How Leeds became a major digital city
PUBLISHED: 00:00 14 June 2016
Joan Russell Photography
Yorkshire's business capital is making its mark as a leading centre of excellence in digital technology, reports Martin Pilkington
It’s well known that Leeds is one of the biggest financial and legal centres outside London, but over recent years the city has developed into a major digital hub too, with massive implications for the area’s economy and its employment prospects. ‘Digital employment is difficult to track, but the estimate is we have about 70,000 people employed in the sector across the city region,’ says James Lewis, the city council’s executive member for resources and strategy. ‘And that’s likely to grow another 15 per cent over the next few years.’
Leeds is now said to be the fifth largest digital ‘cluster’ in the UK, with particular strengths in professional services, data management, and both financial and health technology. By 2021 the sector’s value to the city region is expected to be £2 billion, rising from the current £1.5 billion.
Numerous factors have combined to bring this about. Mark Goldstone head of policy for the West and North Yorkshire Chamber of Commerce says they include skills developed well before the start of the digital age. ‘Leeds was for many years a printing and communications centre. As those sectors have evolved and print has diminished, digital has benefited from skills transferred from them. And Leeds is the county’s commercial centre, which brings weight to the labour and skills side, plus we have really good universities here, all of which have strong degree courses in IT, digital communications and journalism.’
The digital infrastructure has been significant too. ‘Leeds was the home of the country’s first internet service provider, Freeserve, launched in the 1990s,’ adds Mark. ‘The legacy is that there’s phenomenal broadband capability up here, the UK’s spine for the internet runs through the city centre. It is one of three locations in the UK with an internet exchange, so if the other two went down all the UK’s web traffic could and would be routed through Leeds.’
Stuart Clarke, who spearheaded the recent Digital Festival in the city last month, identifies its strong entrepreneurial tradition, especially in retail. ‘Direct marketing and use of data in retail here have been important, so we have more digital scientists than anywhere in the UK outside London,’ he says. ‘Sky were looking to expand last year, and wanted a whole new centre,’ adds Stuart. ‘They worked with LinkedIn to get real data on people with the necessary skills and chose Leeds – the digital talent was here. They’ve taken on 450 people in the 14 months since they arrived.’
Leeds is taking action to ensure the boom continues. ‘It’s recognised there’s a shortage of skilled people for some of the roles, so we’re looking to close that gap,’ says Cllr James Lewis. ‘Recently we’ve seen there are about 400 vacancies for programmers and developers. For the immediate issue, we’re looking for example at skills fairs, and for the longer term we’re working back all the way to primary schools to start children there on the route to coding skills.’
There are plans to establish a digital incubator in the city, supporting the infant companies that could just provide the next Apple or Google one day. It’s possible that a further UTC (university technical college) dedicated to the digital sector - there’s one opening this September for advanced manufacturing - will be created in the coming few years. And there is close collaboration between the universities, businesses and the council aimed at ensuring courses fit real-world requirements present and future. Retaining graduate talent is vital too. ‘Part of the digital festival aims to engage students here to show them there are fantastic companies here, so they can build a career here, not just get a job - they don’t have to go to London!’ adds James.
In fact the city is trying to bring people from London to Yorkshire’s business capital, as James illustrates. ‘I’m about to bring 10 start-ups from London to show them around Leeds, demonstrate it’s a vibrant digital city and costs are a third or half what you’d pay in London, plus the lifestyle is great - we show them two-bedroom riverside flats available at £800 a month, a comparable place in London, if you can find one, is maybe £2,300.’
There can, however, be a downside to such transformative technology, as recent turmoil in the retail sector has proved. ‘With business, nothing lasts forever,’ says Mark Goldstone. ‘But for every BHS there are probably two or three future success stories starting out. It’s about recognising what customers want, and supplying it effectively.’
Amazon is reportedly targeting Leeds in its drive for grocery business, but Mark sees hope especially for small local retailers in our human nature and contemporary habits: ‘We’re social animals, we like to interact, and the days of the big weekly shop are passing – research by Waitrose showed most people only start to plan what they’ll have for dinner at 4pm.’ A bit late to order some carrots online.