Reinventing London

Bridget Rosewell

• Publisher: London Publishing Partnership
• Year: 2013
• eBook ISBN: 9781907994258
• Edition: 1
• Topic: Volkswirtschaftslehre
• Subtopic: Entwicklungsökonomie

London has enjoyed an extraordinary period of growth in the past generation, symbolized by the towers of Canary Wharf built on the skeleton of the old docks. Finance was at the heart of this, so how can London's economy be reinvented after the financial crisis? Success will depend on several factors that must go together: growing service sectors in addition to finance; making it possible for the people who work in London to live there in pleasant and affordable surroundings; and investing in communications and transport links. This must include an early decision on airport investment to improve global links, given that the capital's main airport is full to capacity – where the extra capacity is located is less important than starting work on expansion as soon as possible.

Chapter 1

Introduction

It seems impossible to be neutral about London. Samuel Johnson opined that when one is tired of London, one is tired of life, but William Cobbett described it as a ‘great wen’ and a ‘monster’. These conflicting opinions are still with us, although possibly not so memorably expressed. Both the current mayor of London, Boris Johnson, and his predecessor, Ken Livingstone, have described it as the greatest city on earth, but perhaps they would say that. Their opinions of their city differ much less than their politics.

Other views have not always been so positive. Professor Roy Porter published a social history of London in 1994. It ends on a note of pessimism about London’s prospects, fearing that the city might become a museum piece. It was just as well he also pointed out that historians make poor forecasters, as London was even then on the cusp of its own reinvention.

His last paragraph ends: ‘London is a muddle that works. Will it stay that way?’ The answer would appear to be yes. London and Londoners have rethought their city, its governance and its geography. Only the Rolling Stones appear to be the exception to the rule that change is constant. All great cities need to change. This book looks at how London has been reinvented in the past, and describes the reinvention it is experiencing now. It also asks what is necessary to ensure that this wave of change succeeds and that London continues to prosper.

I grew up in the outer suburbs, in what used to be called the commuter belt, and I went to school in London in the 1960s, travelling by train and spending winter afternoons warming myself on the coal fire in Surbiton station’s art deco waiting room. I gave in to teachers who said I would be foolish to aim to be a geologist, since women were not allowed on oil rigs and oil was the future for geologists. I went as a teenager to London to gawp at Biba and Mary Quant but couldn’t afford any of the clothes. I made most of my wardrobe on the old Singer sewing machine at home, with designer patterns, trying to live up to the new times. Air conditioning was unheard of, and so were daily showers. Central heating was rare.

It is important to remind ourselves from time to time about how enormously lifestyles have changed for the better over these past fifty years – change enabled by economic growth and higher incomes. The reinvention of our capital city and its surrounding hinterland has been a crucial part of that change. In the 1970s it was hard to imagine the London of the new millennium. It seemed as if London, and indeed the United Kingdom, was struggling. Successive oil crises in 1974 and 1979 exacerbated the decline of industries saddled with complacent management and disgruntled workforces. London was losing population and losing jobs. The new towns planned around the edge of the city, such as Basingstoke, Stevenage, Harlow and Milton Keynes, seemed destined to be the sources of growth. The swinging sixties had touched far too small a part of London to make more than a small dent in the general feeling of doom and gloom. Yet change did come. In 2002, when I became the first chief economist to the newly formed Greater London Authority (GLA), my initial task was to prepare long-term projections for the city as the basis for a new London Plan. Those forecasts showed expected employment growth of 435,000 between 2001 and 2011, a scale of job creation sceptics said could not be achieved. In the event, 427,000 additional jobs were created. I am glad I stuck to my guns.

The general thrust of my projections did not change over the following ten years and they continued to be largely accurate. London has even bounced back from the recent post-crisis recession. In the summer of 2013, employment was higher than at the previous peak in 2008, and output was back to 99 per cent of the peak. Short-term indicators are all positive. The doom-mongers of 2008, when Lehman Brothers collapsed, appear to have been mistaken, at least as far as London is concerned. The latest projections from the GLA (not now my responsibility) suggest that, if anything, employment growth has accelerated. Population is now expected to increase by 1.7 million and employment by 850,000 by 2036. The challenge is to provide the conditions in which these projections can be successfully realized, through a further reinvention of London’s economy.

How can this be brought about? Successful urban reinvention depends on changing, in the right way, four interrelated elements of the economy. These are

•the structure of output and employment, enabling new activities and jobs to be created;

•the places people live and the kind of people moving into London, through appropriate planning and building, ensuring there is a suitable workforce;

•transport links and other infrastructure, so that people can get around easily; and

•communications, especially international connections, so that trade can continue to grow, London being quintessentially a trading city.

The rest of this book looks at each element in turn, at the past and at the scope for the next reinvention. In each case, I take a particular London location as symbolic of the issues: Docklands, Croydon, King’s Cross and Heathrow.

Making and doing: the changing structure of the London economy

London’s habit of reinvention is not new. Between 1932 and 1937, 532 new factories were set up in London, 83 per cent of the United Kingdom’s total. Many of these were new enterprises, making new kinds of goods. They located along what became the North Circular and out along the new radial trunk roads: the A1 out to Enfield and the North, the A4 to Hounslow and the West, the A3 to Kingston and down to Portsmouth. Places such as Park Royal became home to 250 factories before the outbreak of World War II. These new factories made radios and other electrical goods, as well as cars. Hoovers were manufactured along the A40, light bulbs along the A1 by Osram and Phillips, records by EMI at Hayes in Middlesex. Telephones were produced in Hendon and turbines in Wembley. Cosmetics were produced on the Kingston bypass. Food and drink production also became more mechanized and took place on a larger scale, with Lyons Bakeries, Guinness and Heinz at Park Royal, while Beechams had a factory on the A4 at Brentford, and Ilford Photographics, established before World War I in (you guessed it) Ilford, expanded its business as consumer demand grew.

