13 ms·

It’s not that London is too big, but that other large UK cities are too small

79 points by edward 9y ago

PaulRobinson 9y ago
Here's my take as a Mancunian, now living in London, whose career also took in trying to help the Manchester tech scene in various forms. Some years ago I was involved in various projects to help make Manchester and the wider North West "the Silicon Valley of Europe". Yorkshire had similar programs. No doubt Germany, Italy, Estonia, Spain, they all have very same-ish intentions. The deal is they all go to the European Development Fund, say "Hey, look at this impoverished area, give us some money and we'll do things to lift them out of the doldrums!", and each programme has limited success. Over five years ago I was offered a job in London and moved. It worked out for the best. I realised quite quickly the London market was prepared to pay me quite well in comparison to the Manchester market. I went back to Manchester after a few months and met with directors, founders and entrepreneurs and explained how they could make Manchester the Silicon Valley of Europe without any EDF funding or major programmes. The solution was quite simple: Pay the best rates in Europe. They looked aghast as I explained: if you want the best companies, you have to have the best people and processes as well as the best ideas. To attract them, you have to compete with the best salaries. Sure, you can hire "good enough", but then you must realise you are going to get "good enough" people, and that might be the difference between a lifestyle business and running a unicorn. Either way, the differential between Manchester and London was too high. I was a CTO of a company paying graduates what Manchester firms were prepared to pay Senior Developers. In fact, I actually saw one firm advertise for a CTO at a rate that I would be hard pushed to recruit for in London as a junior developer role. The directors explained to me this was unthinkable: their business model relied on the cheaper costs of doing business in Manchester, that they provided a cost-effective solution to what they perceived as the "London madness". I told them to watch and wait and see: London would continue to leap ahead, Manchester would flounder, and they would all see the problem ahead of them. I even told other developers they should move. "Too expensive" they told me. OK, the rents are high, it's true. But I can earn 2x-3x as much as I can in Manchester down here, and my food, entertainment and other ancillary costs are no more than 1.5x-2x what they would be in Manchester: in real terms as a percentage of income, living costs in London are actually lower. And in one interesting case - heating bills - the temperatures being 1C-2C warmer down here meant that my bills were literally pound-for-pound cheaper. Everybody told me I was wrong, that the cheaper economies of Manchester led to higher living standards, to better companies, to companies more likely to last than the "silliness" of London. We're five years on. The data suggests that I was right, everybody I spoke to in Manchester was mistaken, and London continued to outgrow and eat everything in sight. Until last June and the Brexit referendum, where the non-Metropolitan majority decided to shoot the economy in the foot in resentment of the Metropolitan-elite's successes. There is much we need to do to prepare for the future, but I sense the answer remains the same: Pay. People. More. Money. It has consistently worked in every territory it has been tried in, in part because in the past the local circumstances allowed for high incomes due to the unique proposition of the area. We're now working in a global industry where people can work anywhere. If you want to catch up to California, steal their people by paying them at least the same salaries. If you want to catch up to London, do the same.
- praulv 9y ago
  That sounds simple enough but I don't think you've factored in the long term state this transition would converge to in terms of effect on the local population. Talent pull drives up prices, predictably displacing the local population. London to an extent already has seen this with the result now spreading to neighbouring areas (Milton Keynes, Beds, Slough). Geographically, northern and midland cities tend to have far smaller centres with satellite villages linked by bus systems.
- f_allwein 9y ago
  Interesting - the cost of living (i.e. rent) is so absurdly high in London, and so much less in other cities, that you could have a better lifestyle there on a much lower salary. But I can imagine not everyone does the maths and people will still flock to the higher pay checks.
  - nip 9y ago
    Exactly, what matters is the money left on your bank account when everything has been paid.
    - PaulRobinson 9y ago
      I have saved far more in London than I ever could in Manchester. Living costs in Manchester took out about 85% of my pay each month. In London it's more like 75%. Why? The salaries are vastly higher for the same job, it outpaces living costs. Do you honestly think we're all idiots and hadn't done the maths?
      - nip 9y ago
        If you have saved more in London than in Manchester then I don't understand the reason of your comment as this is what I explicitly stated in mine: the paycheck doesn't matter. If you saved more with a bigger paycheck, that's good. If you saved more with a smaller one, that's equally good.
  - PaulRobinson 9y ago
gregdoesit 9y ago
The outlook of London (and the rest of the U.K.) will likely change dramatically as the hard Brexit looms closer. A major advantage London had was access to the 500M large European labour market - which will close with Brexit, making London less competitive and attractive to Europeans than before.
- irpapakons 9y ago
  We know very little about what the Brexit agreement will look like. As long as high paying jobs exist, nothing stops highly skilled European people from continuing to get them, even if that involves a bit more bureaucracy.
  - alphabetam 9y ago
    Not really: it's not bureaucracy that scares us Europeans, rather than the fact that over 50% of the country voted in an indisputably racist way to lower immigration. It's the fact that Europeans in the UK feel mistreated and disliked now.
    - logingone 9y ago
      Indisputably? I'd also bet you're not European, but rather a mischievous remoaner. Many people voted leave because of numbers, not languages. I didn't vote, enjoying the entertainment.
      - bad_user 9y ago
