CHESTER’S diversified economy means it is better-placed to survive the credit crunch than other financial centres in the UK, reveals research from city-based accountancy group UHY Hacker Young.
Chester has benefited from the growth in the financial services sector but this industry, along with construction, are now considered most vulnerable to the financial crisis.
However, UHY Hacker Young says Chester’s economy is better-placed to weather the storm even though 32% are employed in these sectors combined, because the rest of the workforce is spread across tourism, retail, the professions and manufacturing.
John Ierston, Partner at UHY Hacker Young said: “The sectors expected to be hit the hardest by the credit crunch are financial services and construction.
“While Chester has considerably prospered by capitalising on those growing sectors, it has maintained a healthy, broad economic base. Tourism as well as professional services and manufacturing make up an important part of the economy.”
UHY Hacker Young ranked Great Britain’s top 50 towns and cities by the highest proportion of the working population employed in the financial services and the construction sectors and found that Chester takes the eighth position with 31.9%. London, Norwich and Edinburgh have the highest exposure with, respectively, 36.5%, 36% and 34.8% of their jobs in finance and construction. This compares to 26% for Great Britain overall.
UHY Hacker Young says that when the full economic consequences of this crisis unfold all sectors will feel the impact but cities where employment is predominantly in financial services and construction could be the most vulnerable.
Mr Ierston commented: “Under normal circumstances one would think that cities that achieved the best performance by capitalising on the growth that the financial services sector delivered would now be in the best position to ride out the economic storm. It seems pretty ironic that cities that have seen the least growth could now be the best protected from the downturn.”
But despite suffering some of the side-effects of the turmoil stirred up in London and New York, cities like Chester that have successfully attracted and retained a highly educated workforce will be the first to pick up when the economy “inevitably rebounds”.