View from Steel City: Sheffield eyes a financial prize from services sector

Critical mass: service sector firms are clustering in Sheffield city centre with physical as well as digital connectivity key for them. Picture: Andrew Roe
Critical mass: service sector firms are clustering in Sheffield city centre with physical as well as digital connectivity key for them. Picture: Andrew Roe
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Can Sheffield rival Leeds for financial and professional services?

That depends on a lot of things – but there’s nothing wrong with a bit of ambition.

John Mothersole, chief executive of Sheffield City Council and Lord Kerslake

John Mothersole, chief executive of Sheffield City Council and Lord Kerslake

Certainly, jobs in the sector are seen as attractive because they are generally better paid than those in manufacturing.

And they’re cheaper to establish, requiring a minimum of a laptop and an internet connection. By contrast, Sheffield heavy engineering firm DavyMarkham has a vast cathedral-sized workshop in Darnall containing machine tools worth £150m.

Sheffield’s banking sector employs about 7,000, a figure which climbs to 17,000 if all professional services firms are included. It generates 13 per cent of the city’s GDP compared to 20 per cent for manufacturing, and comprises 18 per cent of the total workforce. And it is forecast to grow by a further 10,000 jobs by 2025, according to the Sheffield City Region Growth Plan.

Irwin Mitchell, one of the largest law firms in the country, is based in the city and international behemoths, DLA and Nabarro, both have sizeable offices here. Nottingham law firm Freeths, has moved in recently, while accountants Shorts and KPMG opened offices last year. Accountants Grant Thornton are moving from the outskirts to a prime site in the centre next year.

The fomer NUM HQ in Sheffield city centre is set to be Grant Thornton's new home. Jason Brook, CEO Quest Property, John Mothersole, Sheffield City Council, Matthew Stephens, Quest Property, Sacha Romanovitch CEO, Paul Houghton, senior partner, and Donna Steel, director, Grant Thornton Sheffield, and Peter Whiteley, Knight Frank Sheffield

The fomer NUM HQ in Sheffield city centre is set to be Grant Thornton's new home. Jason Brook, CEO Quest Property, John Mothersole, Sheffield City Council, Matthew Stephens, Quest Property, Sacha Romanovitch CEO, Paul Houghton, senior partner, and Donna Steel, director, Grant Thornton Sheffield, and Peter Whiteley, Knight Frank Sheffield

Immigration law firm Fragomen has opened its second UK office as part of a ‘north-shoring’ drive by the city council.

But that is only part of the picture. The authority is keen to position the city as a ‘gateway’ to Chinese investment in the North.

It recently signed a 60-year deal with a property company which will bring £220m in the first three years alone for up to five infrastructure projects.

Sheffield University has ties with China that go back 50 years and vice chancellor Sir Keith Burnett has just come back from a visit to Nanjing.

Now, the university’s Confucius Institute and Sheffield Chamber have announced plans to make Sheffield a base for Chinese investment in the North by establishing a ‘world-class’ business gateway.

High speed rail is also set to boost the sector, when it arrives in the city centre in the form of HS2 and HS3 – an ambition for six trains an hour taking just half-an-hour between the centres of Sheffield, Leeds and Manchester.

Sheffield is also home to the British Business Bank, which has a low profile, but controls up to £4bn, with funds channelled through support organisations. It also looks after the newly-established Northern Powerhouse Fund.

The Lord Mayor of the City of London was impressed on a recent visit, organised by the Company of Cutlers. Lord Mountevans heads the City of London Corporation, responsible for the Square Mile where scores of leading financial and professional services organisations are based.

He said: “As a city, Sheffield has many of the key building blocks required to build a large financial centre, including a highly skilled and educated workforce.

“Already, legal services are increasingly moving to Sheffield, and it is important for us at the City of London to continue to encourage this growth in professional services to drive future prosperity and job creation.

“I will speak to investors about Sheffield’s growing professional services sector, to encourage further investment in the city and its people.”

Leigh Bramall, deputy leader of Sheffield City Council, said a strong city centre was key.

A £25m grade ‘A’ office block, 3 St Paul’s opened recently, and HSBC is set to move hundreds of staff into a city centre office as part of the redevelopment of the retail quarter.

Coun Bramall added: “We know that business, professional and financial services firms cluster in city centres and that physical as well as digital connectivity is key for them. So we must see a strong city centre.”

Neil Large, of the Sheffield office of law firm Lupton Fawcett, said Sheffield needed to be attractive – and able to woo big firms.

He added: “In this time of the Olympics we all know how hard it is to woo the Olympic Committee to make your city the host. Sheffield needs to capture some of that magic if it is to woo big firms whilst also keeping one eye on the other cities who also have strategies to land the same prize.”

Anthony Long, chief executive of Sheffield solicitors, Taylor&Emmet LLP said there was a pyramid of premiership firms and leading championship competitors, of which his firm was one, underpinned by smaller, Sheffield-based operations with a “long and proud heritage in the city”.

“There is no doubt Sheffield’s legal presence could be bigger and better.

“The city is often eclipsed by the vibrant commercial centres of Manchester and Leeds, but given that more than 20,000 graduates enrol in our two universities each year, the talent pool exists and there is no reason why we should not be busier.”

But Sheffield’s future professional services growth must not be based on it being cheap, according to Paul Houghton of Grant Thornton in Sheffield.

Better to focus on collaboration and innovation to bring change.

He said: “Representatives of around 40 business professional and financial services firms from across the city region gather every six weeks to compare notes on how they can grow the economy – I don’t know of any other major UK city where that happens.

“There is a real openness for people to come together to explore new ways of funding growth.”Sheffield’s future professional services growth must not be based on it being cheap, according to Paul Houghton of Grant Thornton in Sheffield.

Better to focus on collaboration and innovation to bring change.

He said: “Representatives of around 40 business professional and financial services firms from across the city region gather every six weeks to compare notes on how they can grow the economy – I don’t know of any other major UK city where that happens.

“There is a real openness for people to come together to explore new ways of funding growth.”