear that the city could respond to the sorts of major, high-profile inward investment opportunities that have done so much to boost its past success.

Connectivity nationally remains strong with improved journey times to London by rail following recent electrification. But Bristol has never had the major investment in public urban transport seen across all other major cities in the UK and, despite recently introduced charging, congestion remains a growing threat to efficiency and environmental quality. Surprisingly also, given the scale of digital tech locally, the roll-out of ultra-fast broadband has been very slow – Bristol lies 54th out of 63 towns and cities in 2022 – and this is another potential brake on efficiency and investment.

Bristol has clearly performed well in economic terms and delivered in terms of prosperity and lifestyle for many of its communities. The underlying factors driving investment and growth remain. But as one of the country’s most successful cities, it is now also one of the most expensive – both for housing, business and employment land. It has also failed, historically, to invest in efficient public transport which can, in turn, support higher density, less car-dependent, sustainable development. The threat is not immediate. The city has proved resilient in the short-term in the face of the Covid-19 pandemic, Brexit and recession, and many places across the UK would welcome the advantages which Bristol continues to enjoy. The danger, however, is of a gradual choking off of growth as more mobile households, more highly skilled workers, businesses and investors increasingly look elsewhere.

Martin Boddy is Emeritus Professor of Urban and Regional Studies at the University of the West of England (UWE Bristol) and a freelance consultant. He has a long history of researching and writing about UK cities including a particular focus on Bristol and the West of England.

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This article appears in Bristol 650: Essays on the Future of Bristol, a book bringing together essays from over 30 contributors, addressing some of the challenges the city faces and sharing ideas about how we might meet them. From dealing with the past, the future of social care, culture and housing to building a city of aspiration, the book looks to promote learning about the future of Bristol and encourage new ideas to come forward.

Free copies of Bristol 650: Essays on the Future of Bristol will be available at selected Festival of the Future City events in October 2023, or you can find articles featured in the book at bristolideas.co.uk/bristol650book.