Manchester is set to outpace UK economic growth until 2027, a new report has predicted.

EY’s latest Regional Economic Forecast shows Manchester is set to see average annual growth in Gross Value Added (GVA) of 2.2% between 2024 and 2027 - comfortably above the national average of 1.9%. The city is also expected to have the second-fastest employment growth of all UK towns and cities over the period.

But the North West as a whole is predicted to see slower than average growth. The region’s GVA growth is forecast to average 1.7% from 2024 to 2027, with average employment growth of 1%, just below the national average of 1.1%.

Liverpool’s economy is expected to see 1.8% annual average growth from 2024 to 2027 – slightly ahead of the regional average. The city is also predicted to see employment grow by 1.2% a year over the period, above both the national and North West averages.

The EY report shows that by 2027, GVA in Manchester’s local economy is expected to be more than £2.4bn larger than in 2023.Key growth sectors include tech, described as “information and communication”, where average growth in Manchester is predicted to be 2.4% compared to a national average of 1.9%. The only UK town or city expecting faster growth than Manchester over the same period is Reading, with predicted average annual growth of 2.5%.

Stephen Church, EY’s North Market Leader, said: “The North is home to fantastic towns and cities, along with ambitious businesses and an abundance of talent. This means that the region will be well-placed to feel and contribute to the benefits of the UK’s return to economic growth over the next few years. Major cities including Newcastle, Leeds and Liverpool are once again expected to be a driving force for economic growth in the North and across the UK. Meanwhile, Manchester is poised to maintain its status as an economic powerhouse, fuelled in part by its flourishing tech sector.

“Nevertheless, it is important that locations across the North utilise their unique strengths to drive growth. There are still a significant number of places in the North expected to trail quite considerably behind national and regional averages both in terms of GVA and employment, highlighting room for improvement.

“Going forward, it is critical that the public and private sectors collaborate to maximise opportunities. Leaders and businesses in the North should prioritise building skills and capabilities that will be in demand across high-growth sectors, while making the most of our region’s fundamental strengths such as our industrial prowess in the North East and Yorkshire, and our technology expertise in the North West. The high levels of economic inactivity in the North West and North East must also be addressed and policymakers should consider what sort of incentives and programmes can encourage people back into work.”

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