Can Labour Kickstart the Northern Powerhouse?

Vacancies across the North drop to five year lows

Given the recent general election, it is no surprise that vacancies dropped in June. With Businesses waiting on the outcome of the election, whilst Labour winning was a given, the coming weeks will now see a blitz of policy announcements, which will give greater clarity when it comes to investment.

Indeed, investment is the watchword. The Labour budget requires growth on a level not seen since Blair, in order for it to balance. To achieve that level of growth will require extensive investment, both from the Government and the private sector. Already there has been a commitment on clean energy and utilities, the question is, what other areas are likely to see a boost?

Transport is a big question. Northern Powerhouse Rail was initially intended to link the North, from Liverpool to Leeds, linking in cities such as Sheffield, Hull and Newcastle, to create one integrated economic region. Initially projected as costing £36bn, this was watered down last year by the Conservatives over concerns about cost. Nonetheless, given these are the regions that are the Labour heartlands, could the initial plan now get the green light? An investment of this size by the Government across the North would stimulate jobs and the local economies in a way few other infrastructure projects could do.

Housing is also a priority. The fastest way to improve living standards, is to build more homes. Already the new Chancellor has announced plans to reform the planning system and re-introduce targets to build new homes, where they have now set a target of 1.5m new houses in the next five years, where the focus will be on social and affordable housing. In terms of investment, if the cost of living drops in terms of housing, this should then lead to greater consumer spending in other areas, so stimulate consumption.

Immigration is also an area to watch. As an example, the UK has double the number of engineers retiring over the next five years, compared to the number graduating from University. And given the commitments to increased spending on infrastructure, housing and energy, the demand for Engineering is only going to increase. For the Government to see its policy framework succeed, it means that more engineers will need to come to the UK. Will the Home Office be instructed to no longer be hostile to immigrants? And what will the Government do regarding its policy on visa charges. Already up to ten times more expensive than any other G8 country, working visas for non UK nationals are becoming a barrier to attracting talent. Why spend 5,000+ for you and your family to have a visa for the year, when in other G8 countries, the cost is under 500.

In summary, the Labour party is in a rush, and rightly so. Osborne’s promise, of levelling up the North was great rhetoric, but has not materialized. Instead parts of the region are falling behind again and the wealth differential between North and South is growing once more. For the Labour Party, their win, whilst emphatic in terms of seats, was not impressive when it comes to vote share. Swathes of society chose not to vote, as the turnout dropped to record lows. Meanwhile Farage came second to Labour in nearly 100 seats and has said, the next phase for Reform, is targeting those seats.

As a result, if the Labour party is to be effective in fighting Farage off, it is in those Northern Seats they need to be effective – and that starts with the economy.


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The data referenced above has been sourced from Vacancy Analytics, a cutting-edge Business Intelligence tool that tracks recruitment industry trends and identifies emerging hotspots. With 17 years of experience, we have a deep understanding of market activities in the UK and globally.

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