Overview
Norwich is the county town of Norfolk. It is the main employment, administrative, education, recreational, leisure, retail, arts, and cultural centre for the county. The city is the fulcrum of economic growth for the region and its wider rural hinterland, a role it has provided for over a thousand years.
Like many other cities in the UK, Norwich is ‘under-bounded’. This means that the wider urban area, which most people would describe and recognise as the ‘City of Norwich’ extends far beyond the local authority boundary and the city council’s governance.
Norwich is defined, in public policy terms, by many different geographies including: the city council local authority area (population 143,135); the Primary Urban Area (population 213,166); the Greater Norwich area, made up of the city and the districts of Broadlands and South Norfolk (population 406,000); and the Travel to Work Area (population 471,330).
Figure 1: Travel to work areas in Norfolk
Source: ONS, 2016
The Norwich Travel to Work Area (TTWA) expands the functional reach of the city’s economic geography. The majority of those who travel in and out of Norwich for work live within Greater Norwich with the largest proportion of commuters travelling into the city from South Norfolk and Broadland. The urban area of Norwich is a major employment centre, providing almost two-thirds of all jobs across the TTWA.
The economy
The City of Norwich, as defined by the local authority boundary, is home to more than 98,000 jobs and more than 6,400 businesses, with almost 50% of all jobs based in large companies.
The majority of high value industries cluster in the city core including businesses that specialise in finance and business services, the creative sector, media and publishing, and production and manufacturing respectively. Norwich has been identified by Tech Nation as an early-stage cluster, with potential across a range of tech sectors.
Additionally, there are in the wider urban area of Norwich, concentrations of high value employment in sectors which are forecast to drive growth nationally - health science and food technologies, and advanced manufacturing. This area also contains some of the largest commercial developments and institutional assets in the region including the Norwich Research Park and Hethel Engineering Centre, Rackheath, and Broadland Business Park, and the University of East Anglia, which supplies the local economy with some of the most talented labour, with graduates in a range of subjects including computer science, software engineering and film, television and media studies.
Prior to the pandemic Norwich had been one of the fastest growing cities in the UK, performing strongly on a range of economic indicators, including productivity and job growth. The city’s economy is diverse and resilient with below average closures and a number of key strengths with significant potential to make an increasingly important contribution to the Regional and National economy.
Norwich has a high job density ratio (1.01) compared with the region (0.85) and nationally (0.84). However, business stock, and new formation, per 10,000 population, lag the national average and many other cities.
The biggest positive change in business numbers by industry over the past decade has been in the most knowledge intensive sectors, where one in every five workers are currently employed. The wider area is also a major centre for energy development and production which can help to utilise and diversify existing sector specialisms. These include supply chain opportunities in the world’s largest market for offshore wind energy, the decommissioning of offshore gas platforms, construction, engineering and maintenance opportunities in the building of Sizewell C Nuclear Power Station.
Quality of life and affordability
The City of Norwich is one of the most desirable places to live in the UK, the result of amenities and services that make a place attractive to live and work in. These include factors such as the historic character of the town centre, the quality of housing, access to good jobs, a strong retail and leisure offer. These are important attributes in attracting and retaining skilled labour, including graduates.
The city is also a hub for education and the arts based around the City College, Easton College and the Norwich University of the Arts. These institutions are critical to supplying the city with a skilled labour force as knowledge-intensive and technology firms play an increasing role in the local economic area. Norwich University of the Arts provides a strong supply of graduates in video games art, design, digital photography, and film.
House prices are in line with the national average and less than many other places in London and the Greater Southeast. However, with a house price to earnings ratio of 10 times greater than the average annual wage, housing is still unaffordable for too many, while the overall stock of housing across the urban area increased by less than 1% in the last year. This will be a key challenge in attracting and retaining young professionals and wealth creators.
Challenges and opportunities
1. Creating the conditions for fast growth
Norwich is the clear knowledge driver in the Norfolk economy, more closely aligned with the knowledge-based industries of Cambridge than the wider county, with established economic assets and networks. But there is scope to attract more businesses to Norwich, particular given the desirability of the city and the quality of its amenities. The city needs to secure a bigger share of these high value services which are currently underrepresented.