        > I didn't vote FYI, when you're not voting, you're inevitably siding with the majority, in this case your vote being #leave, whether you wanted that or not ;-)
        williamgb 9y ago
        I'm at all sure that follows.
    - 9y ago
hacker_9 9y ago
As someone who lives in the UK, visiting London is like visiting a different country. Sometime's I'm amazed just how 'better' everything looks and is. You can clearly see that this is where all the money is funneled into. It even has it's own subway covering the whole city! Where is this sort of commitment to anywhere else in the UK? All that really happens is all the money is poured into London, it then slowly expands, and as HS2 is proving, to the detriment of everyone else.
- matthew349hall 9y ago
  An American in New York...same thing
  - 3pt14159 9y ago
    No way. America has plenty of fast growing cities, just none around the NYC area.
    - lifeisstillgood 9y ago
      To be fair that's another way of saying "Europe has plenty of fast growing cities, just none around the London area" I think we have improved transport economics so much that the size of a metro area needs adjusting in our minds - London has commuters from Birmingham, Cambridge and beyond - in the same way that NYC has commuters from Pennsylvania and even Philly. The winning City in an area sucks in all the surrounding populations - it's just now that transport links mean that those surrounding populations are in what used to be called other cities and are now just suburbs. We need better town planning not ways to hold back cities to certain geographic locations
      - wavefunction 9y ago
        Sometimes people live in the city and commute to work in the suburbs. I propose, instead, that New York City is a suburb of Philly.
thriftwy 9y ago
I guess it's same with Paris in France, Buenos Aires in Argentina and Moscow in Russia. With notable exceptions of Germany and Italy to lesser extent. Of course you would want people and jobs to be spread more fairly, but it's just not what happens in a post-industrial market economy.
sw00pur 9y ago
All I've heard about London from fellow expats is: 1) it's laughably expensive, and it forces you to spend a big part of your salary just for a room in a cramped apartment unless you want to live hours away from your office, 2) it's a hellhole full of scum.
- caoilte 9y ago
  You will never find a more wretched hive of scum and villainy.
- irpapakons 9y ago
  Ok, I know I might be relatively lucky, but just to provide a different anecdote: I spend 34% of my take-home income to live in a big studio in a leafy neighbourhood with Edwardian houses, 35 minutes from work door to door taking the tube, next to 2 parks. I'm pretty happy. Like all big cities London has better and worse neighbourhoods and the experience you get living in them varies greatly.
  - Nursie 9y ago
    34% to live in a studio sounds ludicrous to someone paying 25% to live in a townhouse (in a smaller city in the south).
    - switch007 9y ago
      Yes... Perhaps it's because so much other housing is so expensive in London, relatively many other properties can look like a bargain
    - user5994461 9y ago
      25% on the studio, and another 25% on utilities, car and food.
- deleted 9y ago
  [deleted]
- SirHound 9y ago
stuaxo 9y ago
As a developer in London I take issue with "skilled workers who would be paid relatively well wherever they live". Yes, I could do python contracting outside of London, but there aren't nearly as many. Most of them pay less and would need to take ones further away (so need a car). While I like London, I would love to move out but there isn't enough well paid work for my skillset to justify it.
- chatmasta 9y ago
  I'm a US citizen freelance developer living in the UK (not London) and freelance is the only way I can justify living here. It seems like tech jobs in the UK (and EU generally) pay almost half as much as in the US, so by taking a job here I'd be leaving money on the table. From what I can see, the tech jobs all pay £45k on the high end, whereas similar roles in the US would be $110-120k. I haven't done all the calculations of differences in living costs / etc, but it seems like a stark difference in pay. What is your experience with this apparent discrepancy?
  - Nursie 9y ago
    As a UK contractor who has worked in Australia and the US - yeah what the hell? The money for permanent staff here is derisory, it's terrible. I contract, consult and freelance wherever I can because that is the only way I can come close to what I earned in Aus. It seems like developers here are really undervalued. Though given how god-awful some of the permanent staff I've worked with recently seem to be, maybe it's a case of low pay and low expectations in much of the industry.
  - bob_roboto 9y ago
    I've heard this magical number of 45k for software engineers a lot since I came to London. I'm on 60k, without being overly specialised and not working for the financial industry either. Most of the jobs that are being sent to me by recruiters say 60k-80k so I really don't know where these 45k jobs are? I'd really like to know. Having said that, being Swiss, the salaries in London still make me angry. At home I'll get 90k-100k (GBP) and taxes in Zurich are half of what they are in London. All things considered I made twice as much as here. On the plus side you get to live in a pretty cool city which is nice while you are still young and don't have any responsibilities.
deleted 9y ago
[deleted]
fractalwrench 9y ago
The claim that public transport investment is relatively even across the UK doesn't seem right. Anecdotally it has always seemed that London has had a lot more investment in infrastructure, and figures from the IPPR think-tank say that the spend is about £1,500 greater per capita in London compared to the rest of the country. Is there any evidence to backup this claim within the article or have I misinterpreted?
- jayflux 9y ago
  Yeah I also find that hard to believe, crossrail alone is more investment other cities would get combined. I guessing they're not taking into account investment from TFL, grants and private entities. I could be wrong though
- Brakenshire 9y ago
  The IPPR figures come from a limited dataset, most of the difference is down to Crossrail (£15bn over 10 years), but for instance Network Rail has a £3bn a year infrastructure budget, Highways England another £3bn, plus the other strategic road authorities in other parts of the UK, the local authorities that manage all local roads, most of that spending is not covered.

