Arriving in Birmingham by rail has become a new uplifting experience. The subterranean gloom and sensation of alighting in a basement that used to greet passengers at New Street station has gone; airy platforms are now flooded with natural light from high above the concourse.
This month has been dubbed “Super September”, with Network Rail unveiling its £600m makeover of the station, while up above Brummies got their first taste of the Grand Central shopping centre where John Lewis is anchor tenant.
Birmingham is enjoying a burst of economic success. The change in fortunes owes much to a pro-development attitude by the Labour-run council and a well-judged government decision to press ahead with important transport infrastructure.
The city is reaping the rewards, with figures showing it is growing faster than any other large UK city, with greater levels of foreign investment, and a better export performance.
Andrew Harrison, who runs the Midlands office of Royal Bank of Scotland, says: “If the UK economy is growing at 2 to 3 per cent, we’re probably seeing our loan book growing at twice the rate of GDP, which demonstrates there is probably some catch-up happening as businesses start to invest.”
The success of Jaguar Land Rover and other local automotive companies is helping buoy Birmingham’s traditional manufacturing sector. The city is also starting to attract large groups to its financial services district and its creative quarter around Digbeth — all of which has helped convince more young Brummies to pursue careers at home.
“I’ve been around the city for 14 years and it feels like a really exciting time in Birmingham at the moment,” says Richard Vickery, manager of Harvey Nichols in the revamped Mailbox, another city centre mall.
Andy Street, managing director of the John Lewis Partnership, chairs the Greater Birmingham and Solihull Local Enterprise Partnership, one of 39 bodies set up by the last government to drive the regional economy. He says that when he left for university in the early 1980s, the city was an inward-looking place, defending its past. But today: “It has rediscovered its self-belief”.
If the shopping experience is much improved, so is the restaurant offering, with another Michelin star awarded recently to Carters of Moseley. Cultural life has also taken strides. The ICC Symphony Hall is one of the country’s best venues for classical music and, in March, the Birmingham Conservatoire appointed Julian Lloyd Webber, the cellist, as principal, overseeing a new concert hall and practice facilities on Birmingham City University’s campus.
Yet drive around the poorer inner city neighbourhoods, and it is hard to ignore the scars of past recessions, with old factory plots and disused warehousing.
David Bailey, economics professor at Aston University, says the motor industry accounted for one in three jobs in the 1970s. There was a huge shakeout in the next decade, with 200,000 jobs lost.
The structure of the city economy is much changed, but manufacturing is still a big contributor. At RBS, the bank estimates the sector accounts for a quarter of its loan book. Yet Barry Henley, a Labour councillor, says the city continues to shed its metal bashing image. He compares the recent explosion in its retail sector with the 2003 decision to demolish the old Bullring shopping centre and start construction of the Brindley Place business district — events that symbolised the city’s new identity as a centre for services and tourism.
Business leaders say the next challenge is to persuade more big companies to base their headquarters in the city. RBS estimate 25 per cent of its Midlands clients are subsidiaries of overseas companies. But there are signs of change.
The announcement that HSBC is to move its UK headquarters to the city has “transformed the way the financial community sees Birmingham” says Neil Rami, head of Marketing Birmingham, set up by the council to promote inward investment. “The kind of conversations we’re having today we wouldn’t have been having a few years ago.”
The big worry among business leaders is the capacity of the council and the wider public sector to follow the private sector’s lead. They point to a critical official report last year that delivered a damning assessment of the council’s failings — albeit prompted by worries about Islamist infiltration of some of the city’s schools.
The wider complaint is that Birmingham’s record on educational attainment is leaving young people ill-equipped to take the jobs now coming to the city.
The council says its ability to address these problems is hampered by a harsh budget settlement, which means the city has had to find £641m in savings since 2010, cutting the workforce from 21,000 to 13,000. Still, after months of deliberation and gentle prodding from ministers, the city has now joined forces with six neighbouring councils to assume the spending powers being offered under devolution deals.
“It couldn’t have come at a better time for us, as we need to plan spatially and regionally for the next phase of public investment,” says Mr Rami at Marketing Birmingham.
He also welcomes the decision to set up a commission to look at better land use. “That will mean we’re no longer looking at these small parish boundaries. We’re looking at the natural economic geography of the region,” he says.
Business leaders believe the city has yet to see the real game changer, with the arrival of HS2, the high speed rail link with London due in 2026.
“HS2 has accelerated investment. It is our Olympic Games,” says Mr Street.
But the challenge will be to ensure the economic gains that flow from all this investment are shared more widely in those pockets of the population still suffering deprivation and joblessness.
Alexandra Jones, of the Centre for Cities think-tank, says it remains to be seen whether Birmingham has done enough to persuade government it can take on the extra powers proposed.
But she says: “Even if the West Midlands misses out in 2015, local leaders and the government should continue to work together to strengthen the city region, and to make progress towards securing a substantial devolution deal in the months to come.”
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