All these new industries were consumer oriented. Many of them made it easier for women to work, as the use of electric cookers, toasters and kettles spread (made by women and used by women). Dishwashers came later; I remember my mother insisting that she had to have one when she went back to work in the early 1960s. This was revolution indeed. Clothes washing followed a different trajectory, since commercial laundries had existed for some time and could be replaced by the launderette. Domestic washing machines took longer to penetrate the home. We had a top-loading paddle machine but it didn’t spin, and the mangle was a horrid contraption that was hard work and dangerous to the fingers. Even in the 1970s many women continued to use the launderette.

The earnings generated in the new industries in the 1930s made it possible for their workers to buy the new houses springing up along the suburban rail lines out to the north-west of the capital, or those served by burgeoning bus systems. In one decade, between 1921 and 1931, the outer suburbs attracted 810,000 people, and another 900,000 arrived in the following eight years as London attracted people trying to escape the depressed North, Scotland and Wales. New goods created new markets and new jobs and attracted new people. It is said that the building boom of the 1930s helped rescue London from depression. It would be truer to say that new inventions and the arrival of new firms and much foreign direct investment made the building boom possible. People bought the houses.

The war put all this on hold. Its aftermath saw resources being put into rebuilding, and into new town centres and planning. Spatial expansion was limited by Green Belts. Still, the factories continued to operate, if rather less effectively. It was only in the 1970s that they began to close. I remember the cosmetics factory along the A3 still operating in the 1960s. I visited radio factories and lamp factories in north London as late as the 1980s. None remain now. These sites are sometimes empty, but it is more likely that they have been redeveloped for housing or retail. The Hoover factory in Perivale, listed for its glorious art deco façade, is now a mixture of offices and a Tesco supermarket.

In its post-war reinvention, London recentralized. Pre-war, suburban sprawl and London County Council rehousing reduced urban density across the city. This in turn led to the Abercrombie plans, produced after the war but fundamentally based on a pre-Blitz view of London as a growth problem that needed to be stopped. People and jobs had to be moved out and ring roads were needed to move people round. Fortunately for London, Abercrombie’s most draconian visions were never accepted, since they would have involved complete clearing of many areas to provide for more ‘rational’ segregation of people and activities, as well as restrictions on the heights of buildings. He was more successful in cities such as Plymouth, completing the destruction started by bombing and ripping out the medieval street plan still more effectively. That city has not recovered. However, a mix of planning constraints, Green Belts and war weariness did manage to stop London’s growth in its tracks after at least a century of expansion. It took until the mid 1980s for it to get going again.

Or rather, it took until then for people to notice what was happening. It had become fashionable in the 1980s to talk about the economy as one of ‘market towns’. Out-of-town centres, retail hubs and office parks were all the rage, and we all travelled by car. Even though there had been two oil price crises – one of which meant that the government went as far as issuing petrol ration books (I still have mine, as well as my childhood one, which I can only just remember, for chocolate) – the car, and the personal freedom it enabled, was key. The first thing I wanted to do on my seventeenth birthday was to get behind a steering wheel. And this perception remained even while the world was actually changing. Business services has been on a pretty constant upward trend for decades, even while other activities were declining (Figure 1.1). This kind of employment is largely office work, where meetings and the need for contact with one another hold sway. It is all much easier in the city centre, and so this has been the latest shift in employment.

Figure 1.1. Employment chart showing the shift from manufacturing.

In 1971, there were more than a million jobs in manufacturing in London. The latest estimates, for 2012, show that there are fewer than 200,000 left (according to this definition). In 1971, there were around 400,000 jobs in business-to-business services. There are now about a million. We have succeeded in replacing all those jobs lost in declining manufacturing industries with many more jobs, but in different kinds of roles involving different kinds of goods and services. On the other hand, it might come as a surprise to see that the number of people working in finance and insurance has not changed much over the same period: it is still roughly 350,000.

The reinvention of work continues, both along the current trajectory and potentially into new possibilities. Chapter 2 examines this further by tracing the redevelopment of Docklands and the rise and fall of financial services. I argue that some aspects of both the rise and the fall are myths, and that they obscure the broader and much more important picture of service industries more generally, in which London is a world leader. The digital age heightens the importance of these strengths and leads to new opportunities in services, entertainment and new products. London should be well placed to exploit these opportunities if we manage to keep our nerve.

Living and localities

After all the destruction during World War II, bomb sites were still colonized by rosebay willowherb decades later; it is not surprising this plant is known as fireweed in the United States. A shortage of offices and the slow return of people to the capital meant that residential buildings in central London had temporary permission for office occupation, much of which has only expired in the last ten years or so. Over the decades, the work has moved from all those...

Table of contents

• CoverImage
• Title-Page
• Copyright-Page
• Table-of-Contents
• Chapter-1
• Chapter-2
• Chapter-3
• Chapter-4
• Chapter-5
• Chapter-6