Cardiff is set to experience the largest increase in gross value added (GVA) outside of London over the next two years, according to new research from professional advisory firm PwC. The firm’s annual Good Growth for Cities Index outlines that Cardiff’s GVA is projected to grow by 1.3% this year and by 2.07% in 2025.
Cardiff’s GVA growth is only surpassed by London, which is forecasted to grow by 1.47%, and certain London boroughs at 1.45%, placing Cardiff on par with Ipswich. Out of the 53 UK cities and major towns assessed, Cardiff’s forecast for 2025 GVA growth of 2.07% ranks it third, following London at 2.45% and London boroughs at 2.44%. Reading is predicted to follow closely with a 2.05% GVA growth.
Swansea is also expected to perform notably well, with its GVA growth ranking seventh this year at 1.17%. The city is anticipated to see a 1.78% growth in 2025, positioning it around the midpoint among the assessed locations. According to PwC, the remarkable growth predictions for Cardiff and Swansea can be attributed to their economic compositions, comprising substantial activities in manufacturing, health and social work, finance and insurance, and public administration and defence.
The comprehensive Good Growth for Cities Index evaluates 12 economic measures such as jobs, health, income, safety, and skills, along with work-life balance, housing, travel-to-work times, income equality, high street shops, environment, and business start-ups. In the overall index for this year, Plymouth tops the list, followed by Bristol and Southampton. Cardiff achieved the 13th position, while Swansea is placed 42nd. Middlesbrough and Stockton rank at the bottom.
Cardiff and Swansea excel in metrics related to owner occupation, work-life balance, skills, and income distribution. However, they fall short of the UK average in areas such as income, health, and high street quality. John-Paul Barker, PwC’s Regional Market Lead for the West of England and Wales, commented, ‘This year’s index identifies a clear reason for leaders in Cardiff and Swansea to be optimistic: the areas of the economy in which we are most active are enjoying periods of growth, and we’re due to experience economic growth significantly faster than the UK average.’
Barker also emphasized the importance of ensuring sustainable and inclusive growth by leveraging local expertise and collaboration. He stressed, ‘High streets, support for new businesses, and health are key concerns.’ He also noted PwC’s research indicating a potential £923 billion uplift to the UK economy by 2035 with a successful industrial strategy, highlighting Wales’ strategic positioning to benefit from this growth.
Moreover, PwC’s research underscores that issues impacting financial wellbeing—income, jobs, and housing—are of paramount importance to the public. Cities historically performing well, such as Oxford and Milton Keynes, have seen declines in their scores due to poorer performance in income distribution, housing, and high street quality. The index also reveals a significant decline in the house price-to-earnings ratio across UK cities, now averaging over eight times the average earnings compared to four times in the 1990s.
Cities with extensive social housing waitlists, including London, Birmingham, Manchester, and Newcastle, are among the lowest performers in the index. Rachel Taylor, PwC’s Government and Health Industries Leader, highlighted the need for nationwide prosperity, stating, ‘Raising prosperity across the UK is needed more than ever as we continue to see growing inequality in housing, jobs, and education.’ She underscored the necessity of providing foundational elements like access to jobs, skills, education, and affordable homes to fuel economic growth.
The anticipated economic growth for Cardiff and Swansea, driven by their diverse economic activities, indicates a promising future. Yet, the emphasis on sustainable and inclusive growth requires strategic investments and coordinated efforts. As the public increasingly prioritises financial wellbeing, addressing disparities in income, housing, and education is crucial to maintaining progress across all UK cities.