79 points by edward 9y ago

Here's my take as a Mancunian, now living in London, whose career also took in trying to help the Manchester tech scene in various forms. Some years ago I was involved in various projects to help make Manchester and the wider North West "the Silicon Valley of Europe". Yorkshire had similar programs. No doubt Germany, Italy, Estonia, Spain, they all have very same-ish intentions. The deal is they all go to the European Development Fund, say "Hey, look at this impoverished area, give us some money and we'll do things to lift them out of the doldrums!", and each programme has limited success. Over five years ago I was offered a job in London and moved. It worked out for the best. I realised quite quickly the London market was prepared to pay me quite well in comparison to the Manchester market. I went back to Manchester after a few months and met with directors, founders and entrepreneurs and explained how they could make Manchester the Silicon Valley of Europe without any EDF funding or major programmes. The solution was quite simple: Pay the best rates in Europe. They looked aghast as I explained: if you want the best companies, you have to have the best people and processes as well as the best ideas. To attract them, you have to compete with the best salaries. Sure, you can hire "good enough", but then you must realise you are going to get "good enough" people, and that might be the difference between a lifestyle business and running a unicorn. Either way, the differential between Manchester and London was too high. I was a CTO of a company paying graduates what Manchester firms were prepared to pay Senior Developers. In fact, I actually saw one firm advertise for a CTO at a rate that I would be hard pushed to recruit for in London as a junior developer role. The directors explained to me this was unthinkable: their business model relied on the cheaper costs of doing business in Manchester, that they provided a cost-effective solution to what they perceived as the "London madness". I told them to watch and wait and see: London would continue to leap ahead, Manchester would flounder, and they would all see the problem ahead of them. I even told other developers they should move. "Too expensive" they told me. OK, the rents are high, it's true. But I can earn 2x-3x as much as I can in Manchester down here, and my food, entertainment and other ancillary costs are no more than 1.5x-2x what they would be in Manchester: in real terms as a percentage of income, living costs in London are actually lower. And in one interesting case - heating bills - the temperatures being 1C-2C warmer down here meant that my bills were literally pound-for-pound cheaper. Everybody told me I was wrong, that the cheaper economies of Manchester led to higher living standards, to better companies, to companies more likely to last than the "silliness" of London. We're five years on. The data suggests that I was right, everybody I spoke to in Manchester was mistaken, and London continued to outgrow and eat everything in sight. Until last June and the Brexit referendum, where the non-Metropolitan majority decided to shoot the economy in the foot in resentment of the Metropolitan-elite's successes. There is much we need to do to prepare for the future, but I sense the answer remains the same: Pay. People. More. Money. It has consistently worked in every territory it has been tried in, in part because in the past the local circumstances allowed for high incomes due to the unique proposition of the area. We're now working in a global industry where people can work anywhere. If you want to catch up to California, steal their people by paying them at least the same salaries. If you want to catch up to London, do the same.

