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September 15, 2024 - 1:00pm
The Social Mobility Commission’s new “State of the Nation” report underscores a brutal reality: Birmingham, the UK’s second-largest city, is badly failing.
The SMC’s analysis of 203 upper-tier local authorities placed Birmingham in the “unfavourable” category for conditions of childhood — which incorporates child poverty and parental socio-economic status — and the “least favourable” grouping when it comes to labour market opportunities for young people. In both cases, the city is grouped with Redcar and Cleveland — a corner of North Yorkshire which suffered considerable economic trauma following the 2015 closure of its steelworks.
Birmingham was once considered to be among the world’s greatest cities, playing an integral role in the Industrial Revolution as the construction site of the first steam engine. In 1890, it was described by Harper’s Magazine as the “best-governed city in the world”. Between 1951 to 1961, Birmingham was second only to London in terms of job creation, with its household incomes 13% higher than the national average (exceeding the capital as well as South East England).
Then, not helped by the 1945 Distribution of Industry Act which sought to limit growth in so-called “Congested Areas” — including the Midlands — and push industry into designated “Development Areas” such as South West Scotland, Birmingham witnessed a disastrous collapse of its industrial base. The city’s 200,000 job losses between 1971 and 1981 — concentrated in manufacturing — meant that the West Midlands went from having the highest relative earnings in Britain in 1970 to the lowest in 1983, while unemployment ballooned to 20% in Birmingham.
Though Birmingham City Council has made noises about diversifying its economy — focusing on services, retail, and tourism (areas where London is now at a major advantage) — it has been guilty of gross mismanagement. Once a shining example of city-based governance, in September 2023 Labour-controlled Birmingham City Council issued a Section 114 notice declaring itself effectively bankrupt. Last year, it was reported that the council’s potential total liabilities of nearly £1 billion included equal pay claims of up to £760 million, as well as an £80 million overspend on the calamitous Oracle IT project. Michael Gove, the levelling up secretary at the time, blamed “under-performance, poor leadership, weak governance, woeful mismanagement of employee relations and ineffective service delivery”.
There is no doubt that Birmingham is fast approaching failed city status, if it hasn’t already reached that point. A jewel of the Industrial Revolution has been reduced to a symbol of disastrous governance. With its lack of labour market opportunities for young people, Birmingham risks losing its brightest and best to London, which will only entrench regional inequality in the UK — ironically, the very risk the 1945 Distribution of Industry Act was meant to address. The unfavourable conditions for its children — nearly half of whom now live in poverty — will only worsen with City Council cuts to early help, youth services, and funding for children’s services.
Birmingham, viewed by wartime Westminster as an internal threat to broad-based prosperity, has been left in dire financial straits thanks to its atrocious local governance. Once an economic powerhouse, it is now a city whose young face some of the country’s harshest conditions to make progress in life. Birmingham’s spectacular decline, further highlighted by the SMC report, is one of the saddest developments in modern British history.
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