Competition between the city’s core and its peripheral areas needs to be mitigated to avoid a hollowing out of the city centre, which is a risk to forming the dense business eco-systems essential to city growth. A devolution deal for Norfolk should recognise the importance of the city in driving productive growth for the benefit of the wider economy. To achieve this, the political and economic structures of the region will need to be aligned to make the most of Norwich’s assets and fully deliver the growth potential within the urban economy. Strategic linkage must be created between local government, academic and research institutions, and the indigenous business base. This will be crucial in driving up innovation and productivity.
The Norwich Town Deal will make the city core more attractive and support the delivery of jobs, homes, skills, and action to reduce carbon emissions. Projects will build on industry strengths to develop new start-up and grow-on space for digital businesses in Norwich (e.g. The Digital Hub), and creating key technologically-enabled learning environments to support advanced engineering and manufacturing, sustainable transport, advanced construction and digital technologies (e.g. The Ace Centre). The regeneration of east Norwich will also create a sustainable and ambitious new urban quarter, that could provide up to 4,000 new homes and around 4,000 new jobs – potentially making it the largest development opportunity in the east of England.
2. The workforce and skills to drive economic growth
The working age population is forecast for strong growth over the next 22 years, outperforming many comparator cities. Norwich also has a younger population (68.3%) than the regional (60.6%) and national average (62.4%) which bodes well for the productive capacity of the local workforce.
Economic activity (86.9%) and employment rates (84.1%) for Norwich are very high and the city has higher rates for both indicators than the regional (81% and 77.9% respectively), and the national averages (78.4% and 74.8%).
Norwich has a slightly higher skilled population with 40.2% having a qualification at level 4 or above, compared to the region (39.5%) although it lags the national average (43.5%). The proportion of pupils achieving 9-4 grades in Maths and English at GCSE (71.8%) is broadly in line with the national average (72.2%) and above most other urban areas in the UK.
Low skills are contributing to a relatively low waged economy, with resident earnings (£601.4) below the regional (£628.6) and national average (£628.6), although a comparison with workplace earnings (£600.7) does not suggest significantly higher wages benefiting those travelling into the city for work.
Norwich performs particularly poorly for social mobility with an overall ranking of 294th out of 324 local authority areas in 2017. However, the position is improving following the social mobility campaign launched by Chloe Smith MP, which resulted in Norwich being designated an Opportunity Area. Raising educational performance and overall skill levels through wider participation in higher education is an important factor in addressing problems of social mobility as well as the growth and competitiveness of local firms.
3. Transport and connectivity
The strategic direction of the Norwich economy is necessarily different than that of the surrounding districts. Norwich anchors the eastern end of the east-west rail link, connecting to the fast growth corridor of Cambridge, Milton Keynes and Oxford. The prospects for future economic growth in Norwich point to greater connectivity out of the county, south and westwards.
High quality connections between the city of Norwich, its strategic growth areas, and markets beyond Norfolk are vital to future economic growth. The city centre has good rail links to London, Cambridge and Stansted and there is ambition for further improvements. These include faster journeys and higher frequencies to link further afield to the Midlands and north of England.
East-west Road connections can be slow and unreliable. Improvement to connectivity between Cambridge and Norwich is needed to promote growth and to maximise the benefits that can be achieved along this corridor. As well as better connections to places further afield, investment in key infrastructure that serve the city, such as the A47 and the Northern Distributor Route (NDR) is needed to improve connectivity to major employment areas like the University of East Anglia/Norwich Research Park/hospital area, Broadland Business Park and the city centre.
The announcement of over £32 million from the Government’s Transforming Cities Fund to overhaul local transport links in Norwich, will transform how residents use and access the city. This will improve and develop important local transport links, including a new bus interchange at Norfolk and Norwich University Hospital which will help to improve what has been a congestion hotspot for motorists. Further proposals include improvements to cycle and pedestrian crossing facilities as well as more efficient and reliable bus services to help improve journey times, cut pollution, and boost the local economy by giving residents greater access to jobs and services.
Summary
Norwich is a success story. It is a vibrant city with a thriving economy and cultural scene. But as with any city, it has some challenges. These issues include poor educational attainment and low skills, with considerable inequalities between different parts of the city and the wider urban area. If Norwich is to achieve its ambition to be a fast growth knowledge economy in the heart of East Anglia, it will need to level up outcomes for the resident population while continuing to attract talent from outside the city.