praulv 9y ago
That sounds simple enough but I don't think you've factored in the long term state this transition would converge to in terms of effect on the local population. Talent pull drives up prices, predictably displacing the local population. London to an extent already has seen this with the result now spreading to neighbouring areas (Milton Keynes, Beds, Slough). Geographically, northern and midland cities tend to have far smaller centres with satellite villages linked by bus systems.
f_allwein 9y ago
Interesting - the cost of living (i.e. rent) is so absurdly high in London, and so much less in other cities, that you could have a better lifestyle there on a much lower salary. But I can imagine not everyone does the maths and people will still flock to the higher pay checks.
- nip 9y ago
  Exactly, what matters is the money left on your bank account when everything has been paid.
  - PaulRobinson 9y ago
    I have saved far more in London than I ever could in Manchester. Living costs in Manchester took out about 85% of my pay each month. In London it's more like 75%. Why? The salaries are vastly higher for the same job, it outpaces living costs. Do you honestly think we're all idiots and hadn't done the maths?
    - nip 9y ago
      If you have saved more in London than in Manchester then I don't understand the reason of your comment as this is what I explicitly stated in mine: the paycheck doesn't matter. If you saved more with a bigger paycheck, that's good. If you saved more with a smaller one, that's equally good.
- PaulRobinson 9y ago

gregdoesit 9y ago

The outlook of London (and the rest of the U.K.) will likely change dramatically as the hard Brexit looms closer. A major advantage London had was access to the 500M large European labour market - which will close with Brexit, making London less competitive and attractive to Europeans than before.

irpapakons 9y ago
We know very little about what the Brexit agreement will look like. As long as high paying jobs exist, nothing stops highly skilled European people from continuing to get them, even if that involves a bit more bureaucracy.
- alphabetam 9y ago
  Not really: it's not bureaucracy that scares us Europeans, rather than the fact that over 50% of the country voted in an indisputably racist way to lower immigration. It's the fact that Europeans in the UK feel mistreated and disliked now.
  - logingone 9y ago
    Indisputably? I'd also bet you're not European, but rather a mischievous remoaner. Many people voted leave because of numbers, not languages. I didn't vote, enjoying the entertainment.
    - bad_user 9y ago
      > I didn't vote FYI, when you're not voting, you're inevitably siding with the majority, in this case your vote being #leave, whether you wanted that or not ;-)
      - williamgb 9y ago
        I'm at all sure that follows.
  - 9y ago

hacker_9 9y ago

As someone who lives in the UK, visiting London is like visiting a different country. Sometime's I'm amazed just how 'better' everything looks and is. You can clearly see that this is where all the money is funneled into. It even has it's own subway covering the whole city! Where is this sort of commitment to anywhere else in the UK? All that really happens is all the money is poured into London, it then slowly expands, and as HS2 is proving, to the detriment of everyone else.

matthew349hall 9y ago
An American in New York...same thing
- 3pt14159 9y ago
  No way. America has plenty of fast growing cities, just none around the NYC area.
  - lifeisstillgood 9y ago
    To be fair that's another way of saying "Europe has plenty of fast growing cities, just none around the London area" I think we have improved transport economics so much that the size of a metro area needs adjusting in our minds - London has commuters from Birmingham, Cambridge and beyond - in the same way that NYC has commuters from Pennsylvania and even Philly. The winning City in an area sucks in all the surrounding populations - it's just now that transport links mean that those surrounding populations are in what used to be called other cities and are now just suburbs. We need better town planning not ways to hold back cities to certain geographic locations
    - wavefunction 9y ago
      Sometimes people live in the city and commute to work in the suburbs. I propose, instead, that New York City is a suburb of Philly.

