London workers earn in 8 months what Burnley workers do in a year. It’s hurting UK growth

Workers in London earn in eight months what workers in Burnley earn in a year – with regional wages lagging tens of thousands of pounds behind salaries in the capital.

New analysis by the Centre for Cities has revealed “stark divides” between the UK towns and cities with the highest and lowest pay rates.

London tops the list, with an average annual salary of £49,455, followed by Slough (£48,110), Crawley (£45,204), Reading (£44,586), Cambridge (£44,075). All of these places are in the affluent south-east of England.

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Meanwhile, workers in Burnley typically earn £29,508 per year, nearly £20,000 less than their counterparts in London. Huddersfield, Exeter, Middlesborough, Doncaster and Mansfield don’t fare much better, all boasting average salaries less than £32,000.

“These are striking figures. They show the scale of the challenge facing the government when it comes to boosting prosperity in places that have been struggling for a long time,” said Paul Swinney, director of policy and research at think tank Centre for Cities.

“People in places like Burnley have simply got less money to spend, and their spending is more likely taken up with everyday essentials. So that undoubtedly has an impact on your standard of living.”

Where are the salaries lowest and highest in the UK?

Out of the 63 largest towns and cities, nearly all those with above-average salaries for the UK are in the South East, including Reading and Milton Keynes.

1. London – £49,455
   
2. Slough – £48,110
   
3. Crawley – £45,204
   
4. Reading – £44,586
   
5. Cambridge – £44,075
   
6. Aldershot – £41,723
   
7. Edinburgh – £40,846
   
8. Milton Keynes – £40,596
   
9. Oxford – £40,404
   
10. Aberdeen – £39,822

Just seven places in the rest of the country have salaries above the UK average (£37,206) – Leeds, Warrington, Derby, Swindon, Bristol, Aberdeen and Edinburgh. The 10 least well paid cities are as follows:

1. Burnley £29,508
   
2. Huddersfield £30,332
   
3. Exeter £31,044
   
4. Middlesbrough £31,115
   
5. Doncaster £31,418
   
6. Mansfield £31,448
   
7. Leicester £31,502
   
8. Bradford £31,554
   
9. Bournemouth £31,569
   
10. Swansea  £31,573 
    

The streets aren’t exactly paved with gold in London, where sky-high rents and prices eat into the higher salaries of residents. Nonetheless, redressing the clear regional divides should be a key priority for the government, said Andrew Carter, chief executive of Centre for Cities, in response to the think tank’s Cities Outlooks report.

“The stark nature of Cities Outlook’s findings shows an incremental approach is not going to be enough. Boldness, urgency and scale are crucial. 2025 needs to be year for delivery, particularly on the government’s industrial strategy, framework for English devolution and its reforms to planning,” he said.

The pay disparity largely results from some cities having far more “cutting edge” private sector jobs and businesses than others, the Centre for Cities’ report explained.

Places such as London and Cambridge have more than twice as many “cutting-edge” firms and three times as many jobs in sectors like biotech and artificial intelligence as low pay places such as Burnley, Huddersfield and Middlesbrough.

Why are Britain’s towns and cities so unequal?

From life expectancy to educational outcomes to disposable income, regional inequalities have long been entrenched in the UK.

Successive governments have pledged to rectify these disparities. The previous Tory government published the Levelling Up white paper in early 2022, outlining plans to bring prosperity to ‘left-behind’ regions.

But at the time, the Resolution Foundation warned that the plans fell short – to the tune of billions of pounds.

This government has pledged to boost economic growth around the country, a promise the Centre for Cities has welcomed.

“Bold changes to planning rules can deliver more housing in the most expensive places and in our big cities, where it’s needed most,” said Carter.

“The industrial strategy must prioritise growing the cutting edge of the economy and avoid calls to do something for all sectors and industries. And English devolution needs to be fast-tracked so more places, particularly the big cities, have the powers and resources to deliver the pay increases that many parts of the country badly need.”

However, it could come under “political pressure” for some of these choices, Swinney added.

“We think the government is focused on the right things: it wants to try and improve growth, and within that, it’s identified planning, industrial strategy and devolution as the three key policy pillars,” he said. “That gets two thumbs up from us.”

“But as ever, there will be resistance in all three of those areas to what the government wants to. They cannot afford to back down to vested interests.”

The term “NIMBY” (Not In My Back Yard) is often used to describe people who oppose all new building developments in their area.

Swinney continued: “Basically those anti-development interests have the UK economy in a headlock. We can’t build where we need to build, which has implications: be that access to prosperity so that places can regenerate, because people can’t get a house there, or businesses can’t get a place there to trade.”

More development will help bring higher paid ‘knowledge jobs’ to other parts of the country, he added.

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