- New research shows £1 in London is equivalent to £1.17 in the North
- Leading economist works with Totaljobs to identify formula for North vs. London exchange rate
While London is famed for having the best job opportunities and highest salaries in the UK, new research from Totaljobs shows that other parts of the country are performing strongly, with every pound earnt going further up North. The rise of the ‘Northern Pound’ reflects thriving job opportunities, growing cultural hubs and a lower cost of living in the North. For workers, a pound goes almost a fifth further (17%) up north than in London, meaning northerners are getting more bang for their buck. For UK businesses looking to recruit the staff they need during a period of high employment, this offers a fantastic opportunity to expand their talent pool beyond the local area.
At the start of a typical working day, the difference between London and the North is measurable, with Londoners facing the longest and most expensive commute into the office. While one in five people in York work within 10 minutes of their home, the same amount in London work within 40 minutes. On average, a Londoner travels 43 minutes into work, compared to 28 minutes for Northerners. A Londoner’s commute costs an average of £101.50 every month, which is double that of those in Leeds (£53) and over £40 more than their Mancunian counterparts (£60). What’s more, a morning coffee picked up en route costs 32% more in London than in the average Northern city (£2.40 vs. £1.80).
Totaljobs worked with Professor of Economics at Lancaster University, Geraint Johnes, to calculate the formula to compare London and the North of England. The research finds that, whilst salaries may seem lower, disposable income goes a lot further up north.
The pull of the North
The results show that the North has much to offer - especially when it comes to career options and work-life balance. With many employers relocating to hubs up north, there are increasing opportunities for talent to relocate from London.
In fact, 53% of Londoners would relocate to a new city and accept a lower salary if it meant a better quality of life, suggesting Londoners are increasingly aware of the opportunities other cities offer. Compare this to only 31% of those in the North who would be willing to move, showing northerners are a lot happier with where they call home. Most likely to stay put are Geordies, with 53% of those in Newcastle claiming that not even a pay rise would lead them to relocate.
Though salaries may not top those in the capital, the research reveals a significant difference in quality of living because the money in northerners’ pockets goes further. This is even true of essential outgoings such as rent costs, with those in Manchester paying half the total household rent as those in London (£496 vs. £1,053). When it comes to ownership, the average property owned in Newcastle is worth just over £170,000 which pales in comparison to the £520,000 price tag in the capital.
However, life in London affords its own opportunities, with Londoners spending more free time out of the house. In fact, they eat out on average 3.4 times per month in comparison to 2.1 in northern cities surveyed. Even more notably, 16% of people in London take five or more holidays per year, compared to 9% of those up north. It seems Londoners have a different mindset when it comes to where their money should go.
Professor Geraint Johnes comments: “We took an in-depth review of household income, the cost of living and work life balance around the UK to devise a formula offering insight into the true value of the pound in the North of England vs London.
“While salaries may be lower when compared to the capital, overall those in the North are better off, which will come as a surprise to many. We took into account lower house prices and rents, lower living costs, as well as shorter commutes and more free time.”
Martin Talbot, Director at Totaljobs says: “Gone are the days where a salary is enough to secure the best talent; today’s jobseekers are increasingly valuing work-life balance and their wellbeing above all else.
“Northern cities are seeing a rise in job opportunities as UK companies no longer think the capital is the be all and end all. Many northern cities offer lots of other advantages too, from a shorter (and cheaper) commute, great cultural scene, and a more affordable social life. No matter where they’re based, it’s key for businesses to highlight not just their employer brand, but the lifestyle their local area can provide existing and potential employees.
“Whilst the London bubble hasn’t burst, employers in the North have a fantastic opportunity to offer attractive packages and secure top talent who may not have previously considered a career outside of the capital. It’s clear that the Northern Powerhouse is booming with opportunity.”