thriftwy 9y ago

I guess it's same with Paris in France, Buenos Aires in Argentina and Moscow in Russia. With notable exceptions of Germany and Italy to lesser extent. Of course you would want people and jobs to be spread more fairly, but it's just not what happens in a post-industrial market economy.

sw00pur 9y ago

All I've heard about London from fellow expats is: 1) it's laughably expensive, and it forces you to spend a big part of your salary just for a room in a cramped apartment unless you want to live hours away from your office, 2) it's a hellhole full of scum.

caoilte 9y ago
You will never find a more wretched hive of scum and villainy.
irpapakons 9y ago
Ok, I know I might be relatively lucky, but just to provide a different anecdote: I spend 34% of my take-home income to live in a big studio in a leafy neighbourhood with Edwardian houses, 35 minutes from work door to door taking the tube, next to 2 parks. I'm pretty happy. Like all big cities London has better and worse neighbourhoods and the experience you get living in them varies greatly.
- Nursie 9y ago
  34% to live in a studio sounds ludicrous to someone paying 25% to live in a townhouse (in a smaller city in the south).
  - switch007 9y ago
    Yes... Perhaps it's because so much other housing is so expensive in London, relatively many other properties can look like a bargain
  - user5994461 9y ago
    25% on the studio, and another 25% on utilities, car and food.
deleted 9y ago
[deleted]
SirHound 9y ago

stuaxo 9y ago

As a developer in London I take issue with "skilled workers who would be paid relatively well wherever they live". Yes, I could do python contracting outside of London, but there aren't nearly as many. Most of them pay less and would need to take ones further away (so need a car). While I like London, I would love to move out but there isn't enough well paid work for my skillset to justify it.

chatmasta 9y ago
I'm a US citizen freelance developer living in the UK (not London) and freelance is the only way I can justify living here. It seems like tech jobs in the UK (and EU generally) pay almost half as much as in the US, so by taking a job here I'd be leaving money on the table. From what I can see, the tech jobs all pay £45k on the high end, whereas similar roles in the US would be $110-120k. I haven't done all the calculations of differences in living costs / etc, but it seems like a stark difference in pay. What is your experience with this apparent discrepancy?
- Nursie 9y ago
  As a UK contractor who has worked in Australia and the US - yeah what the hell? The money for permanent staff here is derisory, it's terrible. I contract, consult and freelance wherever I can because that is the only way I can come close to what I earned in Aus. It seems like developers here are really undervalued. Though given how god-awful some of the permanent staff I've worked with recently seem to be, maybe it's a case of low pay and low expectations in much of the industry.
- bob_roboto 9y ago
  I've heard this magical number of 45k for software engineers a lot since I came to London. I'm on 60k, without being overly specialised and not working for the financial industry either. Most of the jobs that are being sent to me by recruiters say 60k-80k so I really don't know where these 45k jobs are? I'd really like to know. Having said that, being Swiss, the salaries in London still make me angry. At home I'll get 90k-100k (GBP) and taxes in Zurich are half of what they are in London. All things considered I made twice as much as here. On the plus side you get to live in a pretty cool city which is nice while you are still young and don't have any responsibilities.

deleted 9y ago

[deleted]

fractalwrench 9y ago

The claim that public transport investment is relatively even across the UK doesn't seem right. Anecdotally it has always seemed that London has had a lot more investment in infrastructure, and figures from the IPPR think-tank say that the spend is about £1,500 greater per capita in London compared to the rest of the country. Is there any evidence to backup this claim within the article or have I misinterpreted?

jayflux 9y ago
Yeah I also find that hard to believe, crossrail alone is more investment other cities would get combined. I guessing they're not taking into account investment from TFL, grants and private entities. I could be wrong though
Brakenshire 9y ago
The IPPR figures come from a limited dataset, most of the difference is down to Crossrail (£15bn over 10 years), but for instance Network Rail has a £3bn a year infrastructure budget, Highways England another £3bn, plus the other strategic road authorities in other parts of the UK, the local authorities that manage all local roads, most of that spending is not covered.